WEBVTT - Musk Could Earn $1 Trillion With New Tesla Pay Package 0:00:00.080 --> 0:00:13.520 Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is live 0:00:13.560 --> 0:00:17.320 from coast to coast with Caroline Hide in New York 0:00:17.640 --> 0:00:20.800 and Eva Low in Sent Francisco. 0:00:22.680 --> 0:00:24.520 This is Bloomberg Tech coming up. 0:00:24.560 --> 0:00:30.400 Tesla proposes an unprecedented one trillion dollar pay package for Elon. 0:00:30.240 --> 0:00:33.640 Musk plus Broadcom surges on earnings and a big new 0:00:33.680 --> 0:00:37.120 AI chip customer who we report is Open Ai. 0:00:37.680 --> 0:00:40.839 And we speak with Qualcom CEO Cristiano amon As. The 0:00:40.880 --> 0:00:45.360 company partners with BMW to provide its automated driving brains. 0:00:45.640 --> 0:00:48.159 But first we check out these markets, which are volatile 0:00:48.240 --> 0:00:50.720 to say the least. As we head towards this weekend, 0:00:50.840 --> 0:00:53.960 people taking money off the table. Look, we bought into 0:00:54.000 --> 0:00:57.080 the stock market throughout this training day and actually earlier 0:00:57.080 --> 0:00:59.560 in trade today. But in the Nazak one hundred now 0:00:59.680 --> 0:01:01.800 rolling up over a bit ed we pull back on 0:01:01.800 --> 0:01:03.880 some of the week's losses. We're now down eight ten 0:01:04.000 --> 0:01:05.840 percent on an Asbak one hundred over the course of 0:01:05.880 --> 0:01:08.600 five days, but remember we were shut on Monday, so 0:01:08.680 --> 0:01:11.559 that factors in the Friday sell off too. More broadly, 0:01:11.560 --> 0:01:14.039 we think of a macro picture a week labor market, 0:01:14.200 --> 0:01:15.960 and we'll dive into that, but for now, look at 0:01:15.959 --> 0:01:18.200 the individual movers, which you've got. 0:01:18.080 --> 0:01:20.400 Yep, our top story, Tesla is up two and a 0:01:20.440 --> 0:01:24.520 half percent. The board proposing a compensation package for Elon 0:01:24.640 --> 0:01:28.399 Musk one trillion dollars is the headline. It is over 0:01:28.480 --> 0:01:33.080 ten years, It is against multiple high bar milestones, both 0:01:33.120 --> 0:01:37.039 operational and financial, and there are some safeguards in there 0:01:37.120 --> 0:01:41.319 as well, additional safeguards to keep Elon Musk focused on Tesla. 0:01:41.440 --> 0:01:43.200 Let's get out of Bloomberg's Dana Hole. 0:01:43.080 --> 0:01:45.720 Who covers Tesla and leads our coverage of Elon Musk. 0:01:45.720 --> 0:01:47.080 And that's where I want to start. 0:01:47.280 --> 0:01:51.280 What are the milestones operational and financial Danna that Elon 0:01:51.360 --> 0:01:53.440 Musk and Tesla have to hit if he's going to 0:01:53.480 --> 0:01:56.000 get to the full one trillion package. 0:01:56.400 --> 0:01:58.880 Yeah, So it's twelve tranches, and to sort of unlock 0:01:58.920 --> 0:02:02.880 a tranch, there's two components. Market cap, which is basically 0:02:03.520 --> 0:02:05.960 it's in half trillion dollar increments. So to reach the 0:02:06.000 --> 0:02:08.320 first one, it's a two trillion dollar market cap, and 0:02:08.360 --> 0:02:11.600 then everyone after that is by half a trillion. But 0:02:11.639 --> 0:02:16.399 it's operational milestones that include things like number of optimist robots, 0:02:16.520 --> 0:02:21.799 number of robotaxis in deployment, cumulative car sales FSD take rate, 0:02:22.240 --> 0:02:26.760 and these are very aggressive, very hard to meet milestones. 0:02:26.800 --> 0:02:29.440 Tesla is nowhere close to them right now. But this 0:02:29.600 --> 0:02:32.760 is what the board thinks is going to motivate Elin 0:02:32.880 --> 0:02:36.240 to really dig in and really go guns blazing for 0:02:36.280 --> 0:02:39.519 this sort of AI robotics future that he recently outlined 0:02:39.520 --> 0:02:40.720 and masterplanned Part four. 0:02:40.919 --> 0:02:43.800 And perhaps what really motivates him is twenty five percent 0:02:43.880 --> 0:02:47.840 ownership of the company. What's interesting and what motivates investors 0:02:48.200 --> 0:02:51.560 is his dedication, particularly moving away from politics, which seems 0:02:51.560 --> 0:02:54.320 to be one of the key points here in what 0:02:54.520 --> 0:02:57.040 the voters, what the investors are going to have to 0:02:57.120 --> 0:02:59.520 vote on. But it's also about thinking about succession. I 0:02:59.560 --> 0:03:01.960 was interesting and the eleventh and the twelfth Trane Donna. 0:03:03.200 --> 0:03:05.680 Yeah, I mean clearly, you know, Musk has been the 0:03:05.680 --> 0:03:08.480 CEO of Tesla since two thousand and eight, and at 0:03:08.480 --> 0:03:11.000 some point they need to come up with a real 0:03:11.040 --> 0:03:13.680 succession plan. And I think that the committee worked very 0:03:13.680 --> 0:03:15.799 hard over the past seven months to kind of make 0:03:15.840 --> 0:03:18.720 it clear to investors that they are always talking about 0:03:18.760 --> 0:03:21.960 secession plans and that whenever the time comes from us 0:03:22.000 --> 0:03:25.000 to step down, they want his involvement in choosing a successor. 0:03:25.120 --> 0:03:28.280 But this package is designed to keep Elon focus for 0:03:28.320 --> 0:03:31.639 the long haul and to really motivate him and give 0:03:31.680 --> 0:03:34.880 him that kind of like dopamine hit that he likes 0:03:34.560 --> 0:03:37.960 of kind of you know, swinging for the fences and 0:03:38.000 --> 0:03:39.920 doing crazy things that no one thought were possible. 0:03:40.920 --> 0:03:44.400 Donna, very quickly, how does this package compare with the 0:03:44.480 --> 0:03:47.240 twenty eighteen package being disputed in the courts? 0:03:48.480 --> 0:03:51.440 So if twenty eighteen was a moonshot package, this one 0:03:51.560 --> 0:03:53.520 really could be thought of as a Mars shot. And 0:03:53.560 --> 0:03:56.839 if you actually, you know, command f the proxy, there's 0:03:56.880 --> 0:03:59.280 a there's a reference to a Marsh shot in one 0:03:59.280 --> 0:04:03.240 of the footnotes. Because the numbers are so high, the 0:04:03.280 --> 0:04:06.200 milestones are I mean, we're not just talking billions anymore, 0:04:06.200 --> 0:04:09.760 we're talking trillions in marketcap. But remember Elon Musk has 0:04:09.760 --> 0:04:13.040 always talked about wanting Tesla to be the most valuable 0:04:13.080 --> 0:04:15.280 company in the world. This is a pay package that 0:04:15.360 --> 0:04:19.560 incentivizes him to get there. And if he gets their shareholders, 0:04:19.600 --> 0:04:21.720 we'll also get there, which is why I think you're 0:04:21.720 --> 0:04:24.039 going to see a lot of investors support this package. 0:04:24.800 --> 0:04:28.039 Dana, How question is with the course supported once again, 0:04:28.120 --> 0:04:31.880 but really interesting take on this one trillion potential payday. 0:04:32.360 --> 0:04:34.560 Let's get more from someone who used to be on 0:04:34.600 --> 0:04:36.800 the board, and then we now push forward to the 0:04:36.800 --> 0:04:39.200 future of Tesla with Steve Wesley from the Wesley Group. 0:04:39.440 --> 0:04:42.320 You are indeed the founder managing partner. Steve, I'm really 0:04:42.360 --> 0:04:45.119 interested as to some of these milestones. Yes, it's about 0:04:45.120 --> 0:04:49.679 market capitalization is extraordinary. But to get twenty million cars 0:04:49.720 --> 0:04:52.040 on the road, to get ten million of those with FSD, 0:04:52.200 --> 0:04:55.640 to get one million robots one million robot taxis is 0:04:55.680 --> 0:04:56.720 that realistic? 0:04:58.400 --> 0:04:58.560 Well? 0:04:58.600 --> 0:05:00.360 I think that should be awesoully hard for tough that 0:05:00.440 --> 0:05:04.040 to do. And again I support incentive based pay packages 0:05:04.080 --> 0:05:08.640 for CEOs, and the pay package sounds astronomical, but so 0:05:08.839 --> 0:05:11.159 are the milestones to get it type. He's got a 0:05:11.200 --> 0:05:13.880 double market cap just even to get the first milestone. 0:05:14.320 --> 0:05:15.920 And I understand what they're doing. 0:05:16.000 --> 0:05:19.440 They want to get must one hundred percent focused on Tesla. 0:05:20.080 --> 0:05:23.080 But the big question is still, how do you get 0:05:23.120 --> 0:05:26.320 Tesla back on a growth trajectory. It's got two years 0:05:26.320 --> 0:05:30.159 of flat growth here. They've got to get permitting for 0:05:30.279 --> 0:05:34.400 full self driving in San Francisco and Austin first, Thanks first, 0:05:34.480 --> 0:05:38.000 and then they've got to start selling humanoid robots. Must 0:05:38.040 --> 0:05:40.240 have said they're going to shoot for five thousand this year. 0:05:40.440 --> 0:05:43.240 That feels a little aspirational, but whatever it takes to 0:05:43.320 --> 0:05:45.960 kick the company into a higher gear, that's what shareholders 0:05:46.000 --> 0:05:46.800 should be looking for. 0:05:47.839 --> 0:05:51.480 Steve Sectional page A fifty one of the proxy. If 0:05:51.480 --> 0:05:53.440 I bring it up and you allow me to read 0:05:53.440 --> 0:05:58.839 it to you, the board receives assurances that Mosk's involvement 0:05:58.920 --> 0:06:02.480 with the political space would wind down in a timely manner. 0:06:03.080 --> 0:06:04.920 The one of the reasons that Caroline and I wanted 0:06:04.960 --> 0:06:06.440 to get you on the show is you did sit 0:06:06.480 --> 0:06:09.400 on Tesla's board for three years. You've been a controller 0:06:09.400 --> 0:06:13.840 of a state in California. How do those provisions come about? 0:06:14.080 --> 0:06:15.320 How do you interpret it? 0:06:16.839 --> 0:06:18.560 But look, I think there's two things going on. 0:06:19.760 --> 0:06:24.200 Musk is saying, look, I want to be wildly incentivized 0:06:25.160 --> 0:06:27.920 if I do great things for shareholders, and I think 0:06:27.960 --> 0:06:31.520 shareholders I think the board is saying, okay, fair enough, 0:06:31.560 --> 0:06:33.640 we're going to have to set awfully highest standards. And 0:06:33.680 --> 0:06:36.000 that's not just going to be performance standards for selling 0:06:36.040 --> 0:06:41.159 more cars, for getting full self driving and really showing 0:06:41.200 --> 0:06:44.000 the promise of AI and Tesla and he's also going 0:06:44.040 --> 0:06:47.839 to have to really make the humanoid robot proposition real. 0:06:48.120 --> 0:06:49.960 I think if he does those things, he deserves a 0:06:49.960 --> 0:06:50.880 big pay package. 0:06:50.920 --> 0:06:52.280 If you've touched on something else. 0:06:52.600 --> 0:06:56.760 The board clearly wants to see him focused on Tesla, 0:06:56.800 --> 0:07:00.560 and that probably means less politics, less forcus on some 0:07:00.600 --> 0:07:03.559 of the other properties that are already doing extraordinarily well. 0:07:04.040 --> 0:07:06.520 So you can see why the board constructed it as 0:07:06.560 --> 0:07:09.320 they did. Let's see if shareholders support it. I have 0:07:09.360 --> 0:07:12.120 a hynch state will and the big question is it's 0:07:12.160 --> 0:07:15.320 going to be game on for Tesla. Kenny hit these right. 0:07:15.480 --> 0:07:20.320 Why gundation scores Within the operational goals, there is the 0:07:20.360 --> 0:07:23.760 target to produce one million humanoid Optimus robots. There is 0:07:23.800 --> 0:07:27.080 to build the Robotaxi fleet to one million vehicles. But 0:07:27.160 --> 0:07:30.320 there is still a goal in there, Steve to produce 0:07:30.440 --> 0:07:34.560 and sell and deliver twenty million electric vehicles to consumers. 0:07:34.840 --> 0:07:38.360 In other words, Tesla's historic bread and butter. That seems 0:07:38.360 --> 0:07:41.720 to contradict like the big picture vision for AI. You know, 0:07:41.760 --> 0:07:44.800 in a world where Tesla operates a prietary ride hailing app, 0:07:45.000 --> 0:07:48.520 he's still being asked to deliver tens of millions of 0:07:48.600 --> 0:07:50.640 vehicles directly to the consumer. 0:07:51.880 --> 0:07:54.400 And you put your finger on the lich fit here 0:07:54.520 --> 0:07:58.360 as always. What I love about this is what I 0:07:58.400 --> 0:08:00.760 suspect and I don't know about back to Elon wants 0:08:00.840 --> 0:08:03.560 is an audacious, big target, because that's what gets ISS 0:08:03.600 --> 0:08:07.040 adrenaline going great. What I think the board is pushing 0:08:07.080 --> 0:08:10.080 for is, hey, don't forget. You've got to sell a 0:08:10.160 --> 0:08:13.720 lot of electric and autonomous vehicles and competition's coming. So 0:08:13.800 --> 0:08:16.240 let's come back to the real world for a minute. 0:08:16.400 --> 0:08:21.080 Volkswagen unveiling twenty nine thousand dollars eighty two next week 0:08:21.240 --> 0:08:25.160 in Europe. That's going to be hugely competitive. BYD Europe 0:08:25.200 --> 0:08:27.920 sales up two hundred and twenty five percent. Well, Tesla 0:08:28.200 --> 0:08:31.640 Europe sales are down fifty percent, cyber truck sales down 0:08:31.760 --> 0:08:35.120 fifty percent. Now Forward's coming out with a thirty thousand 0:08:35.120 --> 0:08:39.560 dollars competing truck, and in China, competition's huge. And now 0:08:39.800 --> 0:08:44.240 not only is BYD rocketing up with more EV sales 0:08:44.280 --> 0:08:47.680 for gly Star Wish a new ten thousand dollars EV 0:08:47.800 --> 0:08:51.360 in China, biggest selling car in China. There's competition coming 0:08:51.400 --> 0:08:53.480 from all sides, and I think this is the board's 0:08:53.520 --> 0:08:56.640 way of saying, hey, don't forget, you still have to 0:08:56.720 --> 0:08:59.920 sell a lot of cars if you want anywhere you're 0:09:00.200 --> 0:09:01.920 this size of governess, it's not. 0:09:01.840 --> 0:09:02.560 Going to be easy. 0:09:02.880 --> 0:09:05.319 Yeah, Steve, So if you're on the board and as 0:09:05.360 --> 0:09:08.560 an investor, how does he turn around the bread and 0:09:08.600 --> 0:09:10.439 butter the selling of cars. 0:09:11.600 --> 0:09:14.400 Well, again, that's we've talked about that one a lot. 0:09:15.480 --> 0:09:17.800 Everybody is going to be coming out with a twenty 0:09:17.840 --> 0:09:22.160 to twenty five thousand dollars car. Tesla has been late 0:09:22.200 --> 0:09:24.319 in getting that to market. They need to do it. 0:09:24.440 --> 0:09:26.320 Here's the point that people really need to get. 0:09:26.240 --> 0:09:27.559 Their arms around. 0:09:27.880 --> 0:09:33.280 We're reaching cost parody for evs this year. Now people 0:09:33.320 --> 0:09:35.400 are going to say, hey, what's going to happen in 0:09:35.480 --> 0:09:38.120 Q three? I can tell you in Q three EV 0:09:38.280 --> 0:09:40.080 sales are going to be up in the US because 0:09:40.120 --> 0:09:43.280 everybody's rushing to still get that last government credit and 0:09:43.280 --> 0:09:45.240 then it's going to go away. A lot of people 0:09:45.280 --> 0:09:47.560 say me, o, my, is that going to crush the industry? 0:09:47.960 --> 0:09:51.840 Absolutely not. What you should understand. The average EV price 0:09:52.440 --> 0:09:54.720 dropped fourteen thousand. 0:09:54.320 --> 0:09:55.839 Dollars in twenty twenty five. 0:09:56.200 --> 0:10:00.400 EV's are soon going to be cheaper than internal combustion 0:10:00.600 --> 0:10:02.400 vehicles and that's going to continue for the rest of 0:10:02.400 --> 0:10:02.960 our lives. 0:10:03.720 --> 0:10:04.000 Steve. 0:10:04.080 --> 0:10:05.720 Later in the program, we're going to go deep on 0:10:05.840 --> 0:10:09.560 the shareholder initiated proposal for Tesla to invest in Xai. 0:10:10.000 --> 0:10:12.920 But if you look across the broad package, would you 0:10:13.000 --> 0:10:17.000 please kindly assign what chances you give that shareholders will 0:10:17.080 --> 0:10:19.880 vote in favor of all of those provisions at the 0:10:19.960 --> 0:10:21.400 November annual meeting. 0:10:23.040 --> 0:10:25.120 Well, look, it's hard to note. It's the biggest pay 0:10:25.400 --> 0:10:29.440 package in history by far. But again they've attached the 0:10:29.520 --> 0:10:32.360 goals to such high numbers where they're trying to create. 0:10:32.160 --> 0:10:32.800 A weird win. 0:10:33.440 --> 0:10:36.760 I have a hunch the shareholders are going to support this. 0:10:36.920 --> 0:10:39.160 I think what they really want to see is the 0:10:39.200 --> 0:10:43.360 two things you've pointed out, one musk dropping back from 0:10:43.400 --> 0:10:48.040 politics and focusing fully on Tesla into getting back to 0:10:48.080 --> 0:10:54.240 the reality of selling more cars, getting full regulatory approval 0:10:54.360 --> 0:10:55.760 for autonomous driving. 0:10:55.880 --> 0:10:57.599 Those are the goals ahead of him. I hope he 0:10:57.640 --> 0:10:59.040 gets them. 0:11:00.080 --> 0:11:02.600 Wesley a former Tesla board member now of Wesley Group 0:11:02.640 --> 0:11:05.079 and somebody with a command of the world of electric vehicles. 0:11:05.080 --> 0:11:06.000 Thank you very much. 0:11:06.240 --> 0:11:10.240 Now coming up shares a broadcommer surging today after news 0:11:10.280 --> 0:11:14.080 breaks that an unnamed customer deal from the call. 0:11:14.640 --> 0:11:17.120 Well, it's open AI. That's next, Cary, what are you 0:11:17.160 --> 0:11:17.480 looking at? 0:11:17.559 --> 0:11:20.000 I'm looking at the broader markets actually end look, maybe 0:11:20.040 --> 0:11:23.160 it feeds into anxiety around in video's command of the 0:11:23.240 --> 0:11:25.640 key hyperscalers and the growth that they see in terms 0:11:25.679 --> 0:11:30.120 of their own chip provision, training and inference. We're down 0:11:30.200 --> 0:11:32.360 four percent on in video. The socks are still up 0:11:32.360 --> 0:11:35.520 four ten percent thanks to Broadcom, but more broadly we're 0:11:35.600 --> 0:11:38.679 risk off. That's after the macro data. This is Bloomberg Tech. 0:11:51.440 --> 0:11:53.640 Taking a look at the shares of broad coom up 0:11:53.640 --> 0:11:55.679 eight and a half percent of times in the session, 0:11:55.760 --> 0:11:59.640 reaching an all time high after posting record revenue. Bloomberg 0:11:59.679 --> 0:12:03.280 then reported that a new customer broadcord So working with 0:12:03.360 --> 0:12:06.760 the design and produce an artificial intelligence accelerator from twenty 0:12:06.800 --> 0:12:11.480 twenty six onwards is open AI. That's something that could 0:12:11.559 --> 0:12:15.760 challenge in video. Let's bring in Bloomberg Intelligence analyst Cunjensabani. 0:12:16.720 --> 0:12:20.920 As normal Hocktan does not name, he alludes to this 0:12:21.360 --> 0:12:24.080 a six customer on the call, and when you publish 0:12:24.160 --> 0:12:27.000 your research, research and reaction, that's where you looked at 0:12:27.280 --> 0:12:28.800 A six and AI revenue. 0:12:29.679 --> 0:12:30.640 Why focus there. 0:12:32.240 --> 0:12:34.840 I mean that is the center skate story right now. Look, 0:12:35.120 --> 0:12:39.000 before this announcement, they were still the majority share owner 0:12:39.160 --> 0:12:42.840 of the A six accelerator landscape, and with this announcement 0:12:42.920 --> 0:12:45.400 now their share is actually going to increase if you 0:12:45.440 --> 0:12:48.080 can believe that. So right now they are the number 0:12:48.120 --> 0:12:52.760 two AI semi company after Nvidia. When you think of 0:12:52.920 --> 0:12:56.880 the revenue size of AI revenues, I mean, just for comparing, contrast, 0:12:56.960 --> 0:12:59.680 right their air revenue now is running or going to 0:12:59.679 --> 0:13:02.400 be done, almost bigger than an entire data center revenue 0:13:02.640 --> 0:13:05.280 of the number two GPU provider in AMD. So they're 0:13:05.320 --> 0:13:08.920 increasing their share at an unprecedented rate. Not just adding 0:13:08.960 --> 0:13:11.840 new customers and new revenue streams, were also increasing the 0:13:12.000 --> 0:13:15.560 unit volumes at the existing customers, so gaining share at 0:13:15.640 --> 0:13:18.439 existing customers and as well as adding more customers. 0:13:18.920 --> 0:13:22.719 I mean a ten billion future backlo on coming from 0:13:22.720 --> 0:13:26.480 open AI is nice conngent, But compare and contrast Nvidia 0:13:26.840 --> 0:13:29.960 and broadcme for us because many want to mainly compete, 0:13:30.040 --> 0:13:32.840 but really, are we seeing this as an alternative this 0:13:32.960 --> 0:13:36.120 custom silicon or is it an and rather than an all? 0:13:37.480 --> 0:13:39.480 At this point it is an end. Look, it's a 0:13:39.480 --> 0:13:42.200 lot more nuanced than just saying that the A six 0:13:42.240 --> 0:13:44.680 from Broadcom are going to kill in media. You know, 0:13:44.760 --> 0:13:48.800 the use case is really limited to say ten top 0:13:48.840 --> 0:13:52.360 ten global hyperscalers now, no doubt today these step top 0:13:52.400 --> 0:13:55.720 ten represent the largest spenders when it comes to accelerators. 0:13:55.960 --> 0:13:58.960 But the compute demand from these top ten today is 0:13:59.000 --> 0:14:01.760 so much more. It's not coming at the cost of 0:14:01.920 --> 0:14:05.439 Nvidia GPUs. The bare case thesis is yes, in the future, 0:14:05.520 --> 0:14:09.200 as these customers keep improving their own chips, gen after 0:14:09.320 --> 0:14:13.600 gen keep improving their software, they could become sellers of 0:14:13.720 --> 0:14:16.480 the computer based on their own chip, the case study 0:14:16.520 --> 0:14:18.600 being the AWS and Anthropic deal. 0:14:19.000 --> 0:14:21.119 However, there's still a major huge. 0:14:20.880 --> 0:14:26.080 Market of enterprises sovieign customers Neo clouds, which still makes 0:14:26.080 --> 0:14:29.360 sense to be exclusively on the GPU's likes of Nvidia. 0:14:30.280 --> 0:14:32.440 Qunjian Savani is always great to get your takes in 0:14:32.440 --> 0:14:35.160 your analyst from Blueberg Intelligence, we thank you. Look Alphabet 0:14:35.200 --> 0:14:38.320 actually a broad On customer. Let's talk about Alphabet right now, because. 0:14:38.080 --> 0:14:39.320 Breaking news from the EU. 0:14:39.880 --> 0:14:43.840 Google will be fined almost three billion euros that's three 0:14:43.840 --> 0:14:46.720 and a half billion dollars by the European Union because 0:14:46.760 --> 0:14:50.800 it's being ordered to stop favoring its own advertising technology services. 0:14:51.240 --> 0:14:53.040 Now this comes hot on the heels of the fact 0:14:53.080 --> 0:14:54.640 that Google seem to only get a slap on the 0:14:54.640 --> 0:14:57.800 wrist when it comes to its monopoly of search coming 0:14:57.800 --> 0:14:59.880 from Judge Meta. Here in the United States, the dog 0:15:00.440 --> 0:15:02.240 ed is still looking at ad tech. 0:15:02.960 --> 0:15:04.960 Will we see the EU find. 0:15:04.800 --> 0:15:07.920 Implicate on that perspective, because it seems as though there 0:15:07.960 --> 0:15:10.640 is a concern coming that it's got too much control. 0:15:11.240 --> 0:15:13.800 It's not just a fine, you know, the European Union's 0:15:13.840 --> 0:15:16.760 now saying to Google that it needs to stop favoring 0:15:16.800 --> 0:15:19.360 its own ad technology platforms. And if you remember back 0:15:19.360 --> 0:15:23.560 in twenty twenty three, under the previous Competition Commissioner Margaret 0:15:23.640 --> 0:15:26.480 the vest there they had been warned that they needed 0:15:26.480 --> 0:15:28.680 to stop doing this, and over the term of Vesta's 0:15:29.320 --> 0:15:33.760 tenure within the European Commission, she went after Google on 0:15:33.840 --> 0:15:36.800 billions of euros of fine. So they have sixty days 0:15:36.800 --> 0:15:39.200 to respond. Google's statement is this is unfair. 0:15:39.800 --> 0:15:42.960 Coming up in conversation on the jobs market, we're gonna 0:15:43.000 --> 0:15:45.680 be speaking ed with Sarah Franklin, that's is CEO, on 0:15:45.760 --> 0:15:48.320 the state of the tech labor markets. After that pretty 0:15:48.320 --> 0:15:50.960 woful number coming from non time payrolls. That's a Blomberg 0:15:51.040 --> 0:16:10.880 Tech US August payrolls out earlier today and again of 0:16:11.000 --> 0:16:13.760 just twenty two thousand jobs, another downward revision in the 0:16:13.760 --> 0:16:16.520 previous month, and unemployment rising to four point three percent. 0:16:16.800 --> 0:16:20.520 Bloomberg International Economics and Policy editor Michael McKee breaks down 0:16:20.560 --> 0:16:22.360 those numbers with a little bit of a tech slant 0:16:22.400 --> 0:16:22.760 for US. 0:16:24.760 --> 0:16:27.800 Yes, Carol, it was not a good month for Donald 0:16:27.840 --> 0:16:32.280 Trump and his economic policies because job growth slowed tremendously 0:16:32.320 --> 0:16:34.280 and it has been soling for the last few months. 0:16:34.360 --> 0:16:37.080 You mentioned unemployment up seventy five basis points from July. 0:16:37.160 --> 0:16:40.720 It's starting to go higher and higher. But in terms 0:16:40.760 --> 0:16:43.400 of tech jobs, and I can see Ed rolling his eyes, going, 0:16:43.520 --> 0:16:46.840 what does it mean for tech? Tech's not special? Tech 0:16:46.880 --> 0:16:49.120 lost a lot of jobs as well. There's not one 0:16:49.280 --> 0:16:53.600 tech category in the overall jobs report, but there's a 0:16:53.600 --> 0:16:55.760 lot of different ones in there, and I've pulled out 0:16:55.760 --> 0:16:59.800 a few to show what happened. In computer manufacturing twenty 0:16:59.800 --> 0:17:05.159 one hundred jobs lost. Semiconductor manufacturing thirty seven hundred jobs lost, 0:17:05.440 --> 0:17:09.040 computer systems designed that would be the software guys three 0:17:09.080 --> 0:17:11.000 three hundred jobs lost. 0:17:11.080 --> 0:17:12.200 So some real. 0:17:12.119 --> 0:17:15.720 Job losses for the people in tech. And the President 0:17:15.800 --> 0:17:18.080 foreshadowed it last night when he was asked about it 0:17:18.119 --> 0:17:22.040 at that dinner with tech company executives, and he said, yeah, 0:17:22.320 --> 0:17:25.240 maybe bad now, but just you wait, the Brooklyn guy 0:17:25.560 --> 0:17:28.320 or the Queen's guy, quoting the Brooklyn Dodgers, wait till 0:17:28.359 --> 0:17:30.600 next year. In a year from now, he said, when 0:17:30.600 --> 0:17:34.120 these monstrous, huge, beautiful places, the palaces of genius, when 0:17:34.160 --> 0:17:36.360 they start opening up, you'll see, I think you'll see 0:17:36.440 --> 0:17:39.640 jobs numbers that are going to be absolutely incredible. 0:17:39.960 --> 0:17:42.800 So we'll see if he is right. In a year. 0:17:43.960 --> 0:17:47.639 My old eyes en roll Bloomberg's international economics correspondent Michael 0:17:47.680 --> 0:17:51.439 McKee with a Teconomic special breakdown of the latest jobs 0:17:51.520 --> 0:17:53.679 data from all in the State of the Labor Market. 0:17:53.720 --> 0:17:56.880 Sarah Franklin Lattice CEO joins us now lattus as about 0:17:56.880 --> 0:17:59.280 with a new State of the People report, and we 0:17:59.359 --> 0:18:01.320 come to you every job because of, like you know, 0:18:01.400 --> 0:18:04.040 the rich data that you have on your own technology platform. 0:18:04.400 --> 0:18:06.400 But the most simple place to start is to say, 0:18:06.400 --> 0:18:10.399 look at Mike's reporting the breakdown of the latest jobs report, 0:18:10.720 --> 0:18:14.119 and say, is AI impacting any of the technology sector 0:18:14.200 --> 0:18:14.919 just yet? 0:18:15.040 --> 0:18:17.640 The short answer is yes, we're seeing the impacts. We're 0:18:17.680 --> 0:18:20.800 seeing the job growth slow, we're seeing unemployment tick up. 0:18:20.920 --> 0:18:23.840 But what we're seeing really is transformation in the workplace. 0:18:24.040 --> 0:18:27.080 You're seeing every job is changing and every company is 0:18:27.119 --> 0:18:30.720 going through the transformational stage eliminating some of the roadwork 0:18:30.840 --> 0:18:34.720 but also investing in ways to increase effectiveness of their people. 0:18:35.600 --> 0:18:38.280 Sarah, much of the transition has to be led by 0:18:38.440 --> 0:18:39.359 human resources. 0:18:39.800 --> 0:18:40.640 But how much do. 0:18:40.560 --> 0:18:43.119 You think the cuts come first and then the rehiring 0:18:43.160 --> 0:18:46.159 of different types of talent then comes, or are we 0:18:46.280 --> 0:18:48.560 seeing people just being asked to be more productive? 0:18:49.920 --> 0:18:53.320 So with HR, it's an opportunity to be very strategic, 0:18:53.800 --> 0:18:57.560 and layoffs are really more like a fad diet. There's 0:18:57.600 --> 0:18:59.720 something where you get an immediate hit into the P 0:18:59.760 --> 0:19:02.560 and L, but the real work, the healthy habits, are 0:19:02.600 --> 0:19:05.560 not being implemented if you're not focusing on your workforce 0:19:05.560 --> 0:19:09.760 effectiveness and the habitual training that you have with all 0:19:09.800 --> 0:19:12.560 of your employees and the structures that you put in place. 0:19:12.800 --> 0:19:14.000 We're going through change. 0:19:14.080 --> 0:19:16.119 It's important to do this in a way that sets 0:19:16.200 --> 0:19:18.960 up companies for long term success, and that's what HR 0:19:19.040 --> 0:19:22.080 departments are really focused on today. When they're driving success 0:19:22.160 --> 0:19:22.639 with AI. 0:19:23.320 --> 0:19:25.560 Talk about that success with Ai, Sarah, because that is 0:19:25.600 --> 0:19:28.040 something that's been questioned a lot in the last couple 0:19:28.080 --> 0:19:30.720 of weeks by this MIT report, people worrying the ninety 0:19:30.720 --> 0:19:34.680 five percent of pilots aren't delivering return on AI investment. 0:19:35.040 --> 0:19:37.320 What have you heard from the people that hire. 0:19:38.200 --> 0:19:41.639 Yeah, Caroline, it's so interesting because it's a headline that 0:19:41.680 --> 0:19:45.560 people have latched onto because there is fear. There's fear 0:19:45.600 --> 0:19:47.480 of what AI can do. And so when you can 0:19:47.480 --> 0:19:51.640 easily say this MIT report says that they're failing, that's 0:19:51.800 --> 0:19:56.960 easy to really embrace. But however, the reason the nuance 0:19:57.040 --> 0:20:00.880 in the report is that it's AI alone, not really 0:20:00.880 --> 0:20:03.520 when you look at AI that's set up properly, AI 0:20:03.560 --> 0:20:06.439 that's integrated well with systems, and so what it tells 0:20:06.520 --> 0:20:09.280 us is that we need to responsibly bring AI in. 0:20:09.520 --> 0:20:12.520 You can't just set up AI and expect it to work. 0:20:12.760 --> 0:20:14.680 All of us that may buy an Alexa for our home, 0:20:14.760 --> 0:20:16.240 you can't just put it in your kitchen. 0:20:16.040 --> 0:20:17.240 Expect it to dend the lights. 0:20:17.520 --> 0:20:19.960 You need to set it up, configure it and understand 0:20:19.960 --> 0:20:22.159 how to use it. The same thing is true with AI, 0:20:22.480 --> 0:20:25.800 and so where AI is succeeding. It's when we have 0:20:25.880 --> 0:20:30.880 responsible practices, we have good integrations, and we have ethical 0:20:30.960 --> 0:20:31.679 usage of it. 0:20:32.359 --> 0:20:35.200 So in your own survey and your own report, one 0:20:35.240 --> 0:20:38.160 of the things that struck me was the results around 0:20:38.200 --> 0:20:42.720 people's attitude towards maintaining work life balance. It talks to 0:20:42.760 --> 0:20:46.440 a bigger picture debate whether AI helps us and makes 0:20:46.480 --> 0:20:48.600 life easier in our daily work life so we can 0:20:48.640 --> 0:20:51.159 go and do more fun things outside of work. Is 0:20:51.160 --> 0:20:54.280 that really happening within the workplace or in any of 0:20:54.520 --> 0:20:56.000 the HR sectors that you track in. 0:20:56.320 --> 0:20:59.800 There's definitely generational differences in the embracing of AI between 0:21:00.240 --> 0:21:04.520 Z millennials and what we're seeing though, is that AI 0:21:04.600 --> 0:21:07.520 whether it's freeing up time to have better work life 0:21:07.600 --> 0:21:10.440 balance or to do more strategic work. I don't think 0:21:10.480 --> 0:21:12.760