Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is live
Speaker 1: from coast to coast with Caroline Hide in New York
Speaker 1: and v Lovelow in San Francisco.
Speaker 2: This is Bloomberg Tech coming up. Big Tech lags as
Speaker 2: investors remain skittish about the AI trade. We dig into
Speaker 2: anxieties and losses coming from the magnificent seven plus earnings
Speaker 2: that still roll in. We speak with Octo CEO Todd
Speaker 2: McKinnon after the software company boosted its full year profit
Speaker 2: Foradcast and TikTok. We'll invest more than thirty seven billion
Speaker 2: dollars to build a data center in Brazil, this first
Speaker 2: project in Latin America. But first we check in on
Speaker 2: these markets that are volatile on this day. Look, we're
Speaker 2: putting back on some of the gains made yesterday on
Speaker 2: the Nastaq one hundred. We're off only by a tenth
Speaker 2: of a percent in video flip flopping between gains and losses.
Speaker 2: But all eyes on some of the key magnificent seven
Speaker 2: names that like magnificent. On the day, Bitcoin so managing
Speaker 2: to power up nine ten percent. We're at ninety two thousand,
Speaker 2: so bit of dip bin and going on a sentiment
Speaker 2: though still remains pretty sour on the asset class. Move
Speaker 2: on and have a little look at what's really under
Speaker 2: fired today. Reports out there that Microsoft potentially having to
Speaker 2: tay you to its salespeople of co pilot of AI
Speaker 2: productivity tools. Maybe you need to pull back on your
Speaker 2: sales targets. There is counter reporting coming from the NBC
Speaker 2: that this isn't currently true, but we're going to dig
Speaker 2: into those details for you. Currently off by one point
Speaker 2: eight percent. All of this speaks to the anxiety that
Speaker 2: AI isn't going to give us the productivity gains many
Speaker 2: and Hope Bailey Nipshew's sent piece to say is here
Speaker 2: with us at the moment, really talking about more broadly
Speaker 2: what we're seeing in this market at the moment. And Bailey,
Speaker 2: are we seeing those sorts of anxieties.
Speaker 3: Well, we are seeing some of the uncertainties that we're
Speaker 3: seeing that play out in real time. The big debate
Speaker 3: really around a lot of the CI trade, and we
Speaker 3: saw this play out throughout November, is how much of.
Speaker 4: This spend is going to be realized?
Speaker 3: Are the dollars going to make sense at the end
Speaker 3: of the day, And if you're seeing companies dial back
Speaker 3: there spending. What does that ultimately mean for the bottom
Speaker 3: lines When you see a report like we've been seeing,
Speaker 3: whether they're conflicting or not with Microsoft, it's a lot
Speaker 3: for investors to chew on.
Speaker 2: And what's been being chewed on is in people who
Speaker 2: have diversified since the bottom in October, since we really
Speaker 2: saw the perhaps end of the significant setting. Tech still
Speaker 2: lagged and we've seen underperformed health, tach, care and other
Speaker 2: key sectors.
Speaker 3: Yeah, if you look so last time, we had an
Speaker 3: all time higher looking back to October twenty eighth best
Speaker 3: performers healthcare, communications, energy. As you mentioned, worst performing group
Speaker 3: is tech. One thing to keep in mind when you
Speaker 3: look at that SMP five hundred info Tech.
Speaker 4: The big names Nvidia, Apple.
Speaker 3: Microsoft are in there, missing Tesla, Alphabet and other names.
Speaker 3: So a little bit of a grain of salt to
Speaker 3: take it with that, But we are certainly seeing investors diversifying,
Speaker 3: flocking to healthcare, Eli, Lilly, Cardinal Health, Biogen all out performing.
Speaker 3: When I talk to portfolio managers, part of the debate
Speaker 3: is we've come so far, so fast in a.
Speaker 4: Lot of these names.
Speaker 3: Yes, and as much as we like to think that
Speaker 3: things only go up eventually, the question is can you
Speaker 3: performing is their alpha generation, and that's why we see some.
Speaker 4: Of that repositioning.
Speaker 2: Repositioning still significant gains on the year if you're thinking
Speaker 2: of an Nvidia, but the momentum traits we've seen on
Speaker 2: the back of this, the fact that quantum stocks have
Speaker 2: done so well, some of the crypto spheres, and they
Speaker 2: still under a lot of pressure right now.
Speaker 4: They're under pressure. There's just a lot of volatility.
Speaker 3: You look at the moves that we saw, whether it
Speaker 3: was a nuclear power or as you mentioned in quantum,
Speaker 3: pretty much NonStop up into the right, whether that was retail,
Speaker 3: whether that was momentum or just hedge funds trying to
Speaker 3: juice their books. We've seen them pull back pretty markedly. Obviously,
Speaker 3: Bitcoin has been quite volatile trying to recoup some of
Speaker 3: those losses. But if you're really kind of macro investor
Speaker 3: or running a book broadly from the equity side, we're
Speaker 3: in December, if you're up quite a bit, maybe take
Speaker 3: some gains off the table and maybe diversify into something
Speaker 3: like a healthcare which could be positioned to benefit or
Speaker 3: at least continue growing.
Speaker 4: If there are concerns around AI.
Speaker 2: And concerns as a macrob of picture. We just saw
Speaker 2: the ADP figures today, I mean jobs market looking a
Speaker 2: little bit weaker as well being lipstials. It's always a
Speaker 2: joy to have him on talking to us through the markets.
Speaker 2: We've got more market context for you now and more
Speaker 2: broadly with Sylvia Deablonski Defiance ETF CEO CIO you've been
Speaker 2: writing it's not all all over, but the pace of
Speaker 2: spending is becoming more selective if upcoming macro data corporates,
Speaker 2: we could be nearing a tradable bottom. As a longer
Speaker 2: term investor, I continue to see these pullbacks as opportunities.
Speaker 2: She joins us. Now so cooperating here, is market sentiment
Speaker 2: not or is market sentiment going to shift to the
Speaker 2: positive again?
Speaker 5: Good warning?
Speaker 6: Well, you know, barring external factors, which we've seen a
Speaker 6: lot of right throughout the last year, whether it's been
Speaker 6: geo politics, whether it's been tariffs or for things like this,
Speaker 6: you know, if we're on pace here for kind of
Speaker 6: the trend that we have here, and we do have
Speaker 6: this growth of AI, you know, I know there's news
Speaker 6: around spending being cut back and things like this, but
Speaker 6: we're still in the infancy of AI and there has
Speaker 6: already been so much spending that is now going to
Speaker 6: kind of pile into the economy, pile into do these
Speaker 6: different companies, different sectors and things like this. So I
Speaker 6: think it plays out and benefits these these companies over time.
Speaker 6: So I think, you know that coupled with a FED
Speaker 6: that is likely to cut particularly if we have a
Speaker 6: new FED chair in, you know, in with the president
Speaker 6: and kind of you know, knowing where the predictions will
Speaker 6: go on. That that's what the market's really looking for.
Speaker 6: Right we have a little bit of a weaker labor number,
Speaker 6: Consumer spending is holding up. You know, corporate earnings were
Speaker 6: arguably great. You had over eighty percent of names beating
Speaker 6: on the top and bottom line. You know, double digit
Speaker 6: growth continues, positive GDP outlook. I think that we could
Speaker 6: be in for a good market here, a.
Speaker 2: Good market led by the same names. It's interesting that
Speaker 2: Innvidia CEO Jensen Wang is in Capital Hill today. We
Speaker 2: understand he's just been seen entering US House speak at
Speaker 2: Mike Johnson's office. How much will political tailwinds or headwinds
Speaker 2: help will hindle some of these companies be worried about
Speaker 2: access to China, well broadly, Cannon Vinie continue to lead
Speaker 2: this market higher.
Speaker 6: So I think in a way, and Video still has
Speaker 6: the monopoly on AI and chips right, and so I
Speaker 6: think that you know, a lot of the other semiconductor
Speaker 6: companies are starting to do you know better and take
Speaker 6: some of the business away, but for now, and Video
Speaker 6: remains the clear leader. In terms of Washington and politics.
Speaker 6: Of course, all of these things impact these companies. You know,
Speaker 6: they are the trillion dollar clubs. They lead the market
Speaker 6: and policy effects them first. But the other side of
Speaker 6: that argument is when the market falls back, you know
Speaker 6: where do people invest. A lot of times they look
Speaker 6: for defensive names, but you have these high again trillion
Speaker 6: dollar companies, high quality, strong balance sheets that over time
Speaker 6: tend to perform. Investors actually do look to those companies
Speaker 6: for investments. And if you look at today, you know,
Speaker 6: four hundred out of the five hundred names actually participated
Speaker 6: in the bounce off of you know, the last pullback,
Speaker 6: and so you see a little breath expansion there. I do, though,
Speaker 6: think that the AI tech is going to continue leading
Speaker 6: markets for years to come.
Speaker 2: You've actually got a lodge cap etf that is, excluding
Speaker 2: magnificent seven, how is that performed of late and how
Speaker 2: many people are wanting to put money into it?
Speaker 6: So interestingly enough, we've actually seen an increase in flows
Speaker 6: into that ETF. And you know, it may sound like
Speaker 6: a contradiction what I just said, it absolutely isn't. I
Speaker 6: think that the average investor has exposure to MAG seven everywhere, right,
Speaker 6: whether it's in ETFs or they hold the single name stocks.
Speaker 6: And so when you're when the market pulls back and
Speaker 6: you're looking to diversify it and broaden your exposure, we
Speaker 6: take out those names because we're saying, hey, you already
Speaker 6: have them, hang on to them, but participate in the
Speaker 6: in the in the breath and the broadening of the
Speaker 6: rallies in the years to come. And so you know,
Speaker 6: very much like an equal which strategy x MAC excludes
Speaker 6: the max haven't. But but what's you know we think
Speaker 6: very favorable about that is you're still letting the winners win, right,
Speaker 6: so you still have market.
Speaker 2: Caps rallying in that fund.
Speaker 6: And can you know do well over time.
Speaker 2: You really have created a lot of ETFs that have
Speaker 2: been galvanized by this whole broadening out of the Trade
Speaker 2: AI and Power Infrastructure ETF. For example, But I'm also
Speaker 2: interested in the quantum side of things because there's an
Speaker 2: interesting story. Key Nobel Laureate, winner of the Physics Prize,
Speaker 2: has just been talking about how China looks like it's
Speaker 2: really pulling ahead just a nanosecond behind the US in
Speaker 2: terms of quantum compute scale and indeed innovation. How much
Speaker 2: have people be wanting to get into the quantum side
Speaker 2: of the equation?
Speaker 6: Well, I think, you know, what you just mentioned will
Speaker 6: be a big reason, and we'll put a lot of
Speaker 6: focus on the quantum names again for investors, because of
Speaker 6: what happens when we think that, you know, other governments
Speaker 6: are beating us in AI or technology or things like this.
Speaker 6: The US government tends to invest right, and American corporations
Speaker 6: tend to invest and catch up and try to win
Speaker 6: the race, right. So I think that just you know,
Speaker 6: on a basic level, you've seen some good news around quantum,
Speaker 6: whether it's been HSBC, the advanced bond pricing models that
Speaker 6: have come out of it. You know, you've seen some
Speaker 6: good results around and kneeling from d Wave. You know,
Speaker 6: some of the top quantum companies have done quite well
Speaker 6: for investors. But I think you know, as this continues
Speaker 6: and it becomes more commercial, you will see flows coming
Speaker 6: into the space, and we think it's a longer term
Speaker 6: hole for investors.
Speaker 2: What hasn't been a longer term held just in recent
Speaker 2: days has been micro strategy. You have a lot of
Speaker 2: ETFs giving either you long exposure to micro micro strategy
Speaker 2: now called strategy or indeed leverage positioning for it, but
Speaker 2: also to go short as well. So you're kind of
Speaker 2: offering both sides of the pile here. What do you
Speaker 2: make of the fact that maybe Michael Sailor isn't a
Speaker 2: complete hoddler for the longer term, that maybe at some
Speaker 2: point they might have to sell bitcoin.
Speaker 6: Yeah, I mean I think that that's you know, that's
Speaker 6: a business decision for their firm in terms of how
Speaker 6: best to to you know, generate ROI and and be
Speaker 6: profitable over time. But you know what you just mentioned,
Speaker 6: it is true. We have long funds, we have short funds,
Speaker 6: and for us, we're just trying to democratize hedge fund
Speaker 6: like products for investors that you know, are tactical and
Speaker 6: knowledgeable about these markets and look for short term exposure opportunities.
Speaker 6: So those products are simply there. We don't necessarily have
Speaker 6: an opinion on you know, their view of that. We
Speaker 6: want to give them the right tool to do that.
Speaker 6: But I think you know, if Bitcoin rallies, you'll see
Speaker 6: strategy do well. If it doesn't, you'll see it go
Speaker 6: the other way, and perhaps the flows we'll also match
Speaker 6: in terms of long and short leverage funds.
Speaker 2: Slovia jabonskiin talking about what has been quite the volatile
Speaker 2: trade for certain retail of late Defiance ETF CEO CIO,
Speaker 2: it's always great to catch up with you. Coming up,
Speaker 2: we're going to hear from AWS CEO mcgarmond at his
Speaker 2: take on the AI power demand, the race with Nvidia
Speaker 2: so much more of course trainium three. This will be
Speaker 2: a big tech.
Speaker 7: The desire and the hunger out there for more power
Speaker 7: and more compute is almost insatiable. And so the more
Speaker 7: we can take an existing power footprint, an existing set
Speaker 7: of capabilities and bring more and more compute into that
Speaker 7: for customers to build cool applications and cool environments and
Speaker 7: to get value from that, that's we're focused on.
Speaker 8: Then.
Speaker 7: So we're going to be pushing that envelope as fast
Speaker 7: as we as we possibly can to get those new
Speaker 7: and new capabilities out to customers.
Speaker 9: The pitch for Trainium in both the training and infants
Speaker 9: use case is that it's a great deal, you know,
Speaker 9: cost effective performance. At the same time, you went on
Speaker 9: stage and said AWS is quote by far the best
Speaker 9: place to run in video GPUs. How are both if possible?
Speaker 7: Well, I mean that both both are possible because that
Speaker 7: is a great environment to run accelerators and compute in.
Speaker 7: And so we've been working for fifteen plus years with
Speaker 7: the in Nvidia team and Jensen and team to deliver
Speaker 7: outstanding capabilities for our customers. And for when you're running
Speaker 7: a large cluster of Nvidia GPUs, people will tell you
Speaker 7: AWS is the best place you get the best performance,
Speaker 7: the most stable cluster, the best capabilities out there and
Speaker 7: broad scale. And so why folks like OPENINGI and others
Speaker 7: are running in AWS and we have that choice. And
Speaker 7: so for others that want to be able to take
Speaker 7: advantage of Trainium. And there's some uses cases that are
Speaker 7: best for TRAININGUM, there's other use cases where in video
Speaker 7: GPUs are going to be your best option. We want
Speaker 7: to have all of those available and so we think
Speaker 7: that if we can continue to push the envelope on
Speaker 7: what TRAINUM can deliver for customers and make sure that
Speaker 7: we are supporting the latest and greatest from everything that
Speaker 7: the awesome team in Nvidia is delivering. That's going to
Speaker 7: be the best outcome for our customers.
Speaker 9: The plan for AWS is to basically double capacity by
Speaker 9: end of twenty twenty seven to round eight gigawatts, so
Speaker 9: you have a sense of how you apportion that capacity
Speaker 9: in how Silicon and serve a design to Trainium versus
Speaker 9: and video GP is.
Speaker 7: We're just going to keep pushing as fast as we
Speaker 7: can and we'll see where customer demands drives us as
Speaker 7: we go. And as you said, we're massively adding capacity.
Speaker 7: In the last year alone, we've added three point eight
Speaker 7: gigawatts of capacity, and we'll continue to add more and
Speaker 7: more as over the next couple of years, and we'll
Speaker 7: let customer demands drive us a little bit on what
Speaker 7: they're looking for and what they want, and that's what
Speaker 7: we always listen to and that's what we'll continue.
Speaker 2: To listen to.
Speaker 9: The focus with Trainium in the time i've been able
Speaker 9: to interact with you and talk about again not just
Speaker 9: the accelerator, but at the server design level, there's a
Speaker 9: lot of benefits the customer. When does that benefit start
Speaker 9: accrueing to AWS in terms of profitability, Like, if it's
Speaker 9: such a good financial proposition, you must be able soon
Speaker 9: to say we're making a lot of money on this.
Speaker 5: Yeah.
Speaker 7: Well, you're already seeing some of the benefits of crew
Speaker 7: You see things like bedrock growing really really rapidly, and
Speaker 7: you see training empowering that under the covers. And we
Speaker 7: announced today that more than half of all tokens and
Speaker 7: inference done in bedrock are done on TRAININGUM two servers
Speaker 7: under the covers, And so you're already seeing that benefit come.
Speaker 7: You see the models that we're building and Nova and
Speaker 7: Nova too start to get better and better over time
Speaker 7: and be accelerated by Trainum. And so we really think
Speaker 7: that there's a whole bunch of dimensions on which both
Speaker 7: our customers, our partners, and our own products are going
Speaker 7: to get accelerated all from TRAINUM.
Speaker 9: Every time you come onto the program, I always offer
Speaker 9: the audience opportunity to pose a question to you. There's
Speaker 9: a lot of interests in AWS, right, many of your
Speaker 9: customers span global technology. Actually most of the questions were
Speaker 9: about anthropic That wasn't much said on stage. I think
Speaker 9: people are trying to understand what is the benefit and
Speaker 9: advantage AWS office tanthropic while they are ramping trainum through
Speaker 9: Project Raineer, but also ramping their TPU allocations as well.
Speaker 7: Well, Look, our partners are an anthropic. Our partnership with
Speaker 7: them is incredibly strong and it's never been stronger, and
Speaker 7: we do a ton of collaboration with them, and as
Speaker 7: I mentioned through Project rain here, it's a huge collaboration
Speaker 7: there to go build their current generation models and all
Speaker 7: their models run today and launch on day one on
Speaker 7: top of Trainium and on top of AWS.
Speaker 2: AWS CEO Matt Garman along with their own ed Ludlow.
Speaker 2: Let's discuss this growing AI chip race and the big
Speaker 2: tech names. Who's when, who's losing? Joan Feeney is the
Speaker 2: perfect person to ask partner and portfolio manager over it
Speaker 2: advises capital management. So did Amazon manage to solidify its
Speaker 2: prowess when it comes to vertical integration, cloud and ship.
Speaker 10: Offering, Well, they seem to be doing a really excellent
Speaker 10: job of that. And what's interesting about what Match has
Speaker 10: said is they're going to let customer demand drive you know,
Speaker 10: how they build out these different capabilities for AI applications,
Speaker 10: which tells us that they are going to be different
Speaker 10: models purposed to different types of workloads. So everybody's thinking, oh,
Speaker 10: and Vidia is the market dominant player right now. They
Speaker 10: have massive market share, and they're treating it like it's
Speaker 10: one sort of big thing that's homogeneous. And I think
Speaker 10: what people are going to realize over time is that
Speaker 10: they're going to be different types of models for different workloads,
Speaker 10: and different chips will be useful for developing such different
Speaker 10: models and for running those models, for doing the inference.
Speaker 10: So I think there's a lot of room for different
Speaker 10: chip players here, and we should expect more of the
Speaker 10: in house chips like what Amazon does in collaboration with Marvel,
Speaker 10: or what Google does in collaboration with Broadcom, to continue
Speaker 10: to rise in prominence, as we've been seeing in the
Speaker 10: recent news coverage.
Speaker 2: I mean, yeah, let's talk about Marvel out with earnings
Speaker 2: out with also a key purchase of Celestial AI. That's
Speaker 2: all about lasers, and we can talk in lasers a
Speaker 2: little bit more. But are we seeing a six really
Speaker 2: starting to put a concern towards in video? Should they
Speaker 2: be threatened by this custom built model?
Speaker 10: Well, no company likes any kind of competition right, So
Speaker 10: I'm sure in video would just be happier if they
Speaker 10: didn't exist.
Speaker 5: But clearly, look, ASEX are very powerful.
Speaker 10: That stands for applications specific integrated circuit right, So these
Speaker 10: I believe these kind of xbus er TPUs are going
Speaker 10: to be designed and going to be put to use
Speaker 10: for the type of applications in AI for which they're
Speaker 10: best designed. So it's clearly the case that in Vidia
Speaker 10: is going to lose share over time in the big
Speaker 10: world of AI compute. But nobody should be surprised by
Speaker 10: set by that, and the pie is still growing so
Speaker 10: massively they can't meet demand. They're not unlikely to be
Speaker 10: able to meet demand for some years to come, and
Speaker 10: so there's a lot of room for a sick approaches
Speaker 10: to play roles in various types of models.
Speaker 5: So we should expect that.
Speaker 2: Before we talk more lasers, I want to go back
Speaker 2: to where we sort of started, the fact that you're
Speaker 2: getting specific chips for specific applications but also specific models.
Speaker 2: And I think there's some threat in the market today
Speaker 2: around Microsoft's are the part of the flywheel, because everyone
Speaker 2: thinks Microsoft got very strong cloud offering, and clearly we've
Speaker 2: seen as you not be able to fill demand with
Speaker 2: its supply. We're now we're just basically about the applications,
Speaker 2: about companies being willing to pay more for these AI
Speaker 2: agents and actually the use of AI. What are you
Speaker 2: hearing in the market. How much does that impact your
Speaker 2: sector of chips?
Speaker 10: There is a lot of sporadic i should say, information
Speaker 10: about how much AI agents and AI is being used
Speaker 10: in different settings. So, right, there was a story today
Speaker 10: about how Microsoft has reduced its sales targets for getting
Speaker 10: AI agents you know, to be adopted by their customers,
Speaker 10: and so that as people concerned, you know, Salesforce similarly
Speaker 10: is trying to roll out right their AI agent capabilities
Speaker 10: and some people are wondering whether that's going to happen.
Speaker 10: But there are so many other applications in addition to
Speaker 10: those kind of smart helper AI agents, and I think
Speaker 10: the earlier in the week announcement with Nvidia in synopsis
Speaker 10: is a good example of that. Right, the industrial uses,
Speaker 10: whether it's these digital twins basically being able to model
Speaker 10: out a whole factory or a whole building, or you know,
Speaker 10: any other physical presence in simulation. You need this kind
Speaker 10: of computational power. You need AI and so that kind
Speaker 10: of collaboration I think really points to lots of other
Speaker 10: applications for AI, and then you go to biotech and
Speaker 10: pharma and.
Speaker 5: Computation.
Speaker 10: We've just been held back for so many years by
Speaker 10: its limitations from the CPU side, and now that we
Speaker 10: have these GPU based accelerators and innovations in fabric like
Speaker 10: what Celestial is bringing to Marvel and what Broadcom already does,
Speaker 10: is speeding up all of these computations, making farmer applications
Speaker 10: possible across all industries.
Speaker 2: And some would say limitations have been in the fabrication
Speaker 2: in the United States energy just making sure that we've
Speaker 2: got more solid and trustworthy supply chains. I think about
Speaker 2: just the news also earlier this week one hundred and
Speaker 2: fifty million dollar steak in a chip startup by Pat Gelsinger.
Speaker 2: Of course we all know him from Intel, but the
Speaker 2: US is making that investment in x light a startup. Johanne,
Speaker 2: you have some real insight as to how this technology
Speaker 2: is being put forward. It's all about lithography taking on ASML.
Speaker 5: Yeah.
Speaker 10: So x light is developing a new laser technology and
Speaker 10: that is a fundamental ingredient to doing lithography right. ASML
Speaker 10: being the leader in extreme ultravilethography, which depends on these
Speaker 10: very high end lasers. So x Light's taking a different
Speaker 10: approach to laser development. And what's interesting is and also
Speaker 10: reminds me of my past, is that this one hundred
Speaker 10: and fifty million dollar investment by the federal government by
Speaker 10: the Chips and Science Act, the work is going to
Speaker 10: be done at a place called Albing Nanotech, which is
Speaker 10: where I got my start in the semiconductor industry, you know,
Speaker 10: twenty plus years ago. And it's a location for collaborative
Speaker 10: R and D for development of new manufacturing techniques, development
Speaker 10: of new materials, development of new recipes for designing and
Speaker 10: building chips. And it's all the major players in the
Speaker 10: industry are there, and it's pre competitive, and so for
Speaker 10: x Light and Pat Gelsinger to be doing it there
Speaker 10: with the support of the federal government sort of enhances
Speaker 10: this model of get some public support for a technology
Speaker 10: that can be spread and help the industry broadly speaking,
Speaker 10: and does go towards this effort to enable more chip
Speaker 10: equipment design and manufacturing to eventually occur.
Speaker 5: In the United States. It's going to take a long time.
Speaker 10: These programs, as I was involved with back in the
Speaker 10: early two thousands. They take many years, but it's a
Speaker 10: great way for the US to subsidize a general technology
Speaker 10: which could ultimately help US position and equipment manufacturing and.
Speaker 2: The state of New York. I'm sure music to its
Speaker 2: is to Joanne Feeni of Advices Capital Management. Thanks so
Speaker 2: much time now for talking tech. First up, Uber launching
Speaker 2: autonomous trips with ad Ride in Dallas, marking the latest
Speaker 2: US city where the right hailing giant is offering such
Speaker 2: a service. Uber's global head of Autonomous and Mobility and
Speaker 2: Delivery sat down with our colleagues at Wall Street Week.
Speaker 11: It's an exciting time to be in the autonomous space
Speaker 11: because we're really graduating from a technical problem that first
Speaker 11: started as a science project to something that now is
Speaker 11: increasingly being solved and can be commercialized and be offered
Speaker 11: to more and more people who are using Uber.
Speaker 6: All around the world.
Speaker 2: And Dell CEO Michael Dell says he sees the AI
Speaker 2: build out as not stopping anytime soon, with more demand
Speaker 2: than supply at the moment. He weighed in after, of course,
Speaker 2: announcing that six week two five billion dollar gift to
Speaker 2: fund accounts for twenty five million American children ten an under.
Speaker 5: Long term, we think.
Speaker 12: Investing these accounts in the s and.
Speaker 4: P five hundred is a very.
Speaker 12: Good way to compound over time for these children. When
Speaker 12: I look at what's going on today in the ignormous
Speaker 12: buildout in AI, what I see is a lot more demand.
Speaker 2: We'llcome back to bo BEG tech. Let's check in on
Speaker 2: these markets because there's a volatile training date. We're on
Speaker 2: a macro data to digest services look stronger, But BOYD
Speaker 2: does that private payrolls and I'm from ADB look pretty
Speaker 2: woeful worse Since the beginning of twenty twenty three, we're
Speaker 2: off by tenth of a percent. The idea of FED
Speaker 2: cuts not managing to outweigh some of the anxiety around
Speaker 2: the AI trade today. Key names in the red like
Speaker 2: Microsoft as we worry about productivity gains and some of
Speaker 2: its provisions. But move on to some of the earnings
Speaker 2: that we've got. CrowdStrike just about six tenths of percent.
Speaker 2: They actually raise fiscal twenty twenty six guidance. They're citing
Speaker 2: resiliency and demand for their AI enabled cybersecurity products. But
Speaker 2: this is a stop that's up about fifty percent this year,
Speaker 2: maybe the expectations to run ahead of it and we
Speaker 2: just take a little bit of money off the table.
Speaker 2: Marvel up more than four percent, even as it's splashing
Speaker 2: the cash on a new acquisition that we're going to
Speaker 2: dive into in the world of lasers. But I'm talking
Speaker 2: about also marvel earnings did beat expectations, and we're more
Speaker 2: broadly seeing the adoption of its technology and a custom
Speaker 2: chips being built across the AI infrastructure sphere. Let's get
Speaker 2: to Dina Bass, who covers all things AI infrastructure. Marvel,
Speaker 2: I mean, only an eighty billion dollar company, not nearly
Speaker 2: as large as Nvidia, but it is starting to show
Speaker 2: how it's building out in AI.
Speaker 13: Sure, we've been talking about in Vidia a lot, and
Speaker 13: last week we were talking a lot about the Google TPU.
Speaker 13: The TPU is one of these kind of custom chips.
Speaker 13: It's not one that Marvell does, it's one that Google
Speaker 13: works with. Marvell's a main competitor, Broadcom. On Broadcoms had
Speaker 13: a lot of significant wins lately, and.
Speaker 14: So investors have been anxiously waiting a slash worry to
Speaker 14: see whether Marvel could post similar, similar interesting contracts, and
Speaker 14: yesterday Marvell's ce you know, Matt Murphy, gave a very
Speaker 14: bullish forecast for the fourth quarter in that business indicated
Speaker 14: a new customer wins.
Speaker 15: That included what he called, quote an emerging hyperscaler. We
Speaker 15: don't know who that is, but that kind of got
Speaker 15: people excited. And maybe Marvella is also benefiting from this
Speaker 15: interest in companies making their own shift designs for AI,
Speaker 15: not just using the in video ones, even though in
Speaker 15: most cases those companies also use a significant amount of Nvidia.
Speaker 2: I mean, it needed a bit of optimism, right The
Speaker 2: stock is down twelve percent year today, even with today's gains.
Speaker 2: There's also optimism that maybe they're making bolt on acquisitions
Speaker 2: Celestial AI. Why are they going into photonics.
Speaker 16: It's basically a new technology which you know, it uses
Speaker 16: light to move data more rapidly. Now, this is a
Speaker 16: technology that's been in the works for a little while
Speaker 16: and seems to always be kind of on the cosp
Speaker 16: of really you know, taking off. So we'll have to
Speaker 16: see there are other startups in this area as well,
Speaker 16: like light Matter. We'll have to see if there is
Speaker 16: significant uptake of this type of technology. But the idea
Speaker 16: is that you can use light to move data more
Speaker 16: quickly through chips and networking. And that's you know, one
Speaker 16: of the major bottlenecks and AI chips at this point
Speaker 16: is you know, stringing them together, the networking that connect
Speaker 16: some the memory and how you move everything rapidly through
Speaker 16: those different bets.
Speaker 2: Dina Bass across this AI infrastructure build out, Thank you
Speaker 2: very much. Indeed, let's now those stick with earnings more broadly,
Speaker 2: we're going to the software sector. We're going to Octa shares.
Speaker 2: You see, been quite a volatile ride today. We're now
Speaker 2: up three point three percent. The company reported earnings and
Speaker 2: boosted their forecasts. We saw twenty percent growth when you're
Speaker 2: looking more badly at earnings, just seeing twelve percent growth
Speaker 2: in revenue. Oct CEO Tom McKinnon joins us now and
Speaker 2: it looks to go on for the market to digest
Speaker 2: what they were seeing here Todd. Now they seem to
Speaker 2: be optimistic. What did you feel you delivered in terms
Speaker 2: of software and not getting eaten up by big AI offerings.
Speaker 5: Well, the business is doing great.
Speaker 17: We had a solid I think what the market is
Speaker 17: digesting is this massive opportunity ahead of us to secure
Speaker 17: AI and what everyone's realizing is that to secure AI,
Speaker 17: you have to secure identity. All these companies are trying
Speaker 17: to roll out AI agents and to make these agents useful,
Speaker 17: they have to be connected to all of a company's data.
Speaker 17: It's not connected to a company's data, and the agent
Speaker 17: can't work on that data. It's no better than a
Speaker 17: consumer chat GPT or Gemini. And we can help companies
Speaker 17: connect their agents to data in a secure and manageable
Speaker 17: way so they can get a great agentic experience for
Speaker 17: their customers and employees and keep it all secure.
Speaker 2: Reflect then on actually the adoption of this agenta KI,
Speaker 2: because we've got questions in the market abound about whether
Speaker 2: Microsoft's having to really be able to scale in the
Speaker 2: way that it thought it could in the adoption of agendaki.
Speaker 2: What are you seeing? Are people jumping on it?
Speaker 17: Well, the inbound interest we have for these new products
Speaker 17: Octa for AI agents is something like I've never seen
Speaker 17: in my history at Octa, and so everyone is very interesting,
Speaker 17: but they're all stuck. They're stuck because they're realizing they
Speaker 17: have to connect it to their company's data and that's challenging.
Speaker 5: They have two choices.
Speaker 17: They can put it all in a data warehouse right
Speaker 17: in the middle and give the agent's access to everything,
Speaker 17: which is problematic because they don't know what the agents
Speaker 17: are going to do with it. Or they can just
Speaker 17: have a very vanilla, water down experience where it looks
Speaker 17: just like the consumer chat GPTD you would use at home.
Speaker 5: So we offer a better choice.
Speaker 17: We can connect it to that data in a secure
Speaker 17: way that lets them govern and manage it.
Speaker 5: And that's why the interest is so high.
Speaker 17: So this is having a big unlock and that's what
Speaker 17: I think everyone is starting to realize.
Speaker 2: There are a few identity management cut offerings out there.
Speaker 2: How do you compete against the Palo Alto networks, against
Speaker 2: Microsoft itself and wants to offer it and offer you
Speaker 2: the agentic KI as well.
Speaker 5: Yeah, the way I.
Speaker 17: Like to explain it is these companies have to choose
Speaker 17: the right platforms and systems to build out this AI future.
Speaker 17: And imagine, like an analogy I use is imagine if
Speaker 17: you had to choose one streaming service, you had to
Speaker 17: pick one, you had to pick either Prime Video or Netflix,
Speaker 17: and then that's only when you could watch. That's what
Speaker 17: some of these big platforms are saying. They're saying all
Speaker 17: use everything from us. It's like, just you can only
Speaker 17: use Netflix, and you better hope all your shows are
Speaker 17: on Netflix. What we're saying is you can choose whatever
Speaker 17: AI technology you want. Get some You can get a
Speaker 17: model from Google, you can get infrastructure from Amazon, you
Speaker 17: can get application data from Salesforce, and we'll make it
Speaker 17: all work together. You can choose any show you want
Speaker 17: to watch, so to speak. So we don't lock people in.
Speaker 17: We give them a choice across all of the different platforms.
Speaker 17: And that's very important in this innovation because these things
Speaker 17: are changing.
Speaker 5: Every week.
Speaker 17: Google comes out of a brand new model. Open Ad
Speaker 17: is going to have a new model, and customers want
Speaker 17: choice and we give that to them.
Speaker 2: Ton it's interesting that you're saying you're seeing interest like
Speaker 2: you've never seen before. And since you're time in Octa,
Speaker 2: why then is the market still thinking then, actually, your
Speaker 2: revenue growth is kind of going to flatline, be sub
Speaker 2: ten percent growth. Can you see something different?
Speaker 18: Well?
Speaker 5: I think we see two things.
Speaker 17: We see a very solid business that is profitable and
Speaker 17: growing at a nice clip, and then we see this
Speaker 17: massive upside. I think the market is trying to understand
Speaker 17: how quick it materializes, you know, how.
Speaker 5: Big it can be.
Speaker 17: When we're very excited, we think it could be bigger
Speaker 17: than our core business. The opportunity to secure AI could
Speaker 17: be bigger than anything we've ever done. But it's just
Speaker 17: a matter of making that real and doing the hard
Speaker 17: work with the customers to bring it to fruition.
Speaker 2: When we're hearing about how companies are actually adopting more borning,
Speaker 2: what are you seeing most Are you seeing consultants coming in?
Speaker 2: Are you seeing companies trying to build within in and
Speaker 2: of themselves organically? Are you seeing the likes of the
Speaker 2: sellers of these generative air offerings, the open AIS or
Speaker 2: indeed the Microsoft's going in and almost consulting for them.
Speaker 2: How are we better to streamline? As you say, we're stuck?
Speaker 2: How do we unstick?
Speaker 5: I think, I mean, I think it's all of the above.
Speaker 17: We're seeing starting a lot of interest in the gentic
Speaker 17: solutions that.
Speaker 5: The SaaS providers have rolled out.
Speaker 17: Again, those are powerful, but they're they're limited in the
Speaker 17: sense they're constrained to one application or one service. We're
Speaker 17: seeing a lot of companies start to build their own
Speaker 17: where they're using tools and capabilities to connect the multiple
Speaker 17: databases and warehouses across different SaaS applications. We're what we're
Speaker 17: seeing organic internal development. We're seeing consultants, everyone's trying to
Speaker 17: help them do this, and I think some of these
Speaker 17: key unlocks like security and identity and context and the
Speaker 17: right access permissions are going to help move this thing
Speaker 17: along in a way that's very, very powerful, powerful for
Speaker 17: everyone because this technology is real and it's quite profound,
Speaker 17: and it can make employees more productive. It can help
Speaker 17: companies grow into new industries and new markets. It's going
Speaker 17: to be a big boon for established companies for new companies.
Speaker 5: It's very exciting.
Speaker 2: Tom McKinnon, oup to CEO, it's been great having you
Speaker 2: on the back of your earnings today. Thank you very much. Now,
Speaker 2: let's talk about open AI right now. Because it's nonprofit.
Speaker 2: Foundation will award over forty million dollars in grants this
Speaker 2: year to US nonprofits now. The organizations support AI literacy,
Speaker 2: community innovation, economic opportunity. It's the foundation's first major action
Speaker 2: since open AI is restructuring. Coming up, how news you
Speaker 2: creators are turning to AI slot into content for kids.
Speaker 2: More on that. Next, this is Boomberg Tech, Warner Brothers Discovery.
Speaker 2: Of course, it's still receiving new rounds of bids, including
Speaker 2: we talked about yesterday. Nearly all cash off are coming
Speaker 2: from Netflix.
Speaker 18: Now.
Speaker 2: Comcast is reportedly looking to expand its entertainment empire, with
Speaker 2: hopes emerging its NBC Universal division with Warner Brothers in
Speaker 2: a cash and stock deal. It's according to sources. Let's
Speaker 2: get home to Blombergs Michelle Davis, who's been covering this
Speaker 2: M and A story across media. So what's new here
Speaker 2: from the side of Comcast.
Speaker 18: So what's new is the big surprise is it sounds
Speaker 18: like Comcast has offered Warner Brothers.
Speaker 2: Is David Zaslav, the CEO.
Speaker 18: A management position and the potentially new combined company that's
Speaker 18: gonna be really big because it'll it'll be appealing to
Speaker 18: David Zaslav if he, you know, as CEO of Warner
Speaker 18: Brothers doesn't want to relinquish that sort of control right now.
Speaker 2: The other information we.
Speaker 18: Have is that Comcast has offered cash and stock for
Speaker 18: a combination, and they're proposing to combine their NBC Universal
Speaker 18: division with Warner Brothers' streaming and studio division.
Speaker 2: And that's something analysts.
Speaker 18: Actually like because they see it as a way to
Speaker 18: potentially unlock some value for Comcast. You'll see Comcast stock
Speaker 18: was trading up on this news, as was Warner Brothers.
Speaker 18: I think our Comcast is still up today, and it
Speaker 18: seems like, you know, this deal situation is really heating up.
Speaker 18: It sounds like while the different offers that are on
Speaker 18: the table are not easily comparable, they are all compelling
Speaker 18: in their own reasons.
Speaker 2: I mean, it's interesting that Comcast is doing something originally
Speaker 2: similar to Warner Brothers Discovery, which is spinning off the
Speaker 2: cable pop so that would still be distributed. This is
Speaker 2: all still for them about the movie, the library, the streaming,
Speaker 2: and that's still something that's interesting to Netflix, even though
Speaker 2: we see it shares like hitting significant lows on the
Speaker 2: back and forth with this.
Speaker 18: Yeah, so Comcast and Netflix both have made offers just
Speaker 18: for the streaming and studios portion of Warner Brothers, which
Speaker 18: is seen as kind of the crown jewel. Warner Brothers
Speaker 18: or Paramount is still the only one making a play
Speaker 18: for the whole company. But you know, if you are
Speaker 18: the board right now, you have to think about whether
Speaker 18: a combination with Netflix or Comcast, while potentially lower in
Speaker 18: value than a full cash offer from paramount for the
Speaker 18: whole company. You have to consider whether that would provide
Speaker 18: future value that would exceed whatever cash you would get
Speaker 18: today from you know, selling, the entire company is.
Speaker 2: Going to keep on folding. You'll be across at bloombergs
Speaker 2: Michelle Davis, thank you very much. Indeed, let's talk about
Speaker 2: content in a different way now, because AI generated videos
Speaker 2: getting easier to make, and some YouTube creators are leaning
Speaker 2: into low effort, low quality videos that churn out. What
Speaker 2: critics school AI slot is aimed at a growing viewer base.
Speaker 2: It's children. Bloomberg social media reporter and it Sorvine joins
Speaker 2: us now, and you were kind of taken aback by
Speaker 2: the amount of AI created kind of addictive, short form
Speaker 2: videos that are getting out there on to YouTube kids.
Speaker 19: Well before I was even taken aback by the AI content,
Speaker 19: I was taken aback by the fact that there are
Speaker 19: so many babies on YouTube tube and YouTube Kids in.
Speaker 2: The first places that stop.
Speaker 19: So we know that kids are loving YouTube. They have
Speaker 19: been for a very long time, so much so that
Speaker 19: YouTube created YouTube Kids a decade ago to help create
Speaker 19: a safer space for this audience. However, YouTube will be
Speaker 19: the first to say that YouTube kids is not created
Speaker 19: for babies under the age of two. It is recommended
Speaker 19: really for kids ages two to twelve. But new Pew
Speaker 19: data has shown that babies and infants are actually flocking
Speaker 19: to YouTube in droves, and that is of course a
Speaker 19: fact not lost on content creators who see in this
Speaker 19: audience an incredibly valuable opportunity to make content.
Speaker 2: Their brain is still developing. That's the argument as to
Speaker 2: why perhaps it should be limited to an extent. But look,
Speaker 2: your heart goes out to families who almost need another
Speaker 2: parent in the house when they're trying to juggle different jobs.
Speaker 2: I can understand how it ends up entering your lifestyle,
Speaker 2: But then what is entering the kids' heads at the moment.
Speaker 2: How much of it is being created by AI video generation.
Speaker 19: It's hard to quantify exactly how much of this is
Speaker 19: high quality content and how much of it is purely
Speaker 19: AI generated, But and speaking two experts for the story,
Speaker 19: it is clear that a lot of what you see
Speaker 19: on YouTube kids is promoting itself as being educational. Titles
Speaker 19: that say that they're educational, things like learning to talk
Speaker 19: or how to say You're ABC's, and you certainly get
Speaker 19: some good quality stuff. You've got the really popular children's
Speaker 19: channels like Coco Melan, you've got creators like Miss Rachel,
Speaker 19: but mixed in with results from those sort of vetted,
Speaker 19: reputable places, you've got much more obscure videos that are
Speaker 19: from sources that you can't really figure out where quite
Speaker 19: where they're from.
Speaker 2: And there lies part of the issue for YouTube that
Speaker 2: YouTube Kids is meant to be safe. It's so safe
Speaker 2: and fat that over in Australia, even they're banning YouTube
Speaker 2: and other social media for kids under sixteen, they're not
Speaker 2: banning YouTube Kids. Is that an interesting fat for you?
Speaker 2: And how much YouTube Kids are going to have to
Speaker 2: start limiting exposure to the so called slop and when
Speaker 2: you want to type in miss Rachel you get miss Rachel.
Speaker 19: Well, I think it is really interesting that in Australia
Speaker 19: YouTube Kids is one of the few social media platforms
Speaker 19: that is that is basically being spared in this band
Speaker 19: for under sixteen. YouTube Kids may have a lot of
Speaker 19: content that is safe, but I think it begs the
Speaker 19: question of how much should kids be watching it in
Speaker 19: the first place, and how short is too short. Some
Speaker 19: of the experts we spoke to are concerned that some
Speaker 19: of the shorter content can affect children's attention spans, and
Speaker 19: how long is too long. Some of the content that
Speaker 19: I was finding on YouTube Kids was four hours long,
Speaker 19: and that is obviously far, far longer than is recommended
Speaker 19: by experts. So I think the question is how YouTube
Speaker 19: Kids balances that one of these are questions that they
Speaker 19: address and sort of what they communicate to parents to
Speaker 19: help parents feel more comfortable that the content that is
Speaker 19: up there is actually vetted and not just simply chosen
Speaker 19: by AI as something that could be appropriate for kids.
Speaker 2: You and I parents young children. How many parents are
Speaker 2: worried about this?
Speaker 19: So you spoke to parents are very conflicted about this.
Speaker 19: They're extremely worried. But at the same time, parents I
Speaker 19: spoke to for the story said that they need YouTube.
Speaker 19: One parent I spoke to described it as a third
Speaker 19: parent sometimes when she just needs a break. Another father
Speaker 19: told me how this is a really big internal struggle
Speaker 19: because sometimes he just needs the kids to lock into
Speaker 19: YouTube so he can deliver on other parts of being
Speaker 19: a dad. At the same time, I think that there
Speaker 19: were parents, their parents that I heard from, who described
Speaker 19: wanting to get rid of YouTube Kids altogether because they
Speaker 19: said that more than any other platform that their kids
Speaker 19: are using or appy. They when they're told to turn
Speaker 19: off YouTube kids, they actually can't turn it off.
Speaker 2: And they end up in a bad mood. Quite often,
Speaker 2: I find off if they've ever consumed anything on the screen.
Speaker 2: We appreciate this deep dive is a great read. Alex
Speaker 2: Levine on her latest on YouTube kids, TikTok. When I
Speaker 2: invest more than thirty seven billion dollars to build a
Speaker 2: data center in Brazil, so the first project in Latin America.
Speaker 2: The data center will be developed near the industrial port
Speaker 2: of the same and will fully rely on clean energy
Speaker 2: from wind energy parks, whom Marg's Peter Millard joins us
Speaker 2: and you cover energy out of Rio. Why is Brazil
Speaker 2: so well placed for this day to send to build out.
Speaker 4: Brazil?
Speaker 20: It's Latin America's largest economy, and it's also a renewable
Speaker 20: energy powerhouse. Most of the energy comes from hydroelectric plants.
Speaker 20: There's also been a rapid advance in wind energy and
Speaker 20: most recently with solar energy, and so data centers they
Speaker 20: want to have, they're basically looking for clean energy when
Speaker 20: they build out these data centers. I know there are
Speaker 20: some that are relying on natural gas, but ideally they
Speaker 20: want renewable energy, and Brazil has it. It also has
Speaker 20: a completely interconnected electricity grid, unlike the US, where you
Speaker 20: have kind of certain where it's kind of split up geographically.
Speaker 5: And so that helps.
Speaker 20: You can have a renewable energy project far away from
Speaker 20: where the data center actually is, and then they can
Speaker 20: have a purchase agreement where they are and the electricity
Speaker 20: goes into the grid and then the data center would
Speaker 20: consume it.
Speaker 2: So the data center developer involved is omnia. You've got
Speaker 2: Casidol's mentors, who's helping with the energy supply. Peter, How
Speaker 2: big is this because in the US we've almost become
Speaker 2: a bit numb to thirty seven billion dollars here, another
Speaker 2: trillion there. But this must be pretty seismic in terms
Speaker 2: of scale.
Speaker 5: Yes, that's right.
Speaker 20: When they talk about the first phase, they're talking about
Speaker 20: three hundred megawatts. But at Pierson, the officials I've spoken
Speaker 20: to have said that it could reach up the three gigawatts,
Speaker 20: which is I mean, they would take about a decade
Speaker 20: to get there, but that's half of what you currently
Speaker 20: have in Virginia. So in terms of scale, it could be.
Speaker 2: Huge, And of course we'll be thinking a lot about
Speaker 2: the relationship that Brazil has with China, and therefore Bite
Speaker 2: Dance TikTok's parent from the Moost Peter Millard. It's a
Speaker 2: great story. Thanks for bringing it to us. Meanwhile, let's
Speaker 2: talk about Salesforce shares at a historic cheap valuation, as
Speaker 2: this concerns well that its growth prospects could be eroded.
Speaker 2: II the company releases its third quarter earnings later today,
Speaker 2: what can we expect. Arag Rana joins us from Blombag Intelligence,
Speaker 2: and there is this anxiety that even though they can
Speaker 2: talk about agent Force until they're blue in the face,
Speaker 2: it's not actually giving much bearing on revenue.
Speaker 8: Yeah, there are two elements of it, and you know,
Speaker 8: one of the most important part is the size of
Speaker 8: the company. It's a it's a very large software company,
Speaker 8: very big revenue base. So even if you see adoption
Speaker 8: of whether it's data cloud on the AI side or
Speaker 8: agent Force, it doesn't move the needle if the macro
Speaker 8: is bad. And that's really the big narrative for whether
Speaker 8: it's Salesforce or Workday or a lot of other software companies.
Speaker 8: Is enterprise tech spending on the non AI side of
Speaker 8: it is not that strong. You're not at people are
Speaker 8: not adding headcount at the same rate they were a
Speaker 8: few years ago, and that is what's weighing in the
Speaker 8: subscription growth rate of all these companies. And I think
Speaker 8: that's the big narrative. And you know, from my experience,
Speaker 8: unless the estimate starts to move up, you know, the
Speaker 8: star kind of you know, it remains you know, I
Speaker 8: would say range bound.
Speaker 5: On that case.
Speaker 2: What's really interesting is the narrative in the market is
Speaker 2: being dictated by a report out of the information about
Speaker 2: Microsoft sort of finding it tough to charge people for
Speaker 2: its co pilots, for its agenda AI offerings and salespeople
Speaker 2: sort of having pulled back on targets. Now we haven't
Speaker 2: managed to match that thus far and around, But is
Speaker 2: that really what is focusing the minds of those in
Speaker 2: the market, Whether there's productivity gains from salesforce from copilot.
Speaker 8: So again, there are two aspects of it, and I
Speaker 8: think one thing is very clear that there is no
Speaker 8: shortage of revenue on the AI infrastructure site, So let's
Speaker 8: keep that, you know. The other one one area, the
Speaker 8: second piece is all these co pilot products that companies
Speaker 8: are launching in the case of Microsoft, when it comes
Speaker 8: to something like a GitHub copilot, highly productive and massive
Speaker 8: updake just because of what it provides. In the case
Speaker 8: of the office copilot, it has value to it for
Speaker 8: the end customers, but at the same time, it's very
Speaker 8: expensive to run at this point because the cost of
Speaker 8: you know, token generation and inference is not that it
Speaker 8: is not that low. That's going to come down and
Speaker 8: it will lead to more and more people embracing that.
Speaker 8: But that goes back to the first thing we talked
Speaker 8: about is a slowdown in enterprise tech spending, and I
Speaker 8: think that bays on everything, not just a handful of sectors.
Speaker 2: Many of those can perhaps show the benefits of Informatica
Speaker 2: purchase today at least yeah, I.
Speaker 8: Mean, I think that you will see some revenue uplift
Speaker 8: because of that, and that's good. But the question is
Speaker 8: going to be what kind of cross selling can they
Speaker 8: do using their distribution arm that could get Informatica's organic
Speaker 8: sales growth a big lift, because I think that is
Speaker 8: one of the benefits of accumulating some of these assets
Speaker 8: under one umbrella.
Speaker 2: And rak Rana it's a busy day, a busy week.
Speaker 2: Senior analysts Bloomberg Intelligence. Thank you so much for bringing
Speaker 2: us your research that does it for this edition of
Speaker 2: Bloombag Tech. Do not forget to check out our podcasts.
Speaker 2: Find it on the terminal as well as online on Apple, Spotify,
Speaker 2: and iHeart and stick with earnings as they break after
Speaker 2: the bell. This is Bloomberg Tech.