WEBVTT - Apple Rises and AI's Impact on the Job Market 0:00:01.240 --> 0:00:04.920 From our Heart where Innovations, money and power Collie in 0:00:05.040 --> 0:00:09.879 Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde 0:00:10.000 --> 0:00:10.879 and Ed Ludlow. 0:00:25.040 --> 0:00:28.400 I'm Caroline Hyde at Bloomberg's World headquarters in New York and. 0:00:28.280 --> 0:00:31.240 I'm Ed Ludlow in San Francisco. This is Bloomberg Technology 0:00:31.320 --> 0:00:31.960 coming out of ed. 0:00:32.080 --> 0:00:35.720 We have full earnings coverage. Of course, we digest Apple, 0:00:35.760 --> 0:00:38.640 it rises on signs of its weathering that smartphone slowdown. 0:00:38.760 --> 0:00:41.720 We've also got dowdash lift, block analysis, you name it. 0:00:41.680 --> 0:00:42.080 We're on it. 0:00:42.880 --> 0:00:46.040 And following another strong US payrolls report, we'll discuss the 0:00:46.080 --> 0:00:49.560 state of the job market for the tech industry, specifically 0:00:49.760 --> 0:00:51.680 when it comes to artificial intelligence. 0:00:51.920 --> 0:00:54.600 Plus we'll break down results from Warner Brothers as the 0:00:54.600 --> 0:00:57.440 company reports a surprise profit and streaming how will the 0:00:57.440 --> 0:00:59.560 writers strike impact results going forward? 0:00:59.560 --> 0:01:00.800 Though all of that. 0:01:00.880 --> 0:01:03.960 As we analyze the broader context of the markets today, 0:01:04.280 --> 0:01:06.880 it's Friday feeling when you're looking at the regional banking 0:01:06.880 --> 0:01:08.800 nex in particular, in fact, when you're looking at tech 0:01:08.800 --> 0:01:11.280 stocks too. Even with a strong jobs report and what 0:01:11.319 --> 0:01:13.959 that means in terms of Federal Reserve still probably having 0:01:14.000 --> 0:01:16.560 to tame inflation we're looking at one point eight percent 0:01:16.640 --> 0:01:18.639 arrive on the NASDAG. We really are seeing a bounce 0:01:18.720 --> 0:01:21.640 back in risk sentiment today KBW bankingex as I say, 0:01:21.720 --> 0:01:23.679 on fire up more than four percent, but remember how 0:01:23.680 --> 0:01:25.880 far we've fallen over the last few days. This is 0:01:25.880 --> 0:01:28.320 all about a bounce back in regional banks. Maybe people 0:01:28.400 --> 0:01:29.679 just buying the dip today. Ed I know you're going 0:01:29.720 --> 0:01:31.639 to dig into that a little bit later. The VIGs 0:01:31.880 --> 0:01:34.480 that all important fear gauge therefore really pulling down by 0:01:34.520 --> 0:01:36.959 almost three points, were at seventeen handle once again. So 0:01:37.360 --> 0:01:39.160 we decide we're going to go along this market into 0:01:39.160 --> 0:01:41.280 the weekend. Let's quickly look at what happening in terms 0:01:41.280 --> 0:01:43.160 of the world a crypto, because actually it looks as 0:01:43.160 --> 0:01:45.760 though risk sentiment is rallying there as well. We're at 0:01:45.800 --> 0:01:47.480 one point eight percent, We're not at that all important 0:01:47.520 --> 0:01:50.200 thirty thousand level, but still a little bit of a pushback. 0:01:50.200 --> 0:01:52.040 And I just drill into what's happening in terms of 0:01:52.040 --> 0:01:53.880 the micro Is there is there risk on sentiment? 0:01:53.920 --> 0:01:54.400 There is at. 0:01:54.320 --> 0:01:57.160 Earnings, Yeah, there's a lot driven by Ernie's. You look 0:01:57.160 --> 0:01:59.840 at a name like Lit down twenty percent more than 0:01:59.840 --> 0:02:02.280 ten actually at one point in the session, Lift is 0:02:02.320 --> 0:02:05.920 touching a record low on that stock. The outlook for 0:02:06.000 --> 0:02:08.840 revenue is not driving with investors. I think there's a 0:02:08.880 --> 0:02:11.200 lot of concern about the near term economic model and 0:02:11.240 --> 0:02:14.000 the new CEO's plan to turn that around. Really big 0:02:14.000 --> 0:02:17.119 decline in Lift Streaming is interesting. Paramount twenty four hours 0:02:17.160 --> 0:02:20.400 ago had a loss. Warner Brothers Discovery out with a 0:02:20.440 --> 0:02:23.359 surprise profit for the streaming unit. Even though the legacy 0:02:23.400 --> 0:02:27.000 business is seeing advertiser flight, We're seeing some buoyancy in 0:02:27.040 --> 0:02:29.160 those names. And then again you talk about the banks, 0:02:29.400 --> 0:02:32.480 Packwest up the most on record eighty four percent or so. 0:02:32.639 --> 0:02:35.760 Why I'm actually not seeing much rationale on the bloomberg 0:02:36.160 --> 0:02:38.519 or out in the reporting. It may be a by 0:02:38.600 --> 0:02:41.240 the dip kind of situation. We will dig into that 0:02:41.600 --> 0:02:43.920 later in the program. There is one clear name moving 0:02:43.960 --> 0:02:46.079 us to the upside, and that is Apple. You look 0:02:46.080 --> 0:02:48.680 at the gain in Apple shares following what was a 0:02:48.720 --> 0:02:52.040 beat on expectations in the quarter, strengthen iPhone and in 0:02:52.120 --> 0:02:54.760 services growth in both units year on the year, Although 0:02:55.040 --> 0:02:56.920 low growth one and a half percent or so for 0:02:57.000 --> 0:02:59.400 the iPhone five and a half percent for the services, 0:02:59.440 --> 0:03:02.799 that four point eight gain is the biggest jump since November. 0:03:02.840 --> 0:03:06.399 We did get commentary on AI quite muted, all about 0:03:06.440 --> 0:03:10.919 emerging markets, all about India, and then that developing services business. 0:03:10.960 --> 0:03:12.600 I know you and I have been talking about fintech 0:03:12.639 --> 0:03:14.880 in particular and what Apple's doing on that side of things. 0:03:15.080 --> 0:03:16.360 That's where there was some strength. 0:03:16.560 --> 0:03:18.639 Yeah, and strength in terms of the points that it's 0:03:18.639 --> 0:03:21.519 adding to the SMP more than fourteen. So Apple helping 0:03:21.600 --> 0:03:22.600 drag the market high. 0:03:22.680 --> 0:03:23.680 Let's get more on all of this. 0:03:24.080 --> 0:03:27.680 Third Bridge Global Sector lead for TMT it is Scott Kesler. 0:03:28.000 --> 0:03:31.040 So let's go back to basics of Apple the broad picture. 0:03:31.320 --> 0:03:33.520 We're talking about the nuances of AI there, but really 0:03:33.560 --> 0:03:36.720 this is about iPhones and still demand internationally. 0:03:37.680 --> 0:03:38.200 Absolutely. 0:03:38.280 --> 0:03:40.040 I mean, if you think about the quarter that they 0:03:40.120 --> 0:03:43.280 just reported, more than half of revenues came from iPhone. 0:03:43.400 --> 0:03:47.000 iPhone outperformed, but as you alluded to, it seems like 0:03:47.120 --> 0:03:50.680 the other major product areas when you think about hardware 0:03:50.720 --> 0:03:54.800 and you think about mac and iPad and wearables, those 0:03:54.880 --> 0:04:00.120 also declines in the quarter. So iPhone was the and 0:04:00.320 --> 0:04:02.920 out in terms of total revenues, but also in terms 0:04:03.000 --> 0:04:05.960 of the beat, and I think that helped carry Apple 0:04:06.560 --> 0:04:08.640 over the finish line, so to speak. 0:04:08.640 --> 0:04:10.760 Yes, Scot, I'll jump in. I think there's a real 0:04:10.800 --> 0:04:14.840 interest here on India in emerging markets. How much confidence 0:04:15.000 --> 0:04:17.760 that does that give you that Apple has pockets for 0:04:17.880 --> 0:04:19.360 major growth going forward. 0:04:19.920 --> 0:04:20.200 You know? 0:04:20.360 --> 0:04:23.000 And I think growth has to be on the minds 0:04:23.040 --> 0:04:26.000 of Apple investors today. Sure, people are happy the stock 0:04:26.160 --> 0:04:29.880 is up, the company reporter results that were largely better 0:04:29.920 --> 0:04:34.240 than expectations. But I think more intermediate term people have 0:04:34.320 --> 0:04:37.839 to wonder about whether or not this is a double 0:04:37.880 --> 0:04:42.479 digit grower in terms of revenues in the foreseeable future 0:04:42.680 --> 0:04:45.360 or at any point in the future. To be frank, 0:04:46.120 --> 0:04:48.720 emerging markets would seemingly have to be a big part 0:04:48.720 --> 0:04:51.400 of that. But when you think about India, and that's 0:04:51.400 --> 0:04:53.920 something they've been talking about, and I think they talk 0:04:54.000 --> 0:04:56.200 more about India during the call than they did AI, 0:04:56.360 --> 0:04:59.680 and rightly so, because that seems to be more of 0:04:59.720 --> 0:05:03.680 a term opportunity for the company. That being said, I 0:05:03.680 --> 0:05:08.040 think people understand that getting that premium pricing is going 0:05:08.120 --> 0:05:11.320 to be difficult in India, and so the strategy and 0:05:11.360 --> 0:05:13.000 the specifics. 0:05:12.680 --> 0:05:14.000 Are very key there. 0:05:14.320 --> 0:05:16.960 We'll see kind of how they go about approaching that market. 0:05:17.279 --> 0:05:20.719 There's no issue when it comes to things like the 0:05:21.080 --> 0:05:26.640 number of potential customers and kind of the possible volumes 0:05:26.680 --> 0:05:30.599 going forward. But how that plays into what Apple is 0:05:30.640 --> 0:05:34.120 able to do. Yeah, given the price sensitivity there, I 0:05:34.120 --> 0:05:35.960 think that's a big question going forward. 0:05:36.360 --> 0:05:39.720 Scott, how much of the rally and shares, to your mind, 0:05:39.760 --> 0:05:41.159 is driven by the comments on AI? 0:05:41.480 --> 0:05:44.239 You know what, I have to be honest, I don't 0:05:44.279 --> 0:05:47.400 know that people are making a lot of those you know, 0:05:47.400 --> 0:05:50.200 it's interesting. I did a search of the transcript for AI. 0:05:51.240 --> 0:05:53.840 There were a handful of references. I think there are 0:05:53.880 --> 0:05:58.240 more references to Mumbai than AI. And I think that 0:05:58.279 --> 0:06:00.479 goes to what I was just saying before. I think 0:06:00.520 --> 0:06:03.559 talking about the fact that it's something they're thinking about, 0:06:04.120 --> 0:06:05.400 it's something they're looking at. 0:06:05.960 --> 0:06:08.520 They don't speak to their product roadmaps. 0:06:08.839 --> 0:06:11.279 I mean that's their way of saying that we haven't 0:06:11.360 --> 0:06:13.640 quite figured it out to the point where we. 0:06:13.560 --> 0:06:14.520 Want to talk about this. 0:06:14.720 --> 0:06:17.760 But look, we speak to experts day in and day out, 0:06:17.800 --> 0:06:20.600 and they consistently tell us that this is an area 0:06:20.680 --> 0:06:23.960 where Apple is behind. If you think about the headlines 0:06:24.000 --> 0:06:27.839 we've seen from Microsoft and from Alphabet and from others 0:06:27.960 --> 0:06:31.520 like Meta, those companies are all well ahead of Apple. 0:06:31.680 --> 0:06:33.080 I think when it comes to AI. 0:06:33.760 --> 0:06:37.039 You know, Caroline, we were waiting for the numbers and 0:06:37.200 --> 0:06:40.880 services to be services came in below expectations, that still 0:06:40.960 --> 0:06:43.440 led growth. And what was interesting is the kind of 0:06:43.480 --> 0:06:45.920 emphasis on the fintech side of that business. 0:06:45.600 --> 0:06:47.599 And that really was the talking point throughout the course 0:06:47.600 --> 0:06:50.520 of Scott. Interestingly was the fact that they're launching the 0:06:50.600 --> 0:06:52.880 savings card, the fact that they're offering such a high 0:06:52.960 --> 0:06:54.000 yield on savings. 0:06:54.200 --> 0:06:56.640 How much is fintech or indeed just the addiction to the. 0:06:56.600 --> 0:06:59.080 Services side and the way they're trying to keep us 0:06:59.160 --> 0:07:02.760 so much within Apple's ecosystem a selling point for you 0:07:02.800 --> 0:07:04.240 at the moment, you. 0:07:04.200 --> 0:07:06.359 Know, I think it actually is pretty important. 0:07:06.440 --> 0:07:08.920 I think a lot of people are wondering about kind 0:07:08.960 --> 0:07:13.560 of R and D and innovation and growth, and with 0:07:13.800 --> 0:07:18.200 WWDC kicking off I think exactly a month from today, rightly, 0:07:18.280 --> 0:07:19.400 so they should be. 0:07:19.320 --> 0:07:20.640 Thinking about those things. 0:07:20.840 --> 0:07:24.080 But Apple has been talking more about payment services and 0:07:24.120 --> 0:07:27.880 financial services, and we've regularly heard that not only does 0:07:27.960 --> 0:07:32.920 that have a massive total addressable market that Apple can pursue, 0:07:33.320 --> 0:07:37.000 but that Apple actually has products and services that can 0:07:37.080 --> 0:07:40.160 take share there and they've been pretty active, frankly, not 0:07:40.200 --> 0:07:42.080 just over the last couple of years, but the last 0:07:42.160 --> 0:07:43.240 couple of quarters. 0:07:43.720 --> 0:07:46.559 In terms of seizing upon that opportunity. 0:07:46.120 --> 0:07:48.480 It scolled Kessler Thirdbridge on all Things Apple. 0:07:48.560 --> 0:07:49.559 Thank you for your time. 0:07:49.840 --> 0:07:51.760 We're going to turn to door Dash, the food delivery 0:07:51.800 --> 0:07:55.560 company beating estimates driven by strong demand for deliveries, joining 0:07:55.640 --> 0:08:00.880 us now cr for a CFRA Senior analyst Angelo Zeno Angelo, Hello, 0:08:01.680 --> 0:08:03.920 this is an interesting company. Yeah, good to see you. 0:08:04.360 --> 0:08:07.679 What does this tell you about the consumer right now 0:08:07.840 --> 0:08:10.320 and where they're spending money. I find door Dash left 0:08:10.320 --> 0:08:13.400 over the gig economy names as pretty good. Baromea to 0:08:13.520 --> 0:08:15.000 right of what's going on on the ground. 0:08:15.720 --> 0:08:17.400 Yeah, I would actually agree with that. And when you 0:08:17.480 --> 0:08:19.720 kind of look at the numbers from all three across, 0:08:19.800 --> 0:08:22.280 you know, this week, I'd say for the most part, 0:08:22.280 --> 0:08:24.520 it's been very resilient in nature. I mean you kind 0:08:24.520 --> 0:08:27.160 of look at Doordash's numbers. Actually they grew the top 0:08:27.240 --> 0:08:30.200 night line very well, grew at about forty percent. And 0:08:30.520 --> 0:08:32.360 when you kind of look at where the gross orders 0:08:32.400 --> 0:08:35.200 were up about twenty nine percent, and they maybe about 0:08:35.280 --> 0:08:37.400 a third of a third of that, you know, being 0:08:37.520 --> 0:08:42.080 driven by their endeavors into Europe. With that Walt acquisition. 0:08:42.240 --> 0:08:44.600 But nonetheless, when you kind of look at the results here, 0:08:44.800 --> 0:08:48.720 specifically from the likes of Uber and to a lesser extent, DoorDash, 0:08:48.840 --> 0:08:52.160 I'd say the consumer right now looks really resilient. And 0:08:52.240 --> 0:08:55.320 specifically i'd done the food delivery side of things, that 0:08:55.520 --> 0:08:57.800 was kind of an area where a lot of you know, 0:08:57.880 --> 0:09:00.480 investors out there thought that, you know, potentially revenue which 0:09:00.520 --> 0:09:03.040 start kind of you know, waning off in a post 0:09:03.080 --> 0:09:05.319 pandemic world, and that just hasn't happened yet. 0:09:05.360 --> 0:09:08.079 And in fact, what's also working for them is not 0:09:08.240 --> 0:09:10.880 just your delivery of your hot food, but plenty of 0:09:10.880 --> 0:09:13.160 other things to be delivered. How much does that have 0:09:13.360 --> 0:09:15.400 to be part of the business model because it's a 0:09:15.400 --> 0:09:17.120 one error that lift really doesn't have. 0:09:18.280 --> 0:09:21.240 Yeah, listen, I think that's a great contributor for both 0:09:21.760 --> 0:09:24.560 Uber as well as doordessk. I think Uber kind of 0:09:24.600 --> 0:09:27.240 highlighted thirty five percent growth in kind of new vertical 0:09:27.320 --> 0:09:30.120 markets within kind of that delivery side of things. We 0:09:30.120 --> 0:09:34.200 actually think DoorDash growing faster than that and kind of 0:09:34.240 --> 0:09:37.240 adjacent market. So it's a huge part of their kind 0:09:37.280 --> 0:09:39.920 of growth initiative here over the next couple of years 0:09:40.160 --> 0:09:42.760 and kind of you know, adding stickiness to that platform, 0:09:42.760 --> 0:09:45.760 because consumers that are kind of leveraging their other businesses, 0:09:45.800 --> 0:09:47.640 whether it be on the food delivery side of things 0:09:47.840 --> 0:09:50.120 or whether it be in ride sharing, they are you know, 0:09:50.480 --> 0:09:52.640 they are looking to, you know, further kind of take 0:09:52.679 --> 0:09:55.480 advantage of services in other adjacent markets. 0:09:55.559 --> 0:09:57.840 And I mean ed, this is where you really do 0:09:57.920 --> 0:10:00.520 compare and contrast the companies that do well that a 0:10:00.600 --> 0:10:03.000 broadened their overall offering, and then you look at Lyft, 0:10:03.040 --> 0:10:04.160 which is tunneling stay ed. 0:10:04.880 --> 0:10:07.160 Yeah, we're down twenty one percent. We've just touched another 0:10:07.679 --> 0:10:09.880 record low. We'll see if that holds through the close. 0:10:10.600 --> 0:10:15.040 Is this just a lift problem, a unique lift problem? 0:10:15.559 --> 0:10:17.400 I think there is. I think it is a lift problem, 0:10:17.480 --> 0:10:19.199 to be honest with you, when you kind of look at, 0:10:19.240 --> 0:10:22.280 you know, what investors are rewarding this week versus what 0:10:22.320 --> 0:10:25.120 they're not rewarding, especially in broader tech, right, they are 0:10:25.400 --> 0:10:28.440 rewarding the names that are kind of pushing the bottom line. 0:10:28.600 --> 0:10:30.920 And we've seen it, you know, not only from Uber, 0:10:31.040 --> 0:10:34.200 which which you know clearly is essentially holding op X 0:10:34.240 --> 0:10:38.320 steady here and seeing that double digit top line orders growth. 0:10:38.559 --> 0:10:41.520 DoorDash also doing it? Last three quarters, essentially keeping op 0:10:41.679 --> 0:10:45.400 X relatively flat, growing the top line nicely. You saw 0:10:45.440 --> 0:10:48.440 what Shopify just announced yesterday, right, and just saw the 0:10:48.440 --> 0:10:50.840 impact on the stock price there when you kind of 0:10:50.840 --> 0:10:53.760 look at Lift here, they've announced some big cost cuts 0:10:53.920 --> 0:10:56.880 in the sense of twenty percent workforce reduction on top 0:10:56.920 --> 0:11:00.200 of a north of a ten percent work force reduction 0:11:00.360 --> 0:11:02.600 late last year. But the fact of the matter is 0:11:02.840 --> 0:11:05.280 those quest cuts are just being reinvested in the business 0:11:05.360 --> 0:11:08.000 to try to keep a float versus their bigger competitor 0:11:08.200 --> 0:11:10.840 in Uber. So it's not going back to shareholders. They're 0:11:10.880 --> 0:11:13.360 not benefiting in any way, and that's a big problem 0:11:13.360 --> 0:11:15.160 in this type of market, and we don't think that 0:11:15.520 --> 0:11:19.360 likely changes anywhere anytime in the near future because of 0:11:19.640 --> 0:11:23.000 the environment we're dealing with, and especially if macro conditions 0:11:23.040 --> 0:11:25.880 start to deteriorate, then Lift becomes in a whole lot 0:11:25.920 --> 0:11:28.240 of trouble relative to Uber. 0:11:29.080 --> 0:11:31.480 Oh, Angelus, you know you're the perfect guest for these 0:11:31.480 --> 0:11:33.040 sorts of days. To wrap it all together, we thank 0:11:33.080 --> 0:11:35.160 you for the CFRA. I mean, ed you were just 0:11:35.200 --> 0:11:37.480 talking about the volatility that we see in Lift, the 0:11:37.520 --> 0:11:40.280 record loan near well, look at the record move that 0:11:40.280 --> 0:11:42.880 we're getting on the day in certain bank stocks, regional 0:11:42.920 --> 0:11:45.840 bank stocks, but Pac West rallying hard, being stopped out 0:11:45.840 --> 0:11:48.120 time and time again. We're up more than eighty percent. 0:11:48.800 --> 0:11:50.920 There seems to be no fundamental change here. A lot 0:11:50.920 --> 0:11:52.880 of people saying, look, you've got to buy this step 0:11:53.400 --> 0:11:56.360 Ultimately it is too hard sold off. But actually put 0:11:56.360 --> 0:11:59.440 it in context, we're back to the higher sinse oh 0:11:59.720 --> 0:12:02.439 when we're still well off the average price, which is 0:12:02.480 --> 0:12:03.520 an excess of twenty dollars. 0:12:03.840 --> 0:12:04.040 Yeah. 0:12:04.080 --> 0:12:05.920 Look that there are big names in the market like 0:12:05.960 --> 0:12:08.599 Bill Ackman who say there's a lot of concern in 0:12:08.640 --> 0:12:11.080 the banking sector. Still, the point that our colleagues at 0:12:11.080 --> 0:12:13.880 Bloomberg Intelligence would make is that the sell off in 0:12:13.960 --> 0:12:18.199 these stocks is not easy to reconcile with the liquidity 0:12:18.240 --> 0:12:20.839 available to the banks. You look at the deposit base. 0:12:21.760 --> 0:12:24.880 This is not Silicon Valley Bank. The proportion of ensured 0:12:24.920 --> 0:12:28.000 deposits is much higher. That's what I'm trying to do, Caroline, 0:12:28.080 --> 0:12:31.240 our audience that's listening, the tech founders, the vcs, they 0:12:31.280 --> 0:12:33.720 bank with these names, and they're trying to work out 0:12:33.920 --> 0:12:34.760 what's actually wrong. 0:12:35.240 --> 0:12:39.000 And a lot of that fear and concern gets spread 0:12:39.040 --> 0:12:40.040 through social media. 0:12:40.160 --> 0:12:41.079 It's on technology. 0:12:41.120 --> 0:12:43.800 It's also far easier to then become a reality, as 0:12:43.800 --> 0:12:45.840 you're able to whip out your deposits that much faster 0:12:46.040 --> 0:12:49.000 using your bank cap. But ultimately the foundation of these 0:12:49.040 --> 0:12:52.080 banks aren't nearly as concerning. There isn't so much of 0:12:52.120 --> 0:12:55.520 an isolated focus on one particular type of borrower and 0:12:55.559 --> 0:12:58.760 one particular type of overall integrated system that just lean 0:12:58.880 --> 0:13:01.480 to back to the overall tech scenes. But we are 0:13:01.520 --> 0:13:04.920 still questioning ultimately the solidity of the entire financial system 0:13:05.000 --> 0:13:05.360 right now. 0:13:05.920 --> 0:13:08.040 Look, when Jamie Diamond and JP Morgan stepped inim with 0:13:08.080 --> 0:13:10.960 First Republic, he was confident it would settle things down 0:13:11.320 --> 0:13:12.840 in the near tub settle things down. 0:13:14.520 --> 0:13:18.320 President Biden is currently making comments about what was a 0:13:18.320 --> 0:13:22.320 particularly strong set of jobs numbers today now with two 0:13:22.440 --> 0:13:25.000 hundred and fifty three thousand jobs being added, that was 0:13:25.080 --> 0:13:29.240 well above I mean, it's sawed past most economist expectations 0:13:29.280 --> 0:13:31.640 all but three of the seventy seven survey by Bloomberg. 0:13:31.679 --> 0:13:33.600 You got health and education jobs to thanks for this. 0:13:33.960 --> 0:13:37.520 But notably, we're still seeing pretty strong hourly earnings coming in. 0:13:37.559 --> 0:13:38.160 They're coming in hot. 0:13:38.200 --> 0:13:40.080 That's an inflatory pressure for the federal Reserve to have 0:13:40.120 --> 0:13:43.400 to tackle. Notably, also there is an equality within once 0:13:43.440 --> 0:13:47.160 again a really low unemployment rate. When you're looking at overall, 0:13:47.200 --> 0:13:49.320 you're still seeing black unemployment rate at four point seven 0:13:49.320 --> 0:13:52.880 percent visa a white unemployment level at three point one percent. 0:13:52.960 --> 0:13:53.640 But overall we. 0:13:53.600 --> 0:13:57.440 Did see unemployment coming in once again relatively low. This 0:13:57.480 --> 0:13:59.920 is a strong jobs market, even as we see the 0:14:00.240 --> 0:14:03.000 Reserve continue to raise rates. With hearing from President Biden, 0:14:03.040 --> 0:14:05.600 we understand Treasure Sectory Janet Yellen is with him. 0:14:05.640 --> 0:14:06.280 To Ed. 0:14:07.840 --> 0:14:10.680 Caroline, taking a little look at shares of Yelp. We're 0:14:10.840 --> 0:14:13.760 hire two tens of percent off. The online review company 0:14:14.000 --> 0:14:16.280 posted first quarter revenue that did come in ahead of 0:14:16.280 --> 0:14:19.479 analysts expectations. Joining me here on set in San Francisco, 0:14:19.600 --> 0:14:26.200 Yelp CFO David Schwartzbuck. David, you talk about high intent users. 0:14:27.080 --> 0:14:27.880 What does that mean? 0:14:28.440 --> 0:14:29.880 First, Ed, it's great to be here. 0:14:29.960 --> 0:14:33.200 Thanks high intent users. When someone comes to Yelp, they 0:14:33.200 --> 0:14:36.440 actually tell us what they're looking for. It could be landscaping, 0:14:36.520 --> 0:14:39.640 it could be a locksmith, and so that actually enables 0:14:39.720 --> 0:14:42.560 us to really match that consumer with the right service 0:14:42.600 --> 0:14:45.520 pro when they come. And also it's important to recognize 0:14:45.560 --> 0:14:48.480 nearly half of our visitors come from households with income 0:14:48.520 --> 0:14:50.760 over one hundred thousand dollars. So that's a great audience 0:14:50.800 --> 0:14:51.960 for advertisers to reach. 0:14:52.320 --> 0:14:55.280 When we look at your earnings and your outlook going forward, 0:14:55.720 --> 0:14:58.760 what does it tell us about engagement from the consumer 0:14:58.800 --> 0:15:00.880 and platforms like you? They are they kind of penny 0:15:00.880 --> 0:15:04.880 pinching right now and looking for the most reliable, valuable 0:15:04.880 --> 0:15:08.560 deals across all kinds of things or is this just 0:15:08.600 --> 0:15:11.000 a robust growth in use of platforms like yours. 0:15:11.520 --> 0:15:15.080 So what is certainly true is inflation is making things 0:15:15.120 --> 0:15:17.760 more expensive, and so I think overall consumers are spending 0:15:17.920 --> 0:15:20.560 about the same amount but less frequently. 0:15:20.920 --> 0:15:22.120 So they're really. 0:15:21.960 --> 0:15:24.640 Focused on ensuring they make a good decision, and what 0:15:24.760 --> 0:15:28.680 Yelp provides them is with reliable information to make that purchase. 0:15:28.400 --> 0:15:34.800 Decision, David, advertisers, are they willing to invest? Are they 0:15:35.040 --> 0:15:36.160 feeling confident in the moment? 0:15:36.200 --> 0:15:36.920 What's your assessment? 0:15:38.400 --> 0:15:42.600 So we obviously serve both large enterprise customers or advertisers 0:15:42.680 --> 0:15:46.240 as well as small and medium businesses. And what we 0:15:46.320 --> 0:15:49.320 see on the services side, as things have slowed down 0:15:49.320 --> 0:15:51.600 a little bit, service pros want to stay busy and 0:15:51.640 --> 0:15:54.120 so they've actually increased their ad spend, and what we've 0:15:54.120 --> 0:15:57.400 seen on Yelp is that their spend per pain advertising 0:15:57.480 --> 0:16:00.360 location has gone up so that they can stay busy. 0:16:00.400 --> 0:16:03.360 And of course we believe that with our high intent audience, 0:16:03.360 --> 0:16:05.880 we're able to match them with a great lead that 0:16:06.000 --> 0:16:07.080 leads to business for them. 0:16:07.640 --> 0:16:11.520 Got to ask it, artificial intelligence, what are you doing 0:16:11.520 --> 0:16:13.680 to incorporate that within the business. How have you got 0:16:13.720 --> 0:16:16.240 the right talent to ensure you can enact that sort 0:16:16.240 --> 0:16:16.960 of entertwinement. 0:16:18.400 --> 0:16:21.800 So we have been using artificial intelligence for some time. 0:16:21.920 --> 0:16:25.560 Of course, everybody's talking about chat, GPT and these new 0:16:25.680 --> 0:16:29.440 large language models, but for our search experience for matching 0:16:29.480 --> 0:16:32.720 consumers with pros, we've been applying AI for some time. 0:16:32.800 --> 0:16:35.120 We have both the infrastructure and the ability to deliver 0:16:35.200 --> 0:16:37.880 that to the consumer when they visit the site. Now, 0:16:38.320 --> 0:16:42.440 large language models making that interaction more conversational. We think 0:16:42.480 --> 0:16:44.960 that's a great opportunity for us, and we're looking forward 0:16:44.960 --> 0:16:46.640 to deploying it. It's still early. 0:16:46.400 --> 0:16:49.600 Though, David shares up half of percent. We're up significantly 0:16:49.640 --> 0:16:51.840 higher earlier in the session three point six percent. I 0:16:51.880 --> 0:16:54.920 covered QSRs for a really long time. Restaurant industry There's 0:16:54.960 --> 0:16:58.040 a titbit that really fascinates me, which is that when 0:16:58.080 --> 0:17:01.440 you go to Yelp, you can look for into restaurants normally. 0:17:02.080 --> 0:17:04.439 Is their data telling you that actually now people are 0:17:04.440 --> 0:17:09.400 looking at chains because of the value proposition. It seems 0:17:09.440 --> 0:17:13.560 like there is evidence that actually consumers a looking for value. 0:17:14.119 --> 0:17:17.440 There's definitely been a lot of talk about consumers choosing 0:17:17.480 --> 0:17:20.760 to go to quick serve restaurants on Yelp. Though when 0:17:20.800 --> 0:17:23.520 people are coming, they're really looking to find that hot 0:17:23.560 --> 0:17:26.440 and new restaurant or something that's different, or if they're 0:17:26.480 --> 0:17:28.959 going out on a Friday night. Of course, people are 0:17:29.040 --> 0:17:32.159 very familiar with these large, quick serve restaurants, and so 0:17:32.400 --> 0:17:34.520 that's not the first thing they're searching for on Yelp. 0:17:34.680 --> 0:17:38.199 We are seeing continued interest, of course in sit down dining, 0:17:38.400 --> 0:17:40.320 and people want to make sure that experience is great, 0:17:40.359 --> 0:17:42.320 so again they come for our reliable reviews. 0:17:43.119 --> 0:17:47.439 What is your key competition at the moment from your perspective, David, 0:17:47.480 --> 0:17:49.720 Because dare I say it, and I mean this with 0:17:49.760 --> 0:17:52.760 full affection for things yelp, but it's pretty old school 0:17:52.800 --> 0:17:55.600 for many people. How are you feeling that it's still yeah? 0:17:55.600 --> 0:17:58.040 How do you feel that the younger generation are interacting 0:17:58.080 --> 0:17:59.879 with it. Are you feeling that you're remaining as relevant 0:18:00.119 --> 0:18:02.240 present when everyone seems to be turning into different ways 0:18:02.240 --> 0:18:04.280 to search? I mean Instagram for one example. 0:18:05.720 --> 0:18:08.119 So one of the things that we have it Yelp 0:18:08.200 --> 0:18:12.760 is actually an even distribution of consumers across each of 0:18:12.760 --> 0:18:15.680 the three large age groups eighteen to thirty four, thirty 0:18:15.680 --> 0:18:18.159 four to fifty four, above, fifty five and above. So 0:18:18.440 --> 0:18:21.200 actually folks who are younger are using us because they 0:18:21.320 --> 0:18:22.480 want to spend their money. 0:18:22.520 --> 0:18:22.720 Well. 0:18:22.800 --> 0:18:26.120 Now, obviously video reviews on some of the other platforms, 0:18:26.359 --> 0:18:29.080 or reviews that through a post that are gain a 0:18:29.119 --> 0:18:32.080 lot of attention, but completeness is very important. When you're 0:18:32.119 --> 0:18:34.080 going out. You want to ensure that you actually have 0:18:34.200 --> 0:18:36.239 a sense for all the things that you could do, 0:18:36.680 --> 0:18:40.520 and Yelp is that complete. So we delivered thirteen percent 0:18:40.560 --> 0:18:43.679 growth in the first quarter. We think that was terrific performance. 0:18:44.119 --> 0:18:46.880 More than sixty percent of our revenue comes from services, 0:18:46.920 --> 0:18:49.240 and so while we're known for the restaurant side, we 0:18:49.359 --> 0:18:52.320 really have been taking share on the services side. 0:18:52.359 --> 0:18:55.240 All right, Yelp, CFI David Schwoltzbeck, thank you so much, Carrie. 0:18:55.320 --> 0:18:57.600 Some bringing ease Yeah, let's look at First Republic Bank, 0:18:57.640 --> 0:18:59.919 because of course we understand that the SEC is investigating 0:19:00.240 --> 0:19:03.880 actually the conduct of executives there before the government seizure. 0:19:03.880 --> 0:19:07.840