Speaker 1: Bloomberg Audio Studios, podcasts, radio news from the heart of
Speaker 1: where innovation, money and power collide in Silicon Valley and beyond.
Speaker 1: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 2: Live Prince San Francisco. This is Bloomberg Technology coming up.
Speaker 2: Tesla in the crosshairs after the Trump Musk blow up
Speaker 2: led to one hundred and fifty billion dollar route.
Speaker 3: Plus what can it mean for space x elon Musk
Speaker 3: backpedaling after threatening to pull Dragon spacecraft from NASA missions?
Speaker 2: And is it the fastest growing software startup of all time?
Speaker 4: The company behind coding.
Speaker 2: Assistant Cursor cashes in on the AI frenzy with a
Speaker 2: close to ten billion dollar valuation. The first we check
Speaker 2: in on the stock of the moment, we were bound
Speaker 2: some We recoup about fifty billion dollars on the day,
Speaker 2: but over the course of the week we've lost one
Speaker 2: hundred and forty billion dollars in market cap for Tesla
Speaker 2: is now sub one trillion dollars. It is his worst
Speaker 2: week since February of twenty twenty five, right.
Speaker 3: And at one point in the session, the worst week
Speaker 3: going back to October of twenty twenty three.
Speaker 5: We need to talk more about what is happening.
Speaker 3: Let's go to DC to discuss it with Bloomberg's Balance
Speaker 3: of Power hosts Katie Lines. The latest reporting, Kaylee, is
Speaker 3: that in the whirlwind of the last twenty four hours,
Speaker 3: there will not be a conversation or phone call between
Speaker 3: Elon Musk and the President today.
Speaker 6: Yeah, that is what White House officials are signaling to Bloomberg.
Speaker 6: And despite the fact that there was reporting that some
Speaker 6: kind of call must happen, and there's been signaling from
Speaker 6: Elon Musk that he is willing to lower the temperature here.
Speaker 6: After someone posted on X at him yesterday that they
Speaker 6: should call off for a few days. He said that
Speaker 6: was good advice. And when Bill Ackman said that Trump
Speaker 6: and must need to make peace for the good of
Speaker 6: the country, Elon Musk responded, You're not wrong. So it
Speaker 6: does seem on at least one side, there is a
Speaker 6: willingness to lower the temperature here. It's unclear though, whether
Speaker 6: or not President Trump feels the same way as that
Speaker 6: same White House official that indicated no call would happen
Speaker 6: today also said that Trump is considering selling the Tesla
Speaker 6: that he purchased in that flashy White House event just
Speaker 6: months ago when these two were still incredibly tight. So
Speaker 6: if they can't fully mend fence this here, obviously, there
Speaker 6: are some major implications we have to consider. There is
Speaker 6: the political implication of whether or not Elon Musk will
Speaker 6: continue to attack what is supposed to be President Trump's
Speaker 6: landmark legislative accomplishment in his second term, this one big,
Speaker 6: beautiful bill. Well, Elon Musk's criticism may not actually change
Speaker 6: the odds of the legislation getting through Congress. At the
Speaker 6: very least, him broadcasting his views to hundreds of millions
Speaker 6: of people does damage Republican messaging around the deficit impact
Speaker 6: of this legislation. There's also Elon Musk's money to consider.
Speaker 6: He of course deployed some two hundred and ninety million
Speaker 6: dollars in the twenty twenty four election cycle, a lot
Speaker 6: of that toward the effort of getting President Trump re elected.
Speaker 6: But Republicans have to consider whether or not Elon might
Speaker 6: deploy that money to primary challengers. For example, if he
Speaker 6: decides he would like to punish those who go ahead
Speaker 6: and vote for this legislation, that will, of course, in
Speaker 6: addition to raising the deficit, lead to the rollback of
Speaker 6: ev credits that Tesla benefits from There's national security implications too,
Speaker 6: given that Musk and those working for him in DOGE
Speaker 6: were given access to government systems. It's unclear how far
Speaker 6: that access winter whe whether or not access for some
Speaker 6: of those individuals is going to be revoked. And then
Speaker 6: you get into, of course, the business implications as to
Speaker 6: whether or not government contracts, as President Trump threatened yesterday
Speaker 6: that Elon Musk's companies from SpaceX to others could actually do,
Speaker 6: actually benefit from need will actually go away. So there
Speaker 6: are many different layers to this.
Speaker 4: And while there is.
Speaker 6: A signal that maybe things have cooled down for now
Speaker 6: after what was an incredibly wild day yesterday, or this
Speaker 6: escalated very quickly, there's really no telling where this goes
Speaker 6: from here.
Speaker 2: What a thorough round up, Kaylie Lines. We appreciate it
Speaker 2: from Washington. Let's now bring in Bluemeg's Max Afkin from
Speaker 2: the Elon Inc. Team and Max, I just want to
Speaker 2: get your perspective here.
Speaker 5: Ron.
Speaker 2: We know how tough the president can be when he
Speaker 2: holds a grudge. Harvard's experienced it, universities have experienced it.
Speaker 4: But what about Elon.
Speaker 2: He's still got that vote going on on X about
Speaker 2: whether a new political party needs to be formed. Do
Speaker 2: we really think he's going to cool down from here?
Speaker 7: I think it would be in his interest to cool down.
Speaker 7: And I think the stock chart that you showed reflects
Speaker 7: that there is no universe that I can imagine anyway.
Speaker 5: Where Elon Musk maintaining this.
Speaker 7: Position where he's, you know, this kind of maximalist. We
Speaker 7: should impeach Donald Trump, start a new political party, you know,
Speaker 7: yesterday accusing Trump of being associated with Jeffrey Epstein. You know,
Speaker 7: like this, this is a point where he's going to
Speaker 7: start alienating MAGA aligned customers. And unfortunately for Tesla that
Speaker 7: is now an important contingent of their customer base because
Speaker 7: Elon Musk has already alienated the left leaning customers. So
Speaker 7: you're in this situation that is difficult.
Speaker 5: Now. Musk has cards to play, right.
Speaker 7: He has the money that he can donate, as we
Speaker 7: just heard. He also has this aerospace company, which you know,
Speaker 7: the US Trump can threaten to cancel contracts, but you know,
Speaker 7: as the Pentagon is construction constructed right now, and as
Speaker 7: NASA is constructed, they are depending on SpaceX for rocket launches.
Speaker 7: So he has cards to play, But I don't see
Speaker 7: how he can kind of maintain this pose without watching
Speaker 7: Tesla's stock decline further, without watching sales fall further. I mean,
Speaker 7: this is the most self destructive.
Speaker 5: I've covered Elon Musk for a very long time.
Speaker 7: This is the most self destructive that I have ever
Speaker 7: seen Elon musk Okay.
Speaker 3: Tesla says are up more than six percent in the session,
Speaker 3: but we remind ourselves that the stock fell fourteen percent
Speaker 3: as of yesterday's close. And while all of this was happening,
Speaker 3: something you mentioned was the core story President Trump's threat
Speaker 3: to cancel government tracks.
Speaker 5: And if you look at it from the Elon Inc.
Speaker 3: Lens Max, Tesla is the publicly traded proxy for sentiment
Speaker 3: towards Elon wright But since two thousands, Tesla SpaceX in
Speaker 3: aggregate have benefited from more than twenty billion dollars in grants, subsidies,
Speaker 3: and direct contracts. Explain that landscape to us, and what's
Speaker 3: at stake here if the President were to carry.
Speaker 5: Through with that threat.
Speaker 7: You know, That's why I'm reacting the way I'm reacting,
Speaker 7: and why I think there are a lot of people
Speaker 7: who still kind of expect, you know, maybe some reconciliation
Speaker 7: because Elon Musk has over the course of his career,
Speaker 7: as you just said, Ed, he has been really really
Speaker 7: effective at basically getting the federal government to give him money.
Speaker 7: And I think what we have been seeing and you
Speaker 7: saw this frustration coming out a little bit in the
Speaker 7: wake of the departure of Jared Isaacman, the person who
Speaker 7: Musk had hoped would be the NASA noominee, as well
Speaker 7: as the discussion around the ev tax credit, which is
Speaker 7: part of this tax bill that the Republicans are trying
Speaker 7: to pass. You saw a little bit of frustration I
Speaker 7: think from Elon Musk that although he's had tremendous influence
Speaker 7: and although he's begune to all the parties he's been
Speaker 7: in Mara Lago, Trump has led him, you know, basically
Speaker 7: it seems to do whatever he wants with DOJE, he
Speaker 7: hasn't actually been able to get the business priorities, and
Speaker 7: now of course is going to get harder.
Speaker 8: Now.
Speaker 7: Like I said, I don't think the government is just
Speaker 7: going to unilaterally cancel SpaceX contracts, but the government has
Speaker 7: leverage over Elon Musk, and Trump is signaling that he's
Speaker 7: wanting to use it.
Speaker 3: What I reported with our DC colleagues is that Isaacsman's
Speaker 3: nomination was canceled because of his relationship with Elon Musk
Speaker 3: and a White House official called Sergio Gore who did
Speaker 3: not like Elon Musk.
Speaker 5: And that's in copy on Bloomberg dot com.
Speaker 3: Bloomers. Max Chafickin of Elon Inc. Fantastic, Thank you very much.
Speaker 3: I want to go to Nancy Tengler. She's CEO and
Speaker 3: CEO of Laffer. Tengler investments about one half billion dollars
Speaker 3: in assets, but a significant holding of Tesla Sheff Nancy.
Speaker 3: Is what we saw in Tesla's stock yesterday Thursday, the
Speaker 3: drop in fourteen percent. Is it the market betting against
Speaker 3: Musk himself as opposed to whatever they feel about the
Speaker 3: long term thesis of Tesla.
Speaker 8: I don't know, Ed, I thanks for having me. I
Speaker 8: think part of what we saw yesterday is what we
Speaker 8: always see in the short term, and that is that
Speaker 8: the algorithms read the headlines, then the shorts jump in,
Speaker 8: and this is the stock and the guy that everyone
Speaker 8: loves to short. So I mean, I'm not saying I
Speaker 8: think this was well advised what Elon did, but I
Speaker 8: do think the fundamentals ultimately will trump this issue if
Speaker 8: you will no pun And that's important because this might
Speaker 8: be a great entry point we had, you know, we'd
Speaker 8: bought in at it again to our holdings on March tenth.
Speaker 8: And I think the stock was training about two forty
Speaker 8: that looked really smart until yesterday. But that's a and
Speaker 8: I think you do want to add it on in
Speaker 8: the volatile periods because Musk has a habit of teetering
Speaker 8: on the edge of destruction and then pulling himself back
Speaker 8: in the nick of time. He has said himself he's
Speaker 8: wired for war, and he often shoots himself in the foot,
Speaker 8: and clearly he's not wrong about that.
Speaker 4: The shooting in the foot.
Speaker 2: How prolific could that get in terms of getting robotaxis
Speaker 2: and a cybercab on the road and implicating that long
Speaker 2: term thesis that so many people hold.
Speaker 8: Yeah, I don't think it will. I mean, Caroline, I
Speaker 8: don't know. But because President Trump's equally unpredictable. I was
Speaker 8: reading a story about one of his previous advisers who
Speaker 8: had given him all the judicial nominees in his first term,
Speaker 8: and he called him a sleezebag who hates America. So
Speaker 8: he has a habit too of embracing people and then
Speaker 8: disengaging and not only disengaging, but saying some pretty rough
Speaker 8: things about him. So, but that said, I do think
Speaker 8: that what the administration understands is they do need productivity
Speaker 8: driven growth to make this tax bill work, and a
Speaker 8: good portion of that is pointed at Elon Musk and
Speaker 8: his efforts and initiatives, including Robotaxi. I expect that next week,
Speaker 8: after the Robotaxi announcement, unless something ridiculous happens, that we
Speaker 8: will be talking about something else as it relates to Tesla.
Speaker 2: What's interesting is we're talking about something else that relates
Speaker 2: to Elon. We're going to talk more about the space
Speaker 2: part of the equation later in the show, Nancy. But
Speaker 2: it's interesting that there's some debt being shocked by Walgan
Speaker 2: Stanley right now for Xai, and it went on for
Speaker 2: sale basically yesterday. We wonder what the sentiment is like
Speaker 2: in terms of shift. Would you want to be adding
Speaker 2: at this point? You said, maybe it's smart, but would
Speaker 2: you want to be adding exposure to all things Elon
Speaker 2: at this moment?
Speaker 8: So we have a pretty full position, and there's a
Speaker 8: reason this stock is not in our twelve Best Ideas portfolio, Caroline,
Speaker 8: because it is inherently bald, and a lot of it
Speaker 8: has to do with Elon, So I would say if
Speaker 8: you don't own it. And we have some clients who
Speaker 8: have asked us to buy positions for them today, which
Speaker 8: we will do in their non managed accounts, but effectively,
Speaker 8: I'm going to wait and if we see what we
Speaker 8: need to see next week and the stock doesn't bounce,
Speaker 8: then we may actually add to it, just discreetly, not
Speaker 8: in a big way, because it's a four percent position
Speaker 8: or it was yesterday, so call it three and a
Speaker 8: half today, and that's about as much as we want
Speaker 8: to own of this stock in our growth portfolio.
Speaker 5: Let's go back to Robotaxi.
Speaker 3: This is the thesis from Bloomberg Intelligence, our in house
Speaker 3: analysts about what the events of the last twenty four
Speaker 3: hours mean, and they argue specifically that it will result
Speaker 3: in a protracted rollout of Robotaxi, because the whole trade
Speaker 3: was based on the idea that Musk's proximity to the
Speaker 3: President would result in favorable legislation or federal level policy
Speaker 3: that would help Robotaxi.
Speaker 5: Where do you stand on that, Nancy.
Speaker 8: Yeah, And I think that's that's that's the risk, and
Speaker 8: that's that's one of the reasons that we're not jumping
Speaker 8: in here the regulatory environment. But I would also point out,
Speaker 8: you know, all the tech CEOs sort of did their
Speaker 8: homage to the administration and to the President in particular,
Speaker 8: and it hasn't really resulted in much good news from
Speaker 8: a regulatory standpoint. In fact, you could argue it's resultant
Speaker 8: in none Apple Google Meta. So I think that I'm
Speaker 8: hopeful that cooler heads will prevail, that the technology will
Speaker 8: be seen for what it is. And you know, if
Speaker 8: you look out that the Robotaxi would be the lowest
Speaker 8: cost per mile provider, there's only two way MO and
Speaker 8: it comes in significantly below And so I think there's
Speaker 8: a lot of reasons to support this technology. But you
Speaker 8: know that these are two unique individuals.
Speaker 3: I think it's important to pull out point out that
Speaker 3: actually Musk was quite consistent over a number.
Speaker 5: Of months that he would be fine if EV subsidies
Speaker 5: were killed or cut.
Speaker 3: He said it in July, he said it in December,
Speaker 3: he said it more recently, and Trump said it at
Speaker 3: March's Cabinet meeting. Does that factor in for you his
Speaker 3: position on that, Yeah, yes.
Speaker 8: I mean I thought that was disingenuous of the President
Speaker 8: yesterday to say that he saw that the ev mandates
Speaker 8: were gone, and that's what drove him crazy. I think
Speaker 8: that was the direct quote. He has been consistent. I
Speaker 8: agree with his position on that it supports the weaker manufacturers.
Speaker 8: It doesn't necessarily support the industry leader. The Tesla buyer
Speaker 8: is really not influenced by the mandate, and most don't
Speaker 8: qualify because of the income limitation. So I think Elon
Speaker 8: is a smart businessman, and what really frustrated him was
Speaker 8: the fact that the government is not run like a business.
Speaker 8: So you make the logical, you have the logical discussions,
Speaker 8: and then the government goes on this giant snowball rolling
Speaker 8: down a hill. So I'm hopeful that we will see
Speaker 8: things settle down and that next week I'm hoping we'll
Speaker 8: be talking about Robotaxi and how amazing it is. I
Speaker 8: live in Weymo Land. It's pretty exciting what's going on
Speaker 8: and what Amazon is doing with robots delivering packages. They
Speaker 8: could be getting out of a robotaxi for all I know.
Speaker 2: Let's just go to sentiment on buying a Tesla though, Nancy,
Speaker 2: because this I think is what's caught many off guard.
Speaker 2: Europeans are incredibly angry about some of the political leanings
Speaker 2: that Elil Musk has had, and it's affected sales.
Speaker 4: It would seem it hasn't.
Speaker 2: Just been the production hole and the wait for a
Speaker 2: new model. Why missing that borne out in may numbers.
Speaker 2: So will this implicate who buys Tesla's going forward?
Speaker 8: That's a great question, Caroline. You know it's interesting is
Speaker 8: that by D has been taken to task by the
Speaker 8: Communist Party for lowering prices because they're in an inflationary environment,
Speaker 8: and so I find that super interesting. Will that open
Speaker 8: up some space for Tesla again in China? It could.
Speaker 8: I mean they've called it rat race competition at the
Speaker 8: Communist Party, calling out the CEO. So we may see another,
Speaker 8: you know, another instance where the public market is invaded
Speaker 8: by the Communist Party, and that may help. But I
Speaker 8: don't think people are going to get over this soon.
Speaker 8: I think they will eventually get over it. But he
Speaker 8: needs to dial down the rhetoric and the drama and
Speaker 8: get back to the business of you know, optimists and
Speaker 8: robotaxi and full self driving. That is what people own
Speaker 8: the stock for, and for his brilliance and genius, of course,
Speaker 8: but not for the historyonics.
Speaker 2: And therefore, do you think you're going to get enough
Speaker 2: of his attention, particularly on the humanoid robot side of
Speaker 2: the equation.
Speaker 8: I mean, what Tesla has said is that they're going
Speaker 8: to have thousands in their factories coming up. That would
Speaker 8: be a good thing, Caroline, because you know, we have
Speaker 8: fought as much as the President talks about bringing manufacturing
Speaker 8: back to America, we have five hundred thousand manufacturing jobs
Speaker 8: that have gone unfilled. It's hard to turn that one
Speaker 8: around when for years we were shrinking the manufacturing base.
Speaker 8: The solution is robots, not across the board, but in
Speaker 8: a good instance, and they are a very productive way
Speaker 8: of producing things. So just as AI is writing AI code,
Speaker 8: I think the robots will build the robots, and we'll
Speaker 8: see manufacturing plants use more and more robotics. That's a
Speaker 8: good thing, and I think Tesla will be at the
Speaker 8: center of that, as well as energy storage.
Speaker 3: If anything's come out of the events of the last
Speaker 3: twenty four hours, it's to remind us of the deficit.
Speaker 3: Nancy listened to this.
Speaker 4: We can debate.
Speaker 9: He didn't get his trillion, he or probably one hundred
Speaker 9: billion or so in terms of cuts, but he worked.
Speaker 9: He was part of Doorge. It was right after the inauguration.
Speaker 4: We had do it.
Speaker 9: So I think I think some of this is as
Speaker 9: he's looking at this one big beautiful bill seeing that
Speaker 9: really the tax cuts are temporary. So is Musk trying
Speaker 9: to highlight the deficit issue again.
Speaker 3: Remember this was all about the big beautiful bill, That's
Speaker 3: where it started. Is Musk putting the emphasis back on
Speaker 3: the deficit helpful?
Speaker 5: Nancy?
Speaker 8: I actually think it is. I think a lot of
Speaker 8: what he's done has changed the narrative, whether you support
Speaker 8: dose or not. It's shine a light on the profligate
Speaker 8: spending in Washington. And I think what most Americans took away,
Speaker 8: And just like if you just start with Harvard, why
Speaker 8: is the government giving an educational or institution that has
Speaker 8: a endowment sorry of fourteen billion dollars, whatever it is,
Speaker 8: Why are we giving them hundreds and millions of dollars
Speaker 8: every year? Those are good debates to have, and there
Speaker 8: may be a very good reason, But I don't think
Speaker 8: most people think that the government is efficient with their
Speaker 8: tax dollars, and so to change to start that debate,
Speaker 8: then to see it, you know, do the work, see
Speaker 8: it unwound. Really with this tax bill which is long,
Speaker 8: un spending, I don't like it either. I don't think
Speaker 8: it's a very good bill. I think that they could
Speaker 8: have done better. They obviously don't think they could have.
Speaker 8: I'm not there, but I think that's that's really what
Speaker 8: he's focusing on, and that's important. Thirty seven trillion dollars
Speaker 8: is debt is nothing short of suicidal in my view.
Speaker 2: Last sort of posts from you know Musco are about
Speaker 2: a slim, beautiful bill and Nancy Tangl We appreciate it.
Speaker 2: CEO and CIO of Leffetengra Investments, Happy weekend to you.
Speaker 4: Now coming up Anisphere.
Speaker 2: It's the maker of the popular AI coding assistant Cursor.
Speaker 4: You've got to have heard of it. You might have
Speaker 4: used it.
Speaker 2: It's got a new valuation a nine point nine billion
Speaker 2: dollars to swing with the CEO Michael Truell. Next, this
Speaker 2: is a blue Bow Technology.
Speaker 3: The company behind the popular AI coding assistant Cursor has
Speaker 3: a new valuation nine point nine billion, just three years
Speaker 3: after it was launched and says it's bringing in five
Speaker 3: hundred million dollars in annualized revenue. Michael Truel is any
Speaker 3: Sphe's CEO, and he joins us. Now your name comes
Speaker 3: up a lot all the time, not just here in Silicon.
Speaker 5: Valley, everywhere.
Speaker 3: The growth that you've seen in the platform has been rapid.
Speaker 5: This is a finance story, you know.
Speaker 3: It's a funding, it's a access to capital. But what
Speaker 3: I want to ask you is what the true motivation
Speaker 3: behind it was. Did you need the money or was
Speaker 3: it just because of the interest.
Speaker 5: In you from the outside.
Speaker 10: Well, the goal for us with building Cursor is to
Speaker 10: invent a very new way to build software, right and
Speaker 10: I think that the product that we built today is
Speaker 10: just the very start of that. I think that over
Speaker 10: the next five years we have a chance to invent
Speaker 10: a style of programming that looks very different from how
Speaker 10: you build software today, one that's much higher level and
Speaker 10: more productive. And it's just still down to defining what
Speaker 10: you want to show up on the computer and how
Speaker 10: you want the.
Speaker 5: Software to work.
Speaker 10: And we have a long way to go there, and
Speaker 10: there's a lot of research and development to do to
Speaker 10: get there. And so we took on this capital to
Speaker 10: invest in frontier AI coding research.
Speaker 3: What is unique about Cursor, how it was written relative
Speaker 3: to what Claude is offering with their similar tool, Windsurf
Speaker 3: and other similar platforms.
Speaker 10: Well, the EPI models created by folks like Anthropic and
Speaker 10: Gemini and open Ai are fantastic and our big parts
Speaker 10: of Cursor and the power the technology under the hood,
Speaker 10: alongside custom models that we developed to that are specifically
Speaker 10: very good at parts of programming. And so at this point,
Speaker 10: Cursor is powered by an ensemble of models. Some of
Speaker 10: them are API, a lot of them are custom, and
Speaker 10: we do over half a billion model claus per day
Speaker 10: on our customer models.
Speaker 5: And it's that ensemble of models.
Speaker 10: Under the hood that separates a useful AI product from
Speaker 10: one that's just a demo. And it's that ensemble of
Speaker 10: models that gives you the speed, instability and performance that
Speaker 10: you need to be really useful vibe coding.
Speaker 4: That is something that's come into our lexicon.
Speaker 2: I just want to be shining a light on who's
Speaker 2: been using Cursor for that very reason.
Speaker 4: So no a pitchy.
Speaker 2: Just take a listen to what you said a couple
Speaker 2: of days ago at the Blombag Tech Summit.
Speaker 10: I wish I could, I could do more, but you know,
Speaker 10: I've just been messing around beat either with cursor or you.
Speaker 5: Know, I wipe coded with replet.
Speaker 10: Compared to the early days of coding, things have come
Speaker 10: a long way.
Speaker 2: How's it feel that the CEO of Alphabet is using
Speaker 2: what you've made and only the last few years.
Speaker 10: Well, it means a lot, and we're honored, and we're
Speaker 10: big fans of the technology and the company that you know,
Speaker 10: he and the people working with him have created.
Speaker 4: I will say that.
Speaker 10: Our target market, the person we're really building for, are
Speaker 10: folks who build software for a living, professional software developers,
Speaker 10: and our goal is to raise the ceiling. But by
Speaker 10: doing that you do raise the floor too, I mean
Speaker 10: lower the floor. And it's been awesome to see folks
Speaker 10: that are less technical executives, designers, product folks also experimenting
Speaker 10: with building software and to end and.
Speaker 4: The money is through subscriptions.
Speaker 2: It's made you many would claim to be the fastest
Speaker 2: growing software startup ever.
Speaker 4: And I'm interested.
Speaker 2: Is the pivot to enterprise really what drives your growth
Speaker 2: from here? Because you have been about individuals, but you're
Speaker 2: selling forty dollars subscriptions for the business is.
Speaker 4: That the growth trajectory.
Speaker 5: We have a very healthy upmarket motion.
Speaker 10: A lot of our growth comes from serving larger and
Speaker 10: larger companies, and we're happy to announce as part of
Speaker 10: the funding that we're serving over half the Fortune five
Speaker 10: hundred and companies like in Nvidia and Adobia and uper
Speaker 10: and we're very happy to be serving those folks missions.
Speaker 3: The question is posed all the time if a larger
Speaker 3: entity will try and acquire you, has a larger entity
Speaker 3: tried to acquire you? And when I say a larger entity,
Speaker 3: I mean a company that is of open AI scale,
Speaker 3: XAI scale and thropic scale.
Speaker 10: Well, we can't comment on anything like that here.
Speaker 5: Actually we just stay in age. You can go ahead.
Speaker 10: I will say that we would like to build an
Speaker 10: independent company.
Speaker 5: You know, the founding team and I.
Speaker 10: Feel like we were bid for this opportunity and we're
Speaker 10: really energized by the product Jurney that we have had
Speaker 10: of us, and we would like to do that.
Speaker 2: Tocandal one Michael Trull, CEO of Anisphere, of course, maker Cursor,
Speaker 2: it's a joy.
Speaker 5: Take you for grabbing me. Thank you.
Speaker 2: Now we've got some breaking news regarding rare Earth and
Speaker 2: supply chain. Let's just take a look how China is
Speaker 2: granting rare earth permits to some US auto suppliers.
Speaker 4: This is currently, of course being.
Speaker 2: Discussed by Reuters as we stand reported by Reuters up
Speaker 2: three tens percent on General Motors.
Speaker 4: The other well auto.
Speaker 2: Companies have been training higher in the session. China granting
Speaker 2: rare Earth's permits to some US auto suppliers.
Speaker 4: According to router s.
Speaker 3: Ed Okay, coming up on the show, the feud between
Speaker 3: President Trump and Elon must maybe calling off, and the
Speaker 3: future of US space has some thing to do with it.
Speaker 5: We're going to talk.
Speaker 3: About the rocket man and the President of the United States.
Speaker 3: Next from San Francisco, this is Bloomberg Technology.
Speaker 4: Welcome back to Bloomberg Technology.
Speaker 2: I'm Karen Hyde right here in San Francisco.
Speaker 5: Yeah, for the final day this week, and I'm ed Lovelow.
Speaker 5: What are you looking at.
Speaker 2: Let's get a check on these market said, because actually
Speaker 2: despite the sell off in one particular name that we've
Speaker 2: seen a couple of days, then as at one hundred
Speaker 2: has had a nice week.
Speaker 4: We're up almost two percent.
Speaker 2: As it stands now, we're currently seeing what the best
Speaker 2: week since all of last week, but it's two straight
Speaker 2: weeks of games. We're up two percentage points. If you're
Speaker 2: looking at points contributors on the day in videos up
Speaker 2: there Apples there, Amazon's there, so too is Tesla. Let's
Speaker 2: look at Tesla though over the last five days. Yes,
Speaker 2: it claws back some of its market capitalization erosion that
Speaker 2: we saw yesterday hard and fast.
Speaker 4: But over the course of the.
Speaker 2: Week we are down by one hundred and forty billion
Speaker 2: dollars in terms of market cap. All of this as
Speaker 2: Elon goes versus well the most powerful person in politics,
Speaker 2: President Trump.
Speaker 3: Let's recap from romance to breakup and now maybe a truce.
Speaker 3: It's started with Musk slamming Trump's tax bill. Trump's response, disappointment.
Speaker 8: I've always liked Dylan and as times we very surprised.
Speaker 11: You saw the words he had for me, the words,
Speaker 11: and yes, I said, any thing about me that's bad,
Speaker 11: I'd rather have been printed serves me than the bill,
Speaker 11: because the bill is incredible.
Speaker 3: Trump claimed that Musk was mad about ev incentive cuts,
Speaker 3: must denied it, noted he's long opposed to subsidies.
Speaker 5: Then it turned personal.
Speaker 3: Trump called Musk crazy and claimed he kicked him out
Speaker 3: of the administration.
Speaker 5: Musk fired back. Tesla shares dropped.
Speaker 3: Investors had hoped must ties to Trump might fast track
Speaker 3: ROBOTAXI rules. Then Trump threatened to end Musk's federal contracts,
Speaker 3: a direct hit to SpaceX. Musk said he'd pulled Dragon
Speaker 3: spacecraft from national missions and then he walked it back.
Speaker 3: So what happens now for space policy? And Musk Blooma's
Speaker 3: Lauren Grush joins us, Now we're focused on Dragon, which
Speaker 3: is the capsule that sits atop the SpaceX rocket that
Speaker 3: takes humans and cargo to and from the.
Speaker 5: International Space Station.
Speaker 3: Musk said that he would decommission the program and then
Speaker 3: walked it back.
Speaker 5: Explain why that was so important.
Speaker 12: Yeah, it's hard to over state just how dependent NASA
Speaker 12: has become.
Speaker 8: On SpaceX and the Dragon spacecraft.
Speaker 12: It is kind of the It is the primary way
Speaker 12: that the NASA sends humans to.
Speaker 8: The International Space Station, and it.
Speaker 12: Is probably the biggest supplier of food and supplies to
Speaker 12: the ISS. So without it, we can't stall have the
Speaker 12: space station very well, and we can't send.
Speaker 8: Food there for the astronauts to eat.
Speaker 12: So we do have some other options, but none are
Speaker 12: as prolific as the Falcon nine and the Dragon combo,
Speaker 12: so it really would bring the operations at the ISS
Speaker 12: to a standstill.
Speaker 2: That's the pain point for NASA for astronauts, But what
Speaker 2: about the pain point for SpaceX? How dependent is it
Speaker 2: on the United States.
Speaker 12: Right, So it's no secret that in order for SpaceX
Speaker 12: to become this behemoth company that it has become, it
Speaker 12: has really lever NASA and government contracts to get help
Speaker 12: develop its Falcon nine rocket, to develop the.
Speaker 8: Dragon capsule, which it uses.
Speaker 12: For commercial purposes. It's not just a government spacecraft. They
Speaker 12: have used it to send tourists into orbit and for
Speaker 12: private citizens to visit the International Space Station, so they
Speaker 12: have actually used it for services outside of the government.
Speaker 8: Of course, you know, SpaceX does have a diversified revenue stream.
Speaker 12: A lot of that comes from Starlink now, which is
Speaker 12: it uses to you know, provide broadband coverage to Earth
Speaker 12: and to customers. So that has definitely supplemented a lot
Speaker 12: of their incoming revenue. But NASA and the Defense Department
Speaker 12: are very big customers and it would definitely be a
Speaker 12: major hit to their incoming you know, money if they
Speaker 12: were to just cancel all of their government contracts without explanation.
Speaker 2: And gosh, a great roundup, thank you so much on
Speaker 2: old sides of SpaceX, but for more on the broad
Speaker 2: impact of this feud. In indeed, it has cooled down.
Speaker 2: Anna Rathman's with US Global Market Strategists. Anna, your perspective
Speaker 2: on yesterday's market moves on the back of what seemed
Speaker 2: to be online warfare between Trump and Musk.
Speaker 13: Yeah, it was an unfortunate and very unnecessary spat between
Speaker 13: two very powerful individuals who have the potential to move markets.
Speaker 13: And we really saw that and felt that yesterday. At
Speaker 13: the end of the day, the question really was like
Speaker 13: who holds more power because that seemed to be the
Speaker 13: trajectory of the spat. Where we settled for the time
Speaker 13: being is that mister Trump seems to have won it.
Speaker 13: And you really saw that because of the potential impact
Speaker 13: for cash flow. If SpaceX had been a publicly traded company,
Speaker 13: you might have seen something similar for that particular name
Speaker 13: as well.
Speaker 8: But frankly, they need each.
Speaker 13: Other and so I'm really glad to see them toning
Speaker 13: down rhetoric and taking a little pause to cool down,
Speaker 13: because the government needs that public private partnership in order
Speaker 13: to make this country great.
Speaker 8: And also, you know, TESLA needs.
Speaker 13: Better regulations or friendly regulations, and space X needs the
Speaker 13: government as well, so they're going to have to work together,
Speaker 13: whether they like it or not.
Speaker 3: We focused a lot on Elon Musk, and the Elon
Speaker 3: Musk proportion of what's been happening. Is there still an
Speaker 3: element of headwind risk uncertainty for the technology investor in
Speaker 3: the market from the president.
Speaker 4: You know.
Speaker 13: So this takes us to the tariff question, right And
Speaker 13: just recently you were just reporting about rare earth minerals
Speaker 13: from China and making it available to automakers, and that's
Speaker 13: really great news. And after at the heels of the
Speaker 13: she Trump conversation yesterday, which was a step in the
Speaker 13: right direction, I think this is an olive branch to
Speaker 13: take the conversation further. We may expect to see maybe
Speaker 13: mister Trump going to China or Cgpin coming into the
Speaker 13: United States, and that would be a huge step. But
Speaker 13: we do need to make headway because we are at
Speaker 13: a daktant.
Speaker 8: I do think that.
Speaker 13: The Trump administration has undermined the difficulty of negotiating with
Speaker 13: people who may not just respond to threats. You know,
Speaker 13: they call their bluff one hundred and forty five percent tariffs,
Speaker 13: and they didn't blink right. In fact, they told us
Speaker 13: they wouldn't respond at all. So I think it's going
Speaker 13: to take a lot more nuanced negotiations, and I would
Speaker 13: look at this rare earth mineral's news as an opening
Speaker 13: for a good faith negotiation.
Speaker 3: There are people I've spoken to who would say, I
Speaker 3: look at the rare earth situation and wonder what the
Speaker 3: United States can do in the context of a trade negotiation.
Speaker 3: One idea is a quid pro quo where rare earth
Speaker 3: access on favorable terms would be exchanged for semiconductor act
Speaker 3: access that's codified in the AI context. That sounds messy,
Speaker 3: doesn't it.
Speaker 13: It sounds very messy, and I'm very skeptical. So the
Speaker 13: question is who holds the cards. China certainly holds the
Speaker 13: cards on rare earths, but in many ways that is
Speaker 13: the only thing that they have the cards on where
Speaker 13: we absolutely need it. We hold the cards on the
Speaker 13: massive consumer base and also influence on other countries as well,
Speaker 13: as we've seen through all of this negotiation process.
Speaker 5: So even though Jensen Wang.
Speaker 13: Would love for US to lower the export controls on AI, chips.
Speaker 13: I just don't see that happening, because if we make
Speaker 13: it available to them, it still doesn't guarantee that China
Speaker 13: isn't going to be making a strides and creating their
Speaker 13: own chips and designing them. So I don't see us
Speaker 13: giving up on it, And that takes.
Speaker 4: Me to one.
Speaker 13: May the solution actually.
Speaker 8: Look like at the end?
Speaker 13: Well, if we're at a daytime and China is a
Speaker 13: national security issue, then what.
Speaker 8: Are we willing to compromise?
Speaker 4: Probably not much, in.
Speaker 13: Which case we may actually end up in a similar
Speaker 13: place where we started, where nobody is giving up on anything.
Speaker 13: And that's to borrow Shakespeare's words, much ado about nothing
Speaker 13: for all of this drama.
Speaker 2: All of this drama involves other people than President Trump
Speaker 2: and Il Musk, and there are some very focused technology
Speaker 2: experts advising the White House.
Speaker 4: One of them is David Sachs.
Speaker 2: There was a lot of concern about what the ripple
Speaker 2: effects of this feud might have on him. But thus
Speaker 2: far AI policy, crypto policy more broadly hasn't been in
Speaker 2: the right direction from your perspective.
Speaker 13: I think in the right direction in terms of doing
Speaker 13: that much about it. Yes, I do think that on
Speaker 13: the hardware side, yeah, there's going to be some questions
Speaker 13: about making certain ships available, but on the software side,
Speaker 13: we have to be continuing to develop because at the
Speaker 13: end of the day, that's where the race is right now.
Speaker 13: It's not just then the chips. The chips were very
Speaker 13: excited about, data centers were very excited about, but it's
Speaker 13: really the going beyond the proof of concepts and making
Speaker 13: it more productive for not only American citizens but global
Speaker 13: citizens around the world. Taking that step is the race,
Speaker 13: and I think they just need to be left alone
Speaker 13: in some ways so that they can continue to innovate.
Speaker 13: And also that innovation will come with being able to
Speaker 13: protect from the bad actors because ultimately that rounds out
Speaker 13: the national security issue.
Speaker 3: And a wrapan global market strategists, thank you very much.
Speaker 3: Now coming up will break down one of the splashiest
Speaker 3: public debuts in years that have stable coin firm Circle
Speaker 3: This next, this is Bloomberg Technology.
Speaker 11: We really do think that major technology firms, major financial institutions,
Speaker 11: major commerce firms are going to go to the stable
Speaker 11: point route, and we think that they're going to look
Speaker 11: to partner with the leading platforms and the leading infrastructure
Speaker 11: that can bring the technology the scale, the network effects,
Speaker 11: and really the broad regulatory footprint like Circle has provided.
Speaker 2: That was Circle CEO Jeremy Lair. Following the stable coin
Speaker 2: Firms IPO. That was yesterday's Circle shows are still surging
Speaker 2: after the company and its shareholders raised nearly one point
Speaker 2: one billion dollars in an upsized offering. Stock was holded
Speaker 2: several times of volatility on the first day. Let's bring
Speaker 2: in Matt Ugu's Venture Science founding partner and a Circle investor.
Speaker 4: Look, I have to ask the.
Speaker 2: Question, was too much money left on the table? It's
Speaker 2: now trading a one hundred and nine. Did the bankers
Speaker 2: get the price just too low?
Speaker 5: Here?
Speaker 14: Well, thank you for having me, but look, nobody knows
Speaker 14: how some of these stocks will play out after the bell.
Speaker 14: So the important thing was for the IPO to be
Speaker 14: sold essentially the night before, and I think it was
Speaker 14: significantly oversubscribe, maybe twenty five times oversubscribed. So the companies
Speaker 14: do get paid ahead of time, and that's all locked
Speaker 14: in and after the bell rings.
Speaker 4: Where the direction takes.
Speaker 14: Obviously, this much of an increase is a pleasant surprise
Speaker 14: to all of us involved, but that's kind of how
Speaker 14: it happened.
Speaker 5: Let's go back a few years. Why did you first
Speaker 5: get into Circle.
Speaker 14: Yeah, that's a great question. I remember, I think about
Speaker 14: seven or eight years ago here and here not too
Speaker 14: far from these offices here where our offices are actually,
Speaker 14: I attended a dinner with a number of people from
Speaker 14: the regulatory side, people from I think some crypto experts,
Speaker 14: even from the Federal Reserve. And during that dinner, anytime
Speaker 14: Circle's name came up, the sentiment was quite positive. So,
Speaker 14: you know, obviously cryptocurrency, blocked chain, these subjects carry a
Speaker 14: certain nuance with them. But one of the things that
Speaker 14: we noticed was essentially Circle was sort of the grown
Speaker 14: up in the room and being on the positive side
Speaker 14: of you know, regulatory things and compliance. Obviously a US
Speaker 14: based company now, that was quite positive. But not to
Speaker 14: mention the technology that they're developing. Circle has some of
Speaker 14: the best blockchain cryptocurrency engineers in the world, along with
Speaker 14: some you know, maybe I have to mention Ripple as well,
Speaker 14: because we're Ripple shareholder also, but these are best the
Speaker 14: best engineers in the world working on amazing cutting edge technology.
Speaker 14: And so the two things combined, along with of course
Speaker 14: we're a quant driven firm. A number of other factors
Speaker 14: that we considered led us to that decision.
Speaker 2: And now it feels as though that grown up in
Speaker 2: the room is bearing dividends when you're looking at the
Speaker 2: Genius act coming into play, when you're thinking about the
Speaker 2: finally some support for stable coins written large when it
Speaker 2: comes from a government perspective, that must have helped the
Speaker 2: moon music for Yuipo.
Speaker 14: Now and that absolutely absolutely you're right. And of course,
Speaker 14: you know, all the positive signs that I mentioned before
Speaker 14: were really the writing on the wall.
Speaker 8: Now.
Speaker 14: Of course, nobody knew how the numbers would exactly play out.
Speaker 14: And again this is a pleasant surprise, and the stock's
Speaker 14: doing very well today.
Speaker 5: This is liquidity event for you.
Speaker 3: This is a great moment to celebrate a return for
Speaker 3: you and shareholders, or you keep holding, we keep holding.
Speaker 14: We're a different firm. We participate both in the equity
Speaker 14: capital markets offerings as well as the private positions that
Speaker 14: we carry, and so we're holding on to both for now.
Speaker 3: Matt Agus Venture Science founding partner, thank you very much.
Speaker 3: Peloton CEO Peter Stern says he has no interest in
Speaker 3: selling the business while he works on its turnaround. He
Speaker 3: made those comments at the Bloomberg Tech Summit in San
Speaker 3: Francisco yesterday, where Stern outlined his vision for reviving the
Speaker 3: fitness giant. Here he is alongside Bloomberg's Mark German.
Speaker 15: My predecessor took a lot of the really hard step
Speaker 15: to right size the company and set us up so
Speaker 15: that now we can execute on the strategy of empowering
Speaker 15: people to live fit, strong, long and happy. And we're
Speaker 15: doing that for six million members in multiple countries. We're
Speaker 15: in a really good place now to build on that
Speaker 15: really strong foundation that was established by my predecessors.
Speaker 5: So what is the strategy?
Speaker 16: What is Peter Stern's strategy for Peloton? Are you going
Speaker 16: to keep it a hardware software services company? Have you
Speaker 16: thought about spinning out the hardware and focusing just on
Speaker 16: the app.
Speaker 15: Yes, we're an equipment company plus amazing software plus human
Speaker 15: coaching with community.
Speaker 4: We are not Our future.
Speaker 15: Is not to try to scale the app at the
Speaker 15: expense of that equipment business. We have reignited the innovation
Speaker 15: engine for us as a company, and so focusing on
Speaker 15: the products and the experiences that we're going to offer
Speaker 15: over the next few months is absolutely my number one.
Speaker 15: Another one that I think is really important that We're
Speaker 15: focused on is how we use AI to deliver personal
Speaker 15: experiences for our members. That that is another one that
Speaker 15: I'm spending an enormous amount of time on, so huge
Speaker 15: priority for us.
Speaker 16: Last question for you, Peloton standalone business for years to come?
Speaker 16: Is it potentially an acquisition target for a larger company?
Speaker 5: What do you see as the you know?
Speaker 15: I mean, I was not hired to sell this company.
Speaker 15: I was hired to bring this company back to growth,
Speaker 15: to reinvigorate it, and it is happening.
Speaker 4: So there is we are.
Speaker 15: We are a standalone company for years to come.
Speaker 2: Allison ceop to stand there alongside Bloomberg's Mark gum And
Speaker 2: at the tech summit coming up. The Nintendo Switch to
Speaker 2: It has finally been released. We can be breaking down
Speaker 2: what the biggest consumer tech product release of the year
Speaker 2: really means. This is Bloomberg Technology.
Speaker 17: Hard to overstate how important the switch is for Nintendo.
Speaker 17: Almost all of its revenue comes from this one product
Speaker 17: or the exclusive games the company develops for it. Its
Speaker 17: popularity since twenty seventeen has driven Nintendo's share price to
Speaker 17: an all time high, and everything's riding on the switch
Speaker 17: to keeping that trend going.
Speaker 4: The stakes were very high.
Speaker 2: Nintendo is us the most successful point in its history.
Speaker 17: And here's why. The Nintendo DS one hundred and fifty
Speaker 17: four million sold, the follow up three DS seventy six million,
Speaker 17: the Wei one hundred and two million sold, the follow
Speaker 17: up We You, Oh Dear, and the Nintendo Switch almost
Speaker 17: the best selling console of all time one hundred and
Speaker 17: fifty two million sold.
Speaker 9: No pressure then, Switch one created a very high hurdle
Speaker 9: for the future consoles to serve us.
Speaker 17: So Nintendo's breaking new ground with some subtle shovels.
Speaker 7: It's the first console on Nintendo's history that is kind
Speaker 7: of the same thing, but just.
Speaker 4: A little bit bigger and a little bit better.
Speaker 17: That strategy belies decades of corporate lessons learned sometimes the
Speaker 17: hardest way. But this time the stakes are just too
Speaker 17: high for history to repeat itself.
Speaker 4: It's a cool.
Speaker 2: And now it is here Legions and Gamment is now
Speaker 2: unboxing trying the new four hundred and fifty dollars gaming
Speaker 2: console for the very first time, removes Cecilia Denistasio joins us,
Speaker 2: now does it live up to the hype?
Speaker 18: The console definitely lives up to the hype. It is bigger,
Speaker 18: It's got better graphics. It's launching with a game, Mario
Speaker 18: Kart World that everybody is so excited for. Gamers were
Speaker 18: lined up around blocks and blocks outside of the Game
Speaker 18: Stop stores in Manhattan and Nintendo New York.
Speaker 5: So in San Francisco, Cara, I forgot to tell you this.
Speaker 3: So I was driving to our event Wednesday night in
Speaker 3: June fourth, the night before June fifth, and in Union Square,
Speaker 3: San Francisco, Cecilia, people were lining up and I was thinking,
Speaker 3: like they got the date wrong. But I guess it's
Speaker 3: like one of those iPhone moments where people, I guess
Speaker 3: are holding their spot.
Speaker 5: In line overnight. Or is that the level of enthusiasm
Speaker 5: we're talking.
Speaker 4: About, not just overnight.
Speaker 18: I talked to one customer who was waiting outside of
Speaker 18: the Nintendo New York store since April. He had people
Speaker 18: holding his spots wait was bringing him pizza. Yeah, shout
Speaker 18: out to Chicken Dog. He got the first switch to
Speaker 18: at the Nintendo New York store, given to him by
Speaker 18: Nintendo of America president Doug Bowser.
Speaker 2: I hope he got some accolades for standing in line
Speaker 2: for that time.
Speaker 4: That's an extraordinary story and therefore the rewards to chicken
Speaker 4: dog who stood there for how many days and months?
Speaker 2: Is how high fidelity were talking how much we likely
Speaker 2: to see the games come into their own because we
Speaker 2: saw a lot of Mario Kart just then, But there's
Speaker 2: plenty of other zeldas that you can be getting the
Speaker 2: action on.
Speaker 18: Yeah, so the Switch Too launched with a lot of
Speaker 18: sort of refreshed versions of very popular games from the
Speaker 18: original Switch console. There are a couple of games that
Speaker 18: people are really excited about going forward, including a new
Speaker 18: Donkey Kong game. But people I spoke to, while they
Speaker 18: are very excited about Mario Kart, some people feel a
Speaker 18: little bit disappointed with the launch slate of games. It's
Speaker 18: not quite so big. Nintendo should be filling that out
Speaker 18: over the next year or so.
Speaker 3: Sceire, I think it's important for you to explain to
Speaker 3: audience that this is like a completely different console to
Speaker 3: the original Switch. I have a Switch and I'm always
Speaker 3: remarking on like its performance or lack of performance. But
Speaker 3: inside Switch Too is a really important GPU.
Speaker 18: That's right, So there's a custom and video chip inside
Speaker 18: of the new Switch Too. I'm not sure I would
Speaker 18: say it's a completely different console. I think the form
Speaker 18: factor is very similar. It's capitalizing on the switches innovation,
Speaker 18: being you know, both portable and having a Doctor TV mode.
Speaker 18: It has these detachable controllers called joy cons. You know,
Speaker 18: it's not quite as big a leap as past console
Speaker 18: generations were for Nintendo. A lot of people think it's
Speaker 18: playing pretty safe right now, which is a good bet.
Speaker 18: And so the games industry has been having a lot
Speaker 18: of difficulties for the last couple of years.
Speaker 3: Okay, go check on that guy that was in line
Speaker 3: since April and we'll make sure he's okay. Bloomberg, Cecilia Dianastasio,
Speaker 3: thank you very much. That does it for this edition
Speaker 3: of Bloomberg Technology Real quick. Tesla Right, there was some
Speaker 3: buoyancy in Friday session, Caro, but the main point is
Speaker 3: that on the week, this was the worst week for
Speaker 3: Tesla since February, and in aggregate this is a huge story.
Speaker 2: Yeah, and this one that's going to play out over
Speaker 2: the course of the weekend. Watch for shots fired or
Speaker 2: Not and pulled back on social media of your choice.
Speaker 2: Don't forget to check out our podcast recap on the
Speaker 2: feud that was. You can check it out online on Apple, Spotify,
Speaker 2: and iHeart this is Bloomberg Technology