Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive
Speaker 1: from coast to coast with Caroline Hyde in New York
Speaker 1: and Eva Low in San Francisco.
Speaker 2: This is Bloomberg Tech coming up. AMD fails to impress
Speaker 2: with its latest earnings. Shares volatile amid rising AI valuation
Speaker 2: concerns from investors, plus a historic victory for Zoram Mamdani,
Speaker 2: the new mayor of New York, will discuss what is
Speaker 2: election means for the city's tech scene, and all eyes
Speaker 2: on Tesla as the company's shareholders are set to vote
Speaker 2: on a proposed one trillion dollar pay package for Elon Musk.
Speaker 2: There are two names in the markets that we're watching
Speaker 2: most closely, and that's in the earnings context right now.
Speaker 2: AMD is basically swung between modest declines and modest gains
Speaker 2: all morning long. It gave an outlook for the current
Speaker 2: period that was well in line with consensus but did
Speaker 2: not beat the most bullish estimates. And everyone's trying to
Speaker 2: work out is they're making some ground up in the
Speaker 2: AI data center context in the near term, or is
Speaker 2: it their legacy businesses processes for pc CPUs for serverts
Speaker 2: doing the business super Micro similar story. The outlook for
Speaker 2: earnings in the current period below consensus traction struggles when
Speaker 2: it comes to have they worked this whole AI thing
Speaker 2: out on the server side? That stock down seven percent.
Speaker 2: Let's get those stories with Bloomberg's executive editor for Tech,
Speaker 2: Peter Elstrom, and start with AMD. It's been really hard
Speaker 2: to pass this one. Right when the stock felon issue,
Speaker 2: You're like, Okay, the stock rally over in chips, but
Speaker 2: actually investors are just playing what AMD is put in front.
Speaker 3: Of them right right, It's been a rough twenty four
Speaker 3: hours for chip stocks. We saw that in Asia, we
Speaker 3: also saw it in Europe. AMD is a bit of
Speaker 3: a different story. The stock has been on such a tier.
Speaker 3: It's up about one hundred percent this year's so far.
Speaker 3: I think investors were looking for an impressive result from them.
Speaker 3: What they're really looking for is AMD. As you alluded to,
Speaker 3: they still have a hand in the traditional business of
Speaker 3: PCs and servers, and they're moving more aggressively into this
Speaker 3: AI space to compete with in Vidia. Now they're not
Speaker 3: growing as quickly as in Vidia. Video is up growing
Speaker 3: in the fifty percent range. At this point, AMD has
Speaker 3: been more in the thirty percent range. People really want
Speaker 3: to see whether the AI business, the AI chips that
Speaker 3: AMD is offering, are going to take off and AMD
Speaker 3: is going to be able to accelerate that growth rate.
Speaker 3: We didn't see that. As you mentioned, they did have
Speaker 3: a pretty solid beat on the revenue side, but it
Speaker 3: was not as high as some people had been expecting. Also,
Speaker 3: the operating expenses were a little bit higher than expected,
Speaker 3: probably suggesting that more of their business was on the
Speaker 3: old traditional PC business rather than the AI business.
Speaker 2: Peter, help us make sense of super Micro. There was
Speaker 2: a time where that was a stock and a name
Speaker 2: caught up in broad and enthusiasm for AI. But at
Speaker 2: the end of the day, super Micro assembles servers and
Speaker 2: server designs for others. What do we learn from their print.
Speaker 3: Right, Well, super Micro has had a few cross currents
Speaker 3: that we have been looking at. They had some accounting
Speaker 3: accounting issues. They announced a couple of revisions to what
Speaker 3: they were reporting in their financials, and now their outlook
Speaker 3: is coming in a little bit light. Their revenues for
Speaker 3: the current quarter were a little light. Also, their projection
Speaker 3: from the next quarter is a little bit light. I
Speaker 3: think people are concerned that This has been an AI play.
Speaker 3: They have benefited from the fast growth and AI demand
Speaker 3: in the past, but it looks like they're losing some
Speaker 3: of that momentum at this point. That could be because
Speaker 3: competitors like Dell are picking up more market share. It
Speaker 3: could also be because we're seeing some of these companies
Speaker 3: do more of this construction, the building the AI chips
Speaker 3: into servers themselves, and that would take away business from
Speaker 3: super micro.
Speaker 4: Max.
Speaker 2: Peter Elstrom with the summary, thank you very much. Let's
Speaker 2: get some more on AMD, the Wyder chip sector, and
Speaker 2: what's really happening with AI evaluations. Joe Ane Feenie Advisors,
Speaker 2: Capital management partner and portfolio manager joins us. I restart
Speaker 2: with you how I did with Peter, right that the
Speaker 2: market is confronted with AMD's earnings and trying to work
Speaker 2: out is this then gaining some territory on Nvidia in
Speaker 2: the accelerator card market or are they getting a boost,
Speaker 2: particularly in the court of gone from those legacy business
Speaker 2: lines PC processors, CPU for server. Let's just start there.
Speaker 2: What did you learn from AMD?
Speaker 5: Yeah, good morning, ed. We're seeing all of that from AMD,
Speaker 5: and let's start with the old, boring part of AMD
Speaker 5: right the PC, the CPUs, the standard server CPUs where
Speaker 5: they're clearly continuing to gain share versus Intel, and that's
Speaker 5: a good cash generator for the company. So we shouldn't
Speaker 5: dismiss that acceleration that we saw there, that success that
Speaker 5: they're continuing to deliver in terms of share gains. Obviously,
Speaker 5: a lot of investors are still focused pretty much on
Speaker 5: the AI opportunity, and what's interesting there is that they've
Speaker 5: just gotten started. They've only now developed solutions for those
Speaker 5: accelerators that meet the quality for inference, for example, potentially
Speaker 5: for training that in Vidia has in the past. When
Speaker 5: we've seen AMD leapfrug Intel back in the old days,
Speaker 5: they gained an enormous amount of share. We saw that
Speaker 5: again this time around. Now they have a new opportunity
Speaker 5: to gain share in the AI accelerator. We're not seeing
Speaker 5: them gain share except for just a little bit as
Speaker 5: they get started today. But I think that's something we
Speaker 5: can look forward to.
Speaker 2: Bloomberg's Ian King, who you know, made a really simple
Speaker 2: point yesterday on the program ahead of AMD earnings. The
Speaker 2: data center category is just north of four billion dollars
Speaker 2: a quarter business. In Vidia's data center category is forty
Speaker 2: billion dollars or north of forty billion dollars each quarter
Speaker 2: in aggregate. Do you see all those ships rising right now?
Speaker 2: With the tide that is AI infrastructure investment?
Speaker 5: It still is ed. We're still seeing the pie expand
Speaker 5: or tie rise, or whatever analogy you want. But what
Speaker 5: AMD has that Nvidia doesn't have is an opportunity to
Speaker 5: take a greater share of that pie as it grows.
Speaker 5: And so you know, I expect we're going to see
Speaker 5: both companies continue to grow very strongly over time. We
Speaker 5: own both of those for clients. I own both of
Speaker 5: them personally because I think this is an opportunity in
Speaker 5: AI that is just beginning. I think we have many
Speaker 5: years ahead. And what we're seeing also in those results
Speaker 5: from AMD and elsewhere is that enterprises, sovereigns are looking
Speaker 5: to deploy AI and that's what's helping to continue to
Speaker 5: grow that pie.
Speaker 2: John Phoenix to bear with us New York City mayor
Speaker 2: elects or A mum Dani is speaking in Queens, New York.
Speaker 4: I now hold, the poetry of campaigning may have come
Speaker 4: to a close last night at nine, but the beautiful
Speaker 4: prose of governing has only just begun. The hard work
Speaker 4: of improving New yorkers lives starts now. That process begins
Speaker 4: with transition. In the coming months, I and my team
Speaker 4: will build a city Hall capable of delivering on the
Speaker 4: promises of this campaign. We will form an administration that
Speaker 4: is in equal parts capable and compassionate, driven by integrity,
Speaker 4: and willing to work just as hard as the millions
Speaker 4: of New Yorkers who.
Speaker 2: Call this city home.
Speaker 4: And central to that effort is a transition team that
Speaker 4: is defined by the excellence New Yorkers will soon come
Speaker 4: to expect from government. Our team will be directed by
Speaker 4: Ilana Leopold, whose roots in this city extend back to
Speaker 4: her grandmother running the trams on Roosevelt Island. She has
Speaker 4: extensive experience in city government and has been a key
Speaker 4: part of our campaign to become the next mayor of
Speaker 4: this city. And it will be led by our formidable
Speaker 4: co chairs former Federal Trade Commissioner Chair Lena Khan, former
Speaker 4: First Deputy Mayor Maria Tis Springer, United Way President and
Speaker 4: CEO Grace Bonia, and former Deputy Mayor for Health and
Speaker 4: Human Services Melanie Hartzog. Over the coming days, we'll start
Speaker 4: announcing the leaders who will implement our agenda. People like
Speaker 4: deputy mayors who oversee entire areas of government, and the
Speaker 4: commissioners who carry out the critical work of city agencies.
Speaker 4: Some of these people will have familiar names, others will not.
Speaker 4: What will unite them will be a commitment to solving
Speaker 4: old problems with new solutions. We will cast a wide net.
Speaker 4: We will speak to the organizers on the front lines
Speaker 4: of the fight to improve our city government, veterans with
Speaker 4: proven track records, policy experts from around the country and
Speaker 4: the world, and working people who know better than anyone
Speaker 4: what their neighborhoods need. Throughout this campaign, I've worked hard
Speaker 4: to be accessible and transparent with New Yorkers. That same
Speaker 4: spirit will animate this transition and the city all we built.
Speaker 4: Because New Yorkers deserve a government that they can trust.
Speaker 4: And on January first, when our city celebrates the inauguration
Speaker 4: of a new administration, let us also celebrate a new
Speaker 4: era for our city, one that we all feel invested
Speaker 4: in and whose success we all work to achieve. Now,
Speaker 4: it is my pleasure to invite Ilana Leopold to deliver
Speaker 4: a few words Thank you, thank you.
Speaker 5: Good morning.
Speaker 6: My name is Ilana Leopold and I'm very honored to
Speaker 6: serve as the executive director of Mayor Elect Mom Donnie's
Speaker 6: leadership team. I want to thank Zoron for his faith
Speaker 6: in me both on.
Speaker 2: The campaign that was New York City Democratic Mayor Elect
Speaker 2: Zorah Mamdani generation, speaking after his win last night, elected
Speaker 2: the one hundred and eleventh mayor of New York City,
Speaker 2: the youngest mayor elect in a century. Let's get the
Speaker 2: reaction now and some of the technology is respective and
Speaker 2: avowed democratic socialist in charge of the city that serves
Speaker 2: as the capital of global finance, increasingly a major technology hub.
Speaker 2: Judy Samuels is the CEO of Tech NYC, a network
Speaker 2: of tech leaders working to foster New York's tech scenes.
Speaker 2: She joins us now and will give us the reaction
Speaker 2: Tech NYC. Will this mayor be a good mayor for
Speaker 2: your industry in New York City?
Speaker 7: Oh listen, I think we don't know. I think what's
Speaker 7: good for New York tends to be good for tech here.
Speaker 7: Zornmamdannie ran on a campaign of making New York affordable
Speaker 7: of He ran in a campaign that really celebrated a
Speaker 7: lot of what people love about New York. People love
Speaker 7: to be out in the streets. So if people want
Speaker 7: to be here, if young people want to be here,
Speaker 7: the tech companies will continue to want to be here.
Speaker 7: And clearly we heard loud and clear yesterday that a
Speaker 7: lot of young people want Zurmumdannie to be mayor. There
Speaker 7: are a lot of tech workers who voted for him.
Speaker 7: Of course, you know, that's the bull case, right The
Speaker 7: Baar case, of course, is that you're going to have
Speaker 7: someone who is anti business. I hope that's not the case,
Speaker 7: but there's so many unknowns right now.
Speaker 2: Julie, you said that a lot of the technology industry
Speaker 2: turned out and voted for him. Voter turnout was a
Speaker 2: critical data point overnight. What's your reaction to that data point.
Speaker 7: Well, listen, as a practical matter, I think more people
Speaker 7: voting always better, So we're really glad to see that
Speaker 7: was the case. And in fact, even as early as
Speaker 7: the primary months ago, the data was the data were
Speaker 7: very clear that people who worked in tech were donating
Speaker 7: a lot of money to Zorn Mamdani's campaign. So it's
Speaker 7: not a surprise. You know, we can quickly or easily,
Speaker 7: I should say, draw a line to understand that a
Speaker 7: lot of tech workers, young tech workers did vote for
Speaker 7: him yesterday. Clearly you know so much about Zoron's campaign,
Speaker 7: I think resonated with people in the tech industry. It
Speaker 7: had the flavor of a startup. It really disrupted the
Speaker 7: status quo of politics in New York and I think
Speaker 7: that resonated with a lot of people who work in tech.
Speaker 2: Julie, there is always a difference, of course, between policy
Speaker 2: platform in the context of a campaign's and then policy
Speaker 2: platform when in office. But the consensus seems to be
Speaker 2: that mister Mumdani is in favor of sort of pro
Speaker 2: housing revisions to the city's charter right making housing available
Speaker 2: and more affordable. Technology as a sector tends to have
Speaker 2: higher pay and perhaps you know, apply to a higher
Speaker 2: to middle income earning bracket. Are they really going to
Speaker 2: be focused on a policy around affordable housing.
Speaker 7: Well, I think that's a really great question. And in fact,
Speaker 7: the organization I run Tech NYC put out research with
Speaker 7: Zillah just maybe a year org that showed that even
Speaker 7: people who have high paying jobs in tech are having
Speaker 7: a hard time affording housing in New York City. So
Speaker 7: it is not when we talk about affordable housing is
Speaker 7: it runs across the entire spectrum. For so many people,
Speaker 7: it's unaffordable, and so I think that more housing is
Speaker 7: better for tech in New York. We've seen the same
Speaker 7: dynamic in San Francisco, of course, that the need to
Speaker 7: build more housing so more people from across the economic
Speaker 7: spectrum can live here, build their careers here, grow their
Speaker 7: family here. I am really incredibly in favor of the
Speaker 7: pro housing initiatives that won yesterday.
Speaker 2: Is there an opportunity, Julie, for you to work with
Speaker 2: this mayor and this administration to bring it a sort
Speaker 2: of closer relationship apologies between you and the administration.
Speaker 7: Absolutely, I think there's a lot of opportunity. I think
Speaker 7: the thing I'm most hopeful about is modernizing government government efficiency.
Speaker 7: So our mom, Donnie is what is a very progressive
Speaker 7: candidate now Mayor elect, and progress means government that works better.
Speaker 7: So we need to unleash technology in New York City
Speaker 7: government to work better for New Yorkers. But we also
Speaker 7: will need to be really careful and when we work
Speaker 7: with his team, or sometimes when we disagree with his team,
Speaker 7: to ensure that the tech economy continues to thrive here,
Speaker 7: that businesses continue to grow here. This is the future
Speaker 7: of the economy in the world. Technology is of course
Speaker 7: and needs to also be the future of the economy
Speaker 7: in New York City. So we have to work together.
Speaker 7: We have no other choice.
Speaker 2: What do you disagree with his team on and what
Speaker 2: would you ask mister Mumdani to reconsider in terms of policy.
Speaker 7: Oh, that's a really that's a great question. I think
Speaker 7: that I don't know what we disagree with necessarily at
Speaker 7: this point, but I can tell you what we'll be
Speaker 7: watching for again, the use of technology in government. We
Speaker 7: think that's crucial, and I want to make sure that
Speaker 7: his team that the incoming may understand that some of that,
Speaker 7: you know, requires some experimentation and requires being open minded
Speaker 7: about new uses of technology. Also, you know, I think
Speaker 7: there are concerns that I hope don't come to be,
Speaker 7: but there are some concerns that there's kind of like
Speaker 7: an anti business dynamic. We haven't talked about raising taxes.
Speaker 7: I haven't brought that up because you can't do that
Speaker 7: without the state. You can't do that without Albany. Obviously,
Speaker 7: a lot of people in tech would not be excited
Speaker 7: about more income tax, more corporate tax, So that I'm
Speaker 7: sure will be an issue that comes up over the
Speaker 7: next four years.
Speaker 2: New York City Mayor elect Zura Mundani, the one hundred
Speaker 2: and eleventh mayor of New York to be elected, is
Speaker 2: an avowed Democratic socialist, and one of the big stories
Speaker 2: of this year twenty twenty five has been the move
Speaker 2: of key figures in the technology industry to put themselves
Speaker 2: in close proximity to President Trump and the administration currently
Speaker 2: in the White House. Are both of those things achievable
Speaker 2: at the same time for mister mum Dannie to have
Speaker 2: relationships of key figures in your industry at the same
Speaker 2: time that they try and be close to this president
Speaker 2: and the Republican Party.
Speaker 7: I think I think that's a really good question, and
Speaker 7: I think we're going to see. I'd point out that
Speaker 7: most of the particular tech leaders you're talking about are
Speaker 7: actually not New Yorkers, but they do run companies that
Speaker 7: have incredibly large presences in New York City. I think
Speaker 7: that I hope that, let me say, I hope that
Speaker 7: zoramum Danni and his team fundamentally understand that the future
Speaker 7: of our city's economy, the future of opportunity for New
Speaker 7: Yorkers is inextricably intertwined with the growth of the tech
Speaker 7: sector here. And if those jobs aren't here, they will
Speaker 7: go somewhere else. And if those resources aren't here, they
Speaker 7: will go somewhere else. And I just have to believe,
Speaker 7: I do believe that we can find a way to
Speaker 7: work together to ensure that all New Yorkers have the
Speaker 7: opportunity to benefit from the growth that technology is bringing
Speaker 7: to the city.
Speaker 2: Let's end that there then July by asking what is
Speaker 2: the one first ask that you have for Mayor Elect
Speaker 2: Mumdani on behalf of your members and the technology industry
Speaker 2: in New York City.
Speaker 7: I think the first big ask will be to really
Speaker 7: drill down and figure out how we can find a
Speaker 7: way to use technology to make New York City government
Speaker 7: work better for New Yorkers.
Speaker 2: Julie Samuel's CEO of Tech NYC, with immediate reaction to
Speaker 2: Mayor Elect Zora Mumdani speaking for the first time since
Speaker 2: his win last night. There are other news headlines It's
Speaker 2: time for talking tech and first st up. The US
Speaker 2: government says it's nearing the end of its investigation into
Speaker 2: Google's thirty two billion dollar acquisition of cybersecurity firm Wiz.
Speaker 2: The deal, announced in March, prompted an in depth probe
Speaker 2: by the Justice Department. While that review is now wrapping up,
Speaker 2: the acquisition remains under scrutiny from other anti trust regulators. Plus,
Speaker 2: Google and Epic Games have reached a settlement in their
Speaker 2: long running anti trust dispute over how developers distribute my
Speaker 2: Tize apps on the Android platform. The deal follows Google's
Speaker 2: court ordered play store changes to allow more competition. Exact
Speaker 2: terms of the agreement weren't disclosed, and the scientist who
Speaker 2: led ten cents flagship AI model has raised fifty million
Speaker 2: dollars for his new startup, Video Rebirth, which aims to
Speaker 2: rival OpenAI Sourra. Founded by Leeway, the company seeks to
Speaker 2: make video creation as intuitive as chatting with an AI.
Speaker 2: The platforms expected to launch in December. Okay, coming up.
Speaker 2: Amazon goes after Perplexity, suing the AI startup from using
Speaker 2: its own AI tool to help shoppers. We've got more
Speaker 2: on that next. This is Bloomberg Tech. Amazon is suing
Speaker 2: Perplexity over its AI shopping tool, known as Common, which
Speaker 2: helps users buy items on Amazon. The retail giant alleges
Speaker 2: Perplexity committed computer fraud and violated its terms of service
Speaker 2: by failing to disclose when Comet was making purchases on
Speaker 2: behalf of real people for more, as Sketz of bloemost
Speaker 2: Matt Day, who leads our coverage of Amazon, this is
Speaker 2: an interesting move. We've covered Comet and Perplexity on the
Speaker 2: show We Understand Amazon, just I think start by explaining
Speaker 2: the grievance that Amazon has and the accusation Amazon's making
Speaker 2: against Perplexity and what they're doing.
Speaker 8: So Amazon says that you know, what Perplexity is doing
Speaker 8: here is masking who's on its website.
Speaker 9: Right.
Speaker 8: They've alleged that Perplexity inserted sort of the same code
Speaker 8: that would make Amazon Systems think it was just a
Speaker 8: regular Google Chrome user, when in fact it was not
Speaker 8: a mad agent going on their site. And so Amazon's
Speaker 8: raised a whole host of concerns, you know, saying account
Speaker 8: integrity could be compromised, saying, you know, if someone has
Speaker 8: to make a return, you know who's at fault. What
Speaker 8: goes on here? Basically kind of a turf war over
Speaker 8: the customer experience on their retail side.
Speaker 2: Okay, we've heard from Perplexity both through a spokesperson, but
Speaker 2: they also put out their own commentary and a blog
Speaker 2: summarize it for us.
Speaker 8: So they are accusing Amazon of bullying.
Speaker 2: You know.
Speaker 8: They say they don't see a meaningful distinction between a
Speaker 8: user who said, listen, I want to purchase something on Amazon.
Speaker 8: I'm going to authorize Perplexity to go, you know, make
Speaker 8: the computer plumbing that makes that work. They say that
Speaker 8: that's no different than someone navigating with a mouse and keyboard.
Speaker 9: Right.
Speaker 8: Obviously Amazon has a different view, but Perplexity seems to
Speaker 8: want to take a stand here and kind of stick
Speaker 8: up for this new potential commerce venue that they're deploying
Speaker 8: with their comment browser.
Speaker 2: Right, you cover Amazon so deeply, like, is this the
Speaker 2: playbook Amazon goes to? Are they typically litigious? Are they
Speaker 2: looking over their shoulder in a real way?
Speaker 8: I think they really are looking over their shoulder here.
Speaker 8: I mean they've said AI is going to change everything.
Speaker 8: You know, there's debates going on right now about what
Speaker 8: is a browser. So this is probably the first of
Speaker 8: many debates that we're going to have, you know, in
Speaker 8: public and in private, as these companies negotiate on just
Speaker 8: how you know, who owns the experience when agents are
Speaker 8: I'm going all over the internet rather than individual users
Speaker 8: with hands and eyes really quick.
Speaker 2: What happens next?
Speaker 8: Oh, we'll see if they settle right, And I don't
Speaker 8: think anybody wants to see if they scott a court
Speaker 8: and all this NFTY discovery come out right. So I
Speaker 8: think the obvious question in a case like this is
Speaker 8: can they come to some agreement?
Speaker 2: Bloombo's Matt Day Ada, Seattle, Thank you very much. Another story.
Speaker 2: It was the breakout hit of the summer. K Pop
Speaker 2: Demon Hunters became Netflix's biggest original film of all time. Now,
Speaker 2: with the chance to build a global franchise, there's just
Speaker 2: one thing missing for the holiday season. The merch. Bluebag's
Speaker 2: entertainment editor Lucas Shaw is here with more I've learned
Speaker 2: through you in attending screen time in the context of movie, TV,
Speaker 2: video games, that merchandising and franchising into other IP or
Speaker 2: from the core IP is so important. Basically, those big
Speaker 2: K pop fans are not going to be able to
Speaker 2: get hold of so C toys and other things this
Speaker 2: holiday season. Explain the story to us.
Speaker 9: Well, comes back to the movie, which was a surprise hit.
Speaker 10: You know, when you have a new property, you go
Speaker 10: to retailers and toy manufacturers, your Mattel, your Hasbro, Walmart, Target,
Speaker 10: and say, hey, we have this movie coming in like
Speaker 10: a year or two. We think it's going to be
Speaker 10: really popular with kids. Do you want to partner on things?
Speaker 10: Will you give a shelf space because they need that.
Speaker 10: The toy manufacturers in particular need time to make the toys,
Speaker 10: which takes a while, and it involves international shipping and
Speaker 10: all of that. And there was not a lot of
Speaker 10: confidence in this project, both because it was an original
Speaker 10: animated movie, which hasn't Those types of movies haven't done
Speaker 10: very well at the box office. Mostly sequels have been
Speaker 10: doing well, and Netflix just doesn't have a track record
Speaker 10: in this regard. And so it was only after this
Speaker 10: movie became so popular that everyone scrambled and they now
Speaker 10: say they're.
Speaker 9: Moving the fastest they've ever moved. But it still means
Speaker 9: that a lot.
Speaker 10: Of the projects, a lot of the toys and other
Speaker 10: things won't be.
Speaker 9: Available until next time.
Speaker 2: We know that the holiday quarter is really important. For example,
Speaker 2: we talk about it in the context of the new
Speaker 2: iPhone being on sale. But I guess in this story
Speaker 2: who's suffering here? Like, is it Netflix that is going
Speaker 2: to have to claw to make up some ground. Where
Speaker 2: is the kind of opportunity lost revenue loss?
Speaker 10: Yeah, I think it's it's shared between the toy companies,
Speaker 10: the retailers, and Netflix. But they would all like to believe,
Speaker 10: and they're all saying that it is sort of short
Speaker 10: term pain. That yes, you know, they won't have all
Speaker 10: they can't maximize what they're getting from the holiday season,
Speaker 10: but they will have properties next year, and that this
Speaker 10: is something they're building for the long term, and that
Speaker 10: if the second movie, which won't come for four years,
Speaker 10: is really popular, that this will all sort of.
Speaker 2: Be a footnote in history.
Speaker 10: Now that's dependent on them making a good second movie
Speaker 10: and building the bridge.
Speaker 9: But short term.
Speaker 2: Pain, Lucas really quick, Warner Brothers, Discovery. What's the need
Speaker 2: to know?
Speaker 10: I mean, all everyone's going to want to know about
Speaker 10: is who is buying them? And how you know the
Speaker 10: company is. The cable networks are not doing so hot?
Speaker 10: Is streaming growing? How's HBO max looking? The movie studio
Speaker 10: had a pretty decent summer, but the big question hanging
Speaker 10: over the company is who's going to buy it?
Speaker 2: Binos Lucas Shaw, who leads our coverage of screen Time
Speaker 2: and Entertainment. Thank you very much. Welcome back to Bloomberg Tech.
Speaker 2: Let's get a look at the markets some of the
Speaker 2: other stories. So we're trying to pass a lot of
Speaker 2: it's still earnings related, and look at this one. Pinterest
Speaker 2: is down more than twenty one percent, on track for
Speaker 2: its biggest drop since the middle of twenty twenty two,
Speaker 2: and it's all about an outlook for the holiday quarter
Speaker 2: that is completely tepid. The market is reactioning to this
Speaker 2: with some severity, and how common is that story across
Speaker 2: all of the names that we've been tracking. But when
Speaker 2: the team met this morning planned the show, we were like, whoa,
Speaker 2: we need to get this one in. It's as simple
Speaker 2: as the out look for the holiday period, and we'll
Speaker 2: give you more when we get it. Okay. Other news
Speaker 2: that we're tracking, Apple is said to be adding a new,
Speaker 2: cheaper MacBook to its lineup, rivaling Google's Chromebooks and Windows
Speaker 2: PCs Bluebos. Samantha Kelly joins us now for more. So
Speaker 2: this is an interesting one. I'm a MacBook user. I
Speaker 2: also have a Windows based PC that I used through work.
Speaker 2: The main thing is the price differential in the market.
Speaker 2: MacBooks are typically very expensive relative to a much broader
Speaker 2: range of available Windows or other operating system based PCs.
Speaker 2: I think there's a place to start tell us about
Speaker 2: what we know from the reporting about a new cheaper MacBook.
Speaker 11: That's right, and thanks for having me. Yeah, it's really interesting.
Speaker 11: This would be a pretty big departure from what we've
Speaker 11: seen from Apple before of the more premium standpoint with computers,
Speaker 11: but this would bring it down to a lower end,
Speaker 11: probably in the six hundred to eight hundred dollars range.
Speaker 11: It would be more targeted towards students, small businesses. It
Speaker 11: wouldn't be able to do everything. You be able to
Speaker 11: surf the web, some documents, some light editing, and would
Speaker 11: really open up the market for a lot of people
Speaker 11: who might have an iPhone but aren't ready to make
Speaker 11: that jump for some MacBooks start, you know, at nine
Speaker 11: hundred and nine and nine dollars. To your point, these
Speaker 11: are pretty expensive computers.
Speaker 2: Do we know anything about the timeline for this, Samantha, Like,
Speaker 2: is Apple going to surprise us with this this year
Speaker 2: or when do we expect to hear about it.
Speaker 11: We're expecting it soon, but it's not eminent, so it's
Speaker 11: in development. It's already in production, So we're thinking the
Speaker 11: first half of next year, probably in the spring, maybe
Speaker 11: somewhere between maybe March and June.
Speaker 2: What has Apple done to you know, Like sometimes I
Speaker 2: reflect about how Apple does something in the iPhone, or
Speaker 2: it might do it in the wearables category or even
Speaker 2: the iPad, and then it will say, how do we
Speaker 2: apply that to a different category like MacBook. Is there
Speaker 2: any reporting on like how there's a technology transfer that
Speaker 2: they have got the cost down or are they going
Speaker 2: to the playbook that they've done a base version iPhone
Speaker 2: took a long time to get after having many premium models.
Speaker 11: Yeah, it's interesting you say that. So my colleague Mark
Speaker 11: German is reporting that some of the components would obviously
Speaker 11: be a lot cheaper, making the price go down. But
Speaker 11: they might use an iPhone chip, which is very advanced
Speaker 11: at this point and exceeds some that we're seeing in
Speaker 11: the earlier m chip center in some of the MacBooks.
Speaker 11: So they would be able to take an iPhone chip,
Speaker 11: put it into a device and really open it up there.
Speaker 11: Also in other ways, you know, people might not need,
Speaker 11: you know, certain features, but they are still looking for
Speaker 11: battery life in some cases they're using an iPad a
Speaker 11: with an external keyboard, but that really increases the price too.
Speaker 11: This would be able to take everything, boil it down
Speaker 11: and give people perhaps an entry point into the ecosystem
Speaker 11: that they haven't been able to enter before.
Speaker 2: I should say that an Apple spokesperson declines a comment
Speaker 2: on our reporting. Now that's out the way, we should
Speaker 2: probably acknowledge the other side of the competation, which is
Speaker 2: the Chromebook and other laptop piecs. They are providing more
Speaker 2: competition to Apple exactly.
Speaker 11: Yeah, so there's been a lot of success around the
Speaker 11: chromebooks for Google. I mean a lot of schools have
Speaker 11: students using these devices. Of course you have Dell and
Speaker 11: HP of major players as well, a lot of people
Speaker 11: who can't afford a premium device will go to these
Speaker 11: very strong products. So it definitely will you have a
Speaker 11: new player involved, and it'll really increase competition. We saw
Speaker 11: some dips yesterday as far as stock with those related
Speaker 11: companies as well.
Speaker 2: Bloomberg Samantha Kelly with the original reporting, Thank you very much.
Speaker 2: Tesla shares are pushing higher ahead of tomorrow's big shareholder meeting,
Speaker 2: where the spotlight will be on Elon Musk's proposed one
Speaker 2: trillion dollar compensation plan and Shane Goodwin, executive director for
Speaker 2: SMU Corporate Governance Initiative. Shane was a governance advisor to
Speaker 2: the Special Committee, engaged to counsel them on corporate governance matters,
Speaker 2: including satisfaction of fiduciary duties under Texas law when that
Speaker 2: special Committee of two on Tesla's board put the package together. Shane,
Speaker 2: welcome back to Bloomberg Tech. I want to start by
Speaker 2: just clarifying some things for our audience. Now that the
Speaker 2: proxy's filed and the proposed compensation plan is out there,
Speaker 2: have you continued to be engaged with Tesla's Special Committee
Speaker 2: or was that work finished Now.
Speaker 12: We've still been very actively involved with the Special Committee
Speaker 12: throughout this whole process. Obviously that was just the start
Speaker 12: of it to kind of work with them, but we've
Speaker 12: been we're working with them ongoing, and they've been engaged.
Speaker 9: With all their advisors and legal prisoners along the way.
Speaker 2: And since the proxy was filed and shareholders became aware
Speaker 2: of the terms of the proposed compensation agreement, what is
Speaker 2: it specifically that you have been talking to the Special
Speaker 2: Committee and the board about.
Speaker 12: Well, the issue is that most people see every single day,
Speaker 12: that a lot of the headlines that come up, and
Speaker 12: then how can we proactively really address those And more importantly,
Speaker 12: it's just really can make sure that it's clear.
Speaker 9: Obviously, as your viewers certainly saw.
Speaker 12: The proxy advisors came out and actually commented on the
Speaker 12: plan and some other aspects as well, and then we
Speaker 12: just wanted to make sure that the shareholders, not the
Speaker 12: proxy advisors, were very fully informed about what the plan
Speaker 12: is and why this is different from what the DSS
Speaker 12: from Glass Lewis is really reviewing.
Speaker 2: So the biggest headline of this week is that Norway's
Speaker 2: Sovereign Wealth Fund came out and voted no against the
Speaker 2: proposed pay package. Not an advisory but an actual shareholder,
Speaker 2: I believe Tesla's ninth biggest shareholder, and their argument was
Speaker 2: very simple that they appreciated the significant value that mister
Speaker 2: Musk has created, but argue that this this proposal, the
Speaker 2: total size of the award is too great and like
Speaker 2: the advisory services, they're worried about dilution. Could you respond
Speaker 2: to that dilution part?
Speaker 12: Yeah, well, first let me just address obviously, they also
Speaker 12: oppose the pay plan on the ratification last year as well,
Speaker 12: So for me it was a little hard to understand
Speaker 12: kind of the Rederck versus the reality because they've been
Speaker 12: a shareholder in Tesla since twenty eleven, so right after
Speaker 12: the IPO they had a very small position, and they've
Speaker 12: actually continued to build that position to where they are today.
Speaker 12: So although they may have some concerns, they've enjoyed the
Speaker 12: benefit of a nearly a forty thousand percent increase in
Speaker 12: their share value during that particular time and constantly adding
Speaker 12: to their position, so they're obviously willing to enjoy the
Speaker 12: benefits of that. You know, with respect to the dilution,
Speaker 12: it's been very clear about what the plan was, and
Speaker 12: I know we talked about this last time ED, which
Speaker 12: was when the Special committe Robin.
Speaker 13: Denholm and Kathleen Wilson Thompson sat down with Elon to
Speaker 13: understand not only his vision for Master Plant four but
Speaker 13: obviously what he wanted to would accomplish. And Elon has
Speaker 13: been very clear about this and obviously the chair as well,
Speaker 13: which is he wanted to make sure he has enough
Speaker 13: voting influence and that number was around twenty five percent
Speaker 13: that would matter for him. This has been discussed as well,
Speaker 13: which is the committee reviewed numerous ways of finding a
Speaker 13: way to actually accomplish the voting and decoupling the economics,
Speaker 13: and unfortunately, under current exchange rules that we have today
Speaker 13: with either EEno Navdak any ways, he has a similar rules.
Speaker 13: You can't go and do a high vote or dual class.
Speaker 9: Listing once you've been listed in the exchange, Shane.
Speaker 2: We've also spoken to Tesla's board chair, Robin Denholm subsequently,
Speaker 2: since you're on the program right and there is an
Speaker 2: acknowledgment that there is a very real risk that if
Speaker 2: this is a no vote in the end and Elon
Speaker 2: Musk either leaves Tesla, or he pays back his activities
Speaker 2: in a different role, or he focuses more attention elsewhere.
Speaker 2: You are privy to these conversations. You've just told us
Speaker 2: that what is the plan B, what is the I
Speaker 2: guess mitigation of key man risk in the event that
Speaker 2: you don't secure the votes?
Speaker 9: Yeah, I don't know.
Speaker 12: Robin has addressed this specifically with both you and Carolina
Speaker 12: as well, you know, quite frankly, and this is really
Speaker 12: what I classify really as a kind of a super
Speaker 12: Bowl performance that we're doing right now, we're focused on
Speaker 12: winning the game and not looking at what happens if
Speaker 12: we lose. I actually do believe that the shareholders are
Speaker 12: going to come out in a very strong way tomorrow
Speaker 12: and really support not only the plan, but the directors
Speaker 12: were obviously a phnomination and all the proposals that are
Speaker 12: put forth, and I think a lot of that is
Speaker 12: already out there, so I don't think there's really a
Speaker 12: need to focus on Plan B.
Speaker 9: I can assure you that they're a very diligent board.
Speaker 12: They thought through these things, but I think everyone's very
Speaker 12: focused on winning.
Speaker 2: We continue to get the same question for you and
Speaker 2: for the board, which is this is the first vote
Speaker 2: under Texas law. What do shareholders need to know that's
Speaker 2: different under Texas law from what they voted previously under
Speaker 2: Delaware law.
Speaker 9: Yeah.
Speaker 12: I would say the biggest one, if it comes up,
Speaker 12: is that you know, insiders, particularly in a transaction like this,
Speaker 12: are allowed to vote their shares in this particular election,
Speaker 12: so you know Elon's shares will definitely be counted as
Speaker 12: and included in part of this process, whereas previously, as
Speaker 12: it was discussed within Delaware, it's not.
Speaker 9: I'd say that's really the fundamental big change.
Speaker 12: But quite frankly, if everyone recalls the previous plan of
Speaker 12: a twenty eighteen plan, both originally in twenty eighteen but
Speaker 12: also in the ratification in twenty twenty four, it had
Speaker 12: over seventy plus percent shareholder approval, which did not include
Speaker 12: elons in that particular time. So I do think we're
Speaker 12: going to have a lot more of a support here
Speaker 12: than some of the headlines reacting to right now.
Speaker 9: But that is that is really one of the bigger
Speaker 9: changes here.
Speaker 2: For textas Shane Goodwin, executive director SMU Corporate Governments Initiative
Speaker 2: and an advisor to the special Committity on Tesla's board
Speaker 2: that put together the proposed pay package, thank you very much.
Speaker 2: By coming up, we're going to talk to an investor, Vinodekostler,
Speaker 2: and also David Zoo, CEO of startup revo ai about
Speaker 2: the go to market platform's debut and it's funding. That's next.
Speaker 2: This is Bimbo tech Ai. Startup revo is emerging from
Speaker 2: self with the aim of unifying the steps and data
Speaker 2: necessary for businesses to develop and execute go to market strategies.
Speaker 2: The company has eighty million dollars from a combination seed
Speaker 2: and Series A funding round co led by the Benches
Speaker 2: and Kline Perkins. Revo CEO David Zoo and investor Fino
Speaker 2: Kosler are with us now. David, I would love to
Speaker 2: start with you. You're trying to tackle the concept that
Speaker 2: you have labeled the Frankin stack. Even though the term
Speaker 2: is new to me, the concept is something that's been
Speaker 2: discussed on this program a lot. Just to explain what
Speaker 2: Revo wants to achieve here.
Speaker 14: Sure, well, first off, thanks for having me. It's a
Speaker 14: big day for us. Look, AI is the biggest shift
Speaker 14: in enterprise software since the cloud, but the reality is,
Speaker 14: revenue teams are still stuck in, like you said, what
Speaker 14: we call the Franklin stack, which is a dozen different
Speaker 14: tools that don't really talk to each other, causing sellers
Speaker 14: to waste over seventy percent of their time wrangling software
Speaker 14: instead of talking to their customers, and that's really painful.
Speaker 14: Revo is looking to fix that via one unified revenue
Speaker 14: operating system built from the ground up with AI at
Speaker 14: its core, and with this eighty million raise, we're scaling
Speaker 14: quickly to help all companies win in the age of AI.
Speaker 2: Vinod I was talking with my team this morning about
Speaker 2: the structure of this round, and so it's basically a
Speaker 2: combined seed in Series A and Revo is coming out
Speaker 2: and kind of announcing itself to the world. Would you
Speaker 2: kind of give us the backstory? You know, you are
Speaker 2: an experienced investor in the world of technology. When this
Speaker 2: crossed your desk, how did you know that you needed
Speaker 2: to get involved and how did you determine at this
Speaker 2: very early stage the potential that that Revo had.
Speaker 15: The opportunity didn't actually cross our desk in a traditional way.
Speaker 15: We've known David for a long time from door dash
Speaker 15: to open Door to open Store Sorry, and now Revo.
Speaker 15: We've been incubating ventures with him. My partner Samira has
Speaker 15: worked closely with him on Revo, and we cooked up
Speaker 15: the concept, rainstormed it and talked it was important enough
Speaker 15: to do in the age of here, I think most
Speaker 15: applications and application stacks need to be retarded. And this
Speaker 15: is David just a superstar armed to know, so it
Speaker 15: was pretty easy.
Speaker 2: You know, is this an example of you investing in
Speaker 2: the known quantity founder then rather than the idea?
Speaker 15: Absolutely, you mainly invested the idea. Wasn't clear that was
Speaker 15: a year and a half or two years ago. But
Speaker 15: the founder was very.
Speaker 2: Clear, David, I'm trying to track the growth that you've had.
Speaker 2: So spring of twenty twenty four, you kind of come
Speaker 2: up with the idea, I guess incorporated business and you've
Speaker 2: hired I guess aggressively. You know you're sub one hundred
Speaker 2: people still, but you've basically gone to companies that are
Speaker 2: well known globally, not just here in the valley, and
Speaker 2: taken the best people you can.
Speaker 14: What was that like, Well, yeah, that's you're spot on there.
Speaker 14: The company you build taking a page out of Vanotes book,
Speaker 14: But the company you build is the team you build
Speaker 14: as a company you build, not the plans you make.
Speaker 14: And when we thought about tackling the space of unifying
Speaker 14: all of go to market tech in one system spanning marketing, sales,
Speaker 14: and success, we really needed to make sure that we
Speaker 14: had the talent density both from a technical perspective but
Speaker 14: also from a go to market to really bring together
Speaker 14: the combination of the depth of domain knowledge plus the
Speaker 14: ability to access the first party data to really pull
Speaker 14: this vision off. So global talent is necessary for us
Speaker 14: to make this a reality.
Speaker 2: David, what else do you need the eighty million dollars.
Speaker 14: For Yeah, well it's over the next few months and
Speaker 14: quarters and years.
Speaker 2: Our vision is clear.
Speaker 14: We need a continue accelerating our product role map to
Speaker 14: build out both the breadth of the surface area to
Speaker 14: serve our customers, but also making sure that every single
Speaker 14: capability is the best possible from a death perspective. But
Speaker 14: more importantly, in the age of AI, context matters, and
Speaker 14: it's very important for us to double down on making
Speaker 14: sure that our AI operating system is able to work
Speaker 14: seamlessly across every single one of these modules. Capabilities job
Speaker 14: to be done, so we're not replicating another Franken Stack
Speaker 14: for the future world. So that's what we're going to
Speaker 14: use the proceeds to do.
Speaker 2: Vinod I go back to you with the concept of
Speaker 2: the Franken stack. You know you're invested everywhere. One of
Speaker 2: the first checks into open AI. The world has changed
Speaker 2: a lot since then. You know, we had yesterday Shrida
Speaker 2: from Snowflake on the program talking about the problems right
Speaker 2: now and in the data layer. What do you make
Speaker 2: of the Franken stack. Is that a real thing or
Speaker 2: this is just a marketing opportunity around this round.
Speaker 15: No, I think it's a real thing. Push AI enables
Speaker 15: each startup to do a lot more than it could do.
Speaker 15: Only engineers can do the work of sixty engineers if
Speaker 15: you use the productivity tools AI enables. But more than that,
Speaker 15: the user experience can be dramatically different with the help
Speaker 15: of AI. As I like to say, in the old
Speaker 15: world of applications, users had to learn an application, and
Speaker 15: they learned to each vertical stat. In the new world
Speaker 15: of AI, the application learns the human and responds the
Speaker 15: way it shift. It's my favorite way to think about
Speaker 15: the transition AI makes possible.
Speaker 9: You don't have to.
Speaker 15: Be trained on an application like SAP or hubstat. The
Speaker 15: application gets to know you and other humans on your team,
Speaker 15: and so it facilitates not only the function, but also
Speaker 15: workflow across people and across applications. I think pretty important
Speaker 15: shift in software.
Speaker 2: It's both you. I kind of like to end the
Speaker 2: conversation by going a little bit bigger on the world
Speaker 2: that we're in right now. You know, David, if you
Speaker 2: could reflect on what it was like doing this round.
Speaker 2: There is a lot of energy behind AI right now,
Speaker 2: but at the other end of the spectrum there is
Speaker 2: valuation concern. You know, there's no difficulty in open AI
Speaker 2: or anthropic those kinds of frontier labs gaining capital, But
Speaker 2: there is a lot going on right now. Would you
Speaker 2: just reflect on what the last few weeks has been
Speaker 2: like in trying to close this.
Speaker 14: Well, you know, the fundamental difference is clear with our approach.
Speaker 14: We're AI native and purpose built for revenue teams, and
Speaker 14: so you know when you talk about the old players
Speaker 14: that are trying to built AI onto legacy stack, it
Speaker 14: just doesn't work. What we're building with Revo is akin
Speaker 14: to how Tesla build its cars vertically integrated with AI
Speaker 14: at its core. This way, our AI is able to
Speaker 14: see and act across the full customer journey. So the
Speaker 14: old players are held back by their past, and the
Speaker 14: new players, to your point, you know, don't have the
Speaker 14: of the main knowledge nor the access to the full
Speaker 14: suite of first party data to pull this vision off.
Speaker 14: So Revo's building with both, and yes it's hard, but
Speaker 14: that's really what makes it defensible and worth doing.
Speaker 2: You know, you know you're co leading this round with
Speaker 2: your friends at Kina Perkins. Again, the same question, like
Speaker 2: what does the environment look like to you? Right now?
Speaker 2: This is a very sizable debut round you had the
Speaker 2: conviction to do that. Well.
Speaker 15: It was a while ago we did the seed round
Speaker 15: of ten million, there wasn't announced, and now we just
Speaker 15: participated in the seventy million dollar round. Obviously we think
Speaker 15: highly of the team, but I think it's the magnitude
Speaker 15: of the opportunity this opens up for AI native companies.
Speaker 15: I like to say most valuations won't hold up in
Speaker 15: the AI space, but the ones that are really high
Speaker 15: quality companies will return disproportionate returns. In twenty eight Keen
Speaker 15: people said to me a billion dollar valuation for Open
Speaker 15: the Air was too high. Then they said twenty six
Speaker 15: billion was too high, and then one hundred billion, then
Speaker 15: three hundred billion, and then five hundred billion.
Speaker 2: Were all too high.
Speaker 15: So a small percentage of the companies I suspect, much
Speaker 15: less than five percent, will actually do extremely well and
Speaker 15: return ten fifty one hundred times stare money invested. Most
Speaker 15: companies will still lose money, and I think that's why
Speaker 15: you want to back quality founders like David. David just
Speaker 15: superstar right back him in almost anything he did.
Speaker 2: David Zuocio Revo Ai Vino cost co founder Coast Adventures,
Speaker 2: and as we just discussed, I let that round. Great
Speaker 2: to have you both on the program. Frank you that
Speaker 2: does it for this edition of Bloomberg Tag Earnings, but
Speaker 2: also AI valuation concerns are driving this market right now
Speaker 2: one way and the other. Has been a volatile session.
Speaker 2: There was a lot to recap, in particular in the
Speaker 2: case of AMD, so do so on the podcast. You
Speaker 2: know exactly where to find it. This is Bloomberg Tech