WEBVTT - Amazon's Big Spending Plans and Bitcoin's Rebound 0:00:02.520 --> 0:00:13.520 Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive 0:00:13.560 --> 0:00:17.360 from coast to coast with Caroline Hyde in New York 0:00:17.640 --> 0:00:19.639 and ever low in sentrances, go. 0:00:22.840 --> 0:00:25.919 This is Bloomberg Tech coming up. Amazon shares drop after 0:00:25.960 --> 0:00:29.880 announcing plans to spend two hundred billion dollars this year 0:00:30.080 --> 0:00:32.599 on data centers, chips and other equipment. 0:00:32.800 --> 0:00:36.960 Mean while Bitcoin rebounds, having plummeted on Thursday when it 0:00:37.000 --> 0:00:38.560 neared the sixty thousand. 0:00:38.280 --> 0:00:41.320 Dollars level, and we break down more tech earnings of 0:00:41.360 --> 0:00:44.960 the CEOs of Roadblocks, a firm, and the Warner Music Group. 0:00:45.680 --> 0:00:49.000 First, we check in on what is a tentative bounce 0:00:49.080 --> 0:00:51.960 back after what has been a punishing week. Remember the 0:00:52.040 --> 0:00:54.600 Nasdaq is on track for its worst week ed in 0:00:54.680 --> 0:00:57.160 three months since the beginning of November. But now we 0:00:57.200 --> 0:00:58.880 see a little bit of a reprieve, a little bit 0:00:58.920 --> 0:01:01.280 of dip by We're up percentage point if you're looking 0:01:01.320 --> 0:01:02.639 at the big indexes, and. 0:01:02.600 --> 0:01:04.679 I know you're going to drill into the individual movers 0:01:04.720 --> 0:01:05.520 that push and pull. 0:01:05.880 --> 0:01:10.440 But Crypto up almost nine percent, but only about eradicating 0:01:10.560 --> 0:01:13.480 half of yesterday's losses. We're still only at sixty eight 0:01:13.560 --> 0:01:16.640 thousand what are remarkable beginning to the year for this 0:01:16.760 --> 0:01:19.360 asset class that in many ways people feel is not 0:01:19.440 --> 0:01:20.279 a store of value. 0:01:20.280 --> 0:01:21.119 But what are you looking at? 0:01:22.080 --> 0:01:25.640 The analyst are calling it sticker shock. Amazon pledging to 0:01:25.680 --> 0:01:30.640 spend two hundred billion dollars capital expenditures on AI infrastructure. 0:01:30.920 --> 0:01:34.000 The stock down more than eight percent right now, on 0:01:34.080 --> 0:01:36.480 track for its biggest drop since April of last year. 0:01:36.880 --> 0:01:40.280 Operating income in the current period twenty one billion dollars 0:01:40.280 --> 0:01:43.600 at the high end below consensus. So the concern is 0:01:43.600 --> 0:01:45.800 is the trade off worfit here? There is a big 0:01:45.880 --> 0:01:49.480 backlog for AWS and AI business. By the way, it's 0:01:49.480 --> 0:01:51.480 one of the few names on the NAZAQ one hundred 0:01:51.520 --> 0:01:55.040 that's down because in reaction to that capital expenditures pledge, 0:01:55.120 --> 0:01:57.920 you see everyone from the GPU providers and videos now 0:01:57.960 --> 0:02:02.280 up more than six percent in response. Memory names, infrastructure names, 0:02:02.400 --> 0:02:06.120 energy names all higher because the capital expenditures for all 0:02:06.160 --> 0:02:09.240 of the hyperscalers in aggregate plus meta is growing. We're 0:02:09.240 --> 0:02:11.079 going to get to that with ananilyst just a few 0:02:11.080 --> 0:02:14.480 minutes time, and the water cryptocurrencies traders are buying the 0:02:14.520 --> 0:02:18.359 dip carry outlined it. Bitcoin's rebounding after plummeting on Thursday, 0:02:18.760 --> 0:02:21.480 raising all the gains since Donald Trump's twenty twenty four election, 0:02:22.160 --> 0:02:25.840 falling close to sixty thousand US dollars, popping back up again. 0:02:25.919 --> 0:02:28.840 Blueberg Distal financial reporter Emily Nicole joins us with the 0:02:28.880 --> 0:02:31.200 latest difficult Emily, what's going on? 0:02:33.120 --> 0:02:35.360 And your guests as good as mine. To be honest, 0:02:35.960 --> 0:02:38.160 We've been watching bitcoin over the last twenty four hours 0:02:38.160 --> 0:02:40.040 and it's really been a roller coaster. As you said, 0:02:40.040 --> 0:02:43.320 it dipped about thirteen percent yesterday. Now I think we're 0:02:43.360 --> 0:02:45.840 up about ten percent, so we're recovering some of that, 0:02:46.120 --> 0:02:48.280 but it's really just been a roller coaster week. It's 0:02:48.280 --> 0:02:50.919 been hard to kind of guess at why that's been happening. 0:02:50.960 --> 0:02:53.000 There's been a lot of instability over the last few 0:02:53.080 --> 0:02:56.880 months with geopolitical tensions, and bitcoins really struggled to perhatch 0:02:56.919 --> 0:02:59.560 onto any narrative within that, whether or not it's a 0:03:00.120 --> 0:03:02.920 safe haven, a saw of value if it can latch 0:03:02.960 --> 0:03:04.799 onto stocks as it used to trade pretty in line 0:03:04.800 --> 0:03:06.919 with tech stocks back in the day. None of that 0:03:06.960 --> 0:03:09.200 seems to be sticking, and it's just kind of doing 0:03:09.240 --> 0:03:10.360 its own thing right now. 0:03:10.840 --> 0:03:12.920 Fud some would call it in the market. 0:03:12.960 --> 0:03:16.360 Fear, uncertainty, doubt just consumed the asset class as a whole, 0:03:16.400 --> 0:03:19.280 and it's consumed companies that have written so high on 0:03:19.280 --> 0:03:21.840 the back of the climb in crypto. I think of 0:03:21.919 --> 0:03:25.320 Strategy in some of these other digital asset treasury companies. 0:03:25.400 --> 0:03:27.720 That's how have you seen, particularly on the back of 0:03:27.720 --> 0:03:31.280 Michael Sailor's earnings yesterday, have you seen people still questioning 0:03:31.639 --> 0:03:32.800 how long they can ride this? 0:03:34.600 --> 0:03:34.720 Boy? 0:03:34.760 --> 0:03:36.960 If we look at Strategy, for example, that has also 0:03:37.000 --> 0:03:39.880 had a similarly up down two days, So yesterday it 0:03:39.920 --> 0:03:42.560 was down about seventeen percent of the close before the earnings, 0:03:42.680 --> 0:03:45.840 Investors were really bracing for some bad news coming from that, 0:03:45.880 --> 0:03:48.520 particularly with bitcoin having such a bad day, and then 0:03:48.560 --> 0:03:51.320 today we're seeing it up more than sixteen percent. Because 0:03:51.360 --> 0:03:54.120 of that kind of whipsawing effect, the earnings weren't as 0:03:54.160 --> 0:03:56.280 bad as people expected. Losses were in line with what 0:03:56.320 --> 0:03:59.000 we thought was happening. No new debt was being created, 0:03:59.280 --> 0:04:02.040 and so people trying to stretch for you know, where 0:04:02.040 --> 0:04:07.400 can we see some some like staying power within this rally? 0:04:07.440 --> 0:04:11.040 Where is there a bottom? Where is their stability? And 0:04:11.120 --> 0:04:12.720 that might be where we're now starting to see a 0:04:12.800 --> 0:04:15.080 sort of bottom. Maybe that sixty thousand mark was it, 0:04:15.400 --> 0:04:17.720 and for strategy as well, maybe it's kind of starting 0:04:17.760 --> 0:04:18.760 to see a way out of that. 0:04:19.400 --> 0:04:21.560 It's interesting, even with the headlines coming from China as 0:04:21.560 --> 0:04:25.240 they tighten curbs on crypto and stable coin issuance, still 0:04:25.279 --> 0:04:27.760 managing to catch some buying of the dick today. 0:04:28.279 --> 0:04:31.000 Emily Nicole, what a busy week. Thanks for joining us. 0:04:31.279 --> 0:04:35.360 Meanwhile, let's talk Waymo now using DeepMind's Genie three AI 0:04:35.400 --> 0:04:38.919 model to create realistic worlds for a new Waymo world models, 0:04:38.920 --> 0:04:39.760 according to the company. 0:04:39.760 --> 0:04:41.360 In a blog post today, the self. 0:04:41.200 --> 0:04:44.960 Driving tech developer argues this collaboration with another segment of 0:04:45.000 --> 0:04:47.560 Google's tech ecosystem is going to help the expansion of 0:04:47.600 --> 0:04:50.400 Waymos's self driving services across many more markets. 0:04:50.680 --> 0:04:54.760 Ed, let's get back to Amazon, big mover, big stories 0:04:54.800 --> 0:04:57.120 stock lower is. The company announced it's set to spend 0:04:57.160 --> 0:05:02.160 two hundred billion dollars this year data centers, chips and equipment, 0:05:02.279 --> 0:05:05.719 supercharging its bets on AI roll. Hit Ko carne Is 0:05:05.720 --> 0:05:08.400 Managing directors see the analyst for Internet and Capital markets 0:05:08.400 --> 0:05:13.440 research at Rough Capital Partners. They call it sticker shock right. 0:05:13.520 --> 0:05:17.320 The reaction to the big capital expenditures number, But there 0:05:17.360 --> 0:05:19.760 was a time where a big capital expenditures number was 0:05:19.800 --> 0:05:24.160 what you wanted to see. Why the negative reaction, I. 0:05:24.120 --> 0:05:28.880 Think the negative reaction is just because outside of the 0:05:28.920 --> 0:05:35.400 caps people expected spotless earnings. I thinks Sticker Shop was 0:05:35.480 --> 0:05:39.520 expected given what Google, Meta Microsoft did last ten days. 0:05:40.640 --> 0:05:44.520 But what was not expected was slight yellow flags and 0:05:44.600 --> 0:05:49.279 operating margins, and certainly people realizing that Amazon has to 0:05:49.279 --> 0:05:53.360 spend a lot more given they are launching satellites to space, right, 0:05:53.440 --> 0:05:55.360 they are building new whole foods and so on and 0:05:55.440 --> 0:05:55.880 so forth. 0:05:57.040 --> 0:05:59.440 You have a buy on Core, on the stock, and 0:05:59.480 --> 0:06:02.560 I believe let me just check here on my Bloomberg terminal. Yeah, 0:06:02.600 --> 0:06:05.320 two hundred and eighty five dollars price target. Right. There 0:06:05.360 --> 0:06:07.880 are lots of pieces of data in there. Some people 0:06:07.880 --> 0:06:10.520 looked at the operating income forecast for the current period 0:06:10.560 --> 0:06:13.800 and thought that's a little worrying, bearing in mind AWS 0:06:13.880 --> 0:06:17.240 is the majority of operating income. Some looked at the backlog. 0:06:17.320 --> 0:06:21.360 Some looked at the AWS growth twenty four percent, fastest 0:06:21.360 --> 0:06:24.279 pace of growth in almost three years. Where would you 0:06:24.360 --> 0:06:27.520 look all of the above. 0:06:27.560 --> 0:06:31.960 There are many positives in the report and in the outlook, 0:06:32.160 --> 0:06:38.679 and the various moving parts in Amazon accident aws, improving 0:06:38.720 --> 0:06:43.479 retail margins, better advertising growth as well as better efficiency 0:06:43.600 --> 0:06:47.599 in the retail. Overall, I think what is spooking the 0:06:47.680 --> 0:06:51.880 market here is there are more investments beyond AI that 0:06:51.920 --> 0:06:55.120 this company is doing, unlike many other peers that are 0:06:55.160 --> 0:06:59.120 just doubling down on simple, simply one thing. So the 0:06:59.160 --> 0:07:02.280 wordy hear is next two to three years. How high 0:07:02.720 --> 0:07:05.760 of an investment curve are we looking at for Amazon 0:07:05.920 --> 0:07:09.560 and what level of ROI do they get beyond the 0:07:09.640 --> 0:07:12.800 core AI investments. I think that's the worry here. But 0:07:13.600 --> 0:07:16.960 all in we think this is a GENEAI winner, very 0:07:17.040 --> 0:07:20.480 underappreciated and over time time retell. 0:07:20.440 --> 0:07:25.600 What's diggins why it's a GENAI winner? Is it trainium, graviton? 0:07:25.880 --> 0:07:28.240 Just seeing the triple digit percentage growth, the fact that 0:07:28.240 --> 0:07:31.239 they've got that vertical integration, making their own chips, using 0:07:31.280 --> 0:07:33.560 that for the compute that they offer in the efficiency 0:07:33.600 --> 0:07:35.920 theres it gains. Then is it more that their own models, 0:07:35.920 --> 0:07:38.520 Like we don't talk much about the own models that 0:07:38.520 --> 0:07:41.320 they're producing. We talk so much about Google's, for example, 0:07:41.360 --> 0:07:43.200 but not so much Amazons. 0:07:43.640 --> 0:07:47.160 I know, I think Amazon is with all of the 0:07:47.160 --> 0:07:50.400 ambo okay, they are vertically integrating in a way that 0:07:51.440 --> 0:07:55.080 absolutely know the company on Earth is trying to replicate 0:07:55.480 --> 0:07:58.040 at the scale at which Amazon is trying to do, 0:07:58.640 --> 0:08:04.040 Vertically integrating cloud, vertically integrating retail, and having the diversity 0:08:04.080 --> 0:08:09.160 of advertising. So I feel when all three pillars of 0:08:09.400 --> 0:08:13.720 Amazon start to crank up higher operating margins, which we 0:08:13.760 --> 0:08:16.120 will we will see over the next college six to 0:08:16.200 --> 0:08:20.040 nine months, that's when the real potential of profitability of 0:08:20.080 --> 0:08:24.000 this company will will manifest in the numbers. And that's 0:08:24.040 --> 0:08:28.600 when That's why I believe the surface area of investments 0:08:28.720 --> 0:08:31.240 as well as surface area of ROI on those investments 0:08:31.600 --> 0:08:35.839 is so much wider at Amazon that is being underappreciated, 0:08:36.280 --> 0:08:40.960 and that's that's where we feel this is a Jenny 0:08:41.000 --> 0:08:42.760 I winner across the board. 0:08:43.280 --> 0:08:46.359 It's interesting we have such short term memory loss sometimes 0:08:46.400 --> 0:08:49.680 this was always a company that focused more on investing 0:08:49.840 --> 0:08:52.160 in itself rather than producing profitability. 0:08:52.440 --> 0:08:53.400 But push us forward. 0:08:53.360 --> 0:08:56.679 As to how Annie Jasse continues to manage the cost basis, 0:08:56.720 --> 0:09:00.240 because that was the headline that stole the show previous 0:09:00.320 --> 0:09:02.679 to earning season was the amount of job cuts they're making. 0:09:02.800 --> 0:09:04.320 Is that still what you need to be seeing from 0:09:04.360 --> 0:09:05.160 Mandy Jesse. 0:09:06.880 --> 0:09:10.360 I think there is room probably the company needs to 0:09:10.400 --> 0:09:13.079 make after the over hiring of almost two and a 0:09:13.120 --> 0:09:17.800 half years after the COVID, I think there is still 0:09:17.920 --> 0:09:21.200 digesi period, but which probably one would argue that has 0:09:21.280 --> 0:09:24.240 been a little bit more prolonged than what would have 0:09:24.679 --> 0:09:27.200 one would have preferred to see. So I think they're 0:09:27.320 --> 0:09:30.040 finally getting there, and I think a little bit of 0:09:30.200 --> 0:09:33.679 extra cost cuts would be much more appreciated to make 0:09:33.800 --> 0:09:34.880 room for more CAPEX. 0:09:36.280 --> 0:09:40.000 CAPEX across the Hyperscals plus Meta is now at six 0:09:40.040 --> 0:09:42.679 hundred and fifty billion dollars for the year for Microsoft. 0:09:42.679 --> 0:09:46.440 That's based on consensus. The difference with Amazon is that 0:09:46.480 --> 0:09:48.839 they might tip into negative free cash flow. We have 0:09:48.920 --> 0:09:50.959 thirty seconds. How worried are you about that? 0:09:52.559 --> 0:09:55.320 Not worried at all. This company has gone through negative 0:09:55.320 --> 0:09:58.480 free cash flow cycles in the past and delivered ROI 0:09:58.840 --> 0:10:01.520 unlike many other become and easier for the first time 0:10:01.640 --> 0:10:04.160 going through this cycle. If you look at fifteen years, 0:10:04.320 --> 0:10:09.000 Amazon has delivered r I C probably in a besting 0:10:09.000 --> 0:10:09.760 class manner. 0:10:10.400 --> 0:10:13.640 O Kakarni of Growth Capital Partners, thank you very much, 0:10:13.840 --> 0:10:16.400 indeed for joining us today and coming up with all 0:10:16.440 --> 0:10:16.880 more earning. 0:10:16.960 --> 0:10:19.319 We're speaking of the Roadblocks CEO Dave Bazuki. As a 0:10:19.320 --> 0:10:20.440 company season one hundred. 0:10:20.200 --> 0:10:22.920 And forty four million daily active users. You don't even 0:10:23.000 --> 0:10:25.360 want to hear how many hours people are spending on 0:10:25.400 --> 0:10:26.040 this platform. 0:10:26.160 --> 0:10:27.800 We'll break it down. This is Blue meg Tech. 0:10:38.679 --> 0:10:41.920 Chackap Chairs of Roadblocks company on fire up ten percent 0:10:41.960 --> 0:10:45.480 after they reported fourth quarter users and bookings at topped expectations. 0:10:45.720 --> 0:10:46.960 Daily active users. 0:10:46.720 --> 0:10:49.360 Jumped sixty nine percent to one hundred and forty four million. 0:10:49.520 --> 0:10:51.960 It beat alas forecasts and pleased to say we're now 0:10:52.040 --> 0:10:54.719 joined on the results by Dave Bazuki, CEO of Roadblocks. 0:10:55.040 --> 0:10:58.559 Your engagement levels was jumping to a similar degree. I 0:10:58.600 --> 0:11:01.200 think it was like sixty eight per What is is 0:11:01.200 --> 0:11:02.800 this the games that are driving this day? 0:11:04.200 --> 0:11:07.440 It's really the games, the platform and the creator. You know, 0:11:07.520 --> 0:11:10.679 we are on a mission to get ten percent of 0:11:10.720 --> 0:11:14.520 all global gaming content running on Roadblocks, and we're well 0:11:14.559 --> 0:11:16.720 on our way. We had a banner year, as you 0:11:16.840 --> 0:11:21.520 mentioned in twenty twenty five, we had fifty five percent 0:11:21.600 --> 0:11:25.600 year on year bookings growth. And in addition, as we 0:11:25.720 --> 0:11:29.600 started rolling out what we call the gold standard for safety, 0:11:30.080 --> 0:11:33.360 we're age checking our users and we now have accurate 0:11:33.840 --> 0:11:36.640 you know data on the eighteen and up segment, which 0:11:36.679 --> 0:11:40.880 is growing at over fifty percent year on year. In addition, 0:11:41.160 --> 0:11:44.040 around the world, countries like Japan are growing one hundred 0:11:44.040 --> 0:11:48.440 and sixty percent year on year. Really, people are creating 0:11:48.559 --> 0:11:51.840 new genres and types of games, whether it was dressed 0:11:51.840 --> 0:11:54.720 to Impress a year ago or grow a garden. So 0:11:54.760 --> 0:11:58.880 we're powered by both platform and an amazing creator community. 0:11:59.360 --> 0:12:03.200 Yeah, you call Bruno Mars singing live on brain rot, 0:12:03.280 --> 0:12:05.400 I mean tolve million people all using and. 0:12:05.280 --> 0:12:07.720 Coming to watch that at the same time. The records 0:12:07.760 --> 0:12:08.280 are interesting. 0:12:08.360 --> 0:12:10.480 Given as you say, these safety measures have been put 0:12:10.520 --> 0:12:14.480 in place, how has that impacted? Has that created any 0:12:14.520 --> 0:12:16.520 friction or indeed, it seems as though you're leaning into 0:12:16.520 --> 0:12:18.760 the opportunity of these safety measures. 0:12:19.440 --> 0:12:23.000 I think leaning in is a good way to mention it. 0:12:23.280 --> 0:12:25.800 I believe the last time we chatted we mentioned our 0:12:25.880 --> 0:12:29.760 vision for the gold standard for safety. In addition to 0:12:30.240 --> 0:12:34.640 filtering and monitoring all chat for critical harms and not 0:12:34.800 --> 0:12:39.040 allowing image or video sharing, we have now are full 0:12:39.080 --> 0:12:42.880 into our roleout of age estimation, which is understanding the 0:12:42.920 --> 0:12:46.560 age of everyone on our platform and using that to 0:12:47.120 --> 0:12:50.839 allow people to communicate with people of similar age. We 0:12:51.280 --> 0:12:55.000 gave our teams an ambitious goal to have no friction 0:12:55.200 --> 0:12:58.360 for this, and when you lean into something like this, 0:12:58.880 --> 0:13:01.520 a lot of innovations pop up. On the side, our 0:13:01.720 --> 0:13:05.360 matchmaking has gotten better. We continue to refine the way 0:13:05.400 --> 0:13:09.800 we filter text and make trusted connections, so we're optimistic 0:13:09.840 --> 0:13:12.640 we're going to go through this and ultimately come out 0:13:12.720 --> 0:13:14.480 with minimal friction from this. 0:13:16.080 --> 0:13:18.400 Dave. I fired up my new gaming PC last night, 0:13:18.880 --> 0:13:22.400 Asa Nitro V fifteen, Intel I five and Video g 0:13:22.520 --> 0:13:25.079 fours ID X forty fifty and I thought to myself, 0:13:25.480 --> 0:13:27.960 what am I going to play? And for you guys 0:13:28.400 --> 0:13:31.760 and everyone else, it's about pipeline, right. You rely on 0:13:31.800 --> 0:13:35.680 these third parties to keep the pipeline going, but you 0:13:35.720 --> 0:13:38.199 also have like the you know, the ambition on these 0:13:38.280 --> 0:13:42.560 higher fidelity games. How do you guarantee the pipeline and 0:13:42.600 --> 0:13:44.920 how are you going to manage the pipeline going forward? 0:13:44.960 --> 0:13:46.199 So I have some more things to play. 0:13:47.280 --> 0:13:50.400 The pipeline on Roadblocks is very, very healthy. We watched 0:13:50.480 --> 0:13:55.280 the distribution, the variety, the diversity of the experiences that 0:13:55.320 --> 0:13:58.560 our creators are growing, and over the last year we've 0:13:58.559 --> 0:14:03.720 made amazing really advances, not just our technology platform, but 0:14:03.800 --> 0:14:07.599 in search and discovery, so that the pipeline is robust. 0:14:07.920 --> 0:14:12.680 Right now, we have a unique vision with our platform, 0:14:12.800 --> 0:14:17.240 especially for eighteen and up expansion, that when a creator 0:14:17.320 --> 0:14:21.400 makes an experience on roadblocks, it works at good performance 0:14:21.440 --> 0:14:24.640 on a low end to gigabyte Android phone, for example, 0:14:25.040 --> 0:14:28.320 but also can scale up and look beautiful on your 0:14:28.440 --> 0:14:32.440 brand new gaming PC. This is a unique technology. It 0:14:32.520 --> 0:14:36.200 requires a vertical stack going from cloud to game engine, 0:14:36.200 --> 0:14:40.480 to discovery to the apps on everyone's desktop. It's why 0:14:40.520 --> 0:14:44.680 we're optimistic that that fifty percent growth in eighteen and 0:14:44.800 --> 0:14:47.880 up can get more and more of that part of 0:14:47.920 --> 0:14:51.080 the global gaming market. I'll highlight in the US our 0:14:51.120 --> 0:14:54.600 ambitions are more than ten percent, and in the US 0:14:54.680 --> 0:14:58.520 a big majority of that fifty billion approximate gaming market 0:14:58.680 --> 0:15:01.800 is eighteen and up. So what we see really good 0:15:01.920 --> 0:15:03.480 trajectory in that direction. 0:15:04.960 --> 0:15:08.560 Dave Advertising, we check with you regularly on it, and 0:15:08.760 --> 0:15:11.720 you're consistent that it's not yet a meaningful contributor. Right 0:15:12.400 --> 0:15:15.040 when will it be? Will it be? Or do investors 0:15:15.040 --> 0:15:18.080 now start to change how they factor in ads? 0:15:18.080 --> 0:15:18.320 For you? 0:15:18.360 --> 0:15:18.960 Going forward? 0:15:20.280 --> 0:15:22.160 I want to highlight the big picture, you know, in 0:15:22.200 --> 0:15:25.280 twenty twenty five, I believe we gave guidance in the 0:15:25.360 --> 0:15:28.640 load twenties and we ended up with fifty five percent 0:15:28.800 --> 0:15:32.520 bookings growth. So I want to highlight the big picture 0:15:32.720 --> 0:15:36.000 is we continue to exceed guidance and expectation on how 0:15:36.000 --> 0:15:40.360 we grow. We're seeing great progress both on rewarded video 0:15:40.440 --> 0:15:46.000 advertising and also developer sponsor tile advertising, which is creators 0:15:46.040 --> 0:15:51.040 on roadblocks who are monetizing really well accelerating their own 0:15:51.120 --> 0:15:55.640 growth by purchasing advertising. We do believe it'll be a 0:15:55.680 --> 0:15:59.360 big segment. It will ultimately as we roll out Roadblocks moments, 0:15:59.440 --> 0:16:02.960 which is I'm really used for discovery of video capture 0:16:03.040 --> 0:16:05.680 of roadblocks, that'll be a part of it. So we're 0:16:05.960 --> 0:16:09.760 continuously bullish, but not ready to really split it out yet. 0:16:10.080 --> 0:16:13.080 Dave, briefly, how going to show you on the AI 0:16:13.800 --> 0:16:15.920 platform and indeed the model that you have We've got 0:16:16.000 --> 0:16:18.680 Cube foundation model that you've just unfailed, but Google's also 0:16:18.720 --> 0:16:21.360 got Project Genie. How are you seeing that changing the 0:16:21.400 --> 0:16:23.160 development of games and how do you stick to your 0:16:23.520 --> 0:16:26.160 sort of more blocky esthetic that people love. 0:16:27.120 --> 0:16:27.400 Well. 0:16:28.280 --> 0:16:30.840 What we believe we will see over time as we 0:16:30.920 --> 0:16:35.440 advance AI, our avatar system and our technology platform a 0:16:35.560 --> 0:16:39.760 much bigger diversity of the types of experiences you see 0:16:39.800 --> 0:16:43.360 on the platform. We've shared our notion of novel games, 0:16:43.400 --> 0:16:46.320 which is games you'd never expected to see on Roadblocks 0:16:46.320 --> 0:16:51.400 and genres like RPG or in sports, and really with AI, 0:16:51.560 --> 0:16:55.360 we see that as an acceleration technology for both creation 0:16:56.160 --> 0:17:00.360 for the way games look. We shared some video on 0:17:00.640 --> 0:17:03.520 X this week around three D in the cloud up 0:17:03.560 --> 0:17:08.879 sampling and also how models will be used for driving creation. 0:17:09.240 --> 0:17:12.560 I'll highlight one key thing about Roadblocks. We are a 0:17:12.640 --> 0:17:17.960 connection and a communication platform. We're a multiplayer platform where 0:17:18.119 --> 0:17:20.600 you know, in sci fi terms, we're building the hollow 0:17:20.600 --> 0:17:24.320 deck where people go together. Some of the technologies out 0:17:24.359 --> 0:17:27.360 there that we're building as well, like world models, are 0:17:27.359 --> 0:17:31.760 currently video single player technologies. We think the big long 0:17:31.840 --> 0:17:35.960 term opportunity for us is synchronizing thousands of players in 0:17:36.040 --> 0:17:39.680 the cloud, which is much different technology and stuff were 0:17:39.880 --> 0:17:42.679 you know is actively part of how we build Roadblocks. 0:17:44.080 --> 0:17:46.760 Dave Bazuki of Roadblocks, thank you very much. Coming up 0:17:46.800 --> 0:17:49.640 on boom bag Tech, Affirm CEO Max Lefchin joins us 0:17:49.840 --> 0:17:53.480 talk about his company's results. Stick Around It's next Spinbag Tech. 0:18:00.280 --> 0:18:03.000 Shares of Affirm down about six percent. The buy Now 0:18:03.040 --> 0:18:06.320 pay later. Company reported results that beat analyst estimates, though 0:18:06.320 --> 0:18:08.800 some on the street say that the outlook part is 0:18:08.840 --> 0:18:11.639 a little bit conservative. Fortunately, we can talk through it 0:18:11.680 --> 0:18:15.520 with a firm CEO, Max left Chin. Actually, there's been 0:18:15.520 --> 0:18:18.560 a lot this morning about the outlook the financial Strong 0:18:18.600 --> 0:18:20.359 couarter gone. I actually just want to talk about what 0:18:20.359 --> 0:18:22.920 you're doing, and I'd like to start, if I may, 0:18:23.040 --> 0:18:27.240 with the affirm card, how's that coming along? And Max 0:18:27.280 --> 0:18:30.359 with you? If if I may, what's the end game 0:18:30.600 --> 0:18:31.680 with the affirm card? 0:18:33.560 --> 0:18:36.480 You know, there is no endgame for there's so much 0:18:36.520 --> 0:18:38.760 to do. I have a hard time saying we'll be 0:18:38.840 --> 0:18:43.280 done when this feature. Ships are from card rocketed once again. 0:18:43.480 --> 0:18:44.080 Yeah. 0:18:44.280 --> 0:18:45.960 For a long time, I think it looked like a 0:18:46.000 --> 0:18:48.960 gently super linear growth curve, and in our latest letter, 0:18:49.119 --> 0:18:50.240 we finally showed. 0:18:49.960 --> 0:18:51.960 That it's that's kind of what I mean, you know, 0:18:52.080 --> 0:18:53.320 the trajectory's changed. 0:18:53.800 --> 0:18:57.760 It's you know, we didn't do anything very specific to 0:18:57.840 --> 0:19:01.680 make it go obviously exponential, but it is accelerating. And 0:19:01.800 --> 0:19:03.639 it's just the great work of our product teams that 0:19:03.680 --> 0:19:08.000 have been putting in new features, integrating all of our 0:19:08.200 --> 0:19:11.399 zero percent deals into the card. The card grew, you know, 0:19:11.880 --> 0:19:14.920 something like four times the rest of the business, or 0:19:15.080 --> 0:19:17.160 you know, it's just a rocket ship that we built 0:19:17.160 --> 0:19:22.040 a few years ago and it just keeps going. The 0:19:22.119 --> 0:19:25.320 endgame is to get you to put away your credit 0:19:25.359 --> 0:19:30.360 card forever and use a deviit card powered by a firm. 0:19:30.480 --> 0:19:31.920 The other growth part of the story, because it is 0:19:31.960 --> 0:19:34.679 a growth story, and whatever you feel about the end 0:19:34.720 --> 0:19:37.760 list saying you're being conservative. Is international expansion a bit 0:19:37.800 --> 0:19:41.040 so in my home country, in Caroline's home country, the UK, 0:19:41.119 --> 0:19:43.920 it's a really interesting case study. How is that going? 0:19:43.960 --> 0:19:45.880 But then what comes next after that? 0:19:46.280 --> 0:19:50.440 Well, we just announced some exciting brands. We're live with Shopify, 0:19:50.560 --> 0:19:52.760 our great partner in the US. Now in the UK 0:19:53.600 --> 0:19:55.720 it's a real business now. So for a couple of quarters, 0:19:55.720 --> 0:19:58.080 we said, look, we're we've crossed upon We're in London, 0:19:58.520 --> 0:20:01.160 we're hiring where we're building. It's now a business, it's 0:20:01.200 --> 0:20:04.840 making real revenue, it's generating some very significant sales lifts 0:20:04.840 --> 0:20:08.320 for emerging partners. We have a whole slew of new 0:20:08.359 --> 0:20:12.320 partnerships to go live with soon, so feeling great about 0:20:12.320 --> 0:20:14.679 it and eyeing continental Europe next of course, and so 0:20:14.840 --> 0:20:17.080 we're definitely not going to be a North American phenomenon only, 0:20:17.160 --> 0:20:19.560 but we're still very, very committed and very focused on 0:20:19.560 --> 0:20:21.040 our North American stronghold. 0:20:21.640 --> 0:20:25.920 So as Ted Securities is truest is Bloomberg Intelligence Analysis right, 0:20:26.040 --> 0:20:29.080 that you do guide conservatively and you just feel that 0:20:29.080 --> 0:20:31.200 that's the right thing to do in this consumer context. 0:20:33.320 --> 0:20:36.160 I think the guide is the guide, As our CFO 0:20:36.200 --> 0:20:40.040 always reminds me to say, you know, I encourage folks 0:20:40.080 --> 0:20:43.280 that hold our stock or eyeing our stock to see 0:20:43.280 --> 0:20:45.520 how we've done in the past. Quarter after quarter. We 0:20:45.560 --> 0:20:47.880 make promises and we deliver on them. So we take 0:20:47.960 --> 0:20:53.000 our guidance very seriously. We intend to always do well 0:20:53.160 --> 0:20:55.640 relative to what we said will do and better and 0:20:57.119 --> 0:21:00.000 that's what it is. I mean, ultimately, the results speak 0:21:00.040 --> 0:21:01.920 for themselves, and we are in it for a very 0:21:01.920 --> 0:21:04.800 long term. So at some point people will figure out 0:21:04.800 --> 0:21:08.440 exactly just how much more growth there is in this business. 0:21:08.760 --> 0:21:11.880 Credit quality holding up clearly, and that's the litmus test 0:21:11.880 --> 0:21:14.680 in many ways to success within delinquencies. 0:21:15.080 --> 0:21:16.879 Are they on the rise? How are you seeing a 0:21:16.920 --> 0:21:17.760 consumer right now? 0:21:17.800 --> 0:21:18.080 Max? 0:21:19.760 --> 0:21:24.200 You know, we have underwritten tens of millions of American 0:21:24.200 --> 0:21:27.359 households in the order of seventy million twenty six million 0:21:27.400 --> 0:21:32.200 actives just last twelve months alone, we reported we see 0:21:32.200 --> 0:21:35.040 a pretty big swath of America. Our consumer is healthy. 0:21:35.320 --> 0:21:37.520 They are paying us back their shopping. They had a 0:21:37.560 --> 0:21:41.359 great holiday season. A lot of outside observers underestimated our 0:21:41.400 --> 0:21:44.680 growth over the holidays. We proved them wrong yesterday. Once again, 0:21:45.600 --> 0:21:50.040 American consumer as we see her, is doing just fine. 0:21:50.400 --> 0:21:53.159 Max, I think this is the first opportunity we've had 0:21:53.200 --> 0:21:56.680 to speak since the President's initiative to cap credit card 0:21:56.720 --> 0:21:59.320