WEBVTT - Apple Hits First Record of 2025 as iPhone Optimism Fuels Rebound 

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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<v Speaker 1>Bloomberg Intelligence podcast. Catch us live weekdays at ten am

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<v Speaker 2>Looking at the shares of Apple fifty two week, Hi,

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<v Speaker 2>there's a little bit better feeling I think about iPhone

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<v Speaker 2>sales in particular. It's kind of helping this story here today.

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<v Speaker 2>Mandy Sink joined us. He's our senior technology channels for

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<v Speaker 2>Bloomberg Intelligence. Mandy, what's going on with Apple here? A

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<v Speaker 2>little bit of a rerating? Is it just trying to

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<v Speaker 2>catch up? Is there a different view that's forming out

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<v Speaker 2>there on these shares?

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<v Speaker 3>I mean I would call it a positive data point

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<v Speaker 3>after the new iPhone launch and look, you know everyone

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<v Speaker 3>was quite negative about Apple's ability to grow unit shipments.

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<v Speaker 3>What they're suggesting here is people who were waiting for

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<v Speaker 3>a new device are upgrading, and especially China is always

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<v Speaker 3>a focus given you know what is going on with Nvideo.

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<v Speaker 3>So Apple being a hardware company, you know, being able

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<v Speaker 3>to sell into China is always a positive and looks

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<v Speaker 3>like there are positive data points over there.

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<v Speaker 4>As well, so many what's the attraction to this one?

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<v Speaker 4>I mean, I'm sitting here with the iPhone. I don't

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<v Speaker 4>even know what this is. I don't even know what

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<v Speaker 4>model that's not about. But what's the attraction to this

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<v Speaker 4>new phone? Why is it doing so much better?

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<v Speaker 3>Well, so that's why I want to put it in context.

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<v Speaker 3>It's not as if, you know, at least from my

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<v Speaker 3>vantage point, we shouldn't be thinking about a big upgrade

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<v Speaker 3>cycle here. This is normal refresh here. With that being said,

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<v Speaker 3>you know, they launch a couple of news cus there

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<v Speaker 3>is a lighter iPhone this time around, so the attractiveness

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<v Speaker 3>is just people. People who want to upgrade for a

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<v Speaker 3>new battery, for a faster processor, probably for a lighter

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<v Speaker 3>from factor are doing that. But to my mind, the

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<v Speaker 3>missing ingredient here is a large anglid model running natively

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<v Speaker 3>on device, and that is where Android still is a

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<v Speaker 3>better experience when it comes to, you know, the LLM

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<v Speaker 3>side of things, and Apple has to step up either

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<v Speaker 3>through their own efforts or through a tie up with

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<v Speaker 3>one of these frontier lms, but there is no doubt

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<v Speaker 3>that they need more to do when it comes to

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<v Speaker 3>a generative AI.

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<v Speaker 2>Is there any sense Mandeep that Coopertino shares your sense

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<v Speaker 2>of we got to get going now kind of thing.

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<v Speaker 3>I think so. But look, I mean there are two

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<v Speaker 3>ways to go about it. One is you step up

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<v Speaker 3>in terms of your CAPEX investments, the way hyperscalers have done,

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<v Speaker 3>you know, whether it's a Microsoft, Google, or Amazon or Oracle.

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<v Speaker 3>The other is, you know, you take the acquisition route.

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<v Speaker 3>And everyone is sort of thinking, you know, Apple will

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<v Speaker 3>go the acquisition route or maybe partner with someone like

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<v Speaker 3>Google now that that antitrust overhang is behind them. So

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<v Speaker 3>either of those two I think should work because Apple

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<v Speaker 3>still controls a distribution. And look, when it comes to hardware,

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<v Speaker 3>I am excited about an AR glass form factor. I

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<v Speaker 3>think they are working on a chip when it comes

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<v Speaker 3>to these new AR glasses, and there will be relevance

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<v Speaker 3>of AI when it comes to your you know, glasses

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<v Speaker 3>form factors. So from that perspective, there is something to

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<v Speaker 3>look forward to. From a hardware standpoint. They already launched one,

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<v Speaker 3>you know, AirPod Pro three with real time transcription. That's exciting.

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<v Speaker 5>So those are the.

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<v Speaker 3>Kind of features they will be looking to add. But

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<v Speaker 3>I don't think they are going the Capex route in

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<v Speaker 3>terms of you know, one hundred billion dollars in Capex,

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<v Speaker 3>the same way Hyperscalers are doing.

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<v Speaker 2>Stay with us more from Bloomberg Intelligence coming up after this.

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<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us live

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<v Speaker 1>weekdays at ten am, heasterned on Apple, Coarcley, and Android

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<v Speaker 1>Otto with the Bloomberg Business App. Listen on demand wherever

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<v Speaker 2>Let's get to another story here today in the luxury business.

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<v Speaker 2>Here carrying the big company that owns a lot of

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<v Speaker 2>big brands, I think Gucci as well. They're backing away

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<v Speaker 2>from their beauty business. They're selling it to Loreal four

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<v Speaker 2>point seven billion dollars. Let's get a breakdown on what's

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<v Speaker 2>going on there. Andrea Felstad, she's a Bloomberg in opinion.

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<v Speaker 2>Commis Andrew, can you tell us what Caring is doing here?

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<v Speaker 5>What this transaction shows.

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<v Speaker 6>Well, it's being dressed up as a partnership between Caring

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<v Speaker 6>and Loreal, but what it really is is effectively the

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<v Speaker 6>sale of their beauty brands to Loreo. They've got a

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<v Speaker 6>new CEO, Luke to Mayo. He's come in at a

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<v Speaker 6>time when the balance sheet is very stretched. His predecessor,

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<v Speaker 6>who is now chairman, well bought a lot of things,

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<v Speaker 6>including Creed, this very very upmarket perfume business as share

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<v Speaker 6>in Valentino to try to make the group less dependent

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<v Speaker 6>on Gucci. But that really increased debt. At the same time,

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<v Speaker 6>Gucci's really slowed down and they're having to revive it.

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<v Speaker 6>So they're saying it for four billion euros in cash.

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<v Speaker 6>That gets some money in to deal with the debt

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<v Speaker 6>and gives the new CEO a bit more time to

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<v Speaker 6>turn around Gucci.

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<v Speaker 4>Andrew, isn't this a complete turnaround? I mean, didn't the

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<v Speaker 4>company want to bulk up the beauty and cosmetics division exactly?

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<v Speaker 6>I mean they're saying, you know, this is built on

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<v Speaker 6>the potential that they created. I mean, to be fair,

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<v Speaker 6>they bought Creed. They paid a lot for Creed three

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<v Speaker 6>point five billion euros. Try worked out to be about

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<v Speaker 6>fourteen time sales, you know, an awful lot. But what

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<v Speaker 6>they did it had a supply chain. They did that

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<v Speaker 6>as a play perform to build for beauty. And the

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<v Speaker 6>argument is they have been able to do this deal

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<v Speaker 6>because of that platform. That's probably kind of rather generous

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<v Speaker 6>looked at him. I had a big decision to make

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<v Speaker 6>when he got in. He either had to stick with

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<v Speaker 6>beauty and invest in it. But with that day, it's

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<v Speaker 6>gone in awe and the need to reinvigorate Gucci. It's

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<v Speaker 6>got an awful lot more calls on its cash, so

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<v Speaker 6>he just decided beauty wasn't a priority.

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<v Speaker 2>I consider myself a Gucci expert. I read the book,

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<v Speaker 2>I saw the movie. In the movie, yes exactly, so Andrew.

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<v Speaker 2>I mean, it's obviously an iconic brand. What are the

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<v Speaker 2>experts saying that needs to be done? Because it's such

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<v Speaker 2>an important part for caring.

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<v Speaker 6>It is it really is. It would add its peak

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<v Speaker 6>and in sort of twenty eighteen nineteen, around that time,

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<v Speaker 6>it was sixty percent group sales. Now, you know, Kerring

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<v Speaker 6>had an amazing run with Gucci. They put in this

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<v Speaker 6>quite unknown designer, Alessandro mckayley, and the prevailing look has

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<v Speaker 6>been very minimalist, and he came in with these big logos,

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<v Speaker 6>clashing print, granny chek and it was just a bread

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<v Speaker 6>of breath of fresh air and it change prevailing fashion.

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<v Speaker 6>But that was in Stor twenty sixteen, after the pandemic,

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<v Speaker 6>when Obviously, nobody was feeling terribly good soaring inflation. It

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<v Speaker 6>just felt very out of sync with how people were feeling.

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<v Speaker 6>And they tried to turn it round and have a

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<v Speaker 6>much more minimalist look, and it just wasn't Gucci. Gucci

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<v Speaker 6>works best when it's very fashionable, when it's over the top.

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<v Speaker 6>So they brought in Dumna Versalia, who was at Valenciaga,

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<v Speaker 6>and he is trying to, you know, really revive it.

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<v Speaker 6>He's gone back to the Tom four days when it

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<v Speaker 6>was very successful. He's gone back to the Alessandro and

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<v Speaker 6>Kaylee days. He did this crazy film in Fashion Week.

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<v Speaker 6>There was absolutely bonkers, but it got people talking about

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<v Speaker 6>Gucci again. I was in New York a couple of

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<v Speaker 6>weeks ago and I went to the store in Soho

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<v Speaker 6>and there was a big installation of all his things

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<v Speaker 6>and the capsule collection. It's trying to get people interested

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<v Speaker 6>in Gucci again, and he's sort of going back to

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<v Speaker 6>the future to try and revive its magic. Whether it's

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<v Speaker 6>going to work, I'm not sure. I thought he was

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<v Speaker 6>the wrong person to be appointed, but so far he

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<v Speaker 6>seems to be doing all the right things.

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<v Speaker 4>Andrew, can you tell us some of the challenges krig

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<v Speaker 4>has been facing. I mean, there's that slump in Chinese demand,

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<v Speaker 4>higher US tariffs as well, what are they facing.

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<v Speaker 6>So what we what we've got at the moment is

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<v Speaker 6>the one percent of still doing very well. But they're

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<v Speaker 6>not buying Gucci. They're buying Hermes, they're buying Brunello, Cuccinelle,

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<v Speaker 6>Laura Piano. They want these very expensive upmarket things. Now

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<v Speaker 6>the rest of the less rest of the luxury market

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<v Speaker 6>that aspirational customers coming under pressure. And she had a

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<v Speaker 6>lot of those aspirational customers, particularly in the US. So

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<v Speaker 6>you've got the sort of esthetic going out of fashion

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<v Speaker 6>and you've got these aspirational customers coming under pressure. It's

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<v Speaker 6>really had a bit of a perfect storm and it

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<v Speaker 6>needs to really revive Guccini and it had the take

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<v Speaker 6>of Annetta wasn't doing too bad and their designer went

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<v Speaker 6>to Chanel. So you know, every brand is sort of

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<v Speaker 6>you know, got its challenges.

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<v Speaker 5>Stay with us.

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<v Speaker 2>More from Bloomberg Intelligence coming up after this.

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<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us live

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<v Speaker 1>weekdays at ten am Eastern on Applecarplay and Android Otto

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<v Speaker 1>with the Bloomberg Business app. Listen on demand wherever you

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<v Speaker 1>get your podcasts or watch us live on YouTube.

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<v Speaker 2>Talking about AI. That's been a theme for this marketplace

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<v Speaker 2>for it seemingly three years now. Everybody says that AI

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<v Speaker 2>is going to revolutionize their business. Even McDonald's say it's

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<v Speaker 2>going to revolutionize how you go through the drive through.

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<v Speaker 5>I'm like, all right, whatever, just get my order right.

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<v Speaker 2>It's also you here in the financial services business, Patrick

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<v Speaker 2>Daniel Joines is here, vice President Advisor Digital Solutions at

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<v Speaker 2>Commonwealth Financial Network. Patrick, is AI going to replace the

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<v Speaker 2>financial advisor?

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<v Speaker 7>Absolutely not the you know what we're seeing today in

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<v Speaker 7>terms of there's a there's an experimentation and a scale

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<v Speaker 7>that's happening within the AI space in terms of advisors,

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<v Speaker 7>and you know we heard that with the robo advisor

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<v Speaker 7>years ago in terms of will it replace and so

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<v Speaker 7>from an AI capability, absolutely there's going to be an

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<v Speaker 7>elevation of the advisor in terms of what they are

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<v Speaker 7>possible and what they can do in terms of the

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<v Speaker 7>art of the possible.

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<v Speaker 5>But absolutely not. There's going to be a need for empathy,

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<v Speaker 5>there's going to be.

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<v Speaker 7>A need for understanding human behavior, and really from a

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<v Speaker 7>technology perspective, that's going to be very difficult to do. Now.

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<v Speaker 7>With that said, you know, if I were to look

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<v Speaker 7>into the three to five year sort of glass in

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<v Speaker 7>terms of what's going to look like, it's going to

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<v Speaker 7>be very difficult. In terms of how that may look like.

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<v Speaker 7>You might have digital assistance right that are paired up

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<v Speaker 7>with a human advisor that is using hyper personzed information

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<v Speaker 7>and services to help the advisor support those clients, but

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<v Speaker 7>generally speaking, you're not going to see that replaced completely

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<v Speaker 7>in terms of what a financial advisor can provide their clients.

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<v Speaker 8>So the human relationship not dying basically, So how is

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<v Speaker 8>a I then changing the way you manage money?

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<v Speaker 7>So there's just a tremendous opportunity in that space in

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<v Speaker 7>terms of right now, what we've seen over the last

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<v Speaker 7>two to three years in terms of experimentation has been

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<v Speaker 7>around client meetings and note taking any efficiency within the space,

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<v Speaker 7>and so you're seeing advisors freeing up time to focus

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<v Speaker 7>more on financial conversations with their clients or asset management.

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<v Speaker 7>And so what we're going to see in the future

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<v Speaker 7>as this technology evolves, and we're starting to see it already,

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<v Speaker 7>is in the space of doing business modeling or financial

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<v Speaker 7>modeling or looking at it from a model's perspective in

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<v Speaker 7>terms of where I should be putting from a next

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<v Speaker 7>best action perspective. And so we're going to start to

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<v Speaker 7>see a lot of that in terms of informing advisors

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<v Speaker 7>to make sure that they're having those conversations in a

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<v Speaker 7>timely fashion and potentially identifying maybe gaps that if they

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<v Speaker 7>didn't have, say an agent or this digital assistant next

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<v Speaker 7>to them, that they could identify in a timely fashion

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<v Speaker 7>from a tax efficiency perspective, or just from a a

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<v Speaker 7>from a scale perspective, or from an a s allocation perspective.

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<v Speaker 2>You know, when I talked to some of the advisors

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<v Speaker 2>here at a conference like a Commonwealth, they say, you know,

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<v Speaker 2>I really want the platform to kind of free up

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<v Speaker 2>more of my time so I can go out and

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<v Speaker 2>work with my clients, prospect for new clients, really help

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<v Speaker 2>me with the back office, help me with the technology,

0:12:29.960 --> 0:12:33.040
<v Speaker 2>help me with all that. How are you guys integrating

0:12:33.080 --> 0:12:35.120
<v Speaker 2>AI into that part of the platform.

0:12:35.160 --> 0:12:36.800
<v Speaker 5>Yeah, absolutely so where we started.

0:12:37.240 --> 0:12:40.320
<v Speaker 7>So, first off, before we started from an AI implementation

0:12:40.400 --> 0:12:44.320
<v Speaker 7>perspective with our affiliates, there was a there's a risk obviously,

0:12:44.400 --> 0:12:46.360
<v Speaker 7>right from a compliance and a regulatory perspective.

0:12:46.400 --> 0:12:48.240
<v Speaker 5>So years ago we.

0:12:48.280 --> 0:12:51.599
<v Speaker 7>Formed an AI or a JENAI Risk Committee at Commonwealth

0:12:51.600 --> 0:12:54.600
<v Speaker 7>to try to make sure that whatever we provide from

0:12:54.600 --> 0:12:57.000
<v Speaker 7>a support perspective as we move forward within the AI space,

0:12:57.040 --> 0:12:58.959
<v Speaker 7>that we do so in a compliant and make sure

0:12:59.000 --> 0:13:01.160
<v Speaker 7>from a data retention and risk perspective that we take

0:13:01.200 --> 0:13:01.560
<v Speaker 7>care of that.

0:13:02.400 --> 0:13:04.640
<v Speaker 5>As I mentioned earlier two years ago, it was more.

0:13:04.559 --> 0:13:09.079
<v Speaker 7>Around around a curiosity with the technology. I'd say a

0:13:09.160 --> 0:13:10.920
<v Speaker 7>year ago, twelve to sixteen months ago, it was more

0:13:10.920 --> 0:13:14.080
<v Speaker 7>around experimentation and now what we're seeing at Commonwealth. We

0:13:14.120 --> 0:13:16.199
<v Speaker 7>just rolled out an AI meeting tool or a couple

0:13:16.240 --> 0:13:19.440
<v Speaker 7>of them actually earlier this year, and we're seeing now

0:13:19.480 --> 0:13:21.719
<v Speaker 7>at scale and that's where I think you're going to

0:13:21.760 --> 0:13:24.560
<v Speaker 7>start to drive the adoption. So we rolled out a

0:13:24.600 --> 0:13:26.920
<v Speaker 7>new platform. It's a third party platform. From the AI

0:13:27.040 --> 0:13:29.640
<v Speaker 7>meeting perspective, we already have twenty percent adoption on that

0:13:29.760 --> 0:13:32.880
<v Speaker 7>and just folks talking to one another at events like

0:13:32.880 --> 0:13:34.760
<v Speaker 7>this from a networking perspective, we're going to start to

0:13:34.800 --> 0:13:38.239
<v Speaker 7>really see that driven in terms of adoption and acceleration

0:13:38.360 --> 0:13:39.080
<v Speaker 7>within our space.

0:13:39.440 --> 0:13:40.160
<v Speaker 8>Now I see the.

0:13:40.160 --> 0:13:41.960
<v Speaker 4>Excitement coming from you when you talk about you know,

0:13:42.040 --> 0:13:45.200
<v Speaker 4>AI and all that can do. But what concerns you

0:13:45.280 --> 0:13:46.800
<v Speaker 4>when it comes to AI in the space.

0:13:46.880 --> 0:13:50.800
<v Speaker 7>Yeah, there's a lot of things. And honestly, the first

0:13:50.840 --> 0:13:54.480
<v Speaker 7>thing I think about is just deep connections. And I

0:13:54.520 --> 0:13:57.520
<v Speaker 7>think about AI not just generally speaking in terms of

0:13:58.000 --> 0:14:00.720
<v Speaker 7>from a financial management or in our space, but you

0:14:00.760 --> 0:14:02.920
<v Speaker 7>think about and I think about my own personal life

0:14:02.960 --> 0:14:05.640
<v Speaker 7>where I would call my folks, whether it's my dad

0:14:05.679 --> 0:14:09.360
<v Speaker 7>on some advice or I need, you know, help with

0:14:09.400 --> 0:14:11.240
<v Speaker 7>whatever it might be in terms of life. Well, I

0:14:11.240 --> 0:14:13.040
<v Speaker 7>think you're finding a lot now people are just going

0:14:13.080 --> 0:14:15.560
<v Speaker 7>to gen AI or it's a large language models for that.

0:14:15.679 --> 0:14:18.640
<v Speaker 7>And so the face, the face, the deep connections, and

0:14:18.679 --> 0:14:20.160
<v Speaker 7>that's what really our industry.

0:14:19.840 --> 0:14:22.880
<v Speaker 5>Is rooted in. You know that, That's what really.

0:14:22.600 --> 0:14:24.920
<v Speaker 7>Concerns me in terms of how do you balance you know,

0:14:25.000 --> 0:14:27.040
<v Speaker 7>from you know, making sure that the human's still in

0:14:27.080 --> 0:14:29.760
<v Speaker 7>the loop and the technology. And I think there's going

0:14:29.840 --> 0:14:30.920
<v Speaker 7>to be a way to do that. But that's what

0:14:31.040 --> 0:14:33.280
<v Speaker 7>really concerns me. It's the connections, It's the people, it's

0:14:33.320 --> 0:14:33.600
<v Speaker 7>the face.

0:14:33.640 --> 0:14:34.000
<v Speaker 5>The face.

0:14:34.080 --> 0:14:36.880
<v Speaker 8>What's sure some people go to chat GPT for financial advice.

0:14:36.960 --> 0:14:38.280
<v Speaker 8>I mean it's well.

0:14:38.400 --> 0:14:40.560
<v Speaker 7>Eighty percent of the people that are using a large

0:14:40.600 --> 0:14:43.400
<v Speaker 7>language model today have actually used it for financial advice,

0:14:43.440 --> 0:14:45.720
<v Speaker 7>and it's a little bit higher for the younger, the millennials,

0:14:45.720 --> 0:14:47.600
<v Speaker 7>et cetera. It's about an eighty two to eighty three

0:14:47.640 --> 0:14:51.120
<v Speaker 7>percent adoption of people using it for financial advice. And

0:14:51.160 --> 0:14:53.680
<v Speaker 7>so again that's an opportunity for financial advisors to make

0:14:53.720 --> 0:14:55.520
<v Speaker 7>sure that they get in front of that and to

0:14:55.600 --> 0:14:57.600
<v Speaker 7>guide that direction in terms of where they go and

0:14:57.600 --> 0:14:58.320
<v Speaker 7>how they use it.

0:14:58.920 --> 0:15:01.640
<v Speaker 2>My number three off bring his into financial services business.

0:15:01.680 --> 0:15:03.080
<v Speaker 2>He's at the stage of his career where he is

0:15:03.120 --> 0:15:06.480
<v Speaker 2>dialing for dollars, doing all the basic grunt work. But

0:15:06.560 --> 0:15:08.880
<v Speaker 2>he finds it as a challenge that a lot of

0:15:08.880 --> 0:15:11.640
<v Speaker 2>the young people that he prospects come back and say, well,

0:15:11.640 --> 0:15:14.160
<v Speaker 2>I've got chatter GPT, how do you put that in

0:15:14.200 --> 0:15:14.680
<v Speaker 2>your training?

0:15:14.880 --> 0:15:15.840
<v Speaker 8>What's the response to that?

0:15:16.160 --> 0:15:18.720
<v Speaker 7>Yeah, so from a financial advisor in terms of when

0:15:18.720 --> 0:15:21.160
<v Speaker 7>they're having that conversation. Yeah, So it's all about guidance,

0:15:21.520 --> 0:15:24.480
<v Speaker 7>and so you know, there's an opportunity there, I think

0:15:24.520 --> 0:15:27.200
<v Speaker 7>in terms of making sure that you're directing, and that's

0:15:27.200 --> 0:15:29.720
<v Speaker 7>where the value of the advisor comes in, right, and

0:15:29.760 --> 0:15:31.560
<v Speaker 7>so it's trying to get in front of that and

0:15:31.600 --> 0:15:36.040
<v Speaker 7>providing information that's more curated and but also recognizing that

0:15:36.080 --> 0:15:38.040
<v Speaker 7>there's this other and that's been in the industry for

0:15:38.120 --> 0:15:40.440
<v Speaker 7>years in terms of whether it's various websites you can

0:15:40.520 --> 0:15:42.640
<v Speaker 7>go to, et cetera. It's just getting elevated more accessible.

0:15:42.640 --> 0:15:44.000
<v Speaker 7>But I think you just need to make sure that

0:15:44.520 --> 0:15:46.920
<v Speaker 7>you call you know, you sort of you address it

0:15:46.920 --> 0:15:48.520
<v Speaker 7>and then you account for it.

0:15:48.600 --> 0:15:51.960
<v Speaker 8>So and what emerging technology are you keeping an eye on?

0:15:52.120 --> 0:15:52.400
<v Speaker 5>Oh?

0:15:52.520 --> 0:15:55.000
<v Speaker 7>Yeah, So, so for me, from an AI perspective, there's

0:15:55.000 --> 0:15:57.640
<v Speaker 7>a couple of things. One is quantum computing actually, and

0:15:57.680 --> 0:16:01.000
<v Speaker 7>so with quantum computing, you're seeing it's a it's a

0:16:01.040 --> 0:16:04.440
<v Speaker 7>symbiotic relationship actually, so you're seeing AI improve the quantum

0:16:04.480 --> 0:16:06.880
<v Speaker 7>computing in terms of what's capable, and then from a

0:16:06.960 --> 0:16:08.640
<v Speaker 7>quantum computing perspective in terms of the.

0:16:08.600 --> 0:16:12.000
<v Speaker 5>Power and what can be provided. It's elevating the AI.

0:16:13.000 --> 0:16:17.720
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