November 4, 2025 • 42 mins
Bloomberg’s Caroline Hyde and Ed Ludlow discuss the drop in tech shares as concerns grow about the sustainability of the AI rally. Plus, as earnings season continues, they break down results from Palantir, Uber, Spotify and Grab. And the world's largest sovereign wealth fund votes against Tesla's proposed pay package for CEO Elon Musk.
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Speaker 1 (00:04):
Bloomberg Tech is alive from coast to coast with Caroline
Hide in New York and ev Low in sentrances go.
Speaker 2 (00:14):
This is Bloomberg Tech coming up.
Speaker 3 (00:16):
Palenteer shares form concerns about the company's valuation and the
sustainability of the AI rally.
Speaker 1 (00:22):
Thus we'll break down more tech earnings, Spotify, Uber grab
all out with results as well, and we push ahead
to am D tonight.
Speaker 3 (00:30):
And the world's largest sovereign wealth fund vote against Tesla's
proposed pay package for CEO E Long. Musk will discuss
the impact on the company's shares.
Speaker 1 (00:39):
But first we check out what's happening in these markets
more broadly. In and I'm looking at and now's that
one hundred that is under pressure. Look, we're only down
to levels well that we've seen this month, and indeed
it's the worst sell off since all Thursday. So this
isn't seismic, but there is a tension here about some
of the levels of valuations in certain people speaking out
(01:00):
about putting on some short bearish bets. I'm looking at Bitcoin, though,
has been under far more pressure. It's the lowest level
that we've seen since June.
Speaker 4 (01:06):
Of this year.
Speaker 1 (01:07):
Off by another three point three percent amid the risk
of tension. You're looking at some big movers underneath the herd.
Speaker 2 (01:13):
Yeah, Tesla's down two point eight percent.
Speaker 3 (01:14):
It had been down four percent of the open Norway's
Sovereign Wealth funds, Tessa's ninth largest shareholder voting against the
bait package. We're going to head out to Europe in
a minute and get more on that. And then there's
Palenteer strong beat in the third quarter, raising annual outlook
for revenue. But the cell side and investors and the
internet all going to valuation as a pointed discussion carro
(01:38):
commercial growth and government growth. But this isn't about fundamentals,
or maybe it is.
Speaker 1 (01:43):
Let's talk about both fundamentals and valuations and talk about
Palenteer's earnings and the sustainability of these numbers. Of Marianna
Perez Mora, she has an aerospaceed defense analyst that be
Evasecurities with a BI rating two ondred and fifteen dollars
price target for Palenteer. More broadly, and I think you're
even upping it to two five five. Tell us about
why Palenteer is just outperforming. It is peerless in your perspective.
Speaker 5 (02:06):
So first, thank you so much for having me here.
I'm happy to share this with you too. And I
think Polunteers has proven that has been the winner of
this AI implementation. And I mean not only about like investment,
but actually the growth they are unlocking the customers actually
go into them because they can prove that they can
(02:28):
actually extract value from these AI implementations. And it doesn't
only stop with those customers, but also other software peers
that are partnering with Palenteer because they also want to
be part of this. They have like really good software,
but they are still struggling to actually make that software work.
And Polunteering is like from a fundamental perspective, actually proving
(02:51):
that they can extract value from those implementations.
Speaker 1 (02:54):
Your note is such a joy to read because you're
using wonderful analogies going back to the matrix, whether you're
going to be where you're going to red pell But
what's interesting is you're thinking that ultimately the red pillar
is there with Paneteer, and they are unlike the ninety
five percent of failed pilots that MIT drew a focus on,
they're managing to make AI work. But why what is
(03:14):
it different about dot cart Daddy Carp however you see
him and indeed the go to market focus that they have.
Speaker 5 (03:22):
I think what is different first is that they have
been working on this infrastructure that is actually what makes
AI be operationable for more than twenty years. This is
something that today has more value than anything because of
like the acceleration and AI and the new software that
we have, but like this ontology that they have that
(03:43):
is like the data integration that can actually unlock value
from all these different like data parts and like have
the human to be able to interoperate with that that
has been in the works for more than twenty years,
and that's why they are a real winner. And from
a customer perspective, you have to take into account that
(04:04):
they work with the US government and they have worked
with the uscrment for so long, so they know how
to do complex operations and they are translating all that
know how into the commercial world. That is why I
think their winner. They were prepared for this.
Speaker 2 (04:20):
Marianna.
Speaker 3 (04:20):
A part of the pressure on the stock this morning,
and we need to acknowledge it is that Michael Berry
of the Big Short fame or Sian Asset Management his
firm have disclosed some various wages, including on Palenteer put options.
It's the form that they've taken, but there's clearly some
bigger picture worry about valuation and are we or are
(04:43):
we not in an AI bubble. The way that you
put it in your note is to discern what is
real and what is not real. What is it you
see in Palenteer that gives you the conviction it is real.
Speaker 5 (04:56):
What makes me convinced about being real is what when
you hear about the customers and the transformation they are
seeing from implementing polunteers product. They are like actually saving money,
They are doing things faster, cheaper, better, smarter. Those real
changes are the ones that make me optimistic about it.
(05:16):
And we have said this over time. I'm really convinced
that even if THEI bubble were to burst, Polenteer will
survive because it's the structure to actually extract that value
and do more with AI, AI agents or whatever is
next from a stochastic models or anything in software and
(05:37):
computing and everything.
Speaker 3 (05:39):
You're right that seeing is believing, Marianna. I've attended quite
a few AIP cons and what happens is you had
these customers go on stage and demo how they actually
use palented, Like, there are so many people out there
that are like, what does palenteer even too?
Speaker 6 (05:54):
Do you know?
Speaker 3 (05:55):
I've seen the demo and you get a sense for
how it works. So then that takes me to the
commercial growth one hundred and twenty one percent growth here
on year in the US. The nervousness out there is
that it's only the US that commercial business isn't growing internationally.
Speaker 5 (06:11):
I think when you think about international, you have to
take into account two things. Number One, there are larger
customers there that like, we're already hardly like a lot
of penetrated, and that palenttary is putting their focus in
the US. So it's also demand is like amazing for
AI in general, and we see that with all the
capits being invested. But if you have to actually catch
(06:35):
up with that demand and execute on that, you have
to take into account where you put your efforts on
your resources, and I think it's aligned with that the
Palantear is putting most of their commercial resources focused in
the US.
Speaker 3 (06:47):
Mariana perez More Bank of America Securities price target up
to two hundred and fifty five dollars, reiterating a buy
on Palenteer, appreciate it. That's get a lot of the
top story in Tesla shares down after the world's largest
sovereign wealth fund voted against Tesla's stock award proposal for
CEO Ela Musk, the biggest show of opposition yet by
(07:07):
a major shareholder in London, Bloomberg's Auto Zar crag Trudell
joins us as more, we're trying to tabulate in tally
who's voted no so far ahead of November sixth. Norway's
sovereign wealth fund is the ninth largest Tesla shareholder, I believe,
hence why we're saying this is the biggest no vote
(07:28):
so far.
Speaker 7 (07:29):
Yeah, that's right. And they were pretty diplomatic about it.
They praised the value that Musk has has created over
the years. They refer to him as, you know, having
played a visionary role. And yet they're concerned just about
this sort of magnitude of of this award, about dilution
and also about the issue of sort of key man risk.
(07:50):
This is something that has been has come up time
and again with Musk. You know, the moment that he
has had someone who's emerged as sort of you know
who's sort of looks like a number two that person
doesn't seem to last very long. So in Tesla's defense,
I think the board has tried to take some steps
with this package to try and mitigate some of that
(08:12):
risk and sort of have Musk play a role in
in you know, succession, But the planning for that still
seems to be, you know, pretty much you know, sort
of to the side, as they really sort of focus
as a board on retaining him and on incentivizing him.
Speaker 1 (08:30):
Can you take us to how they have voted in
prior votes on pay for Tesla or the relationship between
the Norwegian Weld Fund and Elon Musk going forward what
that means for well, really the retail base, which is
the big push here for many.
Speaker 7 (08:47):
Yeah, I think as much as this no vote is concerning,
if if you want to see this measure pass, you know,
we only have to go back to last year to
an example of when this fund voted against a Musk
pay package. This was the vote on reratifying the twenty
eighteen award that a judge in Delaware threw out. And
(09:07):
there's there's kind of a juicy story to that in
that the CEO of this wealth fund, you know, kind
of got raked over the coals by Musk. We found
out later for the way that the fund voted on
that pay package. There was a freedom of information requests
for messages between the head of the fund, Nikolai Tangen
(09:27):
and Elon Musk, and Musk, you know, refer to this
notion that he needed to quote make amends for the
way that the fund voted. So there is a backstory here.
And as much as you know, this is maybe a
negative signal again if you want this to pass. We've
seen that it's been the case that even when this
fund has opposed a measure that the board has wanted
(09:50):
to see through, the board has managed to get its
way with its you know, in part thanks to its
very substantial retail investor base.
Speaker 1 (09:57):
Great context is always pretty most creted out, so appreciate
you joining coming up. Grab well it Boost is early
forecast for the year. We speak with the CFO P
t Ui about the company's latest results as have been
their tech AI is headed for the grocery aisle. Instacart
(10:21):
is launching new AI tools, including an assistant they can
make product recommendations. As it really leans the e commerce
business into more profitable software those Natalie Lung joins us
to talk us through it, tell us a little bit
about how these actual instacar AI tools are working.
Speaker 8 (10:35):
So instacart is building this AI chadboard as a white
label service for groceries, so they can actually have a
chatboard within let's say Kroger's own iOS app or the
Sprout's website app.
Speaker 3 (10:50):
Natalie, let's head out to Uber, one of the big
decliners ride share good delivery, good, profit, not good.
Speaker 2 (10:58):
What's the story then, Yes.
Speaker 8 (11:00):
So Uber sort of reported some disappointing operating income and
adjusted EBITDA this morning out of the third quarter, as
well as some disappointing forecasts earning this forecast for the
four Q and so it's the profit has not been
catching up with some of the growth recovery. We're seeing
their growth reaccelerated to more than twenty percent on the
(11:22):
top line growth spookingymetric. And this is sort of attestament
to their strategy to go into new products, some of
which may not be proudable at the beginning, such as
autonomous investments, which they have been doing a lot of recently.
Speaker 2 (11:40):
Most Natalie Lung, thank you very much.
Speaker 3 (11:42):
Food delivery and right hailing company Grab raised its earnings
forecast for the year after carely profit top testaments. The
Singapore based Grab introduced new products like group food orders
and less expensive shared rights that helped drawing customers. Here
to discuss Peter Uey grabs CF. That's so interesting, right,
you just heard Natalie talking about Uber bringing in new
(12:04):
products that hurts profitability. Your strategy seems to me to
be like more affordable products for a wider audience based
customer base, but you're doing it in a way that
is accreative to your bottom line.
Speaker 2 (12:18):
How have you done that? Let's try it.
Speaker 9 (12:21):
We've been on point in terms of strategy making our
product more affordable and we really widened the top of
the funnel for us. If you look at the third quarter,
we have now forty eight monthly transacting users on our platform,
which is another rerecord for us. And we're also seeing
more you use spending on the platform at the same time,
so that it affordability also is pushing the average spend
(12:44):
also on our platform because they're transacting more on the platform.
If you look at the number of transactions on our platform,
we've grew twenty seven percent, which was actually growing faster
than our GMB also at the same time. So what
we're seeing is a number of things. One is people
are engaging on the platform. We're also cross selling more
also as they're coming in into certain funnels that we
(13:04):
have on the affordable side, they're also trying other products
that we have, whether it's the group order that you
just mentioned, whether it's the dine out features that we
have also for them to be able to go to restaurants.
So there's a lot more products that we've actually been
monetizing and that's producing some of the results that you've seen.
Speaker 3 (13:22):
If you have a strategy where group food orders and
shared rides are a driver of demand, do you need
big volume in order to make this a profitable exercise?
Speaker 2 (13:34):
For grab?
Speaker 9 (13:37):
Obviously, scale is important. The more scale that we have,
the more users using the platform, the more we can
actually leverage the cost structure of our business and also
scale the big driver base that we have also at
the same time. So it does play a role, and
hence what you've been seeing is that now over a
third of our user base, especially in deliveries now are
(14:01):
coming into what we call more the affordable product stack,
and it's a great entry point for them to use.
You're looking at over twenty five million monthly transacting users
just interacting in those affordable products, just on the food
delivery side of the business. And that's a great way
for us because it enables us for those users who
(14:21):
are a little bit more price sensitive to try the
product first, get a taste of it. Also, they're a
little bit more price sensitive on the delivery fee, and
we've managed to be able to lower the delivery fee
for them. But they also get to experience the platform,
and once they've experienced the platform, they get to also
experience other products like grocery delivery, which is still a
very nascent business for us. It's about ten percent of
(14:41):
out delivery GMB. And at the same time, also we're
cross selling them to other products like dine now for
an example, for them to be able to go to restaurants.
Speaker 1 (14:49):
At the same time, it's interesting that you also for
fintech as well and loans.
Speaker 2 (14:53):
But I've just got to target.
Speaker 1 (14:55):
The ennefit in the room is that we hear all
these growth stories, we see analyst raising price target on you,
but the shares are down on the day, Peter, and
from the conversations you had with investors and analysts. What
was it that perhaps was a little bit of concern.
Speaker 9 (15:08):
About I would say any of concern. A lot of
the investors are really focused on how we are going
to finish the quarter, and I've reiterated them that were
on track to finish a very strong quarter. If anything,
that reflects on the guidance that we've given out. Also,
we've increased the EBD guidance now to four hundred and
ninety million dollars to five hundred and that's there also
(15:31):
shows that our confidence in terms of how we're exiting
the quarter. I've also told them that in terms of
our GM we growth, we're continuing to sustain this growth
acceleration in our business today. So we are looking to
finish strong in the quarter. One of the areas that
we're focusing also is the fintech business. We've given out
a one billion dollar loan outstanding by the end of
(15:52):
the year and we're on target to hit that also,
so all the different parts of the business are on
track for us to have a very strong finish of
the year.
Speaker 1 (16:00):
What's also on track is early twenty twenty six Robotaxi
Chinese robotaxi company we Ride. You've been partnering there. How
are you seeing av as the key area of focus
just briefly.
Speaker 9 (16:10):
Yeah, we're leaning it into av it the biggest platform
in Southeast Asia. We're leaning into the rarest part of
investments that were making. One is across learning the tech
and whether it's the wee Right partnership that we have
in Singapore. We're hoping to have the cast deployed on
the street in the first quarter to be able to
take on public passengers with the safety driver. And also
(16:31):
we're looking at US technology such as main Mobility. We
made an announcement we're honering with main Mobility also, So
we're looking at all the different tech and taking the
best of it and really bringing it to Southeast Asia.
Speaker 2 (16:42):
Peter quickly.
Speaker 3 (16:43):
You know, across the jurisdictions you operate in, do you
recognize one that is a better regulatory environment to deploy
robotaxi in.
Speaker 9 (16:52):
You know, in all the countries, especially when we're studying
in Singapore, because really Singapore, when it comes to the
government regulations that the standard are very high here and
a lot of the other Southeast Asian countries tend to
look to Singapore as a proxy, So we've been working
very closely with them, and that's around safety, which is
really important, and also the customer adoption of autonomous vehicle itself.
(17:19):
But at the same time, also we're leaning it in
terms of how we can rescale the existing driver base
that we have here also, so we identifying new opportunities
for driver base where they become safety drivers, that become
remote drivers, fleet operators, etc. Which is really important. So
the way we're approaching AV is working with the government
but also working with the driver community and also the
(17:40):
end user also to be able to adopt these new technologies.
Speaker 1 (17:43):
I mean, the labor impact of AI as front center.
It's interesting that you're really leaning into that, Peter, the
prioritization of innovation. How much you were able to do
that while still driving the bottom line because profitability is
being asked of you.
Speaker 9 (17:57):
Yeah, we'll Actually AI is something which is very core
to grab itself.
Speaker 2 (18:02):
It's not something new.
Speaker 9 (18:03):
Also, we've been focusing a lot on AI about four
or five years ago. We've developed our own models actually
very early on. We now have over one thousand models
in production that we're running here. And the way we've
been operating in the last eighteen months since the technology
has advanced so much is really internally we're also using
a lot of AI of a ninety eight percent of
our engineers today use some sort of AI code assist.
(18:26):
What also we started to deploy is the products to
our customers. Also, we have voice activation now for the
visually impaired where they can actually just speak to our
app and able to order a food or order a
ride for an example. And also we've deployed copilot equivalent
to our driver base where they could really rely as
(18:47):
on with a really effective a pilot to be able
to navigate throughout their day. And also with the merchant
or merchant bot actually that we have also they can
interact with our merchants.
Speaker 1 (18:57):
Staying up late for us. We so appreciate it you
do of grab the Chief Financial Officer. It's election day
in the US and millions of Americans heading to the
polls to cast ballots in local and state races. In
New York, the meyoral contest is in the spotlight Zauraen
Mamdani Andrew Cuomo Curtis leewa battle for city Hall, an
outcome that could have major implications of big tech footprint
(19:18):
right here in the city. Let's get the latest on
an extraordinary race for Miles Miller. What are you watching
out for?
Speaker 6 (19:26):
Yeah, you know, this is going to be a race
that really is going to be either a landslide and
a mandate or a squeaker with Andrew Cuomo. But the
one thing that I think the tech community is looking
out for is if Mamdani is to win, will these
tech firms stay in New York. And the answer that
he's given is yes. He says that in a city
(19:48):
that is more affordable, tech firms will be able to
recruit and retain much quicker. And what he has said
is that that is what will be born out of
some of his big proposals, talking about everything from free childcare,
discounted childcare, to free buses, and he's saying that that'll
have a measurable effect on the tech community. You know,
(20:11):
as I speak to folks like Jeff blau At related
in some other real estate firms, they say that tech
is really starting to continue to work and stay in
New York. And you know, those were some of the
people who were backing Eric Adams and Andrew Cuomo's campaign.
Will they be able to move over and work with Mamdanni.
(20:33):
Mamdanni thinks yes if he is elected, because he will
have this affordability message and that will bore true. We
also know that if Andrew Cuomo were elected, you know,
he spent ten years as governor and really worked very
well with the tech community, and that's what he is
making his pitch as as well.
Speaker 2 (20:53):
Bloomberg's Miles Miller, thank you very much.
Speaker 10 (20:55):
Me.
Speaker 3 (20:55):
While voters in New Jersey and Virginia are heading to
the polls and key gubinatorial races, contests that could shape
house states approached big tech, artificial intelligence, and data center development,
Bloomberg's remain bostic in New Jersey with the latest and
remain whether a Republican win or a Democratic win, the
considerations are very clear.
Speaker 10 (21:12):
Here, yeah, ed. And in fact, this has actually become
a bit of a sleeper issue in this campaign. Remember
it was just about a year ago when one of
the main wholesalers in this region actually ended up delivering
to utilities a more than tenfold jump in wholesale electricity prices,
and that was driven almost entirely by a big build
(21:34):
out in data center demand earlier this year, just in
the summer of twenty twenty five, there was a fresh
auction and prices went up again more than twenty percent.
Remember these are wholesale prices, and these are prices that
are effectively a barometer on future demand for AI capacity.
And I want to put this in context for you ED.
As of right now, there is about five hundred megawatts
(21:56):
of AI data center capacity up and running right now,
so within a year that's likely to double. There are
two big projects under the works about one hundred plus
a mega white project being built by core Weave in
central New Jersey in the downtowntal Worth and one even
larger than that down south near Atlantic City, Carolina, and
there that's going to have a big impact on energy prices.
Speaker 1 (22:16):
Great context Bimberg's remain Bostick.
Speaker 3 (22:19):
And the earnings landscape. We're thinking a lot about Spotify.
This is kind of the Daniel Eck farewell tour. I
guess a little bit. Actually, Common's about to tell me
that I might be a bit wrong on that, but
the core data pretty good. Let's get more on what's
going on with Spotify Blue. It is actually common out
there on the East coast. You know, we've been through
this story with you, Daniel K. Taking a step back
(22:41):
the new co CEO structure, and I'm just looking at earnings.
The key metrics that matters seem to be good. They
seem to be okay.
Speaker 11 (22:48):
Yeah, yeah, no great order. I think investors, you know,
there's a little bit of a loss at one point today.
I think investors really just want to hear that Spotify
is going to raise prices in the US, and they
didn't exactly hear that, so there was a little trepidation there.
But otherwise, broadly speaking, things are looking pretty good.
Speaker 1 (23:08):
It does seem to be pricing power, doesn't it that
everyone's focusing in on and whether advertising can just go
up into the right In terms of that sort of oppo.
What are you hearing for the trajectory in twenty twenty six?
What are AMAS investors focusing on under the new co CEOs?
Speaker 11 (23:23):
Yeah, so, well, they're focusing on a few things. AI
definitely is a big topic. Spotify is now partnering with
chat Chat GPT, so Spotify shows up in chat GPT.
They talked a lot on their earnings calls about this
idea of ubiquity, so their Apple TV app, Chat GPT
and other places where Spotify can show up to be
used everywhere people are so AI is a big conversation
(23:45):
for sure, but also again those prices, the investors and
the music rights holders want to see.
Speaker 3 (23:51):
Higher prices actually want to go to a story that
you broke about Netflix, It's in talks to license video
podcasts from iHeartMedia. On the surface symbol headline, but it
was impactful in the moment. What have you learned in
the course of reporting about this deal?
Speaker 11 (24:09):
Well, and this also relates to Spotify because Spotify was
the first one out of the gate. They announced that
they're licensing some of their video podcasts to Netflix starting
in the new year. Crucially, this means those video podcasts,
the full episodes will be removed from YouTube. So the
fact that Netflix is having conversations with additional networks like
iHeart is pretty significant. It shows that they really are
(24:30):
interested in at least testing out this video podcast space.
Speaker 1 (24:35):
Ashley Carmen always breaking the news. We appreciate it, thanks
for joining. Let's just return to the macro picture now
around this investment landscape, because more Wall Street executives they
are sounding the alarm bell. They're saying investors should brace
for next market correction one ten percent in the next
twelve to twenty four months. Christina Hoop, a Man Group
chief market strategist, sees a mixed economic picture, saying it
(24:56):
is the tale of two cities, tech led success masking
broader week this elsewhere paces, say Christina Hooper joins us
now and we are on this day shining out and
palenteer for example, the sort of poster child or whether
fundamentals live up to what have been deemed nosebreed valuations
on nosebreed success stories. But how do you square that
(25:17):
with then the potential for a pullback in the act market.
Speaker 12 (25:21):
More broadly, well, I think there is just a lot
of enthusiasm around anything that's related to AI. And I'm
old enough to remember the late nineteen nineties and how
much enthusiasm there was around any companies that were related
to the Internet. For example, everyone was scrambling to change
their name to have dot com at the end. Now
many companies are scrambling to say they are part of
(25:43):
this incredible AI food chain. And I think what is
happening though, is that investors may not be thinking about
what could be obstacles to the continued CAPEX boom. Around AI.
I think there are some pretty significant ones. First of all,
we knew and of course we got the deal done
(26:06):
on rare earth elements, but that was clearly an issue.
If you don't have access to enough rare earth elements,
that will certainly slow down an AI cap x boom.
But we also have concerns around how much productivity gains
companies will actually see. We had that MIT report that
came out last spring that suggested maybe not so much.
(26:27):
There could be a point where companies say, you know what,
we've thrown an enormous amount of money at this We're
not necessarily seeing all that we wanted to see. Will
slow down investment, and then finally we have the potential
for a NIMBI movement not in my backyard. In fact,
you just reported on how there are AI data centers,
and of course we're seeing a lot more news around
(26:48):
neighborhoods that are not thrilled to have AI there or
states that don't want to see it there because electricity
costs are going up a lot.
Speaker 1 (26:58):
So there are a lot of macro elements and risk
factors to the endless money that's being thrown at the
desire to build out by the hyper scale as we've
seen in their earnings, but more about the valuation from
because I can understand how people. Is that really what
takes the wind out of the sales of valuations or
is it more of a Michael Berry perspective that you know,
there's just an awful lot of endless capital expenditure and
(27:18):
also cloud growth similarities that seem to be slowing down,
and he's trying to say that, you know, maybe it's
time to bet against just how far we've run rather
than the future risks.
Speaker 12 (27:28):
Absolutely, I think it's both. There are certainly real question marks.
I think about how much more investment we'll see companies
make without seeing you know, sort of significant gains and
perhaps recognizing that there could be some overlap. There could
be there could be more discretion and more thoughtfulness around spending.
(27:53):
So I certainly think there's there's a little of both there.
I just as an outside observer seeing the credible, incredible
amount of money and excitement, there's nothing like it. I
think since what we've seen in the late nineteen nineties,
we know how that ended, so we should just think
of it as a cautionary tale and say, hey, maybe
we should be diversified. Maybe we should have some exposure
(28:13):
to China AI, given that the risks aren't the same,
the vulnerabilities aren't necessarily the same.
Speaker 2 (28:20):
There, let's go back to the tail of two cities thesis.
Speaker 3 (28:24):
So American technology at least good, but papering over some cracks.
Speaker 2 (28:30):
What are those cracks?
Speaker 3 (28:32):
Tell our audience more about the warning signs you're seeing
in other parts of this economy.
Speaker 2 (28:37):
Christina, So, I certainly.
Speaker 12 (28:39):
Think we are seeing consumer weakness, especially among lower income consumers,
but also some middle income consumers. And I think we
can just look to the Chipotle earnings call last week
for signs of that growing weakness. September and October were
difficult months where the frequency of visits went down for
(29:00):
a lot of customers, many of whom are young, and
so that could very well be giving us an inclination
of what could come and what could spread. Because keep
in mind, we are seeing a lot of white collar
job layoffs being announced. We could see more coming and
(29:21):
that will likely impact middle to higher income consumers, many
of whom are spending still spending quite robustly, and that
could create a much bigger problem for the economy. Thus far,
it's been a two legged stool, and it could very
well go down to one and a half legs.
Speaker 3 (29:42):
So this is very interesting going into the holiday quarter.
Maybe this is not the right data set. That Apple
told us last week that revenue going into the holiday
quarters would be up ten to twelve percent, That indicating
that in the middle to hire income in is they'll
go out and spend money on iPhone. I guess that
how does that set us us up for the holiday
(30:04):
quarter and how we view this economy.
Speaker 12 (30:07):
Well, we could still have a very strong holiday quarter
driven by those higher income consumers. My concern though, is
that there are vulnerabilities there, and especially as we go
into twenty twenty six, we could see more in the
way of white collar layoffs. We also know that the
higher income consumers are not so sensitive to inflation, but
they are very sensitive to the stock market, and so
(30:30):
if we were to see some kind of stock market
sell off, think that would be problematic and would certainly
reduce high end consumer spending as well.
Speaker 1 (30:38):
Christina, I want to go back to something you said
that maybe you diversify into China. Ai had a great
conversation with Man Deep just on the side of the set.
He's oblom Bug intelligence analysts. He's just been to Asian
he said, they're doing it so differently there because they
cannot depend on in video chips being limitless. They are
underaware of the geopolitical risks, maybe in the way that
the US ones are putting rare rest to one side,
(31:00):
which China names and how does one get exposure to
that from your mindset?
Speaker 12 (31:04):
So I can't name specific companies, but I can say
that there are so many that look very attractive, that
have much lower valuations and are part of that AI
food chain and that capex spending. I think we'll see
more dollars go there, and certainly it's in earlier innings
(31:24):
in Asia, so I think we have a longer runway there.
Speaker 2 (31:28):
Christina Hooper of Man Group. Great to have you back
on Bloomberg Tech. Thank you very much.
Speaker 3 (31:32):
Now coming up, Snowflake CEO Shwida Ramaswami joins us talk
about the company's latest partnerships to expand AI enterprise access.
This on a day when investors are broadly questioning AI valuations,
particularly in the software space.
Speaker 2 (31:47):
That conversation's next. This is Bloomberg Tech.
Speaker 1 (32:00):
Now for Talking Tech and first s up in video
and Deutsche telecom One have enveiled plans to build out
a one point two billion dollar data center in Germany,
boosting Europ's AI infrastructure. The facility will it's set to
be one of Europe's largest in the region, expected to
begin operations in the first quarter of twenty twenty six.
Plus a two hundred and forty percent rally in sgay
Heinez shares that's in this year alone explanted a warning
(32:22):
from the Career Exchange, signaling that the stock may have
been overheating. The exchange has issued an investment caution on
the chip maker following a surge driven by booming demand
for AI memory chips, and Nintendo is raising its sales
forecast for the switch to now expecting to sell nineteen
million units by March twenty twenty six, up from its
early projection of fifteen million. The upbeat outlook follows strong
(32:43):
early demand for the company, reporting of a ten million
units sold by the end of September.
Speaker 3 (32:48):
Ed Okay Snowflake is announcing a series of new and
expanded partnerships part of the company's effort to become the
data center platform of choice for enterprise AI. Snowfla CEO
Shrida Ramaswami joins us to discuss each of them. The
one that caught my eye was the relationship with Google
Cloud and bringing the availability of the latest.
Speaker 2 (33:10):
Gemini models to Snowflake.
Speaker 3 (33:13):
And the reason I want to start with that is
you are all about choice, right because you can look
at anthropic OAI. But there must have been an indication
to U Shreda that those Gemini models are in demand
amongst your customer base.
Speaker 10 (33:28):
Here.
Speaker 2 (33:28):
It's great to be here.
Speaker 13 (33:29):
Absolutely, Gemini models are among the best in the world
and a lot of our customers are asking for access
to these models. We are thrilled to be expanding our
partnership with Google Blogs similar to what we have done
with our big partners AWS and Azure.
Speaker 2 (33:48):
Is a big step forward for us.
Speaker 3 (33:50):
Can you just explain the basics of the Snowflake business model.
We always talk about Snowflake being a different layer above
the primary cloud. But why is it important that through
cotex AI your platform, any given enterprise customer can access
the underlying model.
Speaker 13 (34:07):
This is a great question. Snowflake is the data layer
that sits above cloud service providers the AWS and Azure
and GCP. We are very much a data centric platform.
We are about making it really easy to ingest, clean
and be able to run analytics on top of the
data and AI, especially Snowflake Intelligence that we are launching,
(34:30):
is a game changer because it brings the access the
power of all the data directly to end users and
what required dashboards, what required analysis right now at the fingertips,
at the voices of every single person. And that's the
reason why Snowflake plays such a critical role. We are
(34:50):
among the best data platforms that run on top of
the hyperscalers and it is that that gives us incredible
ability to create value using AI with partnerships with the
best folks in the world. The open AI is an
anthropic and now.
Speaker 1 (35:06):
Gemini creating value. I think that has been the proof point,
the watchword of this entire year. Strata. How can you
turn to our audience and say this is return on
AI investment, this is what my customers are experiencing.
Speaker 13 (35:20):
This is a great question. First of all, our model
is a consumption model, meaning that Snowflake doesn't get paid.
We don't get to recognize revenue unless customers actually use products.
We don't sell subscriptions that automatically ties us to utility
that we create with our AI products. We work with
our customers, whether it is a ts Imagine or the
(35:44):
USA bobsled team, to create products that they get additional
value from, for example, often replacing an existing dashboarding solution
like we have done at Snowflake. You're confident that using
snowf like intelligence, we can replace a bunch of dashboards
and run the entire data access in a much more
(36:07):
flexible way for a fraction of the cost. We very
much believe in showing ROI return on investment for every
single project that we do, and the consumption model is
a huge help here because if the product isn't used,
there's no revenue on our site.
Speaker 1 (36:23):
So should I. When we're talking in the market, writ
large about warriors of an AI bubble as people are
perhaps selling certain names because they feel that the fundamentals
have become dislocated with the actual valuation of companies. How
are you thinking in this your context? How are you
worrying perhaps that companies will stop their spending until they
get ROAI in the near term.
Speaker 13 (36:45):
Well, this is where as I said, our model is
very very helpful because we don't ask for investments ahead
of the return. Very much we create pilots, we create
proofs of concept and show value to your to our customers,
and only then is it scaled. In our own example,
we launched a tool that indexed all of the enablement information,
(37:08):
the education information for our sales team, and then we
started putting more and more things. Now all of our
sales information lives in a single agent is used pretty
much by everyone in the salesfork, certainly me at Snowflake.
It is that step by step launch and not a
big bang launch that is also important. And keeping that
focus on what are projects that go about creating value?
(37:31):
Are they replacing existing systems? Are they lowering costs? That
kind of moniaical focus is what is helping us successful
even in the AI era, because we very carefully tally
all of this up and make sure that our customers
feel like we are creating value every step of the way.
Speaker 3 (37:49):
STREETA, are we or are we not in an AI bubble?
Based on what you're saying every day through Snowflake.
Speaker 13 (37:59):
Well, absolutely there's a lot of enthusiasm about it. But
at Snowflake, I and every employee at Snowflake is focused
on what does this mean for our customers? We are
back to basics. We created Snowflake Intelligence because we wanted
to bring the power of agentic AI to every single
(38:20):
user within a company in a meaningful way. We wanted
to make sure that data analysts who mind you get
paid a lot, are focused on helping create data agents
rather than writing endless equal queries as I've done in
my life, and that focus on what are projects that
can create value for our customers. How do we get
(38:41):
them to production fast? How do we show the return
to them is what we can do? The outside market valuations,
those things are distractions. I think the more we focus
on back to basics, the better off we are.
Speaker 1 (38:54):
Should Ramswami, it's great to get back to basics with
the Snowflake CEO. We appreciate your time.
Speaker 3 (39:00):
AMD sets report earnings after the closing bell, and the
results should give an indication of how the company's AI
push is going. Investor sentiment has been strong after the
chipmakers signed deals with open Ai and Oracle to deliver
massive amounts of its latest AI chips. Let's get more
with Bloomberg Semiconductor reporter Ian King, it's probably a good
(39:21):
moment to look at what the forecasted revenue is for
the period, and how much of that is data center
revenue because the reality is, for all the headlines and
that stock performance over the last two months, AMD is
just still a much smaller second player behind Video.
Speaker 6 (39:37):
Yeah.
Speaker 4 (39:37):
I mean, it's not getting in annual revenue what in
Vidia is getting in a year. And the story is
as simple as that. But what we've seen over the
last three months is maybe AMD has a seat at
the table now maybe you know, we've seen some validation
of its technology in these deals. Whether that translates in
the short term to stronger revenue and stronger revenue forecast
(40:00):
think importantly is going to be what determines the reaction today.
Speaker 1 (40:03):
There's been a lot of people trying to interpret who
the key clients are. I think link secretary strategies really
saying the key client for MD is metter and actually
how real some of these longer term deals are in
how much vindication is Lisa's who's going to give tonight
or is it all about the analysts meeting that's coming
up in the next week.
Speaker 4 (40:22):
It'll be both. I think up until now everybody has
sort of been AMD curious. Will you know we should
give them a chance, We should give them you know
a look and maybe see if they're a viable alternative.
These deals apparently tell people know their technology is real.
So what they will want from Lisa is the numbers.
If she doesn't give them the numbers the strong forecast,
(40:43):
they'll want a pretty good explanation of why not now
and if not why now then?
Speaker 3 (40:48):
When AMD's traditional market is processes for personal computers and
servers away from the AI chip, what do we think
will learn there?
Speaker 4 (40:57):
Yeah, I know there are very strong expectations there. You'll
remember Intel came out and said, hey, we were worried
that things were in trouble there and that we've got
a lot of inventory. Turns out demands really strong for
aipcs and for standard server parts. AMD is actually taking
market share or has been taking market share from Intel.
So the expectations there are very strong and that could
help the near term numbers.
Speaker 1 (41:18):
It's relentless these earnings in inkings across it throughout for us,
we so appreciate it. Thank you all things AMD after
the bell, but that as I from this edition a
Bloomberg techn YEP.
Speaker 3 (41:28):
Don't forget to check out the pod to recap the show.
There is so much going on in this earning season
and in the background anxiety about valuation and bubbles. Two
day's time of vote on Elon Musk's proposed one trillion
dollar pay package and earnings, no matter how good they
are carriers Impalent's case, valuation is what we're all concerned about.
(41:52):
I alluded to it and many of you use it.
Listen to the podcast. It's very good, if we say
so ourselves. You know where to find it. It's on
the Bloomberg platform as well as online on Apple, Spotify,
and iHeart this is Bloomberg Tech.
Speaker 1 (42:08):
H
Bloomberg Tech is alive from coast to coast with Caroline
Hide in New York and ev Low in sentrances go.
Speaker 2 (00:14):
This is Bloomberg Tech coming up.
Speaker 3 (00:16):
Palenteer shares form concerns about the company's valuation and the
sustainability of the AI rally.
Speaker 1 (00:22):
Thus we'll break down more tech earnings, Spotify, Uber grab
all out with results as well, and we push ahead
to am D tonight.
Speaker 3 (00:30):
And the world's largest sovereign wealth fund vote against Tesla's
proposed pay package for CEO E Long. Musk will discuss
the impact on the company's shares.
Speaker 1 (00:39):
But first we check out what's happening in these markets
more broadly. In and I'm looking at and now's that
one hundred that is under pressure. Look, we're only down
to levels well that we've seen this month, and indeed
it's the worst sell off since all Thursday. So this
isn't seismic, but there is a tension here about some
of the levels of valuations in certain people speaking out
(01:00):
about putting on some short bearish bets. I'm looking at Bitcoin, though,
has been under far more pressure. It's the lowest level
that we've seen since June.
Speaker 4 (01:06):
Of this year.
Speaker 1 (01:07):
Off by another three point three percent amid the risk
of tension. You're looking at some big movers underneath the herd.
Speaker 2 (01:13):
Yeah, Tesla's down two point eight percent.
Speaker 3 (01:14):
It had been down four percent of the open Norway's
Sovereign Wealth funds, Tessa's ninth largest shareholder voting against the
bait package. We're going to head out to Europe in
a minute and get more on that. And then there's
Palenteer strong beat in the third quarter, raising annual outlook
for revenue. But the cell side and investors and the
internet all going to valuation as a pointed discussion carro
(01:38):
commercial growth and government growth. But this isn't about fundamentals,
or maybe it is.
Speaker 1 (01:43):
Let's talk about both fundamentals and valuations and talk about
Palenteer's earnings and the sustainability of these numbers. Of Marianna
Perez Mora, she has an aerospaceed defense analyst that be
Evasecurities with a BI rating two ondred and fifteen dollars
price target for Palenteer. More broadly, and I think you're
even upping it to two five five. Tell us about
why Palenteer is just outperforming. It is peerless in your perspective.
Speaker 5 (02:06):
So first, thank you so much for having me here.
I'm happy to share this with you too. And I
think Polunteers has proven that has been the winner of
this AI implementation. And I mean not only about like investment,
but actually the growth they are unlocking the customers actually
go into them because they can prove that they can
(02:28):
actually extract value from these AI implementations. And it doesn't
only stop with those customers, but also other software peers
that are partnering with Palenteer because they also want to
be part of this. They have like really good software,
but they are still struggling to actually make that software work.
And Polunteering is like from a fundamental perspective, actually proving
(02:51):
that they can extract value from those implementations.
Speaker 1 (02:54):
Your note is such a joy to read because you're
using wonderful analogies going back to the matrix, whether you're
going to be where you're going to red pell But
what's interesting is you're thinking that ultimately the red pillar
is there with Paneteer, and they are unlike the ninety
five percent of failed pilots that MIT drew a focus on,
they're managing to make AI work. But why what is
(03:14):
it different about dot cart Daddy Carp however you see
him and indeed the go to market focus that they have.
Speaker 5 (03:22):
I think what is different first is that they have
been working on this infrastructure that is actually what makes
AI be operationable for more than twenty years. This is
something that today has more value than anything because of
like the acceleration and AI and the new software that
we have, but like this ontology that they have that
(03:43):
is like the data integration that can actually unlock value
from all these different like data parts and like have
the human to be able to interoperate with that that
has been in the works for more than twenty years,
and that's why they are a real winner. And from
a customer perspective, you have to take into account that
(04:04):
they work with the US government and they have worked
with the uscrment for so long, so they know how
to do complex operations and they are translating all that
know how into the commercial world. That is why I
think their winner. They were prepared for this.
Speaker 2 (04:20):
Marianna.
Speaker 3 (04:20):
A part of the pressure on the stock this morning,
and we need to acknowledge it is that Michael Berry
of the Big Short fame or Sian Asset Management his
firm have disclosed some various wages, including on Palenteer put options.
It's the form that they've taken, but there's clearly some
bigger picture worry about valuation and are we or are
(04:43):
we not in an AI bubble. The way that you
put it in your note is to discern what is
real and what is not real. What is it you
see in Palenteer that gives you the conviction it is real.
Speaker 5 (04:56):
What makes me convinced about being real is what when
you hear about the customers and the transformation they are
seeing from implementing polunteers product. They are like actually saving money,
They are doing things faster, cheaper, better, smarter. Those real
changes are the ones that make me optimistic about it.
(05:16):
And we have said this over time. I'm really convinced
that even if THEI bubble were to burst, Polenteer will
survive because it's the structure to actually extract that value
and do more with AI, AI agents or whatever is
next from a stochastic models or anything in software and
(05:37):
computing and everything.
Speaker 3 (05:39):
You're right that seeing is believing, Marianna. I've attended quite
a few AIP cons and what happens is you had
these customers go on stage and demo how they actually
use palented, Like, there are so many people out there
that are like, what does palenteer even too?
Speaker 6 (05:54):
Do you know?
Speaker 3 (05:55):
I've seen the demo and you get a sense for
how it works. So then that takes me to the
commercial growth one hundred and twenty one percent growth here
on year in the US. The nervousness out there is
that it's only the US that commercial business isn't growing internationally.
Speaker 5 (06:11):
I think when you think about international, you have to
take into account two things. Number One, there are larger
customers there that like, we're already hardly like a lot
of penetrated, and that palenttary is putting their focus in
the US. So it's also demand is like amazing for
AI in general, and we see that with all the
capits being invested. But if you have to actually catch
(06:35):
up with that demand and execute on that, you have
to take into account where you put your efforts on
your resources, and I think it's aligned with that the
Palantear is putting most of their commercial resources focused in
the US.
Speaker 3 (06:47):
Mariana perez More Bank of America Securities price target up
to two hundred and fifty five dollars, reiterating a buy
on Palenteer, appreciate it. That's get a lot of the
top story in Tesla shares down after the world's largest
sovereign wealth fund voted against Tesla's stock award proposal for
CEO Ela Musk, the biggest show of opposition yet by
(07:07):
a major shareholder in London, Bloomberg's Auto Zar crag Trudell
joins us as more, we're trying to tabulate in tally
who's voted no so far ahead of November sixth. Norway's
sovereign wealth fund is the ninth largest Tesla shareholder, I believe,
hence why we're saying this is the biggest no vote
(07:28):
so far.
Speaker 7 (07:29):
Yeah, that's right. And they were pretty diplomatic about it.
They praised the value that Musk has has created over
the years. They refer to him as, you know, having
played a visionary role. And yet they're concerned just about
this sort of magnitude of of this award, about dilution
and also about the issue of sort of key man risk.
(07:50):
This is something that has been has come up time
and again with Musk. You know, the moment that he
has had someone who's emerged as sort of you know
who's sort of looks like a number two that person
doesn't seem to last very long. So in Tesla's defense,
I think the board has tried to take some steps
with this package to try and mitigate some of that
(08:12):
risk and sort of have Musk play a role in
in you know, succession, But the planning for that still
seems to be, you know, pretty much you know, sort
of to the side, as they really sort of focus
as a board on retaining him and on incentivizing him.
Speaker 1 (08:30):
Can you take us to how they have voted in
prior votes on pay for Tesla or the relationship between
the Norwegian Weld Fund and Elon Musk going forward what
that means for well, really the retail base, which is
the big push here for many.
Speaker 7 (08:47):
Yeah, I think as much as this no vote is concerning,
if if you want to see this measure pass, you know,
we only have to go back to last year to
an example of when this fund voted against a Musk
pay package. This was the vote on reratifying the twenty
eighteen award that a judge in Delaware threw out. And
(09:07):
there's there's kind of a juicy story to that in
that the CEO of this wealth fund, you know, kind
of got raked over the coals by Musk. We found
out later for the way that the fund voted on
that pay package. There was a freedom of information requests
for messages between the head of the fund, Nikolai Tangen
(09:27):
and Elon Musk, and Musk, you know, refer to this
notion that he needed to quote make amends for the
way that the fund voted. So there is a backstory here.
And as much as you know, this is maybe a
negative signal again if you want this to pass. We've
seen that it's been the case that even when this
fund has opposed a measure that the board has wanted
(09:50):
to see through, the board has managed to get its
way with its you know, in part thanks to its
very substantial retail investor base.
Speaker 1 (09:57):
Great context is always pretty most creted out, so appreciate
you joining coming up. Grab well it Boost is early
forecast for the year. We speak with the CFO P
t Ui about the company's latest results as have been
their tech AI is headed for the grocery aisle. Instacart
(10:21):
is launching new AI tools, including an assistant they can
make product recommendations. As it really leans the e commerce
business into more profitable software those Natalie Lung joins us
to talk us through it, tell us a little bit
about how these actual instacar AI tools are working.
Speaker 8 (10:35):
So instacart is building this AI chadboard as a white
label service for groceries, so they can actually have a
chatboard within let's say Kroger's own iOS app or the
Sprout's website app.
Speaker 3 (10:50):
Natalie, let's head out to Uber, one of the big
decliners ride share good delivery, good, profit, not good.
Speaker 2 (10:58):
What's the story then, Yes.
Speaker 8 (11:00):
So Uber sort of reported some disappointing operating income and
adjusted EBITDA this morning out of the third quarter, as
well as some disappointing forecasts earning this forecast for the
four Q and so it's the profit has not been
catching up with some of the growth recovery. We're seeing
their growth reaccelerated to more than twenty percent on the
(11:22):
top line growth spookingymetric. And this is sort of attestament
to their strategy to go into new products, some of
which may not be proudable at the beginning, such as
autonomous investments, which they have been doing a lot of recently.
Speaker 2 (11:40):
Most Natalie Lung, thank you very much.
Speaker 3 (11:42):
Food delivery and right hailing company Grab raised its earnings
forecast for the year after carely profit top testaments. The
Singapore based Grab introduced new products like group food orders
and less expensive shared rights that helped drawing customers. Here
to discuss Peter Uey grabs CF. That's so interesting, right,
you just heard Natalie talking about Uber bringing in new
(12:04):
products that hurts profitability. Your strategy seems to me to
be like more affordable products for a wider audience based
customer base, but you're doing it in a way that
is accreative to your bottom line.
Speaker 2 (12:18):
How have you done that? Let's try it.
Speaker 9 (12:21):
We've been on point in terms of strategy making our
product more affordable and we really widened the top of
the funnel for us. If you look at the third quarter,
we have now forty eight monthly transacting users on our platform,
which is another rerecord for us. And we're also seeing
more you use spending on the platform at the same time,
so that it affordability also is pushing the average spend
(12:44):
also on our platform because they're transacting more on the platform.
If you look at the number of transactions on our platform,
we've grew twenty seven percent, which was actually growing faster
than our GMB also at the same time. So what
we're seeing is a number of things. One is people
are engaging on the platform. We're also cross selling more
also as they're coming in into certain funnels that we
(13:04):
have on the affordable side, they're also trying other products
that we have, whether it's the group order that you
just mentioned, whether it's the dine out features that we
have also for them to be able to go to restaurants.
So there's a lot more products that we've actually been
monetizing and that's producing some of the results that you've seen.
Speaker 3 (13:22):
If you have a strategy where group food orders and
shared rides are a driver of demand, do you need
big volume in order to make this a profitable exercise?
Speaker 2 (13:34):
For grab?
Speaker 9 (13:37):
Obviously, scale is important. The more scale that we have,
the more users using the platform, the more we can
actually leverage the cost structure of our business and also
scale the big driver base that we have also at
the same time. So it does play a role, and
hence what you've been seeing is that now over a
third of our user base, especially in deliveries now are
(14:01):
coming into what we call more the affordable product stack,
and it's a great entry point for them to use.
You're looking at over twenty five million monthly transacting users
just interacting in those affordable products, just on the food
delivery side of the business. And that's a great way
for us because it enables us for those users who
(14:21):
are a little bit more price sensitive to try the
product first, get a taste of it. Also, they're a
little bit more price sensitive on the delivery fee, and
we've managed to be able to lower the delivery fee
for them. But they also get to experience the platform,
and once they've experienced the platform, they get to also
experience other products like grocery delivery, which is still a
very nascent business for us. It's about ten percent of
(14:41):
out delivery GMB. And at the same time, also we're
cross selling them to other products like dine now for
an example, for them to be able to go to restaurants.
Speaker 1 (14:49):
At the same time, it's interesting that you also for
fintech as well and loans.
Speaker 2 (14:53):
But I've just got to target.
Speaker 1 (14:55):
The ennefit in the room is that we hear all
these growth stories, we see analyst raising price target on you,
but the shares are down on the day, Peter, and
from the conversations you had with investors and analysts. What
was it that perhaps was a little bit of concern.
Speaker 9 (15:08):
About I would say any of concern. A lot of
the investors are really focused on how we are going
to finish the quarter, and I've reiterated them that were
on track to finish a very strong quarter. If anything,
that reflects on the guidance that we've given out. Also,
we've increased the EBD guidance now to four hundred and
ninety million dollars to five hundred and that's there also
(15:31):
shows that our confidence in terms of how we're exiting
the quarter. I've also told them that in terms of
our GM we growth, we're continuing to sustain this growth
acceleration in our business today. So we are looking to
finish strong in the quarter. One of the areas that
we're focusing also is the fintech business. We've given out
a one billion dollar loan outstanding by the end of
(15:52):
the year and we're on target to hit that also,
so all the different parts of the business are on
track for us to have a very strong finish of
the year.
Speaker 1 (16:00):
What's also on track is early twenty twenty six Robotaxi
Chinese robotaxi company we Ride. You've been partnering there. How
are you seeing av as the key area of focus
just briefly.
Speaker 9 (16:10):
Yeah, we're leaning it into av it the biggest platform
in Southeast Asia. We're leaning into the rarest part of
investments that were making. One is across learning the tech
and whether it's the wee Right partnership that we have
in Singapore. We're hoping to have the cast deployed on
the street in the first quarter to be able to
take on public passengers with the safety driver. And also
(16:31):
we're looking at US technology such as main Mobility. We
made an announcement we're honering with main Mobility also, So
we're looking at all the different tech and taking the
best of it and really bringing it to Southeast Asia.
Speaker 2 (16:42):
Peter quickly.
Speaker 3 (16:43):
You know, across the jurisdictions you operate in, do you
recognize one that is a better regulatory environment to deploy
robotaxi in.
Speaker 9 (16:52):
You know, in all the countries, especially when we're studying
in Singapore, because really Singapore, when it comes to the
government regulations that the standard are very high here and
a lot of the other Southeast Asian countries tend to
look to Singapore as a proxy, So we've been working
very closely with them, and that's around safety, which is
really important, and also the customer adoption of autonomous vehicle itself.
(17:19):
But at the same time, also we're leaning it in
terms of how we can rescale the existing driver base
that we have here also, so we identifying new opportunities
for driver base where they become safety drivers, that become
remote drivers, fleet operators, etc. Which is really important. So
the way we're approaching AV is working with the government
but also working with the driver community and also the
(17:40):
end user also to be able to adopt these new technologies.
Speaker 1 (17:43):
I mean, the labor impact of AI as front center.
It's interesting that you're really leaning into that, Peter, the
prioritization of innovation. How much you were able to do
that while still driving the bottom line because profitability is
being asked of you.
Speaker 9 (17:57):
Yeah, we'll Actually AI is something which is very core
to grab itself.
Speaker 2 (18:02):
It's not something new.
Speaker 9 (18:03):
Also, we've been focusing a lot on AI about four
or five years ago. We've developed our own models actually
very early on. We now have over one thousand models
in production that we're running here. And the way we've
been operating in the last eighteen months since the technology
has advanced so much is really internally we're also using
a lot of AI of a ninety eight percent of
our engineers today use some sort of AI code assist.
(18:26):
What also we started to deploy is the products to
our customers. Also, we have voice activation now for the
visually impaired where they can actually just speak to our
app and able to order a food or order a
ride for an example. And also we've deployed copilot equivalent
to our driver base where they could really rely as
(18:47):
on with a really effective a pilot to be able
to navigate throughout their day. And also with the merchant
or merchant bot actually that we have also they can
interact with our merchants.
Speaker 1 (18:57):
Staying up late for us. We so appreciate it you
do of grab the Chief Financial Officer. It's election day
in the US and millions of Americans heading to the
polls to cast ballots in local and state races. In
New York, the meyoral contest is in the spotlight Zauraen
Mamdani Andrew Cuomo Curtis leewa battle for city Hall, an
outcome that could have major implications of big tech footprint
(19:18):
right here in the city. Let's get the latest on
an extraordinary race for Miles Miller. What are you watching
out for?
Speaker 6 (19:26):
Yeah, you know, this is going to be a race
that really is going to be either a landslide and
a mandate or a squeaker with Andrew Cuomo. But the
one thing that I think the tech community is looking
out for is if Mamdani is to win, will these
tech firms stay in New York. And the answer that
he's given is yes. He says that in a city
(19:48):
that is more affordable, tech firms will be able to
recruit and retain much quicker. And what he has said
is that that is what will be born out of
some of his big proposals, talking about everything from free childcare,
discounted childcare, to free buses, and he's saying that that'll
have a measurable effect on the tech community. You know,
(20:11):
as I speak to folks like Jeff blau At related
in some other real estate firms, they say that tech
is really starting to continue to work and stay in
New York. And you know, those were some of the
people who were backing Eric Adams and Andrew Cuomo's campaign.
Will they be able to move over and work with Mamdanni.
(20:33):
Mamdanni thinks yes if he is elected, because he will
have this affordability message and that will bore true. We
also know that if Andrew Cuomo were elected, you know,
he spent ten years as governor and really worked very
well with the tech community, and that's what he is
making his pitch as as well.
Speaker 2 (20:53):
Bloomberg's Miles Miller, thank you very much.
Speaker 10 (20:55):
Me.
Speaker 3 (20:55):
While voters in New Jersey and Virginia are heading to
the polls and key gubinatorial races, contests that could shape
house states approached big tech, artificial intelligence, and data center development,
Bloomberg's remain bostic in New Jersey with the latest and
remain whether a Republican win or a Democratic win, the
considerations are very clear.
Speaker 10 (21:12):
Here, yeah, ed. And in fact, this has actually become
a bit of a sleeper issue in this campaign. Remember
it was just about a year ago when one of
the main wholesalers in this region actually ended up delivering
to utilities a more than tenfold jump in wholesale electricity prices,
and that was driven almost entirely by a big build
(21:34):
out in data center demand earlier this year, just in
the summer of twenty twenty five, there was a fresh
auction and prices went up again more than twenty percent.
Remember these are wholesale prices, and these are prices that
are effectively a barometer on future demand for AI capacity.
And I want to put this in context for you ED.
As of right now, there is about five hundred megawatts
(21:56):
of AI data center capacity up and running right now,
so within a year that's likely to double. There are
two big projects under the works about one hundred plus
a mega white project being built by core Weave in
central New Jersey in the downtowntal Worth and one even
larger than that down south near Atlantic City, Carolina, and
there that's going to have a big impact on energy prices.
Speaker 1 (22:16):
Great context Bimberg's remain Bostick.
Speaker 3 (22:19):
And the earnings landscape. We're thinking a lot about Spotify.
This is kind of the Daniel Eck farewell tour. I
guess a little bit. Actually, Common's about to tell me
that I might be a bit wrong on that, but
the core data pretty good. Let's get more on what's
going on with Spotify Blue. It is actually common out
there on the East coast. You know, we've been through
this story with you, Daniel K. Taking a step back
(22:41):
the new co CEO structure, and I'm just looking at earnings.
The key metrics that matters seem to be good. They
seem to be okay.
Speaker 11 (22:48):
Yeah, yeah, no great order. I think investors, you know,
there's a little bit of a loss at one point today.
I think investors really just want to hear that Spotify
is going to raise prices in the US, and they
didn't exactly hear that, so there was a little trepidation there.
But otherwise, broadly speaking, things are looking pretty good.
Speaker 1 (23:08):
It does seem to be pricing power, doesn't it that
everyone's focusing in on and whether advertising can just go
up into the right In terms of that sort of oppo.
What are you hearing for the trajectory in twenty twenty six?
What are AMAS investors focusing on under the new co CEOs?
Speaker 11 (23:23):
Yeah, so, well, they're focusing on a few things. AI
definitely is a big topic. Spotify is now partnering with
chat Chat GPT, so Spotify shows up in chat GPT.
They talked a lot on their earnings calls about this
idea of ubiquity, so their Apple TV app, Chat GPT
and other places where Spotify can show up to be
used everywhere people are so AI is a big conversation
(23:45):
for sure, but also again those prices, the investors and
the music rights holders want to see.
Speaker 3 (23:51):
Higher prices actually want to go to a story that
you broke about Netflix, It's in talks to license video
podcasts from iHeartMedia. On the surface symbol headline, but it
was impactful in the moment. What have you learned in
the course of reporting about this deal?
Speaker 11 (24:09):
Well, and this also relates to Spotify because Spotify was
the first one out of the gate. They announced that
they're licensing some of their video podcasts to Netflix starting
in the new year. Crucially, this means those video podcasts,
the full episodes will be removed from YouTube. So the
fact that Netflix is having conversations with additional networks like
iHeart is pretty significant. It shows that they really are
(24:30):
interested in at least testing out this video podcast space.
Speaker 1 (24:35):
Ashley Carmen always breaking the news. We appreciate it, thanks
for joining. Let's just return to the macro picture now
around this investment landscape, because more Wall Street executives they
are sounding the alarm bell. They're saying investors should brace
for next market correction one ten percent in the next
twelve to twenty four months. Christina Hoop, a Man Group
chief market strategist, sees a mixed economic picture, saying it
(24:56):
is the tale of two cities, tech led success masking
broader week this elsewhere paces, say Christina Hooper joins us
now and we are on this day shining out and
palenteer for example, the sort of poster child or whether
fundamentals live up to what have been deemed nosebreed valuations
on nosebreed success stories. But how do you square that
(25:17):
with then the potential for a pullback in the act market.
Speaker 12 (25:21):
More broadly, well, I think there is just a lot
of enthusiasm around anything that's related to AI. And I'm
old enough to remember the late nineteen nineties and how
much enthusiasm there was around any companies that were related
to the Internet. For example, everyone was scrambling to change
their name to have dot com at the end. Now
many companies are scrambling to say they are part of
(25:43):
this incredible AI food chain. And I think what is
happening though, is that investors may not be thinking about
what could be obstacles to the continued CAPEX boom. Around AI.
I think there are some pretty significant ones. First of all,
we knew and of course we got the deal done
(26:06):
on rare earth elements, but that was clearly an issue.
If you don't have access to enough rare earth elements,
that will certainly slow down an AI cap x boom.
But we also have concerns around how much productivity gains
companies will actually see. We had that MIT report that
came out last spring that suggested maybe not so much.
(26:27):
There could be a point where companies say, you know what,
we've thrown an enormous amount of money at this We're
not necessarily seeing all that we wanted to see. Will
slow down investment, and then finally we have the potential
for a NIMBI movement not in my backyard. In fact,
you just reported on how there are AI data centers,
and of course we're seeing a lot more news around
(26:48):
neighborhoods that are not thrilled to have AI there or
states that don't want to see it there because electricity
costs are going up a lot.
Speaker 1 (26:58):
So there are a lot of macro elements and risk
factors to the endless money that's being thrown at the
desire to build out by the hyper scale as we've
seen in their earnings, but more about the valuation from
because I can understand how people. Is that really what
takes the wind out of the sales of valuations or
is it more of a Michael Berry perspective that you know,
there's just an awful lot of endless capital expenditure and
(27:18):
also cloud growth similarities that seem to be slowing down,
and he's trying to say that, you know, maybe it's
time to bet against just how far we've run rather
than the future risks.
Speaker 12 (27:28):
Absolutely, I think it's both. There are certainly real question marks.
I think about how much more investment we'll see companies
make without seeing you know, sort of significant gains and
perhaps recognizing that there could be some overlap. There could
be there could be more discretion and more thoughtfulness around spending.
(27:53):
So I certainly think there's there's a little of both there.
I just as an outside observer seeing the credible, incredible
amount of money and excitement, there's nothing like it. I
think since what we've seen in the late nineteen nineties,
we know how that ended, so we should just think
of it as a cautionary tale and say, hey, maybe
we should be diversified. Maybe we should have some exposure
(28:13):
to China AI, given that the risks aren't the same,
the vulnerabilities aren't necessarily the same.
Speaker 2 (28:20):
There, let's go back to the tail of two cities thesis.
Speaker 3 (28:24):
So American technology at least good, but papering over some cracks.
Speaker 2 (28:30):
What are those cracks?
Speaker 3 (28:32):
Tell our audience more about the warning signs you're seeing
in other parts of this economy.
Speaker 2 (28:37):
Christina, So, I certainly.
Speaker 12 (28:39):
Think we are seeing consumer weakness, especially among lower income consumers,
but also some middle income consumers. And I think we
can just look to the Chipotle earnings call last week
for signs of that growing weakness. September and October were
difficult months where the frequency of visits went down for
(29:00):
a lot of customers, many of whom are young, and
so that could very well be giving us an inclination
of what could come and what could spread. Because keep
in mind, we are seeing a lot of white collar
job layoffs being announced. We could see more coming and
(29:21):
that will likely impact middle to higher income consumers, many
of whom are spending still spending quite robustly, and that
could create a much bigger problem for the economy. Thus far,
it's been a two legged stool, and it could very
well go down to one and a half legs.
Speaker 3 (29:42):
So this is very interesting going into the holiday quarter.
Maybe this is not the right data set. That Apple
told us last week that revenue going into the holiday
quarters would be up ten to twelve percent, That indicating
that in the middle to hire income in is they'll
go out and spend money on iPhone. I guess that
how does that set us us up for the holiday
(30:04):
quarter and how we view this economy.
Speaker 12 (30:07):
Well, we could still have a very strong holiday quarter
driven by those higher income consumers. My concern though, is
that there are vulnerabilities there, and especially as we go
into twenty twenty six, we could see more in the
way of white collar layoffs. We also know that the
higher income consumers are not so sensitive to inflation, but
they are very sensitive to the stock market, and so
(30:30):
if we were to see some kind of stock market
sell off, think that would be problematic and would certainly
reduce high end consumer spending as well.
Speaker 1 (30:38):
Christina, I want to go back to something you said
that maybe you diversify into China. Ai had a great
conversation with Man Deep just on the side of the set.
He's oblom Bug intelligence analysts. He's just been to Asian
he said, they're doing it so differently there because they
cannot depend on in video chips being limitless. They are
underaware of the geopolitical risks, maybe in the way that
the US ones are putting rare rest to one side,
(31:00):
which China names and how does one get exposure to
that from your mindset?
Speaker 12 (31:04):
So I can't name specific companies, but I can say
that there are so many that look very attractive, that
have much lower valuations and are part of that AI
food chain and that capex spending. I think we'll see
more dollars go there, and certainly it's in earlier innings
(31:24):
in Asia, so I think we have a longer runway there.
Speaker 2 (31:28):
Christina Hooper of Man Group. Great to have you back
on Bloomberg Tech. Thank you very much.
Speaker 3 (31:32):
Now coming up, Snowflake CEO Shwida Ramaswami joins us talk
about the company's latest partnerships to expand AI enterprise access.
This on a day when investors are broadly questioning AI valuations,
particularly in the software space.
Speaker 2 (31:47):
That conversation's next. This is Bloomberg Tech.
Speaker 1 (32:00):
Now for Talking Tech and first s up in video
and Deutsche telecom One have enveiled plans to build out
a one point two billion dollar data center in Germany,
boosting Europ's AI infrastructure. The facility will it's set to
be one of Europe's largest in the region, expected to
begin operations in the first quarter of twenty twenty six.
Plus a two hundred and forty percent rally in sgay
Heinez shares that's in this year alone explanted a warning
(32:22):
from the Career Exchange, signaling that the stock may have
been overheating. The exchange has issued an investment caution on
the chip maker following a surge driven by booming demand
for AI memory chips, and Nintendo is raising its sales
forecast for the switch to now expecting to sell nineteen
million units by March twenty twenty six, up from its
early projection of fifteen million. The upbeat outlook follows strong
(32:43):
early demand for the company, reporting of a ten million
units sold by the end of September.
Speaker 3 (32:48):
Ed Okay Snowflake is announcing a series of new and
expanded partnerships part of the company's effort to become the
data center platform of choice for enterprise AI. Snowfla CEO
Shrida Ramaswami joins us to discuss each of them. The
one that caught my eye was the relationship with Google
Cloud and bringing the availability of the latest.
Speaker 2 (33:10):
Gemini models to Snowflake.
Speaker 3 (33:13):
And the reason I want to start with that is
you are all about choice, right because you can look
at anthropic OAI. But there must have been an indication
to U Shreda that those Gemini models are in demand
amongst your customer base.
Speaker 10 (33:28):
Here.
Speaker 2 (33:28):
It's great to be here.
Speaker 13 (33:29):
Absolutely, Gemini models are among the best in the world
and a lot of our customers are asking for access
to these models. We are thrilled to be expanding our
partnership with Google Blogs similar to what we have done
with our big partners AWS and Azure.
Speaker 2 (33:48):
Is a big step forward for us.
Speaker 3 (33:50):
Can you just explain the basics of the Snowflake business model.
We always talk about Snowflake being a different layer above
the primary cloud. But why is it important that through
cotex AI your platform, any given enterprise customer can access
the underlying model.
Speaker 13 (34:07):
This is a great question. Snowflake is the data layer
that sits above cloud service providers the AWS and Azure
and GCP. We are very much a data centric platform.
We are about making it really easy to ingest, clean
and be able to run analytics on top of the
data and AI, especially Snowflake Intelligence that we are launching,
(34:30):
is a game changer because it brings the access the
power of all the data directly to end users and
what required dashboards, what required analysis right now at the fingertips,
at the voices of every single person. And that's the
reason why Snowflake plays such a critical role. We are
(34:50):
among the best data platforms that run on top of
the hyperscalers and it is that that gives us incredible
ability to create value using AI with partnerships with the
best folks in the world. The open AI is an
anthropic and now.
Speaker 1 (35:06):
Gemini creating value. I think that has been the proof point,
the watchword of this entire year. Strata. How can you
turn to our audience and say this is return on
AI investment, this is what my customers are experiencing.
Speaker 13 (35:20):
This is a great question. First of all, our model
is a consumption model, meaning that Snowflake doesn't get paid.
We don't get to recognize revenue unless customers actually use products.
We don't sell subscriptions that automatically ties us to utility
that we create with our AI products. We work with
our customers, whether it is a ts Imagine or the
(35:44):
USA bobsled team, to create products that they get additional
value from, for example, often replacing an existing dashboarding solution
like we have done at Snowflake. You're confident that using
snowf like intelligence, we can replace a bunch of dashboards
and run the entire data access in a much more
(36:07):
flexible way for a fraction of the cost. We very
much believe in showing ROI return on investment for every
single project that we do, and the consumption model is
a huge help here because if the product isn't used,
there's no revenue on our site.
Speaker 1 (36:23):
So should I. When we're talking in the market, writ
large about warriors of an AI bubble as people are
perhaps selling certain names because they feel that the fundamentals
have become dislocated with the actual valuation of companies. How
are you thinking in this your context? How are you
worrying perhaps that companies will stop their spending until they
get ROAI in the near term.
Speaker 13 (36:45):
Well, this is where as I said, our model is
very very helpful because we don't ask for investments ahead
of the return. Very much we create pilots, we create
proofs of concept and show value to your to our customers,
and only then is it scaled. In our own example,
we launched a tool that indexed all of the enablement information,
(37:08):
the education information for our sales team, and then we
started putting more and more things. Now all of our
sales information lives in a single agent is used pretty
much by everyone in the salesfork, certainly me at Snowflake.
It is that step by step launch and not a
big bang launch that is also important. And keeping that
focus on what are projects that go about creating value?
(37:31):
Are they replacing existing systems? Are they lowering costs? That
kind of moniaical focus is what is helping us successful
even in the AI era, because we very carefully tally
all of this up and make sure that our customers
feel like we are creating value every step of the way.
Speaker 3 (37:49):
STREETA, are we or are we not in an AI bubble?
Based on what you're saying every day through Snowflake.
Speaker 13 (37:59):
Well, absolutely there's a lot of enthusiasm about it. But
at Snowflake, I and every employee at Snowflake is focused
on what does this mean for our customers? We are
back to basics. We created Snowflake Intelligence because we wanted
to bring the power of agentic AI to every single
(38:20):
user within a company in a meaningful way. We wanted
to make sure that data analysts who mind you get
paid a lot, are focused on helping create data agents
rather than writing endless equal queries as I've done in
my life, and that focus on what are projects that
can create value for our customers. How do we get
(38:41):
them to production fast? How do we show the return
to them is what we can do? The outside market valuations,
those things are distractions. I think the more we focus
on back to basics, the better off we are.
Speaker 1 (38:54):
Should Ramswami, it's great to get back to basics with
the Snowflake CEO. We appreciate your time.
Speaker 3 (39:00):
AMD sets report earnings after the closing bell, and the
results should give an indication of how the company's AI
push is going. Investor sentiment has been strong after the
chipmakers signed deals with open Ai and Oracle to deliver
massive amounts of its latest AI chips. Let's get more
with Bloomberg Semiconductor reporter Ian King, it's probably a good
(39:21):
moment to look at what the forecasted revenue is for
the period, and how much of that is data center
revenue because the reality is, for all the headlines and
that stock performance over the last two months, AMD is
just still a much smaller second player behind Video.
Speaker 6 (39:37):
Yeah.
Speaker 4 (39:37):
I mean, it's not getting in annual revenue what in
Vidia is getting in a year. And the story is
as simple as that. But what we've seen over the
last three months is maybe AMD has a seat at
the table now maybe you know, we've seen some validation
of its technology in these deals. Whether that translates in
the short term to stronger revenue and stronger revenue forecast
(40:00):
think importantly is going to be what determines the reaction today.
Speaker 1 (40:03):
There's been a lot of people trying to interpret who
the key clients are. I think link secretary strategies really
saying the key client for MD is metter and actually
how real some of these longer term deals are in
how much vindication is Lisa's who's going to give tonight
or is it all about the analysts meeting that's coming
up in the next week.
Speaker 4 (40:22):
It'll be both. I think up until now everybody has
sort of been AMD curious. Will you know we should
give them a chance, We should give them you know
a look and maybe see if they're a viable alternative.
These deals apparently tell people know their technology is real.
So what they will want from Lisa is the numbers.
If she doesn't give them the numbers the strong forecast,
(40:43):
they'll want a pretty good explanation of why not now
and if not why now then?
Speaker 3 (40:48):
When AMD's traditional market is processes for personal computers and
servers away from the AI chip, what do we think
will learn there?
Speaker 4 (40:57):
Yeah, I know there are very strong expectations there. You'll
remember Intel came out and said, hey, we were worried
that things were in trouble there and that we've got
a lot of inventory. Turns out demands really strong for
aipcs and for standard server parts. AMD is actually taking
market share or has been taking market share from Intel.
So the expectations there are very strong and that could
help the near term numbers.
Speaker 1 (41:18):
It's relentless these earnings in inkings across it throughout for us,
we so appreciate it. Thank you all things AMD after
the bell, but that as I from this edition a
Bloomberg techn YEP.
Speaker 3 (41:28):
Don't forget to check out the pod to recap the show.
There is so much going on in this earning season
and in the background anxiety about valuation and bubbles. Two
day's time of vote on Elon Musk's proposed one trillion
dollar pay package and earnings, no matter how good they
are carriers Impalent's case, valuation is what we're all concerned about.
(41:52):
I alluded to it and many of you use it.
Listen to the podcast. It's very good, if we say
so ourselves. You know where to find it. It's on
the Bloomberg platform as well as online on Apple, Spotify,
and iHeart this is Bloomberg Tech.
Speaker 1 (42:08):
H
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