China Fights Back, South Korea Declares Martial Law | Bloomberg Technology
>> FROM THE HEART OF WHERE INNOVATION, MONEY, AND POWER COLLIDE, THIS IS "BLOOMBERG TECHNOLOGY" WITH CAROLYN HYDE AND ED LUDLOW. CAROLINE: LIVE FROM NEW YORK, THIS IS BLOOMBERG TECHNOLOGY. POLITICAL ANXIETY HITS TECH. CHINA DIALS UP TRADE TENSIONS WITH THE U.S. AND WE BRING YOU THE LATEST ON
SOUTH KOREA'S MOVE TO MARTIAL LAW. SPACEX WAYS AND OFFER IT COULD BOOST ITS VALUATION TO $350 BILLION. AND WE SIT DOWN WITH THE CEO OF AT&T IS THE COMPANY PREDICTS DOUBLE-DIGIT PROFIT GAINS IN 2027. FIRST WE CHECK ON THE MARKETS. WE ARE OFF ON THE NASDAQ 100 AT A DAY APPLE IS THAT A NEW RECORD HIGH. WE HAVE A LOT TALKING YES INTO THE RED IN TERMS OF KEY MOVES ON THE DOWNSIDE.
I ALSO WANT TO SHINE A LIGHT ON SOUTH KOREA. HE STOCKS THERE FROM THE TECHNOLOGY PERSPECTIVE. SAMSUNG. EVERYTHING TECHNOLOGY. HE EXPORTER FOR THIS COUNTRY.
OFF SIGNIFICANTLY WHEN YOU'RE LOOKING AT SHARES TRADED ABROAD IN LONDON AND GERMANY. ALL AS WE UNDERSTAND THE LEADERSHIP IN SOUTH KOREA MOVES TO MARTIAL LAW. MEMBERS OF THE PARTY OF THE PRESIDENT ARE NOT AGREEING WITH THE MOVE THAT HAS BEEN MADE. YOU WILL GET UP TO THE MOMENT NEWS WITH US. IF YOU HAVE A BLOOMBERG TERMINAL CHECK OUT TOP LIVE. THERE IS A BLOG WITH THE LATEST ON SOUTH KOREA. WE WANT TO BRING YOU WHAT IS
THE UP TO THE MOMENT REPORTING FROM MIKE SHEPPARD WHO JOINS US FROM WASHINGTON. SO MUCH TO BE DEBATING WHEN IT COMES TO GEOPOLITICS. THEN YOU START WITH US IN SOUTH KOREA. HOW EXTRAORDINARY THE MOVEMENTS ARE BEING MADE. MIKE: IT EVEN CAUGHT MEMBERS OF THE PRESIDENT'S OWN PARTY AND AIDS OFF GUARD. THEY WERE NOT EXPECTING THIS. IT WAS BORN OF FRUSTRATION OUT OF A DEADLOCK OVER THE BUDGET BETWEEN HIS MINORITY PARTY AND THE MAJORITY DEMOCRATIC PARTY AND THE NATION'S PARLIAMENT. THAT STANDOFF HAS BUBBLED OVER
INTO THE COUNTRY'S FIRST DECLARATION OF MARTIAL LAW IN 44 YEARS. IT IS UNCERTAIN WHERE THINGS ARE GOING FROM HERE. TROOPS ARE REPORTED TO BE IN THE NATIONAL ASSEMBLY BUILDING AND SOME MEMBERS OF PARLIAMENT MAY BE MOVING TO TRY TO BLOCK THIS.
THEY HAVE THE AUTHORITY TO DO SO BUT THEY NEED A MAJORITY PRESENT , WHICH WOULD BE AT LEAST 150 LAWMAKERS. THIS IS A FAST-MOVING STORY SO WE WILL HAVE TO KEEP CLOSE WATCH ON WHERE THE STANDOFF BETWEEN THE PRESIDENT AND HIS OWN LAWMAKERS ENDS UP HEADING. CAROLINE: WE HAVE BREAKING NEWS SAYING THE SOUTH KOREAN PARLIAMENT HAS PASSED A REQUEST OF THE MARTIAL LAW TO BE LIFTED AND THEY SAY SOUTH KOREAN LAWMAKERS WILL VOTE ON THE MARTIAL LAW LIFT. NOTING AS YOU SAY AND ACCORDING TO THE LATEST BLOG THAT DOZENS OF LAWMAKERS HAVE MANAGED TO ENTER THE MAIN HALL OF THE NATIONAL ASSEMBLY ACCORDING TO FOOTAGE OF KBS AND THE NEED 150 LAWMAKERS TO BE PRESENT FROM A CONSTITUTIONAL PERSPECTIVE. THIS DOES HAVE AN EFFECT ON LIQUIDITY, EVEN THOUGH THEY'VE MADE A MOVE TO ENSURE LIQUIDITY IS THERE FOR THE MARKETS. FROM A TECHNOLOGY PERSPECTIVE OF SAMSUNG AND THESE COMPANIES THAT ARE CURRENTLY WORRYING ABOUT THE NEW U.S.
ADMINISTRATION AND WHAT THAT MEANS FOR TARIFFS AND THEIR OWN EXPORTS FALLING. MICHAEL: THERE IS SO MUCH HAPPENING FOR THESE COMPANIES RIGHT NOW BETWEEN THE U.S. CAP -- THE U.S. SHIP EXPORT CURVES ANNOUNCED YESTERDAY AND THE CROSSCURRENTS WITH THE INCOME ADMINISTRATION, WHERE THE RELATIONSHIP WITH SOUTH KOREA AND THE U.S. AND THE REST OF THE WORLD WITH
THE PRESIDENT ELECT THREATENING TARIFFS ON IMPORTS TO THE U.S. ADDING THIS TO THE MIX IS ANOTHER BIT OF VOLATILITY FOR KEY COMPANIES LIKE SAMSUNG AS YOU HIGHLIGHTED. CAROLINE: YTN TV IS REPORTING IT IS UNCERTAIN WHETHER SOUTH KOREAN STOCKMARKETS WILL OPEN ON WEDNESDAY.
WE WANT TO TALK ABOUT WHAT IS HAPPENING WITH THE CHINA U.S. TIT-FOR-TAT. LIMITATIONS ON KEY METALS FOR TECHNOLOGY USE. MICHAEL: THIS IS SOMETHING THAT IS NOT TO BE OVERLOOKED. ALL OF THE GLOBAL CONVERSATION
ABOUT TURMOIL HERE AND IN PARIS. THE CHINESE TOOK A SIGNIFICANT MOVE IN THE OVERNIGHT HOURS TO COUNTER THE CHIPS CURVES THE BIDEN ADMINISTRATION ANNOUNCED YESTERDAY. THIS WOULD LIMIT IMPORTS AND EXPORTS TO THE U.S.
FROM CHINA OF KEY MINERALS. THESE WOULD INCLUDE GALLIUM AND GERMANIUM. THESE ARE NOT SOMETHING THAT IS TRADED VERY HEAVILY LIKE THE WAY YOU MIGHT THINK OF OIL WITH A TRILLION DOLLAR MARKET. THESE ARE TINY AMOUNTS EXPORTED EACH YEAR BUT THEY ARE SIGNIFICANT. THEY END UP IN SEMICONDUCTORS. THEY END UP IN SATELLITES. THESE MATERIALS ALSO SHOW UP IN NIGHT VISION GOGGLES.
IT IS HITTING THE U.S. IN A WAY THAT IS AIMED AT THE DEFENSE INDUSTRIAL BASE AND THE TECH INDUSTRIAL BASE. FOR THE MOMENT THE U.S. IS TAKING THIS IN STRIDE. THE WHITE HOUSE HAS NOT RESPONDED TO THIS. THE INDUSTRY HAS BEEN ABLE TO ADAPT SO FAR TO EARLIER RESTRICTIONS CHINA HAD ALREADY IMPOSED ABOUT A YEAR AGO.
THEY'VE BEEN ABLE TO FIND ALTERNATE SOURCES OF SUPPLY FROM THEIR OWN INVENTORIES AND THERE ARE OTHER PLACES OUTSIDE CHINA WHERE THESE MINERALS CAN BE PRODUCED AND FOUND. IT IS THAT THE WORLD HAS GROWN SO DEPENDENT ON CHINA AS THE TOP SUPPLIER BECAUSE IT CAN BE MADE SO CHEAPLY AND IN SUCH GREAT ABUNDANCE. CAROLINE: MIKE SHEPPARD BRINGING US THE NEED TO KNOW. LET'S TALK ABOUT RAMIFICATIONS OF THE U.S. LIMITS ON EXPORTS TO CHINA. WE SHINED A LIGHT ON ASML, A CHIPMAKER IN EUROPE, SAYING U.S. AUTHORITIES ARE IMPOSING RESTRICTIONS ON MANUFACTURERS THAT WILL BECOME EFFECTIVE IMMEDIATELY, BUT IT DOES NOT EXPECT LONG-TERM DEMAND TO BE IMPACTED BY THESE NEW REGULATIONS. LET'S STICK WITH ALL THINGS
CHIPS AND TAKE A LOOK AT INTEL SHARES. ONE OF THE KEY DRAGS ON THE BENCHMARKS TODAY. WE ARE OFF 4% AGAIN AFTER YESTERDAY'S SURPRISE DEPARTURE OF THE CEO, OPENING THE DOOR FOR THE COMPANY TO CONTINUE -- TO CONSIDER MORE DEAL OPTIONS, SCENARIOS HE REJECTED DURING HIS TIME RUNNING THE CHIPMAKER. FIRST WE THINK OF M&A.
PLENTY OF REPORTING AROUND WHAT COULD BE SPUN OFF AND WHO WOULD BE BUYERS. WHAT ARE YOU THINKING ABOUT THAT BEING REIGNITED? >> INTEL HAS BEEN AT THE HEART OF DEAL TALKS. THEY HAVE LOST A LOT OF GROUND IN THE CHIP INDUSTRY TO THEIR COMPETITORS, NOTABLY NVIDIA AND TSMC. THERE BEEN DISCUSSIONS AND DEALS. PAT GELSINGER HAD BEEN AN ADVOCATE FOR KEEPING THE
COMPANY TOGETHER. MAKING INVESTMENTS IN BIG COMPANIES AND IN PARTICULAR HE WANTED TO MOVE INTO THE FOUNDRY BUSINESS THAT IS MAKING BESPOKE CHIPS FOR OTHER PLAYERS IN THE MARKET LIKE NVIDIA. THAT IS WHERE TSMC HAS EXCELLED. HE INVESTED BILLIONS OF DOLLARS INTO THE INITIATIVE. HE WANTED TO KEEP THE MANUFACTURING AND THE PRODUCT DESIGN TOGETHER. NOW YOU CAN SEE CHANGES IN THAT
ATTITUDE. YOU CAN SEE THEM BREAKING UP THE MANUFACTURING AND DESIGN. WE KNOW QUALCOMM LOOKED AT TRYING TO BUY THE COMPANY IN THE PAST. INTEL HAS SUBSIDIARIES THAT MAY BE RIGHT FOR SPINOFFS, INCLUDING ALL TERRA.
FIRST AND FOREMOST THE BOARD HAS TO FIND A NEW CEA FOR THE COMPANY. CAROLINE: AND THEY ARE PAYING A LOT TO THE EXIT CEO. PETER: GELSINGER IS COLLECTING HIS PAY PACKAGE ON THE WAY OUT. HE DEPARTED LAST WEEKEND. HE WAS NOT GOING TO STICK AROUND TO TRAIN THE NEW CEO. THE BOARD TOOK A DRAMATIC STEP. THEY PUSHED OUT SOMEONE WHO HAD BEEN WELL RESPECTED WHEN HE CAME INTO THE COMPANY, HE WAS EXPECTED TO BE THE SAVIOR.
NOW THEY NEED TO FIND SOMEONE ELSE WHO WILL TAKE THE HELM SO THEY CAN SET A STRATEGY GOING FORWARD, WHETHER IT WILL BE DEALS OR DOUBLING DOWN ON THIS IDEA INTEL CAN GO BACK TO ITS ROOTS OR ESTABLISH THE INDUSTRY LEADING MANUFACTURING IT USED TO HAVE. CAROLINE: THANKS A MUCH FOR THE LATEST ON INTEL. COMING UP, AT&T SEEN SUSTAINED PROFIT GROWTH FOR THE NEXT THREE YEARS. WE WILL TALK WITH THE CEO JOHN STANKEY.
CAROLINE: AT&T TRADING HIGHER AS THEY SEE SUSTAINED PROFIT GROWTH OVER THE NEXT THREE YEARS, INCLUDING DOUBLE-DIGIT GAINS. THE AT&T CEO JOHN STANKEY JOINS US NOW FROM YOUR OWN NAME STADIUM. LET'S TALK ABOUT 2029. YOU ARE LOOKING TO HAVE 50 MILLION PLUS TOTAL LOCATIONS WITH FIBER. WHY THE BIG FIBER FOCUS? JOHN: WE HAVE HAD GREAT SUCCESS WITH WHAT WE HAVE BUILT THUS FAR AND WE SEE CUSTOMERS LOVE THE PRODUCT. THEY STAY WITH US LONGER, THEY DRIVE BETTER VALUE INTO THE BUSINESS, WE ARE HAVING GREAT SUCCESS SELLING MULTIPLE PRODUCTS INTO FIBER HOUSEHOLDS. FOUR OUT OF EVERY 10 OF OUR SUBSCRIBERS ALSO SUBSCRIBE TO OUR WIRELESS SERVICE AND THAT IS GETTING HIGHER. WHEN YOU THINK ABOUT WHERE
TECHNOLOGY IS GOING THE FUTURE WORKLOADS WILL ONLY GO UP. DATA CONSUMPTION WILL INCREASE 80% OVER THE NEXT FIVE YEARS AND FIBER IS THE ONE TO DO THAT. IT HAS THE SYMMETRICAL BANDWIDTH CHARACTERISTICS THAT WILL FACILITATE AI AND SENDING MORE DATA INTO A NETWORK THAN WHAT COMES DOWN WHICH IS HELP RON BEN NETWORKS ARE BUILT. WITH THICK THAT IS A GREAT INVESTMENT FOR THE LONG HAUL. CAROLINE: WE HAVE SOME BREAKING INTERNATIONAL NEWS. SOUTH KOREAN LAWMAKERS VOTED TO
REQUEST LIFTING MARTIAL LAW. WE WILL BRING YOU UP TO THE MOMENT NEWS. WE RETURNED TO YOU AT A U.S. FOCUSED BUSINESS YOU ARE
WANTING TO SEE. THE BRAND FOR -- THE BREAK -- THE BANDWIDTH AND THE BROADBAND YOU ARE OFFERING. THE WAY YOU ARE FUELING INVESTMENT IS BY DOING INNOVATIVE PARTNERSHIPS LIKE THE ONE WITH BLACKROCK.
DO YOU NEED OUTSIDE INVESTMENT TO COMMIT TO THIS INFRASTRUCTURE ROLLOUT? JOHN: WE HAVE A GREAT PORTFOLIO OF OPTIONS. THE PRIMARY PORTFOLIO PLAY IS OWNED AND OPERATED WHERE WE TAKE 100% OF THE ECONOMICS, WE BUILD AND OPERATE IT OURSELVES. WE ALSO REALIZE WE ARE IN A CONSTRAINED WINDOW. FIBER IS NEEDED NOW. THERE'S NOT GOING TO BE A WINDOW THAT IS LONG TIME TO DO THIS WORK. PRIVATE CAPITAL MARKETS PROVIDE A LITTLE BIT OF INSULATION THAT PUBLIC MARKETS WILL NOT END IN ORDER TO MAKE SURE WE KEEP OUR LEAD WE BALANCE OUR PER FOLIO OUT AND OUR RELATIONSHIP WITH BLACKROCK AND OUR POWER WORK HAS BEEN EFFECTIVE. WHAT WE HAVE PROVEN IN THE MARKET IS WE CAN OPERATE OUTSIDE OF OUR TRADITIONAL OPERATING TERRITORY JUST AS EFFECTIVELY AS WE HAVE IN OUR HOME TERRITORY. I THINK BLACKROCK AS A PARTNER
HAS VIEWED IT AS BEING A SUCCESSFUL INVESTMENT. THEY'VE BEEN WILLING TO PUT MORE IN AND WE WILL EXPECT TO USE THAT AS ONE OF THE TOOLS TO GROW OUR FOOTPRINT OVER TIME TO GET PAST THAT 50 MILLION WE WERE TALKING ABOUT. CAROLINE: IT IS INTERESTING YOU BROUGHT UP AI AND THE DEMANDS THERE.
EVERYONE'S HAVE BEEN WRINGING THEIR HANDS OVER ENERGY INFRASTRUCTURE. HOW SIGNIFICANT IS THE AI DEMAND AND THE STRAINS ON WHAT YOU PROVIDE? JOHN: IT IS AN INTERESTING ISSUE. POWER CONSUMPTION WILL BE REALLY IMPORTANT MOVING FORWARD. THAT IS ONE OF THE THINGS WE
ARE TALKING ABOUT WITH OUR ANALYSTS AND INVESTORS. HOW DO WE SHUTDOWN DOWN OUR CENTURY OLD COPPER INFRASTRUCTURE AND ALL OF THE ELECTRONICS AND EQUIPMENT THAT ARE POWER-HUNGRY AND THAT IS ONE OF THE WAYS GETTING MORE OF THE TRAFFIC OVER TO FIBER, WHICH IS PASSIVE AND USES A LOT LESS POWER THAT WE CAN HELP OFFSET SOME OF THE INCREASE OF WHAT DATA DEMAND AND AI WILL DRIVE MOVING FORWARD. WE THINK THAT IS A REALLY IMPORTANT POLICY DYNAMIC. I THINK THERE'LL BE A LOT OF ISSUES THE COUNTRY HAS TO WORK THROUGH ON GETTING THE POWER GRID TO SUPPORT LEADERSHIP IN AI. IT WILL HAPPEN. MAYBE IT SLOWS DOWN A LITTLE BIT. WHAT WE DO KNOW IS DEMAND WILL
BE CONTINUING TO GO UP. CAROLINE: WE ARE ALSO TALKING TO ANALYSTS AND INVESTORS ABOUT HOW YOUR GIVING MONEY BACK, BIG RETURNS TO INVESTORS, WHETHER THROUGH DERIVATIVES OR BUYBACKS. WHY HAVE YOU CHOSEN THAT ANGLE? JOHN: IT IS A GOOD DAY WHEN YOU'RE GIVING MORE BACK TO SHAREHOLDERS. WE FEEL COMFORTABLE WITH OUR DEBT POSITION WE WILL ARRIVE AT NEXT YEAR AND THAT IS WHY WE ARE MAKING THIS ANNOUNCEMENT TODAY. WE DID A NICE JOB OF
STRUCTURING OUR BALANCE SHEET PROPERLY SO WE HAVE REALLY ATTRACTIVE INTEREST RATES FROM OUR PORTFOLIO DEBT. THAT IS A STRATEGIC ASSET THE WAY IT IS SET UP RIGHT NOW. GIVEN WE ARE LARGELY INVESTING ORGANICALLY IN THE BUSINESS, REINVESTING IN OUR BUSINESS LIKE THIS AND GETTING OUR LEVERAGE STRUCTURE THE WAY IT IS FEELS COMFORTABLE TO US BECAUSE EVERY YEAR WE ARE REINVESTING THE CAPITAL, REINVESTING IN ASSETS WE HOLD. WHEN YOU LOOK AT THE M&A WORK WE HAVE DONE AS WE'VE RESTRUCTURED THE BUSINESS, WE SPUN OUT CERTAIN NONSTRATEGIC ASSETS. WE HAVE NOT GONE BACK AFTER THE EQUITY STRUCTURE AND REDUCING THE SHARE ACCOUNT. WHEN THE DIVIDEND YIELD IS
STILL OVER 5% WE HAVE FANTASTIC DIVIDENDS COVERAGE. THIS IS AN OPPORTUNITY FOR US TO BALANCE THAT OUT AND BRING EQUITY BACK IN THE HOUSE. CAROLINE: LET'S TALK ABOUT THAT CHANGE IN YOUR OWN PORTFOLIO.
WILL WE SEE THAT BEING INTEGRAL TO THESE FINANCIAL FORECASTS? JOHN: DAY AS WE SIT DOWN AND TALK WITH THE INVESTMENT COMMUNITY WE WILL BE PROVIDING RESTATED CONSTRUCTS UNDER DIRECTV ASSUMING WE WILL CLOSE THAT BY THE MIDDLE OF NEXT YEAR. WE SEE GREAT IMPROVEMENTS IN OUR CASH FLOW. WE EXPECT WE WILL GROW CASH FLOW BY A BILLION DOLLARS A YEAR EVEN WITHOUT DIRECT TV AS WE MOVE THROUGH THIS PLANNING PROCESS. WE SEE ACCELERATION IN OUR EBS. DIRECTV HAS BEEN GOOD AND PROVIDED US A LOT OF CASH COVERAGE.
WE DID A NICE JOB OF MANAGING THE ASSET DOWN TO THIS POINT. IT IS TIME TO FOCUS ON WHAT WE WILL DO MOVING FORWARD WHICH IS BUILD A WORLD-CLASS CONNECTIVITY BUSINESS AND IT IS THE RIGHT DECISION AT THIS POINT. CAROLINE: A LOT OF ANALYSTS ARE ECHOING THAT. WE ARE WITH JOHN STANKEY. MANY BELIEVE YOU'RE GETTING BACK TO WHAT YOU DO BEST WHICH IS TELECOMS. WITHIN THAT IS CLARITY IN GIVEN ON THE NUMBERS. $40 BILLION OF ANTICIPATED SHAREHOLDER RETURNS. $50 BILLION OF FINANCIAL CAPACITY.
ARE THERE RISKS TO THESE NUMBERS? JOHN: ANY TIMES THERE IS AN ADMINISTRATION CHANGE THERE IS DISCUSSION ON -- WE HAVE DONE JUST FINE FOR THE LAST FOUR YEARS. SOME OF THE THINGS I HEAR RIGHT NOW, TAX POLICY, POSSIBLY REINSTITUTING ACCELERATED DEPRECIATION, THOSE THINGS COULD BE VERY GOOD FOR OUR BUSINESS. WHEN THEY WERE IN PLACE AND THEY WERE NOT LAPSING, WE WERE INVESTING AT A HIGHER LEVEL. I THINK IF THIS ADMINISTRATION FOLLOWS THROUGH ON WHAT THEY WOULD LIKE TO DO, WHICH IS PUT PRO INVESTMENT POLICIES IN PLACE FOR ONE OF THE NATION'S LARGEST CAPITAL INVESTORS, THAT WILL BE A GOOD THING FOR US. WE WATCH THAT CAREFULLY.
THERE ARE OTHER POLICIES UP IN THE AIR AROUND TARIFFS AND A FEW OTHER THINGS WE ARE WONDERING WHAT MIGHT OCCUR WITH THAT. I THINK SAYING MINDS WILL PREVAIL. SOME OF WHAT WE ARE -- I THINK SANE MINDS WILL PREVAIL. SOME OF WHAT WE'RE HEARING IS MAKING SURE WE NEGOTIATE FROM A POSITION OF STRENGTH AND MAKING SURE WE RESPECT THE U.S. MARKET THAT PEOPLE SHOULD PLAY ANNA -- SHOULD PLAY ON A LEVEL PLAYING FIELD WHEN THEY GET ACCESS TO IT AND I'M HOPING FOR GOOD ECONOMIC RETURNS AS A RESULT. CAROLINE: RETURNS ARE UP ON YOUR SHARES. MORE BROADLY DO YOU THINK YOU
CAN SUSTAIN THIS GROWTH? JOHN: WE DO, OTHERWISE WE WOULD NOT BE GIVING THE THREE-YEAR GUIDANCE WE ARE GIVING. WE FEEL STRONG ON THE FUNDAMENTALS. CONSUMERS NEED TO USE MORE INTERNET AND GET HIGHER PERFORMANCE NETWORKS TO SUPPORT THAT. THAT IS THE BUSINESS WE ARE IN. WE WILL TALK THIS AFTERNOON WITH OUR INVESTORS ABOUT OUR ABILITY TO MANAGE THE COST STRUCTURE.
WHICH ULTIMATELY DROP MORE CASH TO THE BOTTOM LINE. THAT GROWTH DYNAMIC OF PEOPLE GETTING MORE EFFICIENT, PEOPLE USING MORE OF THE PRODUCT, WE THINK THAT WILL SUSTAIN ITSELF AND THAT IS WHY WE GAVE THE GUIDANCE WE GAVE. CAROLINE: WE SO APPRECIATE YOU COMING LIVE FROM AT&T STADIUM IN TEXAS. JOHN STANKEY, AT&T CEO, BE WELL. LET'S TALK ABOUT A VALUATION GOING ON. $350 BILLION.
THAT IS HOW MUCH SPACEX IS AIMING AT. THE COMPANY AIMING TO SELL INSIDER SHARES THAT COULD MAKE IT ELON MUSK'S COMPANY THE MOST VALUABLE STARTUP. KATIE RUTH JOINS US NOW. THIS IS SECONDARY MARKET ACTIVITY. WE WILL BE SELLING TO WHO? KATIE: INSIDER SUCH AS EMPLOYEES AND EXISTING VENTURE CAPITALISTS CAN SELL THEIR SHARES TO NEW INVESTORS. THE $350 BILLION VALUATION IS A HUGE JUMP. LAST MONTH THEY WERE DISCUSSING
$255 BILLION VALUATION. THE RECENT SUCCESS OF THE STARSHIP LAUNCH AND ALSO ELON MUSK'S TIES TO TRUMP AND TRUMP'S WIN CREATED MORE INVESTOR ENTHUSIASM SO IT IS NOW A RECORD FOR MOST VALUABLE STARTUP IN THE WORLD. CAROLINE: MANY THEN SAY WHEN WILL THEY EXIT, WHEN MIGHT SOME OF THE SECONDARY SHARES BE SOLD ON AN OPEN MARKET? DO YOU THINK THIS ACTIVITY IN THE SECONDARY MARKET PUTS OFF SUCH A LIQUIDITY EVENT? KATIE: THEY WOULD NOT DO THIS IF THEY WERE ON THE VERGE OF IPO BECAUSE YOU WOULD NOT WANT TO REDUCE THE DEMAND FROM THE INSTITUTIONAL INVESTORS, SO YOU WOULD NOT DO THIS ON THE EVE OF AN IPO. IT HAS BEEN REPORTED AND IT IS KNOWN THAT AT SOME POINT THEY WANT TO SPINOUTS STARLINK, THEIR SATELLITE INTERNET PROVIDER AND CREATE A SEPARATE BUSINESS WITH THAT. STARLINK COULD GO PUBLIC.
NOTHING IMMINENT. CAROLINE: WE THANK YOU. KATIE ROOF IN L.A. IN ELON MUSK WORLD, DELIVERY FROM TESLA SHANGHAI FACTORY WAS DOWN. THIS COMES AFTER THE CHINESE
GOVERNMENT INCREASED SUBSIDIES TO ENTICE MORE CONSUMERS TO BUY ELECTRIC VEHICLE. LET'S STICK WITH ALL THINGS ELON MUSK. IT HAS BEEN DENIED AGAIN THAT ELON MUSK'S RECORD-SETTING PAY PACKAGE.
IT WAS STRUCK DOWN AGAIN BY A DELAWARE JUDGE, RULING TESLA'S BOARD WAS IMPROPERLY INFLUENCED BY ELON MUSK WHEN ADOPTING HIS PAY PACKAGE IN 2018, AVOIDING THE DEAL. ELON MUSK REACTED TO THE NEWS ON X THE POST THAT SAYS "ABSOLUTE CORRUPTION." THE JUDGE SAYS I DO NOT CARE WHAT YOUR SHAREHOLDERS THINK, THIS IS TOO MUCH. >> AND THEY PLAN ON APPEALING AGAIN.
IT SEEMS LIKE THIS IS A DANCE WE CONTINUE TO KEEP AN EYE ON. IT WAS WORTH $56 BILLION AT THE TIME. LAST TIME THE JUDGE CANCELED THE PLAN, WORTH $101.5 BILLION. IF THIS DOES END UP BEING STOOD BY, IF TESLA IS NOT EFFECTIVELY SUCCESSFUL IN PUSHING BACK ON THE RULING, AND THEN THE BOARD WOULD BE BACK TO THE DRAWING BOARD AND HAVE TO COME UP WITH A NEW PROPOSAL. CAROLINE: TESLA IS THE BIGGEST POINTS CONTRIBUTOR ON THE DOWNSIDE TO THE NASDAQ. MAYBE THAT IS ABOUT SALES IN CHINA.
THERE WAS THIS WORRY THAT IF HE DOES NOT GET THIS PAY PACKAGE HE IS OUT, HE WILL FOCUS MORE ON HIS AI PACKAGE AND ON THE GOVERNMENT SIDE OF THINGS. IS THAT STILL A RISK? >> IT AN UNKNOWN. WHEN YOU TALK TO INVESTORS OR TESLA BULLS -- THE STOCK IS UP MORE THAN 14%. THERE IS SUCH A BIG RISK IN ELON MUSK. IF THERE IS A THOUGHT HE STEPS AWAY FROM THE COMPANY, WHAT DOES THAT MEAN FOR TESLA, WHAT DOES THAT MEAN FOR SELF-DRIVING AMBITIONS. IF HE LEANS INTO HIS ROLE WITH
THE GOVERNMENT. THERE ARE SO MANY UNKNOWNS AND THAT IS THE BIG DEBATE IF YOU GO BACK TO 2018 WHEN ELON MUSK WAS POTENTIALLY LOOKING AT WHAT THIS COMPANY COULD DO. NOW HE IS WEARING A GOVERNMENT HAT. CAROLINE: ALL OF THIS SPARKED BY ONE KEY SHAREHOLDER LAWSUIT AND THOSE LAWYERS GOT A HUGE PAYOUT FOR THE PRIVILEGE OF HAVING REPRESENTED THIS PERSON. I'M INTERESTED IN THE FUTURE OF DELAWARE AS WELL. ELON MUSK ON THE BACK OF THIS SAYING COMPANY SHOULD FOLLOW HIM. IS THAT SOMETHING THAT WILL
CARRY ON IF WE SEE THESE LEGAL TIT-FOR-TATS? >> IF YOU GO ON X IT SEEMS TO BE A PLATFORM THAT IS FRO ELON MUSK. YOU SEE PROMINENT INVESTORS TALK ABOUT WHAT THIS COULD MEAN FOR BEING DOMICILED IN DELAWARE. WHAT THE UNCERTAINTY MEANS IF A JUDGE CAN PUSH BACK ON SOMETHING YOUR SHAREHOLDERS VOTED A SUPER MAJORITY. IT DOES CREATE A BIT OF A CLOUD OVER DOMICILE AND IN DELAWARE AND WHAT THAT COULD MEAN. ELON MUSK DID MOVE OUT OF THERE QUITE QUICKLY SO INTERESTING TO SEE IF OTHERS THINK ABOUT FOLLOWING SUIT IN THE WAKE OF THE SECOND PUSHBACK. CAROLINE:
MAYBE NOT SO MANY HAVE $100 BILLION ON THE LINE. ELON MUSK'S X FACES RISING COMPETITION. WE WILL SPEAK WITH ROSE WANG, THE COO OF BLUE SKIES. FOCUSING ON WHAT IS HAPPENING TO SOME OF THE SOUTH KOREAN COMPANIES IN THE SHARES THAT TRADE ABROAD. SK HIDE ITS TRADING IN GERMANY OFF, SAMSUNG HAS BEEN OFF 3.6%.
OFFICIALS IN SOUTH KOREA ARE PLEDGING TO STABILIZE FINANCIAL MARKETS. THE CURRENCY HAS BEEN STABILIZING SOMEWHAT. LAWMAKERS VOTING TO REQUEST THE LIFTING OF MARTIAL LAW. THIS IS BLOOMBERG. CAROLINE: THE NASDAQ HAD BEEN PULLED A LITTLE BIT LOWER, NOW UP .1%. ON THE DOWNSIDE TESLA PUTTING US LOWER. WE WANT TO DIVE INTO INDIVIDUAL
NAMES AFTER NEWS COMING FROM CERTAIN COMPANIES. PALANTIR MANAGING TO SOAR EVER HIGHER AS THEY GET A PARTICULAR NEW DEAL LIFTED FOR HOW THEY CAN SELL THEIR PRODUCTS. PALANTIR UP 5.5%. EARNING SEEM TO BE
UNDERWHELMING. FIRST QUARTER RESULTS WERE FINE BUT THE BILLING BEAT WAS LIGHTER THAN EXPECTED. META UP 2.5%. REPORTS COMING FROM THE FINANCIAL TIMES MARK ZUCKERBERG WOULD NOT MIND BEING PART OF CONTRIBUTING TO TECHNOLOGY LAWMAKING UNDER THE NEXT ADMINISTRATION. ETSY MET WITH DONALD TRUMP AND MAR-A-LAGO LAST WEEK. SOCIAL MEDIA PLATFORMS LIKE THREADS AND BLUES GUY SAW AN INFLUX IN NEW USERS SEEKING ALTERNATIVE TO ELON MUSK'S RIGHT-LEANING PLATFORM ACTS.
JOINING US IS ROSE WANG, ALONGSIDE OUR OWN KURT WAGNER. LET'S DIG IN A LITTLE BIT TO WHAT IT HAS BEEN LIKE SINCE THE ELECTION. HOW HAVE YOU FIND BLUE SKIES, THE NUMBERS RACKING UP, HOW THE INFRASTRUCTURE HAS BEEN SLIGHTLY TAXED. ROSE:
SINCE THE ELECTION WE HAVE SEEN MORE THAN 10 MILLION U.S. USERS JOIN BLUES GUY AND IT HAS BEEN VERY EXCITING FOR US. UP UNTIL NOW WE HAVE SEEN GLOBAL GROWTH FROM JAPAN IN FEBRUARY, FROM BRAZIL IN APRIL AND AUGUST AND NOW WE ARE SEEING THE GROWTH IN THE U.S., U.K., AND CANADA. PEOPLE ARE TIRED OF A PLATFORM THAT CONTROLS WHAT THEY SEE AND THEY DO NOT LIKE A PLATFORM THAT IS PARTISAN. CAROLINE: DON'T LIKE PARTISANSHIP LET'S TALK ABOUT INFRASTRUCTURE AND WITH THAT SUDDEN GROWTH OF USERS INTERNATIONALLY AND IN THE U.S. SERVICE HAS BEEN STRAINED.
HOW MUCH OF YOU HAD TO BOOST YOUR OWN SUPPORT SYSTEMS? ROSE: THE ENGINEERS HAVE BEEN WORKING TO MAKE SURE THE APP STAYS ONLINE. WE ARE VERY PROUD THAT THE INFRASTRUCTURE HAS NOT HAD SIGNIFICANT DOWNTIME AND THE TIME WE HAVE HAD THIS INFLUX OF NEW USERS. OUR PROTOCOL IS BUILT FOR SCALE. WHEN WE BUILT OUR PROTOCOL WE WERE BUILDING IT FOR TWITTER AS OUR CUSTOMER.
THAT WAS THE CHOICE. THINGS CHANGE WHEN X CHANGED HANDS AND WE BUILD OUR OWN APP. KURT: I'M WONDERING WHAT ALL OF THIS INFLUX IN NEW USERS HAS DONE FOR YOU FINANCIALLY. THERE WAS A REPORT LAST MONTH THERE'S BEEN A LOT OF INTEREST IN MORE INVESTORS COMING IN TO BLUES GUY. HAVE YOU STARTED LOOKING AT RAISING MORE MONEY TO KEEP UP WITH THIS GROWTH? ROSE: RIGHT NOW WE ARE FOCUSED ON OUR END USER. WE HAVE SO MANY NEW PEOPLE COMING TO THE PLATFORM AND WHAT THEY CARE ABOUT IS ARE WE HAVING FUN, ARE WE MAKING FRIENDS AGAIN COME AND DO WE FEEL SAFE. THAT IS WHAT THE TEAM IS
FOCUSED ON. WE'RE ALSO LAUNCHING SUBSCRIPTIONS BECAUSE WE SEE SO MANY PEOPLE WHO WANT TO SUPPORT US AND WANT TO GIVE USERS TOOLS TO SELF EXPRESS MORE. MORE CUSTOM ICONS, LONGER VIDEO UPLOADS, BUT WE WOULD NEVER PUT A SPEECH BEHIND A PAY WALL.
NOTHING THAT IS THE CORE FUNCTIONALITY YOU WOULD HAVE TO PAY FOR. KURT: AND SPEAKING OF THOSE CORE USERS YOU HAVE BENEFITED FROM THE ELECTION FROM A LOT OF PEOPLE LEAVING X, NO LONGER FEELING LIKE THEY ARE GETTING WHAT THEY WANT FROM X. IT HAS CREATED THIS LABEL OF BLUE SKIES AS THE ANTI-ELON MUSK NETWORK OR A LEFT-LEANING NETWORK. YOU FEEL LIKE THAT LABEL IS WHAT YOU'RE GOING FOR OR IS THAT JUST PEOPLE PROJECTING ONTO YOU GUYS? ROSE: THERE IS ALWAYS A REACTION WHEN SOMETHING HAPPENS, AN EVENT. WE WILL SEE THAT IT OF CHANGE OVER TIME. BEFORE HAND WE HAD JAPANESE
USERS, BRAZILIAN USERS, PEOPLE FROM ALL OVER THE WORLD COMING TO BLUES GUY. TO SAY IT IS A U.S. CENTRIC LEFT-LEANING APP IS NOT CORRECT. WE ARE ALSO NOT BUILDING AN APP FOR ONE VOICE OR ONE TYPE OF POLITICAL VIEWPOINT. WHAT WE HAVE BUILT IS OPEN INFRASTRUCTURE FOR ANY PERSON WHO HAS INTERESTING VIEWPOINTS WHO WANTS TO HAVE ENGAGING CONVERSATIONS TO COME TO BLUE SKY AND BUILD THEIR OWN SPACE, WHETHER THAT IS THEIR OWN FEED OR THEIR OWN POLITICAL LABELER USERS CAN SUBSCRIBE TO TO TURN OFF POLITICAL CONTENT OR TURN IT BACK ON DEPENDING ON THEIR MOOD. CAROLINE: I KNOW THIS IS REALLY REAL-TIME BUT YOU MENTIONED KOREAN USERS. ARE YOU SEEING A LOT OF
ACTIVITY TODAY GIVEN THE NEWS ON MARTIAL LAW? HOW MUCH ARE YOU SEEING JOURNALIST FLOCKED TO THE PLATFORM AND PEOPLE WANTING TO KNOW? ROSE: I BELIEVE WE HAD OUR FIRST BREAKING HAPPENING ON BLUE SKY WHEN ONE OF THE REPORTERS IS REPORTING LIVE FROM KOREA AND ONLY POSTING ON BLUE SKY. WE ARE STARTING TO SEE BLUE SKY IS THE PLACE FOR THINGS THAT ARE HAPPENING CURRENTLY. WHERE YOU TALK ABOUT IT? ON BLUE SKY. THERE ARE ALL SORT OF GUARDS AGAINST SPECULATIVE INFORMATION BECAUSE USERS CAN LABEL THAT POST WITHOUT WAITING ON THE CENTRAL AUTHORITY OR A PARENT COMPANY LIKE US. KURT: AS YOU SEE STATE AFFILIATED MEDIA, FOR EXAMPLE IN RUSSIA AND NORTH KOREA START TO GO ON TO BLUE SKY, HISTORICALLY PLATFORMS HAVE LABELED THOSE MEDIA IN SOME CASES CUT DOWN ON THEIR ABILITY TO ADVERTISE OR THINGS LIKE THAT. HAVE YOU THOUGHT ABOUT HOW YOU WILL DEAL WITH STATE AFFILIATED MEDIA ORGANIZATIONS AND SOME OF THESE CONTROVERSIAL COUNTRIES? ROSE: THE WAY WE HAVE BUILT SOCIAL IS WE HAVE GIVEN THE TOOLBOX TO USERS TO DECIDE HOW THEY WANT TO EXPERIENCE CONTENT AND INTERACT WITH OTHER PEOPLE.
CURRENTLY THE WAY WE CARE ABOUT THE END USER IS THEY ARE OUR PRIMARY CITIZENS. WE ARE NOT WORRIED ABOUT HEADS OF STATE OR BRANDS IN TERMS OF TRYING TO SERVE THEM FIRST. WE ARE TRYING TO SERVE THE END USER FIRST WHICH MEANS WE ARE GIVING USERS THE TOOLS TO DECIDE HOW THEY WANT TO TAKE IN THE NEWS OR HOW THEY WANT TO INTERACT WITH DIFFERENT ACCOUNTS. WHEN IT COMES TO DIFFERENT
HEADS OF STATE, WHAT WE CARE ABOUT IS THEY WANT TO FOLLOW THE RULES OF OUR TERMS OF SERVICE AND COMMUNITY GUIDELINES AND WE ALSO HAVE DIFFERENT JURISDICTIONS FOR DIFFERENT COUNTRIES, MUCH LIKE OTHER SOCIAL MEDIA PLATFORMS. CAROLINE: LET'S TALK ABOUT THOSE RULES AND THE WAY YOU INTERACT ON BLUE SKY. YOU ARE HAVING TO THINK ABOUT MODERATION. SOME OF THE MONEY WAS EARMARKED FOR THAT. HOW ARE YOU MANAGING TO CRACK
DOWN ON CONTENT YOU DO NOT WANT TO SEE ON THE PLATFORM? ROSE: IT IS IMPORTANT YOU PUT SAFETY AS A PRIORITY. MOST SOCIAL MEDIA PLATFORMS PUT GROWTH AHEAD OF TRUST IN SAFETY AND TRUST AND SAFETY IS SOMETHING THEY HAVE TO DO. THAT IS TOTALLY DIFFERENT ON BLUESKY. WHEN YOU HAVE A NETWORK RUN BY TWO WOMEN WHO HAVE BEEN ON THE INTERNET FOR DECADES AND EXPERIENCE THE INTERNET AS WOMEN WE HAVE PRIORITIZED SAFETY.
WE HAD INVITE CODES LAST YEAR BECAUSE WE WERE NOT READY TO OPEN UP THE NETWORK BEFORE WE HAD A MODERATION TEAM. THE OTHER WAY WE THOUGHT ABOUT MODERATION IS WE THOUGHT ABOUT IT IN TERMS OF STACKABLE MODERATION, WHICH ONLY THE CENTRAL COMPANY ONLY HAS A CERTAIN AMOUNT OF CONTROLS THEY CAN DO TO HELP DIVERSE COMMUNITIES. CENTRAL AUTHORITIES TEND TO ACT VERY SLOWLY. THERE IS SO MUCH INFORMATION BETWEEN TOXIC MISINFORMATION OR HATE SPEECH AND THINGS THAT MAKE PEOPLE UNHAPPY ON SOCIAL. WE GIVE THOSE CONTROLS BACK TO USERS SO THEY CAN LABEL SPECULATIVE INFORMATION AND OTHER USERS CAN SUBSCRIBE TO THOSE LABELS AND NOT WAIT FOR US TO MAKE THOSE DECISIONS. THAT IS WHAT WE MEAN BY OPENING
UP SOCIAL AND MAKING IT MORE DEMOCRATIC WHERE YOU DO NOT HAVE TO WAIT FOR US, YOU CAN BUILD. KURT: WE SPENT A LOT OF THE CONVERSATION TALKING ABOUT HOW GLOBAL THIS NETWORK IS. YOU ARE IN SAN FRANCISCO. IS THAT THE LONG-TERM PLAN FOR YOU? IS THERE ANY WORLD IN WHICH BLUESKY WOULD RELOCATE, MAY BE MOVED TO EUROPE OR SOMEWHERE ELSE FOR HEADQUARTERS FOR REGULATORY REASONS OR TO AVOID A CONFRONTATION WITH ELON MUSK OR DONALD TRUMP? ROSE: BLUESKY IS REMOTE. THE TEAM IS QUITE GLOBAL. WE HAVE PEOPLE IN EUROPE AND ASIA AND THE U.S..
IT IS IMPORTANT TO THE TEAM LOOKS LIKE THE USERS. WE WANT TO CONTINUE TO BE A REMOTE TEAM AND BE REACTIVE TO THE DIFFERENT NEEDS OF OUR GLOBAL AUDIENCE. CAROLINE: NO TECHNICAL HQ COME IS THAT THE ANSWER? ROSE: NO HQ. CAROLINE: ROSE WANG AND BLOOMBERG'S KURT WAGNER. THANK YOU FOR BRINGING US THE
GREAT INTERVIEW. SO COY OF CAPITAL PARTNER WILL BE JOINING US TO TALK ABOUT WHERE AI IS HEADING AT THE MOMENT AND WHAT HE DEEMS TO BE AI. THIS IS BLOOMBERG TECHNOLOGY.
CAROLINE: YOU'RE LOOKING AT A LIVE SHOT OF THE PRINCIPAL ROOM. TUNE IN LATER FOR CONVERSATION WITH MATT GARMAN, CEO OF AWS. 4:00 EASTERN, 1:00 PACIFIC. THIS IS BLOOMBERG. TECHNOLOGICAL ADVANCES IN AI EXPECTING TO BOOM IN THE NEXT YEAR, DRAWINGS AND GIVE YOU INTEREST AND INVESTMENT. AT THE FOREFRONT IS SEQUOIA CAPITAL PARTNER CONSTANTINE RULER. HE IS JOINING US TO TALK ABOUT
WHERE WE ARE IN THE AI HYPE CYCLE, WHERE WE ARE IN TERMS OF IDENTIFYING WHAT ARTIFICIAL INTELLIGENCE IS. ARE WE STILL HYPED? KONSTANTINE: GOOD MORNING AND GREAT TO SEE YOU. WE ARE DEFINITELY IN AI HYPE CYCLE AND YET WE ARE NOT FOCUSED ON THE 2024 HYPE CYCLE OR EVEN 2025. WE ARE FOCUSED ON THE LONG-TERM. ARTIFICIAL INTELLIGENCE IS A VERY IMPORTANT MACRO TREND. AKIN TO THE INDUSTRIAL REVOLUTION. THAT IS A TREND WE HAVE BEEN INVESTING IN AND WILL CONTINUE INVESTING IN FOR DECADES, REGARDLESS OF WHERE HYPE LANDS.
CAROLINE: YOU WROTE A PIECE IDENTIFYING HOW GARTNER'S SCENES HYPE CYCLES AND THIS WILD ENTHUSIASM AND SUDDENLY YOU GET INTO THIS DISAPPOINTMENT, THIS DISILLUSIONMENT. WHERE ARE WE IN TERMS OF CONSUMER ADOPTION, IN TERMS OF PEOPLE PUTTING RETURN ON AI INVESTMENT FIRST? KONSTANTINE: YOU ARE EXACTLY RIGHT. AI CHANGES OVER TIME. WHEN I WAS IN AI RESEARCHER A LONG TIME AGO WE WERE BARELY SCRATCHING THE SURFACE OF NATURAL LANGUAGE PROCESSING AND THE BEGINNING OF PURE VISION. 2022, 2023, WE ARE ABOUT LARGE LANGUAGE MODELS AND ANSWERING QUESTIONS AND THE ADVENT OF MODERN AI. 2024 HAS BEEN THE YEAR OF AGENTS.
WHAT AN AGENT IS IS IN AI THAT COMPLETES A TASK. YOU ASK IT TO DO SOMETHING AND IT DOES NOT JUST TELL YOU HOW TO DO IT. IT DOES IT FOR YOU. AN EXAMPLE OF AN AI AGENT COMPANY IS OUR OWN PORTFOLIO COMPANY EXPO. EXPO WAS FOUNDED BY THE CREATOR OF GITHUB COPILOT AND THEY SET OUT TO CREATE AN AGENT FOR CYBERSECURITY, A CHALLENGING AND IMPORTANT SPACE. IN A FEW MONTHS THEY WERE ABLE TO DEVELOP AI THAT CAN OUTPERFORM SOME OF THE BEST PENETRATION TESTERS IN THE WORLD.
AI ATTACKS A WEBSITE WITH THE PERMISSION OF THE WEBSITE PROVIDER, FIND SMALLER ABILITIES , AND REPORTS BACK AND SAYS WE HAVE FOUND THESE VULNERABILITIES , WE HAVE COMPLETED THIS ENTIRE TASK. THAT WAS 2024 FOR AI. 2025 AND BEYOND WILL LIKELY BE ABOUT SWARMS OF AI AGENTS, NETWORKS OF AGENTS WORKING TOGETHER AND MAY AGAINST EACH OTHER TO SOME RESULT. CAROLINE: THE SWARM OF AI AGENTS. I FEEL LIKE THERE'S A SWARM OF COMPANIES TALKING ABOUT AI AGENTS. WE HAVE SALESFORCE NUMBERS. WE RECENTLY HAD ONE OF YOUR PORTFOLIO COMPANIES WHICH IS ALSO ALL ABOUT AGENTS. HOW ARE WE GOING TO SEE THEM CROSS CONTAMINATE AND WORK AGAINST EACH OTHER OR IT SEEMS SOME WIN AND SOME LOSE? KONSTANTINE: THE REASON PEOPLE ARE SO EXCITED ABOUT AGENTS IS THE PROMISE OF AI COMPLETING TASKS IS SO IMPACTFUL.
WE WANT AI TO DO THE WORK. YOU JUST MENTIONED ROX, A GREAT EXAMPLE OF A COMPANY THAT IS IN AI AGENT THAT INCLUDES THE HUMAN IN THE LOOP. ROX IS NOT TRYING TO CUT THE PERSON OUT, THEY ARE TRYING TO SAY YOU'RE A GOOD SELLER, YOU HAVE GOOD HUMAN RELATIONSHIPS WITH YOUR BUYERS. INSTEAD OF TRYING TO DISS INTERMEDIATE THAT WE WILL EMPOWER YOU WITH AN AGENT. THE AGENT WILL DO ALL OF THE WORK AND RESEARCH FOR YOU AND GET YOU PREPARED FOR THE NEXT MEETING. AN EXAMPLE OF THEM PUTTING THAT
THEORY INTO PRACTICE AS THEY ORIGINALLY DEVELOPED TECHNOLOGY THAT WOULD AUTO DRAFT EMAILS AND THEY HAD THE ABILITY TO SEND THOSE EMAILS. THEY TOOK THAT OUT AND FOUND WHEN THEY KEPT THE HUMAN IN THE LOOP PERFORMANCE WAS TRIPLE, THREE TIMES AS HIGH. THERE ARE COMPANIES FOR THE AGENT WILL DO THE ENTIRE TASK, LIKELY IN THE CYBERSECURITY SPACE. THERE ARE COMPANIES FOR THE AI AGENT WILL DO WORK FOR THE PERSON TO AUGMENT THEM LIKE IN THE CASE OF ROCKS. CAROLINE: YOU ARE A BIG THINKER AND YOU
PUT OUT TRENDS AND FORECASTS. TREND FOR US HUMBLY AGENT OFFERINGS WE NEED? HOW MANY PUBLIC AND PRIVATE COMPANIES. HOW MANY HORSES SUCH AS ROX CAN YOU BACK? KONSTANTINE: IT IS EARLY DAYS FOR ARTIFICIAL INTELLIGENCE.
THE CONSTRAINT IS OUR CREATIVITY. THE OPPORTUNITY FOR ARTIFICIAL INTELLIGENCE IS HUGE AND I WILL GIVE AN EXAMPLE. TWO AREAS CRITICAL TO ALL OF US ARE HEALTH CARE AND EDUCATION. THEY HAVE BEEN AREAS WHERE COST
HAS GONE UP AND UP FOR DECADES AND A LOT OF REASON FOR THAT INCREASE IS BECAUSE OF THE COST OF SERVICES. NOW THAT AI CAN COMPLETE SOME TASKS I THINK AI CAN COME IN AND IN THE COMING DECADES BE A HERO FOR THOSE INDUSTRIES AND HELP US HAVE A BETTER EDUCATION AND HEALTHIER POPULATION. THIS GUY IS LIMIT FOR ARTIFICIAL INTELLIGENCE AND AI AGENTS AND NETWORKS OF AI. CAROLINE: KONSTANTINE BUHLER, SEQUOIA CAPITAL.
WE WILL TALK ABOUT SEARS FORCE STRATEGIC PIVOT TO AI AGENT. IT IS CERTAINLY PAYING OFF ON THE SHARE PRICE. CAROLINE: AMAZON'S CLOUD UNIT IS WARMING UP COMPONENTS IT SAYS WILL MAKE DATA CENTERS RUN MORE EFFICIENTLY.
THESE NEW DESIGNS COULD HELP ADDRESS THE GROWING STRAIN ON THE ELECTRICAL GRID FOR POWER-HUNGRY SERVER FARMS. LET'S TURN TO ANOTHER KEY COMPANY, SALESFORCE, WITH THE COMPANY SCHEDULED REPORT THIRD-QUARTER EARNINGS COME INVESTORS ARE WATCHING THE COMPANY'S NEW AI AGENT STRATEGY TO SEE IF THIS PIVOT THEY ARE TALKING ABOUT IS PAYING OFF IN REAL-TIME. THE SHARE PRICE IS VERY EXUBERANT. WILL THE NUMBERS BEAR IT OUT? >> LAST EARNINGS MANY INVESTORS OF SALESFORCE HAD NOT HEARD THE WORD AI AGENT. THEN THE COMPANY SAID IT 100 TIMES ON THE EARNINGS CALL. APPLICATION SOFTWARE COMPANIES
HAVE NOT MADE A BUNCH OF MONEY FROM AI. IT HAS BEEN THE SOFTWARE INFRASTRUCTURE COMPANIES. THE AGENT PIVOT IS ALL ABOUT TESTING OUT A NEW GENERATIVE AI TYPE PRODUCTS. NOW FOLKS ARE MORE OPTIMISTIC ABOUT IT. WE DO NOT EXPECTED TO BOOST
NUMBERS TONIGHT. ALL ATTENTION IS ON WHAT THE COMPANY TELLS US WITH WHAT AGENTS CAN MAKE MONEY MISE WHEN YOU LOOK AT THE SIX OR 12 MONTH TIME HORIZON. CAROLINE: ARE WE GOING TO GET UPDATED FIGURES ON THE ADOPTION OF THIS FORCE COME ARE WE GOING TO SEE REAL-TIME SALES UPTICK ON THE BACK OF THIS PUSH? BRODY: I EXPECT TO HEAR ABOUT A LOT OF PROOF OF CONCEPTS, I EXPECT TO HEAR BIG NAME COMPANIES USING THE AGENTS. AGENTS ARE A CONSUMPTION BASED
PRODUCT. IT WILL TAKE TIME FOR THIS REVENUE TO RAMP UP. RIGHT NOW AS WE SEE IN THE SHARE PRICE INVESTORS BELIEVE IT WILL RAMP. CAROLINE: WHAT ABOUT COST BASE? BRODY: THAT IS AN INTERESTING QUESTION BECAUSE EVERY TIME YOU SERVE THE PRODUCT THAT IS AN EXPENSIVE SALESFORCE PAYS. THE INITIAL COST IS TWO DOLLARS
PER USE. CAROLINE: ALL EYES ARE ON 4:00, WHAT COMES OUT AFTER THE BELL. BRODY FORD, WE APPRECIATE IT. NOW LET'S GET TO THE KEY GEOPOLITICAL STORY. SOUTH KOREA'S PRESIDENT DECLARED MARTIAL LAW IN AN EMERGENCY ADDRESS EARLIER TODAY. HE SAID THE DECISION WAS MADE TO PROTECT FREEDOM AND CONSTITUTIONAL ORDER AND ACCUSE THE OPPOSITION OF TRYING TO PARALYZE THE ADMINISTRATION.
OPPOSITION LAWMAKERS RACED INTO PARLIAMENT AND VOTED TO REQUEST THE PRESIDENT WITHDRAW MARTIAL LAW. NOW THE MARKET WAITS TO SEE IF THE PRESIDENT COMPLIES. JOINING US FOR MORE ON THE MARKET REACTION IS BLOOMBERG'S MARIA ELENA. WE ARE A TECHNOLOGY SHOW, WE LOOK AT SAMSUNG, THE SHARE PRICES DROPPED. WHAT WE WISH FOR? MARIA: THE MARKET IS JUST WAITING FOR THE NEXT ANNOUNCEMENTS FROM AUTHORITIES, WHETHER IT IS THE FINANCE MINISTRY, THE CENTRAL BANK, FUME AND ITS AGO THEY PUT OUT A STATEMENT SAYING THEY WOULD PROVIDE UNLIMITED LIQUIDITY IF THEY NEED TO. THAT WAS A BIG COMFORT FOR
INVESTORS. THERE IS A TON OF ASSETS THAT DO TRADED DURING U.S. HOURS. SAMSUNG SHARES LISTED IN LONDON LOST 7.5% AFTER THE HEADLINES ON MARTIAL LAW. IT WAS LISTED IN THE U.S. WITH SOUTH KOREAN STOCKS THAT
FELL AS MUCH AS 7%. THE ETF'S, THE SHARES OF KOREAN COMPANIES LISTED IN LONDON TO HAVE LOST SO MUCH BUT THEY HAVE PAIRED SOME OF THOSE LOSSES IN THE LAST COUPLE OF HOURS SINCE THE STATEMENT CAME OUT. I THINK THEY'RE JUST LOOKING FOR DETAILS AND HOPING FOR A LOT OF SUPPORT. THAT IS WHAT YOU CAN EXPECT IN THOSE SITUATIONS. CAROLINE: IN WHILE SAMSUNG ELECTRONICS, THERE HAS BEEN ADDED CONCERNED ABOUT THESE ARE KEY EXPORTERS FOR A NATION DEPENDENT ON THESE TECHNOLOGY COMPANIES AND EXPORTS WILL BE UNDER RISK OF NEW TARIFFS FROM THE UNITED STATES. THIS IS A LOCK FOR THE KOREAN GOVERNMENT TO BE TRYING TO NAVIGATE. IS THIS WHAT SPARKED IT ALL AND
HIS TARIFFS WHAT YOU'RE HEARING IS A KEY CONCERN FOR INVESTORS? MARIA: IT HAS BEEN. IT IS PART OF THE SO-CALLED TRUMP TRADE. YOU ARE BULLISH U.S. DOLLAR AND BEARISH ASIAN CURRENCIES. EVEN IF IT IS NOT A DIRECT THREAT OF TARIFFS FOR KOREA BECAUSE WE HEAR TRUMP MENTIONING CHINA OR MEXICO MORE OFTEN THAN HE DOES KOREA, IT WOULD CAUSE THE REGION TO SLOW DOWN EVENTUALLY AND HIT THE CURRENCY. OBVIOUSLY THE CURRENT POLITICAL ENVIRONMENT WITH FOREIGN POLICY COMING UP WITH THE NEXT ADMINISTRATION WILL BE A BIG PART OF WHAT HAPPENS IN KOREAN MARKETS. CAROLINE: UP TO THE MOMENT ON WHAT IS HAPPENING IN SOUTH KOREA.
THAT DOES IT FOR THIS ADDITIONAL BLOOMBERG TECHNOLOGY. CHECK OUT THE PODCAST, FIND IT
2024-12-08 09:49
