Big Tech Earnings, Reid Hoffman and the Election | Bloomberg Technology
>> FROM THE HEART OF WHERE INNOVATION, MONEY, AND POWER COLLIDE IN SILICON VALLEY AND BEYOND, THIS IS "BLOOMBERG TECHNOLOGY" WITH CAROLINE HYDE AND ED LUDLOW. ♪ CAROLINE: LIVE FROM NEW YORK AND SAN FRANCISCO, THIS IS "BLOOMBERG TECHNOLOGY." MICROSOFT AND META RESULTS DRIVE THE MARKET LOWER. WE WILL LOOK AT HOW THE AI STORIES PLAYING OUT FOR THEM. ED: DOORDASH POSTED ITS FIRST OPERATING PROFIT SINCE THE PANDEMIC AS A GROSS OUTSIDE RESTAURANT DELIVERIES.
WE SPEAK TO THE CFO. CAROLINE: WE WILL SIT DOWN WITH LINKEDIN COFOUNDER REID HOFFMAN TO DISCUSS THE IMPACT OF THE ELECTION ON SILICON VALLEY. FIRST, WE CHECK IN ON MARKETS THAT ARE TO THE DOWNSIDE. NASDAQ OFF BY MORE THAN 2%. THIS IS AS THE EARNINGS COME TAKE, COME-- COME THICK, COME FAST. I HIGHLIGHT UBER, ONE OF THE LATEST ONES, DOWN THE MOST IN TWO YEARS. WHY? GROSS BOOKINGS NOT AS HIGH AS
THE MARKET WANTED TO SEE. $41 BILLION FOR THE QUARTER JUST REPORTED. THE MARKET WANTED TO SEE HIGHER AND DEVELOP A FORECAST AS WELL . WE ARE SEEING CALIFORNIA NEW JERSEY PERHAPS PUSHING BACK A LITTLE BIT BY THE COST OF INSURANCE, BUT ALSO THERE IS AN FX HAEADWIND THAT IS HAPPENING. WHAT ELSE ARE YOU WATCHING ON A MICRO BASIS? ED: EMPHASIS ON FORECAST WHEN IT COMES TO THE MEGA CAPS AND MEMBERS OF THE MAG SEVEN. META NARROWLY BEATING THE
QUARTER ON THE ADVERTISING BUSINESS, BUT IT IS WARNING OF GREATER LOSSES ON REALITY LABS AS IT INVESTS IN AI AND X FINISHES GROWTH INTO 2025. MICROSOFT IS A SIMILAR STORY. ON TRACK TO BE DROPPED BY THE MOST SINCE OCTOBER 2022. AS YOUR GROWTH OF THE NEXT THREE-MONTH PERIOD WILL BE 31 TO 32%, THAT IS A DECLINE SEQUENTIALLY. UNBELIEVABLY, THEY ARE SAYING THE SUPPLY CONSTRAINT CAPACITY CONSTRAINT ON THE DATA CENTER SIDE, IN OTHER WORDS, THEY DON'T HAVE COMPUTE CAPACITY TO MEET DEMAND OUT THERE FOR AI, WHICH IS A REALLY FASCINATING PREDICAMENT TO BE IN, BUT ALSO RECORD SPENDING. THE THEMES ARE QUITE CONSISTENT. CAROLINE: THE THEMES ARE, AND SO IS THE MOVEMENT ACROSS MOST OF THE MARKET. LET'S BRING IN JUST MENTIONED, WHO HELPS US -- -JESS MINTON.
ALL EYES HAVE BEEN ON A HIGH-CAPACITY NAI SPENDING. JESS: ESPECIALLY WITH MICROSOFT BECAUSE THEY RAMPED UP SO MUCH SPENDING. YOU COVER THE DATA CENTER FOCUS AS WELL BECAUSE THAT IS NOT SOMETHING A COMPANY LIKE MICROSOFT WOULD HAVE DONE BEFORE 2020, BUT ESPECIALLY WHEN YOU THINK ABOUT UTILITY STOCKS, THOSE TYPES -- THAT IS WHERE IT IS WHEN YOU THINK OF SPENDING -- CAPEX SPENDING. SAY YOU ARE LOOKING AT META, MARK ZUCKERBERG MADE IT CLEAR THEY WILL KEEP SPENDING NAI, EVEN AS YOU SEE NOT QUITE AS MUCH OF A BOOST TIDY -- TIED TO AI LOSSES THERE. STILL A FEW WEEKS AWAY, NOVEMBER 20.
WHEN YOU THINK ABOUT THE KEY CLIENTS WHEN IT COMES TO AI SPENDING, WE HEARD FROM ALPHABET. WE HAD MICROSOFT AND META AND AMAZON AFTER THE BELL. WITH THEM RAMPING UP SPENDING, THAT WILL BODE WELL FOR NVIDIA. WHEN YOU THINK OF HALF OF THE REVENUE GROWTH -- ED: JESS, LET ME JUMP IN, REALLY INTERESTING -- NVIDIA'S DOWN 4%, MORE THAN. SECOND-BIGGEST POINTS DRAG ON THE NASDAQ 100. MAYBE THE LOGIC HERE IS
MICROSOFT, ONE OF THE BIGGEST BUYERS OF NVIDIA'S CHIPS, THE GROWTH OUTLOOKS ARE DISAPPOINTING. EVEN THOUGH THEY'RE BOTH SAYING WE ARE COMMITTED TO SPENDING ON AI, IF THEY CAN'T SUSTAIN THE GROWTH THAT INVESTORS WANT TO SEE IN RESPONSE TO THAT, MAYBE THOSE PLANS CHANGE. I THINK THAT IS SO INTERESTING TO SEE THAT NAME DOWN SIGNIFICANT DESPITE THE BIGGEST CUSTOMER SAYING WE WILL SPEND MONEY, NO WORRIES. JESS: A LOT OF IT HAS TO DO WITH THE
LINGERING CONCERNS -- WHEN YOU THINK OF PRODUCT DELAYS AND LONG-TERM GROWTH PROSPECTS, A LOT OF THAT IS TIED, TO YOUR POINT, AS FAR AS WHAT THAT MEANS AND HOW LONG THESE COMPANIES CAN RAMP UP THIS PENNY BECAUSE WE NORMALLY HAVEN'T SEEN THAT WHEN IT COMES TO SOMETHING LIKE MICROSOFT. ED: ASTONISHING GAINS GOING INTO EARNINGS. AMAZING AND INTERESTING MARKET SESSION AND WE HAVE JUST MENTIONED -- JESS MENTON. LET'S BRING IN SHWETA KHAJURIA, MANAGING DIRECTOR FOR GLOBAL INTERNET AT WOLF RESEARCH. WE HAVE TO START WITH META. IT'S AN INTERESTING COMPANY TO UNDERSTAND BECAUSE BEATING THE QUARTER GONE, THE ADVERTISING- SUPPORTED BUSINESS. REALITY LABS WILL SEE GREATER
LOSSES. CAPITAL EXPENDITURES CONTINUE TO GROW. GOT A BIG SENSE OF DÉJÀ VU. I DON'T KNOW ABOUT YOU, SHWETA. WHAT WAS YOUR TAKE AWAY FROM THAT? SHWETA: YEAH, FIRST OF ALL, THANKS FOR HAVING ME, GOOD TO BE HERE. MY TAKE AWAY WAS THERE ARE A LOT OF GOOD THINGS GOING ON FOR META.
WE THINK ABOUT AT A HIGH LEVEL, YES, THE NEGATIVE SIDE, CAPEX REMAINS UNCLEAR, THEY WILL SPEND $50 BILLION TO $60 BILLION ON CAPEX NEXT YEAR. THE LOSSES IN REALITY LABS IS A CONCERN. BUT ON THE UPSIDE, WHAT THEY ARE DOING IN TERMS OF HOW THEY ARE LEVERAGING LLAMA, STROKE OF GENIUS ON THEIR PART, TO THEIR OWN ADVANTAGE IS AMAZING, ESPECIALLY AS WE THINK ABOUT ENGAGEMENT AND MONETIZATION. VIDEO RECOMMENDATIONS ALONE ARE DRIVING GROWTH ON TIME SPENT, IMPRESSION GROWTH ARE HIGH SINGLE DIGITS, PRICING IS IMPROVING 11%. META AI ALREADY HAS 500 MILLION MAU 'S. ENGAGEMENT ON THE PLATFORM IS REMARKABLE.
WE EXPECT REVENUE GROWTH TO BE SUSTAINED AT MID-TTEEN GROWTHS RATE AT CURRENT LEVELS. THEY ARE ONE OF THE BIGGEST BENEFICIARIES OF DEPLOYING AI FOR THEIR OWN ADVANTAGE. CAROLINE: HALF A MILLION MONTHLY USERS OF META AI WAS ARRESTING. BUT WHAT ARRESTED THE MARKET WAS THE 2025 PROMISE TO SPEND. TAKE A LISTEN TO WHAT MARK
ZUCKERBERG SAID ON THE CALL. >> IT'S CLEAR THERE ARE A LOT OF NEW OPPORTUNITIES TO USE NEW AI ADVANCES TO ACCELERATE OUR CORE BUSINESS THAT SHOULD'VE STRONG ROI OVER THE NEXT FEW YEARS FOR THE SECOND, WE SHOULD INVEST MORE THERE. SECOND, OUR AI INVESTMENTS CONTINUE TO REQUIRE SERIOUS INFRASTRUCTURE AND EXPECT TO CONTINUE INVESTING SIGNIFICANTLY THERE, TOO. CAROLINE: IN YOUR NOTES, SHWETA, YOU TALK ABOUT THE NEW OPPORTUNITIES, THE NEW REVENUE AVENUES WE ARE GOING TO SEE. WHAT ARE THEY? ARTICULATE THAT FOR THE MARKET.
SHWETA: SURE. IN THE NEAR TO MIDTERM IT IS LEVERAGING THE A MODELSI TO THEIR OWN ADVANTAGE AROUND ENGAGEMENT AND MONETIZATION. THEY ARE MAKING RECOMMENDATIONS BATTLE. --BETTER. AN EXAMPLE WOULD BE UNIFIED VIDEO, FULLSCREEN VIDEO ON THEIR PLATFORMS ACROSS APPS. THAT WILL DRIVE ENGAGEMENT
BECAUSE IT IS SHORT FORM VIDEOS, DIFFERENTIATED VIDEOS ON ONE PLATFORM ON A FULL-SCREEN. THAT HAS AN OPPORTUNITY TO INCREASE IS APPLIED IN TERMS OF ADDING IMPRESSIONS IN THAT FORMAT. IN ADDITION TO THAT, USING AI TO MAKE THE RECOMMENDATIONS MORE TARGETED.
THEY HAVE NOT UNTAPPED THE OPPORTUNITY AS MUCH. IN 2025, IS MOST LIKELY GOING TO BE VIDEO RECOMMENDATION PLATFORMS IN THE VIDEO FEED DRIVING ADVERTISING GROWTH. IN THE MID TO LONG TERM, THERE ARE OTHER REVENUE SOURCES THEY'VE NEVER HAD. BUSINESS-TO-BUSINESS MESSAGING ON WHATSAPP, THAT IS TWO YEARS OUT BUT THEY ARE ALREADY MONETIZING THAT. BEYOND TWO YEARS, META AI, IN TERMS OF ADDING ADVERTISING TO THE SEARCH FEEDS, IN ADDITION TO SUBSCRIPTION, JUST LIKE CHATGPT OR GEMINI, ARE COMPLETELY NEW REVENUE SOURCES FOR THEM. ED: AND THEY CONTINUE TO SEE EARLY
SURPRISE SUCCESS WITH RAY-BAN METAS, THE GLASSES. YOU DO NOT COVER MICROSOFT, BUT YOU FOLLOW ALPHABET, THE PARENT OF GOOGLE, AND AMAZON, THAT PURPORTS AFTER THE BELL. IN THE CONTEXT OF CLOUD, I LOOK AT WHAT ALPHABET SAID IN MICROSOFT, BOTH SEEMING TO SUGGEST THAT THE NUMBER THREE AND TWO PLAYERS TOOK MARKET SHARE FROM EWS, THE NUMBER ONE PLAYER. DO YOU GOING TO AMAZON'S EARNINGS TONIGHT WITH THAT ANALYSIS AS WELL? SHWETA: ABSOLUTELY.
THE TOP THREE PLAYERS IN THE MARKET ARE AMAZON'S AWS, AZURE AND GOOGLE CLOUD. ,WHAT WE SAW WITH GOOGLE CLOUD IS 35% CLOUD BIRTH RATE, IN PART DRIVEN BY NOT ONLY GAINING SHARE, BUT EXPANDING MARKET 10, THE AI SERVICES AND PRODUCTS DRIVING THAT GROWTH. EVEN THE BACKLOG, THE DEMAND TRENDS THEY ARE SEEING A PRETTY AMAZING. GOING INTO AMAZON, OUR EXPECTATION IS AMAZON'S AWS CLOUD REVENUE LIKELY GREW 20 221% IN THE STREET IS LOOKING FOR A PERCENT GROWTH RATE. WE EXPECT THAT TO ACCELERATE IN
THE FOURTH QUARTER. CAROLINE: YOU HAVE OUTPERFORM RATING ON AMAZON. SHWETA KHAJURIA, GREAT TO HAVE YOU, WOLFE RESEARCH. DOORDASH MARKS A MAJOR
MILESTONE SINCE LAUNCHING ITS IPO. CFO RAVI INUKONDA JOINS US NEXT. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: TIME FOR "TALKING TECH." IT'S OFFICIAL, THE EU IS INVESTIGATING AN E-COMMERCE PLATFORM FOR POTENTIALLY VIOLATING THE DIGITAL SERVICES ACT. THE COMMISSION SAYS THE COMPANY IS NOT DOING ENOUGH TO COMBAT SALES OF ILLEGAL PRODUCTS ON ITS SITE. ONE MUST -- ELON MUSK WAS SUED
BY THE PHILADELPHIA DISTRICT ATTORNEY FOR HIS POLITICAL ACTION COMMITTEE'S SWEEPSTAKES TARGETING SWING STATE VOTERS. THE DA IS ASKING A COURT TO STOP MUSK FROM ENGAGING IN WHAT BECAUSE UNLAWFUL LOTTERY. PELOTON HAS TQAPPED AFFORD EXECUTIVE AS ITS NEW CEO. IT HIRED STERN LAST YEAR TO RUN A NEW THE CREATOR TECHNOLOGY-FOCUSED DIVISION OF THE AUTOMAKER. ED: DOORDASH IS TOPPED WALL STREET EXPECTATIONS IN A NEARLY EVERY KEY METRIC THIS EARNINGS SEASON, SEEING ITS FIRST QUARTERLY OPERATING PROFIT SINCE THE START OF THE PANDEMIC, GENERATING $107 MILLION IN OPERATING INCOME. IT'S A STORY ABOUT A PLATFORM THAT IS SHIFTING FROM RESTAURANT DELIVERIES TO SO MUCH MORE.
THE DOORDASH CFO, RAVI INUKONDA, IS WITH US IN SAN FRANCISCO. LET'S FOCUS ON THE FUTURE. THAT WAS THE STORY, WHAT IS HAPPENING IN SUCCESS IN BUSINESS LINES, BUT SO MANY INTERESTED ABOUT THE LONG-TERM FUTURE OF DOORDASH. YOU HINTED THERE WOULD BE LONG-TERM INVESTMENTS IN NEW AREAS FOR THE WHAT ARE THEY? RAVI: SHORT. WE-- SURE. WE STARTED OUR BUSINESS WITH RESTAURANTS AS THE COURT FOCUSED, WE ARE SO MUCH MORE THAN RESTAURANTS. MORE CONSUMERS ARE ORDERING FOR MORE CATEGORIES. IT IS GROCERY, RETAIL, HALLOWEEN COSTUMES. WE ARE PARTNERING WITH EVERY
SINGLE STORY IN YOUR LOCAL NEIGHBORHOOD OUR GOAL IS TO BE YOUR LOCAL NEIGHBORHOOD SUPERSTORE. ED: WHICH AREAS ARE THE MOST PROFITABLE BUSINESS LINES FOR THE APP? RAVI: THE OVERALL BUSINESS HAS BEEN PROFITABLE FOR THE FIRST TIME AS A COMPANY. NO BUSINESS, SCALE IS THE MOST -- IN OUR BUSINESS, SCALE IS THE MOST IMPORTANT THING BECAUSE SCALE DRIVES EFFICIENCY, WHICH DRIVES PROFIT. IF YOU LOOK AT THE RESTAURANT BUSINESS, IT HAS BEEN PROFITABLE FOR A FEW YEARS. WE ARE BUILDING OUR NEW CATEGORIES BUSINESS AND OUR INTERNATIONAL BUSINESS. CAROLINE:
LET'S TALK ABOUT INTERNATIONAL, BECAUSE YOU MADE ACQUISITIONS THERE. I'M CURIOUS HOW THE CONSUMER STACK UP, U.S. VERSUS INTERNATIONAL. RAVI: INTERNATIONALLY SEEING VERY GOOD AND STRONG GROWTH. GROWTH HAS BEEN SUBSTANTIALLY FASTER.
WE ARE GAINING SHARE IN EVERY COUNTRY WE OPERATING IN. ALL OF THAT IS DRIVEN BY THE UNDERLYING PRODUCT INNOVATION. FREQUENCY IS GROWING BEC WE LAUNCHED OUR SUBSCRIPTION PROGRAM IN INTERNATIONAL MARKETS AND THAT IS OFF TO A FLYING START. CAROLINE: WHAT IS INTERESTING IS YOU ARE DOING PARTNERSHIPS. IN THE U.S. IT IS WITH LYFT.
HOW INTEGRAL IS THAT PARTNERSHIP FOR GROWING YOUR USER BASE? YOUR CEO IS SAYING IT IS ONLY A FRACTION OF THE OVERALL RESTAURANT INDUSTRY. RAVI: WE ARE EXCITED ABOUT THE PARTNERSHIP WITH LYFT. WE THINK IT IS AN OPPORTUNITY TO MAKE DASH PASS EVEN MORE VIABLE. 60 MILLION-PLUS SUBSCRIBERS
HAVE SAVED $10 MILLION GLOBALLY. IT HELPS CONSUMERS SAVE EVEN MORE. THE CORE FOCUS CONTINUES TO BE TO IMPROVE. THE PLATFORM THAT IS WHERE WE SEE THE MAJORITY OF THE GROWTH. ED:
RAVI, COMBINING RIDE HAILING WITH DELIVERY OF FOOD AND GROCERIES SENSE A LOT LIKE WHAT UBER DOES. THERE IS INTERESTING ANALYSIS TO BE DONE OF WHAT YOU ARE THRIVING BUT UBER PRINTED RESULTS THAT SHOW THE CONSUMER IS CAP IT IN THE R-- TEPID IN THE RIDE-HAILING CONTEXT. IN THE GIG ECONOMY WORLD, WHY IS IT YOU ARE SUCCEEDING? RAVI: THERE IS SO MUCH MORE THAN RESTAURANTS.
JUST A COUPLE MONTHS AGO WE WERE RUNNING FOR BACK TO SCHOOL AND WE USE DOORDASH FOR BACK-TO-SCHOOL SUPPLIES FOR BOTH OF OUR KIDS. WE WANTED TO TAKE AWAY THE WORRY OF HAVING A TO-DO LIST. WE WANT DOORDASH TO BE YOUR LOCAL COMMERCE TO DO LIST. LOCAL COMMERCE IS A LARGE
OPPORTUNITY DELIVERIES IS THE MOST FREQUENT USE CASE. PEOPLE QUARTER FROM LOCAL STORES MORE THAN ANY OTHER ACTIVITY, AND WE ARE THE LEADERS IN THAT SPACE. WE ARE BRINGING THE BEST OF LOCAL NEIGHBORHOODS TO YOUR DOORSTEP. CAROLINE: LET'S TALK A LITTLE BIT MORE ABOUT THE GEOGRAPHY OF WHERE YOU WANT TO BE EXPANDING. IS IT ABOUT SPENDING POWER OR GEOGRAPHY WHEN IT COMES TO A DEAL LIKE THE ONE WE SEE WITH LYFT? HOW DO YOU EXTRAPOLATE THAT TO POTENTIALLY INTERNATIONAL GEOGRAPHY GROWTH AS WELL? RAVI: WE OPERATE IN OVER 30 COUNTRIES.
A INTERESTINGN THING IS HE EVEN IN ALL THE COUNTRIES, WE ARE NOT IN ALL THE CITIES. OUR FOCUS CONTINUES TO BE TO BUILD THE BEST PRODUCT POSSIBLE NOT JUST FOR CONSUMERS, FOR MERCHANTS AS WELL AS DASHERS. WE ANNOUNCED A COMMERCE PLATFORM FOR MERCHANTS THAT CONTINUES TO DO WELL. WE ARE THE FASTEST GROWING FROM A GROCERY PERSPECTIVE. WE ARE GETTING SHARE COMPARED TO PEERS. OUR GOAL IS TO EXPAND TO ALL THINGS WITHIN LOCAL COMMERCE.
ED: YOU ARE A TECHNOLOGY COMPANY AND YOU TALK ABOUT YOUR BUSINESS. GIVE ME ONE REASON WHY IT HELPS YOU STAND OUT, WHAT YOU ARE VERY GOOD AT THAT OTHERS AREN'T. RAVI: THERE ARE THREE LEGS TO THE STOOL. IT IS SELECTION, QUALITY, AFFORDABILITY. IT IS NOT ONE OR THE OTHER. IT IS A COMBINATION OF ALL THREE THINGS THAT CONSUMERS ARE ASKING FOR AND DRIVING SAME-STORE SALES GROWTH FOR MERCHANTS.
OVER 7 MILLION DASHERS HAVE DASHED WITH US THE LAST YEAR. WITH THE FASTEST GROWING FROM THE CONSUMER'S PERSPECTIVE AS WELL. CAROLINE: WE WANT TO THANK YOU FOR COMING IN AND SPELLING OUT THE EARNINGS OF A POTENTIAL -- DOORDASH CFO RAVI INUKONDA. WE WILL BE SPEAKING WITH THE TWILIO CEO ON THE HEELS OF THE COMPANY'S QUARTERLY EARNINGS REPORT. ED, WHAT ARE YOU LOOKING AT? ED:
QUICK CHECK ON EBAY. THE STOCK DOWN MORE THAN 8%. THE FULL COST OF THE KEY HOLIDAY PERIOD WAS LACKLUSTER. I THINK IT IS AN INTERESTING ONE BECAUSE WE TALKED ABOUT DOORDASH AND UBER IN THEIR FINAL THREE MONTHS OF THE YEAR. EVERYONE -- THERE IS SINGLES ABOUT CONSUMER BEHAVIOR THAT INVESTORS DO NOT LIKE WHAT EBAY SAYING. THIS IS "BLOOMBERG TECHNOLOGY."
ED: CLOUD COMMUNICATIONS PLAYER TWILIO'S THIRD-QUARTER EARNINGS BEAT ESTIMATES, AND THE COMPANY HAS RAISED ITS FULL-YEAR REVENUE OUTLOOK. HERE WITH TWILIO CEO KHOZEMA SHIPCHANDLER. THERE HAS BEEN THIS RESTRUCTURING SINCE YOU CAME IN AS CEO, OR JUMPED TO CEO. WHICH IS WORKING BEST? KHOZEMA, I WOULDN'T CALL IT RESTRUCTURING. IT IS STEADY PROGRESS, VERY GOOD FINANCIAL DISCIPLINE, OPERATING RIGOR, A LOT OF INNOVATION FOCUS.
WHAT YOU ARE STARTING DISEASE THAT SHOW UP IN TERMS OF ACCELERATED GROWTH -- STARTING TO SEE IS THAT SHOW UP IN TERMS OF ACCELERATED GROWTH. WE ARE STARTING TO BECOME A BENEFICIARY OF THE AI WAVE. ED: LET'S EXPAND ON THE INNOVATION PART THE BACK STORY WITH TWILIO WAS INVESTORS WANTED TO SEE DISCIPLINE AND A GROWTH PLAN. WHAT YOU ARE DOING THINGS IN THE WORLD OF TECHNOLOGY THAT MATTER. KHOZEMA: I THINK YOU ARE STARTING TO SEE
MARGINS REALLY IMPROVE OVER THE LAST SEVERAL YEARS, WHICH IS EXCITING FOR INVESTORS, CERTAINLY EXCITING FOR US. ON TOP OF THAT, WE HAVE SEEN A REAL RETURN TO INNOVATION. WE ARE MAKING SOME REALLY FOCUSED BETS IN TERMS OF WHERE THE INNOVATION LIES, AND FOR US IT IS ABOUT DELIVERING FOR CONSUMERS VIS-À-VIS OUR CUSTOMERS PERSONALIZATION AT SCALE. WITH THAT REALLY MEANS IS HOW
DO WE COMBINE COMMUNICATIONS PLUS CONTEXTUAL DATA PLUS AI TO DELIVER THESE AMAZING CONSUMER EXPERIENCES THROUGH DIGITAL INTERACTION. ED: THROUGH THE MAGIC OF TELEVISION YOUR RFB HAS POPPED OUT. FEEL FREE TO POP IT BACK INCOME AND I WILL POINT OUT THAT ANALYST SEE A CLEARER FUTURE. DO YOU THINK THAT IS FAIR, A LONGER-TERM PATH YOU? KHOZEMA: I THINK SO. WE FEEL OPTIMISTIC ABOUT OUR LONG-TERM AMBITIONS. WE WANT TO BALANCE THE ABILITY TO GROW THE COMPANY AS WELL AS DRIVE ONGOING PROFITABILITY AND FREE CASH FLOW. FINDING THE BALANCE IS THE
TRICK. AS I LOOK OUT AND SEE WHAT IS HAPPENING IN THIS AGE OF AI, WE WILL BE ONE OF THE BENEFICIARIES. CAROLINE: LET'S TALK ABOUT MONETIZING THE AI. MORGAN STANLEY SAYS IT IS ENCOURAGING WITH THE AI PRODUCT INTEGRATION, BUT THEY WANT TO SEE MONETIZATION. HOW DO YOU TURN THAT ON? KHOZEMA: I THINK THE WAY IT HAPPENS IS WE HAVE THIS GREAT DATA ACID WE BOUGHT SEVERAL YEARS AGO--DATA ACID WE BOUGHT SEVERAL USE AGO. ON A STANDALONE BASIS ITS
RELATIVELY SMALL PIECE OF REVENUE FOR THE LONG-TERM PLATE, IS WHAT IT DOES IS EXTRACT CONTEXTUAL DATA OUT OF THE BUSINESSES WE SERVE, AND OUR ABILITY TO COMBINE THAT WITH COMMUNICATIONS CAPABILITIES AND THEN USE A LITTLE BIT OF AI TO CREATE THAT AWESOME CONSUMER OUTCOME ON THE OTHER SIDE. THAT IS WHAT WE ARE GOING FOR. WHAT IT MEANS IS WHETHER IT IS YOU, THE TWO OF US, THOUSANDS OF OTHER CONSUMERS ALL AT THE SAME TIME, US BEING ABLE TO ACHIEVE THAT PERSONALIZATION AS IF A BUSINESS KNOWS EVERY SINGLE THING ABOUT US IN THE WAY THEY INTERACT WITH US, THAT IS WHAT WE UNLOCK. CAROLINE: IT IS INTERESTING YOU BRING UP THAT SEGMENT PART, BECAUSE THAT WAS THE AREA OF THE BUSINESS THAT ACTIVIST INVESTORS WANTED YOU TO SHIRK. THERE IS WEAKNESS WITHIN IT. ARE YOU STANDING BY THE DECISION TO KEEP IT AS PART OF TWILIO? HOW DO YOU TELL A STORY GOING FORWARD? KHOZEMA: I MEAN, LOOK, WE HAVE MADE PROGRESS IN THAT BUSINESS.
WE MADE A NUMBER OF COMMITMENTS AND THE START OF THE YEAR IN TERMS OF WHAT WE INTENDED TO DO TO IMPROVE THE ONGOING PERFORMANCE OF THE BUSINESS. WE'RE VERY MUCH ON TRACK TO GET THE BUSINESS TO BREAKEVEN. WE MADE A NUMBER OF IMPROVEMENTS IN THE MARKET CAPACITY OF THE BUSINESS. IT IS NOT LIKE OUR WORK IS DONE YET. IT CONTINUES APACE. IT IS IMPORTANT TO REMEMBER
THAT IS LESS THAN 7% OF OUR REVENUES OVERALL. WHEN YOU CONSIDER IT IN THE TOTALITY OF TWILIO, THE BUSINESS GROWTH IS WEAK SALADIN, THE MARGINS HAVE BEEN FANTASTIC, FREE CASH FLOWS ARE ACTIVATING. NOW IT BECOMES AN ACTIVATION ENGINE FOR AI USING DATA AND COMMUNICATIONS. ED: THE STOCK IS UP 15%, ON TRACK FOR THE BIGGEST JUMP SINCE 2022. I KNOW THIS IS A TECHNOLOGY
SHOW AND THAT MANY EXECUTIVES ARE DISCIPLINED BY TALKING ABOUT STOCK, BUT THE MARKET IS REWARDING YOU HERE. WHAT DO YOU MAKE OF IT? KHOZEMA: I THINK WE ARE MAKING STEADY PROGRESS. WE ARE NOT NECESSARILY FOCUSED ON THE DAY-TO-DAY MOVEMENT OF THE STOCK PRICE. THIS IS THE LONGER GAME WE FUNDAMENTALLY PLAYING HERE. THE AGE OF AI IS GOING TO PLAN FOR A LONG TIME TO COME.
THAT IS WHAT WE ARE EXCITED ABOUT. HOW CAN WE DELIVER FOR CUSTOMERS IN A VERY PERSONALIZED WAY, USING COMMUNICATIONS PLUS CONTEXTUAL DATA PLUS AI TO DELIVER THOSE AMAZING CONSUMER CAROLINE: TWILIO CEO KHOZEMA SHIPCHANDLER, THANK YOU FOR JOINING US. ROADBLOCK IS HAVING EARNINGS OF 17%, THE BEST MOVE WE'VE HAD IN AT LEAST A YEAR. THEY BEAT ANALYST EXPECTATIONS, THEY ARE BOOSTING THEIR GUIDANCE, REPORTING $1.1 MILLION IN BOOKINGS, 30 FOUR, PERCENT INCREASE AT THE USER BASE SURGED. ALL EYES ON THOSE NUMBERS BEING ANALYZED BY SHORT-SELLERS. FROM NEW YORK, FROM SAN
FRANCISCO, THIS IS "BLOOMBERG TECHNOLOGY." ♪ >> WELCOME BACK TO "BLOOMBERG TECHNOLOGY." ED: THERE’S A LOT TO FIT IN. WE’RE ENTERING ELECTION WEEK. THERE’S VULNERABILITY IN CRYPTO ASSETS AND MARKETS TIED TO THAT BUT IT’S NOT CLEAR WHETHER THEY’LL BENEFIT OR NOT. WE’LL CONTINUE TO TRACK. IT MICROSTRATEGY, A GAME THAT HOIDS BITCOIN IN PARTICULAR IN ITS BALANCE SHEET AND HAS PLEDGED TO BUY MORE BITCOIN BUT SAW A LOSS IN THE QUARTER, ONE OF THE FIRST COMPANIES TO DO THAT, BY THE WAY.
WHEN WE THINK ABOUT BITCOIN, VOLATILITY, YES, BUT STILL ABOVE $07,000 PER TOKEN, THEN THERE’S THE MEGACAPS. MUCH TO DISCUSS WITH THEM. CAROLINE: YEAH. SO MUCH ON THE MEGACAPS. LET’S TALK ABOUT MICROSOFT EARNINGS. WANT TO GET BACK TO IT. BECAUSE IT UNDERWHELMED. THE FORECAST OF GROWTH FROM
ADISEUR PERHAPS LETTING THE -- ACAN ZURE -- AZURE PERHAPS LETTING THE COMPANY DOWN A LITTLE BIT. >> 10 BILLION DOLLARS NEXT QUARTER WHICH WILL MAKE IT THE FEAFT OF THE BUSINESS IN -- FASTEST BUSINESS IN OUR INDUSTRY. CAROLINE: THAT’S BIG TALK. MICROSOFT IS SUCH AN INTERESTING ONE BECAUSE THE QUARTER LOOKED GREAT, THEY’RE SEEING AZURE GROWTH BACK AT 34%. THEN THE FORECAST WAS A LITTLE BIT WEAKER. AND IT SEEMS TO BE CAPACITY THAT’S LIMITED HERE. WHAT DO YOU MAKE OF IT? >> LOOK AT THE GOOGLE CROWD GROWTH.
ALL THESE VENDERS ARE GROWING. THE CORE BUSINESS IS GROWING NORTH OF 20%, WHEN YOU TAKE OUT THE A.I. ELEMENT. IN THE CASE OF GOOGLE CLOUD, WE SAW THE GROWTH ACCELERATE TO 35%. AND THAT WAS ALL POWERED BY A.I. IN THE CASE OF MICROSOFT, THEY DID SOME RESEGMENTING, SO THEY TOOK OUT SOME PORTION AND IT’S NOT A VERY CLEAN NUMBER TO SEE, OK, A.I. CONTRIBUTION WAS 12 PERCENTAGE POINTS AND THAT’S WHERE, YOU KNOW, WHETHER IT’S HELPED GOOGLE CLOUD, IT’S NOT VERY CLEAR, BECAUSE OF THE RESEGMENTING, BUT NET-NET, YOU KNOW, THEY CALLED OUT SUPPLY SHORTAGES, WHEN CAP X IS GROWING 50%. THAT’S WHERE YOU HAVE TO ASK YOURSELF, WHAT IS THE CAP X BEING SPENT ON? IF YOU DON’T HAVE ENERGY, ARE THEY SPENDING MORE ON FACILITIES? IT’S HARD TO PARIS THAT OUT -- PARSE THAT OUT.
GOOGLE CALLED THAT OUT. IT WILL BE INTERESTING TO SEE WHAT AMAZON DOES TONIGHT IN TERMS OF THEIR NVIDIA LOCATION AND HOW THEY ARE FRAMING THE CAPACITY SHORTAGES WHEN IT COMES TO THE ADVANCED ACCELERATORS. BUT THAT’S WHAT IT COMES DOWN TO. IS HOW MUCH CAPACITY DO YOU HAVE AVAILABLE FOR EXTERNAL USE VERSUS WHAT IS OPEN A.I. CONSUMING INTERNALLY FOR TRAINING? ED: A LOT OF THAT IS GEARED TOWARD THE ENTERPRISE BUSINESS, RIGHT? WITH MICROSOFT, THIS IS A COMPANY THAT’S BEEN WONDERFUL AT SELLING SOFTWARE TO CONSUMERS AS WELL.
PARTICULARLY SOFTWARE THAT SOMETIMES YOU CAN GET FOR FREE. ON OTHER PLATFORMS. DID YOU GET ANY SENSE OF THE TRAJECTORY OF CONSUMER ADOPTION FOR THESE KIND OF A.I. IMPROVED OFFICE 365 AND PRODUCTS LIKE THAT? >> VERY UNLIKELY. I DON’T THINK THEY WANT TO
FOCUS ON CONSUMER RIGHT NOW. BECAUSE THE INTERSURPRISE OPPORTUNITY IS SO BIG -- ENTERPRISE OPPORTUNITY IS SO BIG. THEY CALLED OUT SEPARATE PRODUCTS, CO-PILOT, STUDIO, SO THEY ARE CREATING, YOU KNOW, THAT BUNDLE THAT MICROSOFT IS SO GOOD AT SELLING. AND I’M SURE THEY’LL GET A LOT OF TRACTION. BUT IN TERMS OF SEPARATE A.I.
CONTRIBUTION WHICH IS WHAT I THINK META GOT PENALIZED FOR LAST NIGHT, AS NOT HAVING THAT SEPARATE A.I. CONTRIBUTION, EVEN THOUGH IT’S GETTING REFLECTED IN THEIR FAMILY OF APPS, THAT’S WHAT INVESTORS ARE FOCUSED ON BECAUSE THE CAP X INCREASES ARE SO BIG AND THESE COMPANIES KEEP CALLING OUT SCALING. SO YOU HAVE TO FIND THAT CEILING, HOW MUCH WILL THAT CAP KEEP GOING UP? CAROLINE: THE TRANSPARENCY, YOU HELP BRING IT. THANK YOU. COMING UP, TECH BILLIONAIRES, THEY CONTINUE TO THROW THEIR WEIGHT IN THE U.S. ELECTION. AS THE D-DAY APPROACHES, WE
SPEAK WITH REID HOFFMAN. THAT’S NEXT. ED: LET’S GO BACK TO EARNINGS. THERE’S SO MUCH GOING ON. YOU DID SUCH A GREAT JOB SUMMARIZING -- ANNOUNCER: BLOOMBERG TELEVISION IS BROUGHT TO YOU BY EMPOWER. TAKE CONTROL OF YOUR FINANCIAL FUTURE AND EMPOWER WHAT’S NEXT. GET YOUR FREE DASHBOARD AT EMPOWER.COM. FEST. CHECK OUT THE "BLOOMBERG TECHNOLOGY"
PODCAST. THIS IS BLOOMBERG. ♪ D ED: AS THE ELECTION APPROACHES, LEADING VOICES IN TECHNOLOGY AND VENTURE CAPITAL ARE THROWING THEIR WEIGHT BEHIND PREFERRED CANDIDATES. LIKE ELON MUSK APPEARING AT A DONALD TRUMP RALLY THIS PAST WEEKEND. TODAY ON "BLOOMBERG TECHNOLOGY," WE’RE GOING TO SPEAK WITH REID HOFFMAN. YOU PERHAPS KNOW HIM BEST AS THE CO-FOUNDER OF LINKED IN.
BUT HE’S ALSO PART OF A GROUP OF VIL CON VALLEY INVESTORS THAT ARE IMMERSED IN THIS PRESIDENTIAL ELECTION, RALLYING BEHIND HIS OR THEIR FAVORITE CANDIDATE IN THE RACE, KAMALA HARRIS. REID HOFFMAN JOINS US NOW. THANK YOU FOR YOUR TIME IN COMING ON BLOO "BLOOMBERG TECHNOLOGY." THE PITCH WAS TO KEEP THIS FOCUSED ON TECH. SO I WOULD LIKE TO ASK YOU, WHY
IS KAMALA HARRIS THE BEST CANDIDATE FOR THE TECHNOLOGY INDUSTRY AND VENTURE CAPITALISTS AROUND THE U.S.? >> WELL, SO, WHAT THE TECH INDUSTRY NEEDS IS KIND OF A STABLE ENVIRONMENT IN ORDER TO KIND OF FOLLOW THE RULES AND PROSPER IN. AN ABILITY, BY THE WAY, ONE THING THE TECH INDUSTRIES BRINGS TO THE U.S. IS A KIND OF -- IT’S ONE OF OUR MOST SUCCESSFUL GLOBAL INDUSTRIES. WHERE MOST OF, FOR EXAMPLE, THE LARGE TECH COMPANIES GET THE VAST MAJORITY OF THEIR REVENUES OVERSEAS, LIKE THE MAJORITY, DEPENDS ON THE BUSINESS. AND SO GOOD GLOBAL RELATIONS IN ADDITION TO STABILITY, AND AN ABILITY TO KIND OF KNOW THAT YOU’RE FOLLOWING A RULE OF LAW VERSUS WHAT I THINK OF AS GRISTER CAPITALISM.
ALL OF THAT LEADS TO LIKE THE REASON WHY I AND OTHERS LIKE ME SUPPORT VICE PRESIDENT HARRIS FOR PRESIDENT. BECAUSE I THINK THOSE ARE THE MORE FUNDAMENTAL THINGS THAN WHETHER OR NOT A CORPORATE TAX RATE GOES UP OR DOWN A LITTLE. OBVIOUSLY THOSE CAN BE IMPORTANT IN OTHER TIMES FOR BUSINESS. BUT THAT’S THE REASON WHY, I THINK, WITHIN THE TECHNOLOGY INDUSTRY, I THINK IT’S A FAIRLY CLEAR CHOICE. ED: WE RECENTLY HAD S.E.C. CHAIR GO AGAINST HER ON THE -- ON THE PROGRAM AND A PART OF THE CONVERSATION FOR BOTH CANDIDATES IS CONTINUITY AT THE F.T.C. AND THE S.E.C. YOU’VE SPOKEN PUBLICLY I THINK ABOUT BOTH ALREADY. BUT WHAT IS YOUR LATEST
POSITION ON THOSE TWO ROLES, IF KAMALA HARRIS WERE TO CONTINUE IN THE WHITE HOUSE, DUE TO THEIR IMPACT ON THE TECHNOLOGY INDUSTRY? >> WELL, LET’S SEE. SO, FIRST, SINCE I’VE SPOKEN -- BECAUSE I GET ASKED A LOT ABOUT LENA, I’VE SPOKEN MORE ABOUT LENA KAHN. ONE MISCONCEPTION TO CLEAR UP IS I’VE NEVER TALKED TO KAMALA HARRIS OR ANYONE IN THE WHITE HOUSE ABOUT LENA KAHN. SO THIS IS ENTIRELY A PRESS SET OF STORIES WHERE I’M ASKED ABOUT MY POINT OF VIEW. I THINK SHE’S DONE A VERY GOOD JOB ON A NUMBER OF THINGS. THE ANTI-COMPETE STUFF. THE CLICK TO CANCEL AND
SUBSCRIPTIONS, A NUMBER OF THINGS. ON M.N.A., SPEAKING AS A PARTNER AT GRAYLOCK AND A SILICON VALLEY PERSON WHO INVESTS IN COMPANIES TRYING TO CREATE THE NEXT GENERATION OF LARGE TECH COMPANIES, HER KIND OF WAGING WAR ON M.N.A. IS ACTUALLY IN FACT AS UNHELPFUL TO THE TECH INDUSTRY. IT ACCOMPLISHES SOMETHING DIFFERENT THAN WHAT SHE THINKS SHE’S ACCOMPLISHING. SHE THINKS SHE’S TRYING TO ACCOMPLISH THE, YOU KNOW, KIND OF THE LIMITATION OF THE GROWTH OF THE LARGE TECH COMPANIES AND ACTUALLY IN FACT SHE’S CAUSING A LACK OF FUNDING FOR ANY OF THE COMPANIES THAT MIGHT POTENTIALLY COMPETE WITH THEM. SO THAT’S A DIFFERENT THING. THAT’S THE LENA KAHN WHICH I STILL HAVE THE SAME POINT OF VIEW AND WHEN ASKED ABOUT IT, I WILL CONTINUE TO SAY THAT.
GARY GENSLER, I THINK THE QUESTION, AND I KNOW GARY, I’VE TALKED TO HIM FROM THE M. I.T. DAYS, IS HOW DO YOU KIND OF SHIFT KIND OF AN APPROACH TO CRYPTO THAT’S LESS KIND OF HIT WITH STICK AND MORE OF A HERE’S THE SET OF RULES THAT WE CAN SET OUT THAT WOULD CREATE A BENEFICIAL TECHNOLOGICAL INVESTMENT THAT HELPS U.S. POSITION IMLOABLY? -- GLOBALLY? I THINK IT’S BEEN UNEVEN AND SO I WOULD HOPE THAT, YOU KNOW, VICE PRESIDENT HARRIS WHO GREW UP WITHIN THE CALIFORNIA TECH COMMUNITY UNDERSTANDS THE IMPORTANCE OF THIS KIND OF RULE OF LAW, YOU KNOW, KIND OF EQUAL BASIS, INNOVATION ECONOMY. SHE TALKED ABOUT, YOU KNOW, KIND OF INNOVATION OPPORTUNITIES. SHE’S THE ONLY PRESIDENTIAL CANDIDATE IN U.S. HISTORY WHO SPOKE ABOUT THE IMPORTANCE OF FOUNDERS AND SO I HOPE THAT SHE WOULD BRING KIND OF A MORE INNOVATION-FORWARD POINT OF VIEW HERE AND WOULD ANTICIPATE THAT. CAROLINE: AN INNOVATION-FORWARD
PERSPECTIVE. IS THAT THE KEY DIFFERENCE THAT YOU ANTICIPATE IF HYPOTHETICALLY WE HAD A HARRIS ADMINISTRATION, A DIFFERENCE FROM THE CURRENT BIDEN ADMINISTRATION? AND WHERE ELSE MIGHT SHE DIFFER? >> I THINK -- SO SHE HAS ALWAYS BROUGHT A CERTAIN -- BECAUSE TALKED TO HER OVER THE YEARS AND THIS, INTELLECTUAL CURIOSITY TO WHAT’S GOING ON IN THE TECH INDUSTRY. HOW THAT CAN HELP EVERYONE AMERICANS, HOW THAT CAN HELP THE REST OF AMERICAN INDUSTRY. SO IT’S KIND OF LIKE, LOOK, I
REALIZE THAT THE TECH INDUSTRY IS ABOUT INNOVATION AND BUILDING NEW THINGS AND THOSE BUILDING NEW THINGS, NEW PRODUCTS AND SERVICES, BUT THEY’RE ALSO WAYS THAT CAN HELP ALL OF AMERICA. THOSE ARE THE QUESTIONS THAT SHE’S ASKED. NOW, BIDEN, WHO HAS DONE A NUMBER OF GREAT THINGS IN HIS PRESIDENCY, YOU KNOW, HE’S CONTROLLED INFLATION BETTER THAN POST-COVID THAN ANY OTHER KIND OF FIRST-WORLD COUNTRY. AND HAS DONE A NUMBER OF VERY GOOD THINGS. BUT HE’S NOT BEEN AS ENGAGED WITH THE TECH INDUSTRY. WHEREAS I THINK VICE PRESIDENT HARRIS, INCLUDING, YOU KNOW, KIND OF IN HER VERY ACCEPTANCE SPEECH, HAS BEEN AND SO I THINK THAT THAT KIND OF HOW DO WE ENGAGE IN THE CONVERSATION. LOOK, FOR EXAMPLE, AT WHAT THEY
DID IN THE ARTIFICIAL INTELLIGENCE REGULATION AND EXECUTIVE ORDER PROCESS. SHE RAN THAT. FIRST THING SHE DID, SHE BROUGHT ALL THE COMPANIES INTO THE WHITE HOUSE TO SAY, HEY, WE REALLY NEED YOU GUYS TO BE GOING FOOT FORWARD ON SAFETY AND REGULATION, WHAT KIND OF THINGS CAN YOU VOLUNTARY COMMIT TO? I TALKED TO THE FOLKS WHO WERE THERE, SHE PUSHED THEM VERY HARD ON THAT. THEN SHE LOOKED AT, OK, SO THIS IS WHAT THEY CAN COMMIT TO. HERE’S WHAT WE CAN PUT INTO AN
EXECUTIVE ORDER LAW. HERE’S WHAT WE CAN DO TO ONGOING MONITOR WHAT HAPPENED AND LEAVE ROOM FOR INNOVATION. THAT’S WHAT I EXPECT ACROSS HER APPROACH IN THE ENTIRE TECHNOLOGY INDUSTRY WITH A.I. AS THE INSTANCE OF IT. CAROLINE:
LET’S GO TO THE OTHER HYPOTHETICAL. BECAUSE SHE’S ENGAGING AT THE MOMENT WITH THE TECH COMMUNITY. BUT MANY WOULD SAY THAT TRUMP HAS VERY MUCH ENGAGED WITH THE TECHNOLOGY COMMUNITY WITH THE AMOUNT THAT HE’S HAVING ELON MUSK ONSTAGE. IF WE SEE MUSK TAKING A BIGGER ROLE WITHIN A FUTURE ADMINISTRATION, WHAT DOES THAT MEAN FOR YOU AND ULTIMATELY FOR THE RELATIONSHIP THAT SILICON VALLEY HAS WITH ELON MUSK? >> I THINK IT DEPENDS ON WHAT THE TRUMP ADMINISTRATION, WHAT ELON DOES. I THINK THE TRUMP, YOU KNOW,
TRUMP AND TRUMP PRESIDENCY ONE, HIS EARLY PRESIDENCY, HAS SHOWN A CERTAIN AMOUNT OF GRIFTER CAPITALISM. TRYING TO PENALIZE HIS OPPONENTS, USING THE INSTRUMENTS OF STATE. OBVIOUSLY WE SAW THAT HAPPEN WITH AMAZON, WHICH PROBABLY -- NO INSIDE KNOWLEDGE, PROBABLY CORRELATED WITH BEZOS FOR BIDDING "THE WASHINGTON POST" FROM ISSUING A SUPPORT STATEMENT. IF YOU’RE GOING TO BE INDIVIDUAL COMPANY RETALIATORY, IT’S PART OF WHAT MIGHT UNDERLIE A TARIFFS REGIME, I CAN CHOOSE WHO I’M DOLLING OUT FAVORS TO, THAT DOES NOT CREATE A GOOD, STABLE ENVIRONMENT FOR INVESTING IN KIND OF LIKE, HOW DO YOU INVEST IN AN OVERALL INDUSTRY AND ECOSYSTEM? THEN THE QUESTION WOULD COME DOWN WITH ELON, OBVIOUSLY ELON’S BUSINESSES HAVE GREAT TIES TO GOVERNMENT. THE WHOLE SPACE BUSINESS IS DEEPLY TIED TO REGULATION AND KIND OF GOVERNMENT CONTRACTS. AUTOMOBILES IS ALSO TIED TO A BUNCH OF REGULATORY FRAMEWORKS.
OBVIOUSLY WHAT’S GOING ON WITH KIND OF MEDIA AND INFORMATION HAS TIES THERE TOO AND I THINK UNFORTUNATELY X.COM IS THE PRIMARY SUPPORTER OF CONSPIRACY THEORIES AND OTHER KINDS OF THINGS. WHICH IS A SERIOUS PROBLEM. ALL OF THAT, THE QUESTION IS, ALL RIGHT, WELL, DOES IT CONTINUE TO BE GRIFTER CAPITALISM WHICH IS CALLING OUT THE SPECIFIC COMPANIES, OR IS IT RULE OF LAW? ED: REID, ON X AND CONSPIRACY THEORIES, BLOOMBERG DID A DEEP REPORT, A DATA-BASED PIECE OF INVESTIGATIVE JOURNALISM ON THAT RECENTLY AND IN THAT SEGMENT ON THE SHOW WHICH YOU CAN FIND ON YOUTUBE, WE GAVE X’S POINT OF VIEW WHICH IS THAT THEY DISAGREE WITH THAT AND IF YOU ALLOW ME TO, I’VE INVITED ELON MUSK ONTO THIS PROGRAM MANY TIMES AND YOU’RE HERE AND HE’S NOT. SOMETHING’S DIFFERENT IN THIS ELECTION. YOU’RE A WELL-KNOWN PERSON IN
THE WORLD OF TECHNOLOGY BUT THERE ARE OTHERS ON BOTH SIDES WHO ARE SPEAKING OUT IN MY EXPERIENCE MORE PROMINENTLY THAN PREVIOUSLY. HAVE THERE BEEN ANY NEGATIVE CONSEQUENCES OF THAT? FOR EXAMPLE, IF YOU’RE A RENTURE CAP -- VENTURE CAPITALIST OR C.E.O., THAT’S PUBLICLY SPEAKING ABOUT YOUR POLITICAL ORIENTATION AND YOUR SUPPORT OF A CANDIDATE, HAS RESULTED IN A LOSS OF OPPORTUNITY IN DEALS OR WHATEVER IT MAY BE? >> I’VE SEEN -- I THINK -- IN SOMETHING THAT’S THIS FRAUGHT, I DON’T THINK IT’S JUST RETALIATION IN BUSINESS CIRCUMSTANCES FROM FOLKS WHO ARE SUPPORTING TRUMP LIKE I SAW, YOU KNOW, KIND OF WHEN V.C.’S WERE SPEAKING OUT, SOME L.P.’S WERE VERY SUPPORTIVE OF TRUMP.
NOT AT GREYLOCK, BUT IN OTHER FIRMS. KIND OF WITHDREW THEIR SUPPORT FROM THE VENTURE FIRMS. I’VE SEEN OTHER KINDS OF THINGS WHERE PEOPLE KIND OF -- BUSINESS RELATIONSHIPS HAVE SOURED BECAUSE OF IT. WHICH I THINK IS VERY UNFORTUNATE. I THINK THE PART OF WHAT WE SHOULD ASPIRE TO AS AMERICANS AND AS BUSINESS PEOPLE IS TO KIND OF SAY, HEY, LOOK, WHAT WE SHOULD DO IS SAY, WHAT’S THE THING THAT WE DO TO MAKE AMERICAN BUSINESS AND AMERICAN INDUSTRY BETTER? I’VE HEARD OF REPUBLICAN SENATORS TRASH TALKING ME INTERNATIONALLY WHERE YOU THINK THEY’D BE SUPPORTIVE OF AMERICAN BUSINESS PEOPLE.
SO I THINK THAT THERE IS -- I THINK THERE ARE CONSEQUENCES OF IT, WHICH I THINK IS UNFORTUNATE. BUT I THINK IT’S MORE IMPORTANT TO BE KIND OF PATRIOTIC ABOUT WHAT IS GOOD FOR AMERICA, AMERICAN INDUSTRY, AND AMERICAN SOCIETY, EVEN WHEN YOU HAVE THIS FEAR. CAROLINE: LET’S TALK ABOUT THE SOURING OF CERTAIN RELATIONSHIPS. THE FIRST ONE THAT COMES TO MY MIND IS THE SOURING OF THE RELATIONSHIP OF WHO WAS A CO-FOUNDER OF OPEN A.I., ELON MUSK, AND NOW OPEN A.I., MORE EXPLICITLY IN ITS NEW FORM. YOU HAVE SPOKEN TO SAM ALTMAN ABOUT THE WORRIES OF ELON MUSK WHO SEEMS TO HAVE A DISLIKE FOR THE BUSINESS? IF HE TOOK A MORE PROMINENT ROLE WITHIN THE ADMINISTRATION, WHAT WOULD IT LOOK LIKE FOR A.I. MORE BROADLY TO HAVE ELON MUSS
INCOME A POSITION OF POWER? -- MUSK IN A POSITION OF POWER? >> ONE OF THE THINGS THAT I WOULD WORRY ABOUT IF ELON TOOK A MORE PROMINENT ROLE IS THAT HE WOULD VIEW THAT THE ONLY REAL SUCCESS FOR THE A.I. INDUSTRY IS IF HE’S DOING IT. THIS IS PART OF THE QUESTION AROUND THE FACT THAT HE’S KIND OF DOING THESE BASELESS LAWSUITS AGAINST OPEN A.I. THAT ARE KIND OF LIKE, WELL, I GAVE MONEY FILL THROPICALLY AND I SHOULD GET A CUT OF WHAT THEN TURNS INTO COMMERCIAL. WHICH IS BY THE WAY ILLEGAL. RIGHT? AND SO THAT KIND OF ISSUE MIGHT THEN REAR ITS HEAD IN THIS KIND OF TRADITION OF, YOU KNOW, KIND OF TRUMP’S GRIFTER CAPITALISM.
I WOULD HOPE THAT ACTUALLY IN FACT IF ELON WERE TO ACCEPT A ROLE, THAT HE WOULD GO, LOOK, WHAT I CARE ABOUT IS ALL OF -- THE TECH SECTOR, AMERICAN INDUSTRY, NOT JUST MY OWN EFFORTS. AND I THINK SWREED TO SEE -- WE’D HAVE TO SEE WHAT WOULD PLAY OUT THERE. ED: THE LATEST ON THE LITIGATION BETWEEN THE TWO I BELIEVE IS OCTOBER 8 WHEN OPEN A.I. ACCUSED ELON MUSK OF HARASSMENT IN THAT LEGAL FIGHT. AGAIN, WE’VE COVERED IT ON THIS PROGRAM AND WE’LL GO BACK TO IT. IS A.I. AND REGULATION OF A.I.
BEING DISCUSSED ENOUGH IN THIS ELECTION? BY EITHER CANDIDATE? >> WELL, I’M NOT SURE THAT IT’S THE MOST CENTRAL THING FOR KIND OF THE GENERAL AMERICAN SOCIETY AT THE MOMENT. I THINK HOW WE GET THE BENEFITS OF A.I. FOR AMERICAN INDUSTRY, AMERICAN SOCIETY, AMERICAN CONSUMERS, I THINK IS REALLY IMPORTANT. AND ONE OF THE THINGS ABOUT REGULATION IS IT TENDS TO SLOW DOWN INNOVATION, IT TENDS TO DELAY. I THINK OUR TOOLS FOR GETTING A MEDICAL ASSISTANT ON EVERY SMARTPHONE, A TUTOR ON EVERY SMARTPHONE, FOR EVERY AMERICAN AND MAYBE EVEN MORE GLOBALLY, I THINK THOSE ARE THE IMPORTANT THINGS TRYING TO GET TO AND THAT’S LESS OF A DISCUSSION ABOUT A.I. IN THE ELECTION. BUT MORE KIND OF -- WE SHOULD BE BUILDING TOWARDS THE FUTURE.
ED: IF FORMER PRESIDENT TRUMP WERE TO GET A SECOND TERM IN OFFICE, HOW ARE YOU PREPARING FOR THAT AND HOW DO YOU APPROACH IT WERE THAT TO BE THE CASE? >> WELL, IF THAT’S THE CASE, THEN I WOULD HOPE FOR THE FOLKS WHO HAVE ARGUED TO ME THAT, YOU KNOW, YOU SHOULDN’T ACTUALLY IN FACT TAKE PRESIDENT TRUMP’S WORDS SERIOUSLY, THE FACT THAT HE’S DECLARING LIKE A TARIFF WAR WHERE HE CAN DO INDIVIDUAL KIND OF GRIFTER CAPITALISM, THAT’S NOT WHAT HE’S GOING TO DO, HE’S GOING TO TRY TO BE MORE BUSINESS-FORWARD, MORE TECHNOLOGY-FORWARD AND YOU SHOULD NOT BE PAYING ATTENTION TO WHAT HIS WORDS ARE. I WOULD HOPE THAT THEY WOULD BE CORRECT. IF IT ENDS UP BEING WHAT I FEAR, WHICH IS ACTUALLY IN FACT KIND OF AN INDIVIDUAL KIND OF SWEATING VARIOUS BUSINESSES FOR HIS OWN POLITICAL FAVOR, I THINK THAT WILL AFFECT AMERICAN INDUSTRY IN A WAY THAT WILL AFFECT AMERICAN PROSPERITY. AND SO I THINK YOU HAVE TO -- YOU BUILD IN MORE RESILIENCE TO CHAOS AND UNCERTAINTY AND THAT’S WHAT YOU WOULD DO. OBVIOUSLY I’M VERY HOPEFUL THAT
VICE PRESIDENT HARLESS WIN THE ELECTION AND SO -- HARRIS WILL WIN THE ELECTION AND SO THEREFORE HAVEN’T DONE ENORMOUS CONTINGENCY PLANNING YET. CAROLINE: WE WANT TO THANK YOU SO MUCH FOR YOUR PERSPECTIVE TODAY. AS YOU DO INDEED BACK VICE PRESIDENT HARRIS FOR THE ADMINISTRATION AND FOR THE FUTURE. GREYLOCK PARTNER, REID HOFFMAN. WE APPRECIATE IT. ED: TODAY’S BIG TAKE FOCUSES ON HOW AMAZON IS WORKING TO MAKE ITS ALEXA DEVICES A FORCE IN ARTIFICIAL INTELLIGENCE. C.E.O.
ANDY JA IS, S -- JASSE IS EAGER TO TAKE ON THAT AMAZON CLAIMS IS ONE QUARTER OF U.S. HOUSEHOLDS BUT TECHNICAL CHALLENGES ARE SLOWING THE COMPANY DOWN. BLOOMBERG CO-WROTE THE BIG TAKE. WE ARE AN ALEXA HOUSEHOLD BUT I’M USING CHAT GPT FOR VOICE INPUT SO MUCH MORE. IT’S AN INCREDIBLE DI SECTION OF THE STRUGGLE AMAZON IS HAVING BRINGING ALEXA INTO THAT FIELD.
>> YEAH, IT’S PRETTY WILD. JUST THINK, IT’S BEEN ALREADY ALMOST TWO YEARS SINCE CHAT GPT LAUNCHED. MEANWHILE, MICROSOFT, GOOGLE, EVEN APPLE HAVE ROLLED OUT A LOT OF A.I. TOOLS AND YET WE HAVEN’T SEEN ANYTHING FROM AMAZON DESPITE THEM HAVING MORE THAN A DECADE LEAD IN THE CHATBOT SPACE. THEY’RE IN 500 MILLION-SOME HOUSEHOLDS WITH THEIR DEVICES BUT THEY’VE BEEN STRUGGLING TO MOVE THAT OLD ALEXA BRAIN TO SORT OF A NEW L.L.M., LARGE LANGUAGE MODEL, APPROACH. AND THEY’VE BEEN DEALING
INTERNALLY BASED ON THE SOURCES WE’RE TALKING TO WITH TONS OF I HAD LOSE NATIONS, STRUG -- HALLUCINATIONS, STRUGGLING WITH BASIC TASKS LIKE TURNING ON AND OFF LIGHT, AND WATCHING THIS COMPANY WHICH IS FAMOUS FOR DATA STRUCTURE, CLOUD COMPUTING WITH A.W.S. AND ALEXA REALLY FALL BEHIND IN THIS A.I. WAR AND THERE’S A LOT OF QUESTIONS OVER WHETHER OR NOT THEY’LL BE ABLE TO CATCH UP. CAROLINE: WHAT’S SO GREAT ABOUT THE WAY YOU WRITE IS YOU MAKE IT INTERESTING AND PERSONAL. WE ALL KNOW ANDY, OF COURSE, THE LEADER OF AMAZON, IS A BIG SPORTS FAN AND YOU TALK ABOUT HOW HE KEEPS PRODDING THE ALEXA WITH SPORTS QUESTIONS AND IT HALLUCINATES IN THAT RESPECT, PARTICULARLY ABOUT UP TO THE MOMENT RESULTS.
WHAT THEREFORE ARE WE SEEING IN TERMS OF FURTHER INVESTMENT? WHAT ARE WE SEEING IN TERMS OF EVENTUAL ROLLOUT? >> IT’S T.B.D. AT THIS POINT BUT OUR SOURCES INDICATE IT HAS BEEN PUSHED BACK. THERE WAS AN EARLY TARGET IN EARLY 2024, THEN IT WAS MOVED BACK MONTH BY MONTH. MOST RECENTLY IN OCTOBER THEY
WERE HOPING TO LAUNCH IT. THEY SCRAPPED THAT EVENT. AND THEY’VE REPLACED IT WITH A SMALLER KINDL ROLLOUT. SO SOURCES ARE TELLING US THIS COULD BE THEIR TARGET DEADLINE IS BEING KICKED BACK INTO 2025. WHICH REALLY PUTS THEM BEHIND THE BALL. BUT AGAIN, IT’S ALL THESE
TECHNICAL CHALLENGES THEY’RE FACING. IT’S NOT A MATTER OF NECESSARILY BUREAUCRACY OR SOME LACK OF OVERALL GOAL. THEY’RE REALLY MARSHALLING TROOPS TOWARD THIS AND RUNNING INTO CHALLENGES WITH, AGAIN, MAKING SURE SORT OF AN L.L.M. CAN DO BASIC TASKS LIKE, YOU KNOW, ALL THE TASKS THAT YOU ASKED IT TO DO AROUND YOUR HOME. L.L.M.
REAS NOT PARTICULARLY GOOD AT THAT. AND WITH THE HALLUCINATIONS, WITH ALL THESE DEVICES IN HOMES WITH FAMILIES AND KIDS, YOU DON’T WANT IT SPEWING OFF INFORMATION THAT’S PROVOCATIVE. THAT COULD CAUSE A LOT OF REPUTATIONAL DAMAGE FOR AMAZON AND THE ALEXA BRAND. ED: THERE’S A GREAT ACADEMIC DEBATE WE COULD HAVE, A.I. MODELS IN THE VOICE SYSTEM FORM. THE OTHER BIT OF NEWS IS THERE
IS A TIMELINE DELAY INTO 2025. JUST TELL US WHAT YOU UNDERSTAND THE TEAM IS WORKING ON TO GET THIS INTO THE REAL WORLD. >> THE BIG CHALLENGE RIGHT NOW IS MERGING THAT OLD BRAIN WITH THE NEW BRAIN. THERE’S A LOT OF ARGUMENT ABOUT WHETHER OR NOT THEY SHOULD SCRAP THE OLD AMAZON APPROACH AND MOVE TO AN L.L.M. MODEL LIKE CHATGPT AND META ARE
USING. BUT THEY’RE TRYING TO DO THIS HYBRID APPROACH AND THAT TAKES A LOT OF CUSTOM CODE TO MAKE SURE IT KNOWS MY PERMISSIONS AND KNOWS I HAVE ACCESS TO THIS LIGHT BULB OR THIS KITCHEN TIMER OR THIS MICROWAVE. THAT’S THE IRONY. THAT ALL THE STUFF THAT AMAZON ALEXA IS REALLY GOOD AT ARE VERY SIMPLE TASKS. AND THAT’S WHAT L.L.M. REAS NOT PARTICULARLY -- L.L.M.’S ARE NOT PARTICULARLY ADEPT AT. CAROLINE: THANK YOU FOR BRINGING IT TO US. MEANWHILE, THAT IS IT FOR THIS EDITION OF "BLOOMBERG TECHNOLOGY." AND WE’VE GOT EARNINGS LIKE
AMAZON AFTER THE BELL. BUT AN IMPORTANT CONVERSATION COMING UP TOMORROW. ED: YEAH. TODAY THE DEMOCRATIC PERSPECTIVE. TOMORROW THE REPUBLICAN.
A SURROGATE OR BACKER OR BOOSTER FOR TRUMP WILL BE ON THE PROGRAM TO GIVE HIS TAKE ON THE TECHNOLOGY DISCUSSION TO BE HAD FOR EITHER CANDIDATE. BUT YOU SHOULD RECAP ON THE PODCAST. IT WAS A PACKED SHOW. IT WAS CRAZY. YOU KNOW WHERE TO FIND IT. EVERYONE HERE, WOW, THIS WAS A GREAT "BLOOMBERG TECHNOLOGY."
2024-11-02 05:06
