TSMC's US Plant and White House's Military AI Plan
ANNOUNCER: FROM THE HEART OF WHERE MONEY AND POWER COLLIDE, THIS IS "BLOOMBERG TECHNOLOGY" WITH CAROLINE HYDE AND ED LUDLOW. ♪ CAROLINE: LIVE FROM NEW YORK AND SAN FRANCISCO, THIS IS "BLOOMBERG TECHNOLOGY." COMING UP, THE U.S. PLANT YIELDS SURPASSED THAT OF SIMILAR FACTORIES IN TAIWAN. WHAT THAT MEANS FOR U.S.
CHIP AMBITIONS. ED: THE BIDEN ADMINISTRATION IS PLANNING A CONCRETE STRATEGY ON THE MILITARY USE OF AI IN WARFARE. CAROLINE: ALPHABET'S WAYMO RATES IS $5.6 BILLION IN ITS LARGEST EVER FUNDING ROUND -- RAISES $5.6 BILLION IN HIS LARGEST EVER FUNDING ROUND. THE BROADER TECHNOLOGY INDEX IS
UP ON THE DAY. CONSUMER SENTIMENT LOOKS STRONG. IT INJECTS SOME RISK ON ACROSS THE BOARD. NOTABLY, WE ARE STILL SEEING THE KEY MAGNIFICENT SEVEN PLAYERS MANAGING TO DRIVE TO A NEW RECORD HIGH. ED: I WANT TO GET TO THE BREAKING NEWS FROM THIS MORNING ABOUT WAYMO RAISING $5.6 BILLION, ITS LARGEST EVER ROUND. WAYMO IS THE AUTONOMOUS DRIVING UNIT OF ALPHABET, PARENT OF GOOGLE. ALPHABET IS LEADING THE ROUND.
THE STOCK DID PUSH HIGHER AFTER THE OPEN WHEN THE NEWS HIT. LATER, WE WILL BRING YOU THE FULL DETAILS. INTERESTING NAMES IN THE WORLD OF FINANCE PARTICIPATING. A LOT OF ATTENTION ON AUTONOMOUS DRIVING.
BLOOMBERG IS REPORTING THE FIRST U.S. CHIP PLANT IN ARIZONA HAS ACHIEVED YIELDS THAT SURPASSED THAT OF EQUIVALENT PLANTS IN ITS DOMESTIC HOME OF TAIWAN. IMPORTANT POLITICAL AND INDUSTRY STORY. SHARES UP ALMOST 3%. CAROLINE: LET'S GET TO IT. THE NUANCE OF THE YIELDS IN THE FIRST PLANT IN ARIZONA SURPASSING SIMILAR FACTORIES BACK HOME IS A SIGNIFICANT BREAKTHROUGH MANY FEEL FOR THE U.S. EXPANSION PRO PROJECT. IAN KING JOINS US. IT WAS HARD TO GET TO THE
POSITION THEY ARE CURRENTLY IN. IAN: THERE WERE SEVERAL REPORTS THERE WERE LABOR ISSUES. CAN THEY REALLY DO THIS OUTSIDE OF THEIR HOME BASE? THIS IS BIG BET THE GOVERNMENT IS MAKING ON A FOREIGN COMPANY, IS THAT GOING TO WORK OUT? TSMC AND OUR SOURCING IS INDICATING IT IS WORKING OUT. ED: I THINK IT IS WORTH EXPLAINING TO THE AUDIENCE WHAT YIELD IS AND WHY IT IS IMPORTANT. I HAVE HAD A GO AT IT AND WILL BRING THE DEFINITION UP ON THE SCREEN. IT IS THE VOLUME OR NUMBER OF
USABLE CHIPS IN A BATCH. THAT IS SUPER IMPORTANT WHEN YOU THINK ABOUT PROFIT AND EFFICIENCY. IAN: THE KEY PHRASE IS PRODUCTION YIELDS. IF YOU DO NOT HAVE PRODUCTION YIELDS, YOU ARE LOSING MONEY ON WHAT YOU ARE DOING. HOW MANY DO YOU HAVE TO THROW AWAY? YOU HAVE TO THROW AWAY A LOT IN THE EARLY STAGES. THEY ARE SAYING WE HAVE GOTTEN THROUGH THE EARLY STAGES QUICKER THAN EXPECTED AND ARE IN A GOOD POSITION. CAROLINE:
WHAT IS THE RAMIFICATIONS FOR THE U.S. FOCUS ON BRINGING PRODUCTION TO THE UNITED STATES? ARE WE GOING TO SEE MORE TSMC PRODUCTION? MORE MONEY COMING FROM THE FEDERAL GOVERNMENT? IAN: THERE IS NO DOUBT GIVEN THE LANDSCAPE THAT IS WHAT THE U.S. GOVERNMENT WOULD WANT FROM TSMC. WE HAVE INTEL THAT HAS HAD PROBLEMS. SAMSUNG HAVING SOME ISSUES.
IF WE WANT THIS PRODUCTION IN THIS COUNTRY, TSMC HAS TO BE THE LEADING VEHICLE FOR THAT. ED: I WOULD NOT READ TOO MUCH INTO IT. I WOULD SAY THE TIMING AND MANNER BY WHICH WE CAME TO THIS INFORMATION IS INTERESTING. HELP ME EXPLAIN WHY. IAN: THE U.S. NEEDS A ALISA:. THE -- THE U.S. NEEDS A WIN. THE BIDEN ADMINISTRATION NEEDS
A WIN. THERE'S A LOT OF NEGATIVE NEWS FLOW AROUND THIS INITIATIVE. IF YOU ARE TSMC, YOU HAVE BEEN CRITICIZED FOR NOT GOING AS BIG AS POSSIBLE, COMING IN WITH AN OLDER PRODUCTION TECHNIQUE. PERHAPS YOU WANT TO REMIND THE WORLD THAT WE CAN DO THIS, WE KNOW WHAT WE ARE DOING. ED:
ONSHORING IS ONE PART. THE OTHER PART IS THE CONTROL. I WANT TO BRING IN THE EXECUTIVE DIRECTOR OF THE ASPEN STRATEGY GROUP AND FORMER DIPLOMAT. LET'S START WITH THE BASICS OF THE SITUATION.
TSMC, THE CROWN JEWEL OF TAIWAN'S TECHNOLOGY INDUSTRY HAVING SUCCESS EARLY IN THE U.S. AND THE SUPPORT OF THE U.S. TO DO IT IN THE CONTEXT OF CHINA IS A DIFFICULT ONE. >> THAT IS RIGHT. THIS IS VERY GOOD NEWS.
IT MEANS THE BIDEN POLICY OF HAVING TOUGH EXPORT CONTROLS ON SMALL, CRITICAL TECHNOLOGIES BUT ALSO SUBSIDIES, I THINK TSMC GOT $6 BILLION IN SUBSIDIES, $5 BILLION IN LOANS. OTHER COMPANIES ARE GETTING SIMILAR. THE PROJECT OF PUSHING OUR SEMICONDUCTOR IS WORKING. CAROLINE:
WE COME TO YOU BECAUSE OF THE RICH EXPERIENCE WHEN IT COMES TO FOREIGN POLICY AND THE WORK YOU DO WITH THE ASPEN STRATEGY GROUP AND THE U.S. GOVERNMENT. WHAT DO YOU GRADE THE FOCUS OF THE UNITED STATES ON ONSHORING OF CHIP SUPPLY A-D. SURPASSING EXPECTATIONS? >> I WOULD GIVE IT ABOUT A-. THERE ARE CERTAIN KEY TECHNOLOGIES WHERE THE U.S. AND OUR FRIENDS AND ALLIES SHOULD STAY IN THE LEAD, WE SHOULD BE MORE ADVANCED THAN THE CHINESE WHO ARE BECOMING COMPETITORS IN THAT SPACE. WE DO THAT IN TWO WAYS, BY SLOWING THEM DOWN.
THAT IS THE EXPORT CONTROLS, AND BY SPEEDING OURSELVES UP. MY PERSONAL VIEW IS WE HAVE DONE CLOSE TO WHAT WE CAN DO TO SLOWLY CHINESE DOWN. THEY ARE GREAT ENTREPRENEURS THEMSELVES. WE HAVE SOME TOUGH EXPORT CONTROLS ON THE MOST ADVANCED CHIPS AND THE TOOLS THAT MAKES THE CHIPS. MAKING THOSE CONTROLS EVEN TOUGHER UNILATERALLY ON THE U.S. SIDE WILL NOT SLOW CHINA DOWN. IT JUST MEANS OUR COMPANIES WILL NOT HAVE THE REVENUE THEY NEED TO FUND THE RESEARCH AND DEVELOPMENT TO KEEP OURSELVES IN THE LEAD. CAROLINE: LET'S SET THE CONTEXT OF THIS
WEEK. THERE WERE SOME HICCUPS TO THE U.S. FOCUS ON CONTAINING SEMICONDUCTOR EXPERTISE, LIMITING IT FROM GOING INTO CHINESE HANDS IN PARTICULAR. WE HEAR THAT TSMC HAS HAD TO ADMIT SOMEHOW IT'S CHIPS ARE WORKING ITS WAY INTO HUAWEI'S PRODUCTS EVEN THOUGH HUAWEI HAS BEEN CUT OFF IN THEORY SINCE 2020. THEY SAID THEY HAVE NO DIRECT OR INDIRECT BUSINESS DEALINGS WITH HUAWEI. MANY TRYING TO WORK OUT HOW AND WHICH CLIENT OF TSMC'S ALLOWED THE CHIPS TO GET INTO THE HANDS OF HUAWEI.
HOW EFFECTIVE CAN THESE LIMITATIONS REALLY BE? >> THAT IS THE PERFECT QUESTION. THIS EXAMPLE SHOWS HOW DIFFICULT IT IS. THERE ARE LOTS OF WELL-MEANING PEOPLE IN THE U.S. AND EUROPEAN GOVERNMENTS TRYING TO GET THIS RIGHT AND MAKE THE CONTROLS NARROWLY FOCUSED AND EFFECTIVE. VERY HARD TO DO. I THINK THEY ARE DOING QUITE A
GOOD JOB. I WORRY, HOWEVER, FOR EXAMPLE, YOU SEEK SOME FOLKS MIGHT TO GO INTO A TRUMP ADMINISTRATION VERY TOUGH ON CHINA, CHINA HAWKS SAYING WE WILL CONTROL MORE, PUT MORE COMPANIES ON THE ENTITY LIST. EVEN WHEN PEOPLE ARE WELL-MEANING, IT IS VERY DIFFICULT TO DO THINGS WITH CONTROLS ALONE.
YOU HAVE TO RUN FASTER. ED: WHICH IS MORE POWERFUL? WE COVERED THE EXPORT CONTROLS PART OF THE STORY DEEPLY ON THE PROGRAM. THEY ALMOST WORK IN PARALLEL. YOU CANNOT HAVE ONE WITHOUT THE OTHER IF YOUR END GOAL IS TO MAKE YOUR OWN NATION MORE COMPETITIVE IN ANY GIVEN FIELD. >> ABSOLUTELY RIGHT. I AM FIRMLY ON THE SIDE OF
RUNNING FASTER IS BETTER. WE HAVE AN AMAZING INNOVATION ENGINE. I LIVE IN CALIFORNIA. YOU REPORT ON IT ALL THE TIME. WE ARE DOING GREAT. WE NEED TO MAKE SURE THAT ENGINE KEEPS RUNNING AND KEEPS RUNNING FAST. ONE OF THE THINGS UNDERAPPRECIATED, EVERYBODY ALWAYS TALKS ABOUT THE CHIPS ACT, BUT WHAT THEY DO NOT TALK ABOUT SO MUCH IS THAT WAS SUPPOSED TO BE $170 BILLION GOING INTO BASIC SCIENCE R&D FUNDING. THIS IS REALLY IMPORTANT. THIS CREATES ALL OF THE TECHNOLOGIES OF THE FUTURE.
THOSE ARE THE THINGS WE SHOULD BE DOUBLING DOWN ON. ED: AT THE SAME TIME, CHINA IS TAKING ITS OWN ACTION. HOW CLOSELY DO YOU FOLLOW AND ASSESS THEIR RESPONSE TO THE TSMC SITUATION? >> CHINA IS GREAT. THEY ARE DOING A LOT OF INNOVATING. THERE COMPANIES ARE EXCELLENT. IF YOU LOOK AT WHAT THEY ARE DOING ON ARTIFICIAL INTELLIGENCE, THERE LANGUAGE MODELS, THE BIGGEST NAIN AI, OUR SIX MONTH BEHIND. ON SURVEILLANCE AND DRONES, THEY ARE FIRST RATE.
THE CHINESE WILL KEEP RUNNING FAST. THIS POLICY NEEDS TO BE NUANCED. IT IS NOT LIKE WE ARE COMPETING WITH CHINA ON EVERY TECHNOLOGY. THERE ARE CERTAIN AREAS WHERE
WE SHOULD STILL COLLABORATE, HEALTH CARE TECH AND OTHER THINGS. IT IS JUST THE THINGS THAT TOUCH NATIONAL SECURITY THAT CAN BE DUAL USE WHERE WE NEED TO BE MORE CAREFUL. CAROLINE: NO MATTER WHAT THE ADMINISTRATION AFTER NOVEMBER 5 THINK, WILL THERE FOREVER BE THE IDEA OF TENSION AND OPPOSING NATIONS BETWEEN CHINA AND THE U.S. WHEN IT COMES TO AI? DO YOU SEE ANY GROUNDS FOR A MORE DOVISH APPROACH? >> I DO THINK WE ARE ENTERING A PHASE WHERE THE CHINESE GOVERNMENT LED BY XI JINPING SPECIFICALLY HAS SAID THEY WANT TO ADVANCE IN CERTAIN TECHNOLOGIES, AI, SEMICONDUCTORS, 5G, 6G, CERTAIN OTHERS, THEY HAVE SET THIS OUT IN A PLAN. AND THEY WANT TO HAVE A VERY DOMINANT MILITARY. THOSE THINGS ARE QUITE WORRYING TO THE U.S., EUROPE, OUR FRIENDS AND ALLIES.
I DO THINK W NO MATTER WHO WINS OUR ELECTION, THIS PART OF THE TECHNOLOGY RACE IS GOING TO CONTINUE. THIS IS A LONG-TERM PUSH THAT WILL CONTINUE. THAT DOES NOT MEAN THE U.S. AND CHINA CANNOT DO BUSINESS TOGETHER AND LOTS OF OTHER AREAS. WHEN I SEE COMPANIES IN THE CONSUMER SECTOR AND AGRICULTURE STILL DOING A LOT OF WORK WITH CHINA, IT DOES NOT MEAN THERE HAS TO BE A STOP TO THAT. CAROLINE: COMING UP, HOW THE U.K.
PRIME MINISTER IS LOOKING TO ED: AFTER EARLY CONFUSION AROUND THE U.K. LABOUR PARTY'S COMMITMENT TO AI, THE PRIME MINISTER IS POSITIONING HIMSELF AS A CHAMPION FOR AI AT HIS PARTY'S INAUGURAL INVESTMENT SUMMIT LAST WEEK. HE EVEN APPEARED ALONGSIDE THE FORMER GOOGLE CEO AND CALLED AI AN OPPORTUNITY RATHER THAN SOMETHING TO BE SCARED OF. LET'S BRING IN MARK BERGEN OUT IN LONDON FOR US.
LET'S ASK THE SIMPLE QUESTION, WHAT IS THE U.K.'S AI PLAN? MARK: WE DO NOT KNOW IT YET. IN OUR STORE, WE TALKED TO SECRETARY PETER KYLE WHO RUNS THE DEPARTMENT HERE. HE SAID THEY ARE COMING OUT WITH A TWOFOLD STRATEGY.
ONE IS THE OPPORTUNITY PLAN WITH A WILL BE USING AI FOR IMPROVEMENTS IN THE PUBLIC SECTOR AND THE PRIVATE SECTOR. WE HAVE SEEN A LITTLE OF THAT IN THE PUBLIC SECTOR SO FAR. THE SECOND PART IS THEY PROMISED LEGISLATION AROUND AI. HE TOLD US EXPLICITLY WE ARE NOT GOING TO GO AS FAR AS THE E.U. HAS. THEY SAID THE E.U. HAS OVERREACHED AND OVERREGULATED. THIS IS ONE OF THE SILVER
LININGS FOR BREXIT FOR THE LABOUR PARTY WHICH STOOD AGAINST IT. THEY HAVE GIVEN TWO ROUGH COMMITMENTS. ONE IS THE AI LABS WILL HAVE TO MAKE VOLUNTARY COMMITMENTS THEY MADE LAST YEAR INTO LAW AND THEY WILL HAVE A NEW AGENCY TO MONITOR AND ENFORCE THE SAFETY AND CRITERIA FOR THE FRONTIER'S LIKE OPENAI AND GOOGLE. CAROLINE: THE SECRETARY UPENDED EVERYONE EARLIER BY HAVING TO NIX A COUPLE OF PORTEN INVESTMENT AREAS.
I'M CURIOUS HOW HE HAS I BEEN ABLE TO NAVIGATE AND EDUCATE US. MARK: THAT WAS THE PROJECT IN SCOTLAND, ONE OF THE FEW SUPERCONDUCTING PRODUCTS. THE EXPLANATION IS THE PRIOR GOVERNMENT PROMISED THE MONEY WITHOUT ALLOCATING THE FUNDS. THEY ARE IN A BIG FISCAL HOLE
THEY ARE TRYING TO FILL. THEY ARE DISCUSSING THE POSSIBILITY OF CAPITAL GAINS TAX AND OTHER THINGS THE TECH COMMUNITY IS AFRAID OF AND DOES NOT WANT TO HAPPEN. PEOPLE WE HAVE TALKED TO ADMIT THAT WAS CLUMSY HANDLING. HE TOLD US THEY ARE REEVALUATING THE COMPUTING BUDGET FOR THE COUNTRY. CAROLINE: YOU COVER VENTURE CAPITAL IN THE U.K. AND EUROPE.
WHAT IS THE AMOUNT OF MONEY GOING INTO AI AND INNOVATION COMPARED TO THE U.S.? MARK: IT IS SMALL. THERE IS A CONCERN THE U.K. IS LOSING ITS FOOTING TO FRANCE WHICH HAS INVESTED QUITE A BIT. TO GOVERNMENT HAS BEEN WORKING
TO PROP UP THE INDUSTRY -- THE GOVERNMENT HAS BEEN WORKING TO PROP UP THE INDUSTRY. I THINK THE OTHER SIDE OF THAT IS DEFENDERS OF THE GOVERNMENT ARE MUCH MORE REALISTIC. WE HAD RISHI SUNAK, THE PRIOR PRIME MINISTER, TALKING ABOUT THE U.K. BEING A SCIENCE SUPERPOWER, HAVING ELON MUSK ON STAGE, SOME THINGS THAT WERE NOT REALISTIC FOR THE U.K. TO DO. ED:
CAROLINE AND I HAVE EXPERIENCE REPORTING ON THE U.K. GOVERNMENT. THEY OFTEN ADD IN BUZZWORDS LIKE EFFICIENCY, SOME OF WHICH WE HAVE MENTIONED IN THIS CONVERSATION. ARE THEY ACTING WITH THE PRIVATE SECTOR? THEY NEED SOME RELATIONSHIP TO MOVE FORWARD. MARK: THE TERM WE HEARD A LOT WAS IT IS WAIT-AND-SEE.
THEY ARE CERTAINLY HAVING CONVERSATIONS WITH THE START UP INDUSTRIES. I DON'T THINK WE HAVE SEEN A LOT OF EVIDENCE OF THEM BEING DRAWN AND AS GOVERNMENT CONTRACTS. THAT IS SOMETHING AT LEAST IN LIPSERVICE THEY ARE TALKING ABOUT A LOT. CAROLINE: THANK YOU FOR KEEPING US ON THE NOSE OF WHAT IS HAPPENING IN THE U.K. COMING UP, THE WHITE HOUSE SAYS IT NEEDS AI ADOPTION IN THE MILITARY. MORE ON THAT STORY NEXT.
ED: IT IS TIME FOR TALKING TECH. FOUR ASTRONAUTS HAVE MADE TOUCHDOWN BACK ON EARTH. THE SPACEX CAPSULE LANDED EARLIER THIS MORNING AFTER UNDOCKING FROM THE INTERNATIONAL SPACE STATION. THE CREW ARRIVED MARCH 5 BUT
COULD RETURN DUE TO DELAYS AND ISSUES WITH BOEING'S STARLINER. TWO TEST PILOTS ARE STILL STUCK IN SPACE WITH THE RETURN SET FOR FEBRUARY. ELON MUSK IS SAID TO HAVE HAD SECRET CONVERSATIONS WITH VLADIMIR PUTIN ACCORDING TO "THE WALL STREET JOURNAL," WHO SAY THE TWO HAVE BEEN CHATTING REGULARLY SINCE 2022 ON A WIDE-RANGING NUMBER OF TOPICS INCLUDING BUSINESS AND GEOPOLITICAL ISSUES.
TESLA IS DRAWING UP AN ECLECTIC MENU AS IT PREPARES TO OPEN A 1950'S DINER-THEMED CHARGING STATION IN THE HEART OF L.A. WHERE CHARGES WILL BE ABLE TO CATCH A MOVIE WHILE TOPPING OFF THE BATTERY. THE UTILITARIAN GAS STATION MODEL IS SOMETHING I THOUGHT I WOULD NEVER READ. CAROLINE: LET'S TALK ABOUT THE BIDEN ADMINISTRATION SAYING THE U.S. MUST ACCELERATE ADOPTION OF AR FOR MILITARY AND INTELLIGENCE USE -- AI FOR MILITARY AND INTELLIGENCE USE TO MAINTAIN AN EDGE OVER RIVALS AND INCREASE SAFETY.
YOU HAVE BEEN FOCUSING IN ON WHY THE U.S. GOVERNMENT IS RAMPING UP THE NARRATIVE. WHAT IS BEHIND IT? >> THE PRIMARY PART OF ALL OF THIS IS U.S.
ADVERSARIES ARE ALREADY DEPLOYING AI. THAT IS WHAT PRESIDENT BIDEN'S NATIONAL SECURITY ADVISOR SAID YESTERDAY. HE SAID THESE THINGS ARE ADVANCING WITHOUT AMERICAN VALUES SO THE U.S. HAS TO KEEP UP TO KEEP UP WITH THE ADVERSARIES. ED:
I WANT TO GET INTO THE SPECIFICS OF WHAT A STRATEGY MIGHT LOOK LIKE. TO BE FAIR TO OUR AUDIENCE, WE ARE ALL CONSCIOUS WE HAVE A U.S. PRESIDENTIAL ELECTION IN LESS THAN TWO WEEKS. THEREFORE, THE EXISTING ADMINISTRATION HAVE A TIME LIMIT ON WHAT IT CAN OR CANNOT DO IN OFFICE. EXPLAIN THAT BIT TO US, PLEASE. >> THIS MEMO THAT PRESIDENT BIDEN'S TEAM PUBLISHED YESTERDAY LAYS OUT A BUNCH OF TO DO LISTS FOR MILITARY AND GOVERNMENT OFFICIALS. THE PRESIDENT WILL NOT BE EMPOWERED TO SEE A LOT OF THAT THROUGH, SO WE NEED TO BE THINKING ABOUT WHAT THE NEXT PRESIDENT WOULD DO ON THESE ISSUES. THE REPUBLICAN PLATFORM SAYS
PRESIDENT TRUMP WOULD REPEAL A LOT OF THE FIGHT IN ADMINISTRATION'S CONSUMER POLICIES ON AI. IT DOES NOT REALLY HAVE A TAKE ON MILITARY AND INTELLIGENCE USES. THAT IS ONE VISION FOR US. THAT IS ONE VISION FORWARD. KAMALA HARRIS HAS BEEN THE FACE OF AI ON THE INTERNATIONAL STAGE AND HAD A HAND IN DEVELOPING THESE POLICIES PRETTY TWO DIFFERENT VISIONS. REGARDLESS, IT WILL NOT BE PRESIDENT BIDEN EXECUTING ON THESE THINGS. ED: WE TALK TO COMPANIES ALL THE TIME LIKE PALANTIR, PRIVATE SECTOR PUBLICLY TRADED COMPANIES OR START-UPS THAT TELL US THEY ARE WORKING MORE AND MORE WITH THE GOVERNMENT. FROM THE GOVERNMENT SIDE, IS THE STRATEGY BASED ON WORKING WITH THE PRIVATE SECTOR? >> YES.
JAMES SULLIVAN, PRESIDENT BIDEN'S NATIONAL SECURITY ADVISOR, YESTERDAY MADE A SPEECH ABOUT THE ARTIFICIAL INTELLIGENCE AND NATIONAL SECURITY STRATEGY. HE DEVOTED A LOT OF TIME TO HOW INNOVATION IS LARGELY HAPPENING IN THE PRIVATE SECTOR AND NOT GOVERNMENT. THERE WAS A LOT OF TALK ABOUT HOW THE U.S. GOVERNMENT WILL HAVE TO WORK WITH TECH COMPANIES TO MAKE THAT HAPPEN IN A WAY THAT MAYBE THEY HAD NOT IN DIFFERENT ERAS OF TECHNOLOGY. I WAS SITTING IN A ROOM IN WASHINGTON A COUPLE OF MONTHS AGO DURING NATO WHEN SOMEONE SAID SOMETHING SIMILAR. THE TECH IS EXISTING IN THE
COMPANY. THE GOVERNMENT IS BEHIND. THE TWO HAVE TO GET ALONG TO MAKE IT WORK. CAROLINE: WHAT IS INTERESTING IS THE ETHICS AROUND IT AND ANY LIMITATIONS COMING FROM THE UNITED NATIONS. THERE IS TENSION AROUND AUTONOMOUS WEAPONS AND AI AND THEIR USE IN THE BATTLEFIELD. HOW IS THAT SOMETHING JAKE SULLIVAN IS SPEAKING TO OR TRYING TO NAVIGATE? >> THEY PUT TOGETHER WHAT I WOULD CALL A RISK-BASED APPROACH.
THE RISKIEST USES OF AI IN MILITARY AND INTELLIGENCE SETTINGS, USING IT TO MAKE DECISIONS ABOUT WEAPONS TARGETING, THAT SHOULD REQUIRE THE MOST SAFEGUARDS AND THINKING ABOUT ETHICS. TASKS THAT ARE SMALLER DO NOT NECESSARILY NEED THOSE KIND OF GUARDRAILS ACCORDING TO THE BIDEN ADMINISTRATION. THEY ARE THINKING ABOUT THIS AS TEARS OF RISK WHICH MATCHES UP WITH WHAT THEY HAVE DONE WITH CONSUMER AI AS WELL. CAROLINE: IS IT GOING TO BE THE COMPANIES WE REFERENCED? ARE THEY GOING TO BE THE ONES THAT LEAD THE WAY? >> RIGHT NOW, THE STRATEGY PRESIDENT BIDEN DIRECTED HIS TEAMS AT THE DEPARTMENT OF DEFENSE TO WORK ON EXPANDING THE DATABASE OF VENDORS FOR THIS TECHNOLOGY. THEY ARE TRYING TO OF COURSE WORK WITH THE BIG GUYS BUT ALSO TO ENGAGE WITH THE START-UP COMMUNITY AND MAKE SURE THEY HAVE ACCESS TO THIS OPPORTUNITY TO HELP THE U.S. GOVERNMENT AND MILITARY JUST AS MUCH AS THE BIGGER PLAYERS WOULD. ED: BLOOMBERG GOVERNMENT REPORTER
COURTNEY ROZEN, THANK YOU. CAROLINE: WELCOME TO BLOOMBERG TECHNOLOGY. I'M CAROLINE HYDE IN NEW YORK. ED: I'M ED LUDLOW IN SAN FRANCISCO. CAROLINE: YOU'RE THE RECORD HIGH ON AN INTRADAY BASIS. CURRENTLY UP .8% OVER THE WEEK. ANOTHER VOLATILE ONE TRYING TO
DIGEST WHAT THE FEDERAL RESERVE WILL DO IN TERMS OF RIGHTS, WHAT IT MEANS FOR SOME OF THE MAIN BIG WINNERS IN TECH. WHAT DRAGS THE NASDAQ TO A NEW RECORD HIGH TODAY ARE THE SAME NAMES THAT LED TO 24% RALLY OVER THE YEAR, NVIDIA ON TOP AND ALSO TESLA FINDING SEEMINGLY BREAKING INTO SOME OF THE MAGNIFICENT SEVEN ON THE WEEK AT LEAST. A NUMBER OF KEY NAMES OUTPERFORMING. UP .9% ON THE WEEKEND MORE ON
THE DAY. WE HAVE MORE WHEN WE ARE DIGGING INTO INDIVIDUAL NAMES. I WANT TO SHINE A LIGHT ON APPLE. DOWN ON THE WEEK, BUT UP ON THE DAY. NOTABLY, YOU ARE DRAWING ATTENTION TO ONE KEY ANALYST REPORT. WE WANT TO GET INTO WHAT KEYBANC IS SAYING AND WHY THEY THINK SOME ANALYST VIEWS ON APPLE ARE TOO OPTIMISTIC. THERE'S A LOT GOING ON FOR
APPLE MAIL. ED: PARTICULARLY WITH ONIONS ON CHINA AND ALSO NEXT WEEK APPLE PLANS A SERIES OF EVENTS EXPECTED TO INCLUDE THE ROLLOUT OF NEW MAC MODELS WITH THE NEW M4 CHIPS DESIGNED TO SUPPORT AI CAPABILITIES INCLUDING APPLE'S OWN PLATFORM APPLE INTELLIGENCE. HERE WITH MORE IS BLOOMBERG TECH EDITOR VAN WARMAN. IT IS INTERESTING THAT APPLE HAS EARNINGS THURSDAY AND A SERIES OF EVENTS GOING UP TO IT. MARK GURMAN HAS DONE A LOT OF
REPORTING ABOUT THESE MACS. >> IT LOOKS LIKE APPLE IS TRYING TO CREATE A MEGA NEWS CYCLE AHEAD OF THE HOLIDAY SHOPPING SEASON AND IT SEEMS LIKE THE IN FORCE --M4 IS COMING TO A SERIES OF PRODUCTS. THE MAC MINI SPECIFICALLY IS DUE FOR A DRASTIC DESIGN REFRESH THAT WOULD SEE THE DEVICE GETTING MUCH SMALLER THAN IT IS. CAROLINE: LET'S PUT THIS INTO THE CONTEXT OF WHAT IS NEEDED FROM APPLE LATER IN THE WEEK. AT THE MOMENT THERE IS ANTICIPATION APPLE WILL BE FUELED BY ARTIFICIAL INTELLIGENCE, INTERWEAVING ITSELF AND ALL THE PRODUCTS AND MANAGED TO OUTPERFORM. THE STOCK HAS ALREADY DONE PRETTY WELL.
KEYBANC CAPITAL MARKETS ANALYST SAYING WE ARE BANKING IN TOO MUCH NOW. DANA: THEIR POINT, AND I DO NOT THINK IT IS A DISPARAGEMENT OF APPLE, REALLY, BUT IT IS THAT THE UNDERLYING EXPECTATION ISN'T REALISTIC ASSUMING APPLE WILL GROW ACROSS ALL PRODUCT LINES AT ONCE ACROSS ALL REGIONS AND STATISTICALLY THAT IS NOT IMPOSSIBLE EXACTLY. IT HAS HAPPENED BEFORE. IT'S AN EVENT THAT HAPPENS ONCE EVERY FEW YEARS IS NOT ONCE A DECADE ROUGHLY.
ED: I WANT TO GO BACK TO ONE SELL SIDE FIRM, KEYBANC WHO BASICALLY CUT APPLE TO SELL. THEY ARE TALKING ABOUT SOMETHING VERY INTERESTING IN CHINA. IN CHINA YOU HAVE IPHONE 16 SALES. THE DATA IS CONFUSING, FRANKLY, ABOUT WHETHER IT IS DOING WELL OR NOT. APPLE INTELLIGENCE ISN'T AVAILABLE IN CHINA, YET, EVIDENCE TELLS US THE CONSUMER MIGHT BE BUYING TO HANDSETS BECAUSE THEY BELIEVE IN THE FUTURE THAT IT WILL. WHAT WE KNOW ABOUT WHAT IS
GOING ON? DANA: I AGREE THAT SALES DATA HAS BEEN INCONSISTENT AT BEST. INITIALLY IT SEEMED THAT APPLE OR RETAILERS HAD TO CUT PRICES IN CHINA TO BOOST SALES THIS SPRING. YET, AS YOU SAID, THE EARLY NUMBERS FOR THE IPHONE 16 IN CHINA HAVE BEEN ENCOURAGING DESPITE THE FACT THAT SALES OF OTHERWISE LUXURY GOODS IN CHINA HAVE BEEN SOFT. AROUND THE SAME PERIOD. THOSE ARE GOOD EARLY INDICATORS. I DON'T THINK THE RESULTS NEXT WEEK SHOULD SHED MUCH LIGHT ON IPHONE 16 SALES SPECIFICALLY. IT'S TOO SOON TO KNOW.
BUT I THINK THERE WILL BE A LOT OF SCRUTINY ON A CHINA SALES SPECIFICALLY NEXT WEEK WHEN THE EARNINGS COME OUT. MICHAEL CONTOPOULOS. HALLOWEEN IS WHEN THE NUMBERS COME OUT. THANK YOU SO MUCH. HERE WITH MORE IS THOMAS MARTIN SENIOR PORTFOLIO MANAGER AT GLOBAL INVESTMENTS.
LET'S TALK ABOUT APPLE AS IT SITS IN THE CONTEXT OF THE MAGNIFICENT SEVEN. AS WE LOOK TOWARDS NEXT WEEKEND WE START TO GET A BUMPER CROP OF EARNINGS ARE YOU FEELING OPTIMISTIC? THOMAS: WE ARE. THESE ARE COMPANIES THAT ARE GROWING THEIR EARNINGS AND REVENUES. THEY HAVE HAD A LITTLE BIT OF A, I GUESS, NOT SLOW DOWN, BUT, THEY HAVE NOT BEEN AS STRONG AS THEY WERE FIRST HALF OF THE YEAR. THE FUNDAMENTALS UNDERLYING THEM IN TERMS OF DRIVING THEIR REVENUES AND EARNINGS ARE STILL PRETTY STRONG. WE ARE HOPEFUL WE CAN GET GOOD REPORTS OUT OF THEM. ED: INTERESTING, THOMAS.
IF YOU WILL ALLOW ME I WILL DO SOME SCENE SETTING. I THINK WE AGREE TO MAG SEVEN WAS AT THE BIG DRIVER OF THE S&P 500 THE FIRST HALF OF THIS YEAR BUT IT HAS KIND OF CHANGED SINCE JULY WHEN THAT INDEX PEAKED. IF YOU TAKE THE BASKET OF THE MAGNIFICENT SEVEN, THE FIVE THAT WILL REPORT NEXT, I THINK THAT EARNINGS GROWTH EXPECTATIONS ABOUT 19%, SUB 20%, WAY BEYOND THE S&P 500 AND ALSO THE SLOWEST RATE OF EPS GROWTH FOR SIX QUARTERS. HOW OPTIMISTIC ARE YOU? GIVE US A RELATIVE FRAME OF REFERENCE? THOMAS: I THINK THAT IS A GOOD POINT THAT ALSO APPLIES TO THE MARKET IN GENERAL. WE DID HAVE A BIG RUN UP TO A NEW HIGH. AND WE ARE ABOVE THAT HIGH AGAIN.
WE ARE OFF IT A LITTLE BIT. NOW FROM THE ALL-TIME HIGH. HERE WE ARE. THE SEASONALITY OF THE MARKET HAS REALLY BEEN BROUGHT FORWARD IN EVERY CASE.
WE WERE SUPPOSED TO MAYBE HAVE WEAKNESS HERE. IN SEPTEMBER AND OCTOBER. OCTOBER IS ALMOST OVER. WE HAVEN'T SEEN THAT. WE ARE SUPPOSED TO HAVE A RALLY
TO THE END OF THE YEAR. FROM THAT WEEKEND POINT. WE MAY NOT GET THAT. IT MIGHT HAVE BEEN PULLED THROUGH. ONE REASON TO NOT BE AS OPTIMISTIC REGARDLESS OF WHAT THE RESULTS ARE IS THE MARKET SAYS WE NEED TO TAKE A BREATHER HERE FOR THE COMPANY'S UP SO STRONGLY. 20 7% ON THE RUSSELL 1000 GROWTH AND MG K.
THE LARGE CAP MEGA GROWTH. ED: WHICH CORNERS OF THE VERY LARGE WORLD OF TECHNOLOGY DO YOU LIKE THE MOST? THOMAS: WE STILL LIKE SEMICONDUCTOR COMPANIES THAT ARE PART OF THE AI MOVEMENT. EVEN THOUGH NVIDIA IS BACK UP TO ITS OLD HIGH, THE OUTLOOK FOR WHAT THEY HAVE AND IN THE DEMAND FOR THEIR PRODUCT AND THE UNDERLYING DRIVER OF THE NEED FOR THIS LARGE LANGUAGE MODEL, ETC.
IN AI IS STILL IN THE EARLY INNINGS. THOSE ARE COMPANIES THAT EVEN THOUGH, ALONG WITH OTHER COMPANIES IN THE INDEX ARE AT HIGH'S, STILL HAVE THE FUNDAMENTALS TO SUPPORT IT. AND WE LIKE INDUSTRIALS THAT WOULD FIT THAT METHOD TOO. CAROLINA:
WITH NVIDIA WE HAVE TO WAIT UNTIL NOVEMBER 21 TO GET THEIR NUMBERS BUT WE WILL GET SIGNALS FROM SO-CALLED HYPER STAINLESS, AMAZON, APPLE, SPENDING FROM METADATA. HOW MUCH WILL BE PLOWED INTO NVIDIA'S CHIPS? WILL THE QUARTER SHOW THE LEVEL OF COMMITMENT AND INVESTMENT WE HAVE BEEN USED IN PREVIOUS QUARTERS? THOMAS: IT WILL BE CRITICAL AND EVERYBODY WILL WATCH NUMBERS CAREFULLY. -- WATCH THE CAPEX NUMBERS CAREFULLY. I THINK IT WILL STILL BE THERE.
IT'S TOO EARLY FOR THEM TO BACK OFF. THE REASON THEY WENT BACK OFF ON CAPITAL SPENDING IS IF THERE IS A SLOWDOWN IN THEIR REVENUE AND BUSINESS. AND THEIR COSTS, THERE ARE OTHER COSTS GO UP THEY WOULD NEED TO CUT BACK ON IN ORDER TO KEEP THE EPS GROWTH GOING. I DON'T THINK WE ARE AT THAT POINT YET OR MAYBE EVEN THE NEXT COUPLE QUARTERS. IT COULD BE A RISK FOR LATER IN 2025. ED: THOMAS MARTIN SENIOR PORTFOLIO MANAGER AT GLOBAL INVESTMENTS.
HAPPY FRIDAY. THANK YOU FOR JOINING US. CRYPTOCURRENCY EXCHANGE CRACK IN -- KRAKEN WILL NAME A NEW CEO. ARJUN SETHI WILL LEAD ALONGSIDE CURRENT CEO DAVE RIPLEY.
KRAKEN IS CONSIDERING A FINAL FUNDING ROUND BEFORE A POTENTIAL IPO OFFERING. CAROLINE: CRYPTO COMPANIES ARE MAKING A MASSIVE INVESTMENT IN THE UPCOMING ELECTION IN AN EFFORT TO MEASURE POLITICIANS POLITICIANS TAKE THE INDUSTRY MORE SERIOUSLY. BLOOMBERG'S TIM STENOVEC HAS MORE ON THE IMPACT IS HAVING ON GROWING RACES ACROSS THE COUNTRY. TIM: CRYPTO IS INVOLVED IN THE U.S. ELECTION CYCLE LIKE NEVER
BEFORE. CAMPAIGN DONATIONS POURED IN SUPPORTING POLITICIANS FRIENDLY TO THE INDUSTRY AND OPPOSING SKEPTICS. CRYPTO BACKERS HAVE DIRECTED MORE MONEY TO SUPPORT THEIR INDUSTRY THAN ANY OTHER INTEREST GROUP. IT LEADING THE WAY IS THE SUPER PAC FAIR CHECK THAT BACKS REPUBLICANS AND DEMOCRATS AS LONG AS THEY THAT CRYPTO AND ATTACKED MEMBERS OF OTHER PARTIES WHO DO NOT. IT HAS RAISED MORE THAN $160 MILLION. AT THE COMPANY LEVEL COINBASE
LEADS THE WAY FOLLOWED BY REBEL AND ANDREESSEN HOROWITZ. ADDED UP CRYPTO DONORS HAVE GIVEN MORE THAN $190 MILLION AT THE FEDERAL EVER. COINBASE PREDICTS POLITICAL FINANCING WILL TRANSLATE TO REGULATORY RESULTS. >> WE WILL SEE A PRO CRYPTO CONGRESS EMERGE REGARDLESS OF OUTCOMES IN INDIVIDUAL RACES OR THE PRESIDENTIAL RACE. TIM: PRESIDENTIAL CANDIDATE DONALD TRUMP SAID IN 2021 THAT BITCOIN SEEMED LIKE A SCAM A BUT NOW HE IS CRYPTO'S MOST HIGH-PROFILE PERFORMED AT -- PROPONENT.
>> I'M LAYING OUT MY PLAN TO MAKE SURE THAT THE U.S. WILL BE THE CRYPTO CAPITAL OF THE PLANET AND THE BITCOIN SUPERPOWER OF THE WORLD. THE DAY I TAKE THE OATH OF OFFICE JOE BIDEN AND KAMALA HARRIS' ANTI-CRYPTO CRUSADE WILL BE DONE. I WILL FIRE GARY GENSLER AND A
POINT I FCC CHAIRMAN. TIM: ON THE DEMOCRATIC SIDE VICE PRESIDENT KAMALA HARRIS STRIKES POTENTIALLY SOFTER STANCE ON AS A TEACHER GARY GENSLER. HER CAMPAIGNS CRYPTO PLAN IS MORE VAGUE. IN A POLICY STATEMENT AND THAT
IS PART OF THE OPPORTUNITY AGENDA FOR BLACK MEN IT READS " MAKE SURE OWNERS AND INVESTORS IN DIGITAL ASSETS BENEFIT FROM A REGULATORY FRAMEWORK SOLD BLACK MEN AND OTHERS THAT PARTICIPATE IN THE MARKET ARE PROTECTED." THIS SHOWS BOTH CANDIDATES RECOGNIZE THE IMPORTANCE OF CRYPTO. CRYPTO INSIDERS BELIEVE THE INDUSTRY WILL OUTLAST THE ELECTION. >> ELECTIONS WILL SWING BACK AND FORTH FOR A WHILE. CRYPTO SHOULD NOT BE PARTISAN. >> IT DOES NOT MATTER MUCH TO HIS PRESIDENT.
CRYPTO BROADLY AND BITCOIN SPECIFICALLY, IT'S AN UNSTOPPABLE FORCE. AN UNSTOPPABLE FORCE MEETING AN IMMOVABLE OBJECT, THERE WILL BE FIREWORKS. TIM: CRYPTO HAS A BIGGER VOICE IN THE ELECTION CYCLE THAT EVER BEFORE. ED: OK. COMING UP, ACTIVATE CONSULTING
OUT WITH ITS 2025 TECH AND MEDIA OUTLOOK REPORT. THE CEO OF MICHAEL WOLF JOINS US NEXT. MONDAY WE SPEAK WITH THE OPENAI CEO SARAH FRIAR HERE ON BLOOMBERG TECHNOLOGY.
CAROLINE: NOW IT'S TIME FOR THE VC ROUNDUP. WAYMO RAISED $5.6 BILLION FROM INVESTORS FOR ITS LARGEST EVER FUNDING ROUND. IT WAS LED BY ALPHABET AND INCLUDED ANDREESSEN HOROWITZ, FIDELITY, AND T. ROWE PRICE.
CHINA'S WE RIDE RAISED OVER $44 MILLION PERFORMANCE TWICE DELAYED IPO. THE SELF-DRIVING AUTOMAKER COMPANY PRICED IN THE BOTTOM OF WHAT WAS ARRANGED 15.5 DOLLARS-18 POINT FIVE DOLLARS. IT WAS OUTSIZED AND HAD A CONCURRENTLY PRIVATE PLACEMENT. AGILITY ROBOTICS RAISING 150 MILLION DOLLARS FROM INVESTORS LED BY INVESTMENT FIRM DCVC AND WOULD VALUE THE MAKER OF THE HUMANOID ROBOTS YOU SEE AT ABOUT $100. ED: SO MUCH IN THAT WORLD. OVER THE NEXT FOUR YEARS AS THE TECHNOLOGY, INTERNET, AND MEDIA SECTORS ARE EXPECTED TO ADD MORE THAN $1.1 TRILLION OF GLOBAL GROWTH ACCORDING TO
ACTIVATE CONSULTING'S 2025 TECHNOLOGY AND MEDIA OUTLOOK. THE COMPANY’'S CEO MICHAEL WOLF IS WITH US NOW. READING THE REPORT IT IS NOT JUST OF THE DENSITY OR GLOBAL NATURE OF IT, BUT THE NEAR-TERM JUMP YOU SEE. THE 2025 OUTLOOK. BUT BY THE TIME YOU GET TO 2028, THESE ARE BIG NUMBERS. WHAT ARE THE TOP LINE CONCLUSIONS YOU HAVE DRAWN? MICHAEL: COUPLE THINGS.
FIRST, WE ARE TALKING ABOUT ROUGHLY 400 BILLION DOLLARS IN INCREMENTAL REVENUE TO CONSUMER. THE CONSUMER IN TECHNOLOGY, MEDIA BUSINESSES. AND ANOTHER $700 BILLION ADDITIONAL REVENUE FOR B TO B. UCB TO BE WILL GROW -- YOU SEE B TO B WILL GROW THREE PERCENTAGE POINTS FASTER THAN THE CONSUMER SIDE OF THE BUSINESS.
WHEN WE LOOK AT AS WE ARE VERY OPTIMISTIC BECAUSE THERE WERE STILL BE -- WILL STILL BE A LOT MORE MONEY COMING INTO THE BUSINESSES. CAROLINE: CAN YOU SPELL OUT THE UNDERLYING DATA YOU USED TO GET TO THE NUMBERS? HOW DID YOU FACTOR IN THIS LEVEL OF GROWTH? MICHAEL: WE SPEND AN ENTIRE YEAR DOING TREMENDOUS AMOUNTS OF BOTH CONSUMER AND B TO B RESEARCH. WE TAKE APART ALL OF THE PLANS FOR THE MAJOR COMPANIES. WE LOOK AND SEE UNDERLYING THINGS DRIVING GROWTH. AS A RESULT, OUR FORECASTS REFLECT, REALLY, A MOSAIC OF EVERYTHING WE SEE GOING ON. WHERE WE BELIEVE THAT WILL TRANSLATE INTO REVENUE GROWTH. ED:
THE REASON CAROLINE'S QUESTION IS SO GOOD AND IMPORTANT IS WITHIN THE REPORTS, YOU ATTRIBUTE SOME, QUITE A LOT OF WHAT IS GOING TO HAPPEN, TO GENERATIVE AI. ON THIS PROGRAM, WHETHER IT IS AN INVESTOR, A COMPANY EXECUTIVE, OR US AS A JOURNALIST I THINK WE STILL FIND IT VERY HARD TO SEE MONEY COMING OUT OF THE OTHER SIDE OF ALL OF THE INVESTMENT INTO THE INFRASTRUCTURE BEHIND AI. TAKE US THERE, MICHAEL. GENERATIVE AI LEADING TO SALES GROWTH. MICHAEL: WE ARE LOOKING AT IT THAT WAY.
THERE ARE SPECIFIC FORECASTS FOR THE USE OF GENERATIVE AI. MOST OF WHAT WE FOCUSED ON ON THE CONSUMER SIDE IS INCREASES IN CONSUMER TIME WITH TECHNOLOGY AND MEDIA AND IN THE CASE OF ENTERPRISE IT'S NOT MONEY THE COMPANIES ARE GOING TO GET FROM GENERATIVE AI. IT IS ACTUALLY THE AMOUNT OF MONEY THEY WILL GET FROM BOTH PRICING FOR ADDITIONAL PENETRATION OF THEIR B2B APPLICATIONS. WE AREN'T SPECIFICALLY FORECASTING SOME NUMBER FOR WHAT GENERATIVE AI WILL BE.
CAROLINE: IS THERE HYPE AROUND HOW MUCH RETURN ON AI THERE WILL BE? I SPOKE WITH THE IBM CEO. HE SAID AT THE MOMENT IT IS STILL COSTLY. CEOS WANT TO BRING GENERATIVE AI TO THEIR COMPANIES, BUT IT IS NOT EASY ENOUGH FOR ENTERPRISE NOW AND REALLY TOO EXPENSIVE. IS THAT WHAT YOU ARE FEELING ADHERING? MICHAEL: THIS IS AN AMAZING HYPE CYCLE. AND THERE WILL BE A LOT OF SPECIFIC APPLICATIONS. IT'S UNLIKELY ANY OF THOSE WILL PROVIDE HUGE AMOUNTS OF ADDITIONAL REVENUE TO COMPANIES. IN MANY CASES IT WILL BE
INCREASED FUNCTIONALITY. IT WILL BE BETTER TOOLS. BUT WE AREN'T STEPPING BACK SAYING, LET'S PREDICT WHAT IS HAPPENING IN THE MARKET BASED ON GENERATIVE AI. WE KEEP LOOKING AT THIS FROM THE PERSPECTIVE OF WHAT WILL HAPPEN IN TERMS OF SPECIFIC SALES OF WHAT IS EXISTING OUT THERE RATHER THAN INVENTING WHAT COULD BE COMING. ED: WE ARE SHORT ON TIME BUT ANOTHER NASCENT AREA YOU ARE LOOKING AT IS AR. I WAS FORTUNATE TO SPEND SOME TIME WITH ORION, META'S CONCEPT. MICHAEL:
WE ARE FORECASTING 54 MILLION HEADSET SHIPMENTS BY 2028. IT'S REALLY UNDERWHELMING. THE EQUIVALENT OF 4% OF SMARTPHONE SALES. WE BELIEVE THERE WILL BE A GREAT DEAL MORE. WE ARE COUNTING ON MUCH MORE SOPHISTICATED HEADSETS. THE OTHER THING IS, IT IS A
PLACE WHERE THE AI IS ALREADY HERE. THE AI IS AHEAD OF THE DEVICE VERSUS THE OTHER WAY AROUND. CAROLINE: IT'S A FASCINATING READ.
THANK YOU FOR BRINGING A YEAR-LONG SET OF NUMBER CRUNCHING. WE APPRECIATE IT CEO MICHAEL WOLFF. COMING UP, WHAT THE TSMC U.S. PLANT YIELDS MEAN FOR THE REST OF THE U.S. CHIP INDUSTRY AND INVESTMENT BRINGING SUPPLY HOME. BLOOMBERG TECHNOLOGY.
CAROLINE: TODAY'S BIG STORY. TSMC CHIP FIELDS IN THE U.S.. WHAT IT MEANS FOR AMERICAN CHIP MANUFACTURING AT LARGE. LET'S BRING IN BLOOMBERG INTELLIGENT SENIOR ANALYST MANDEEP SINGH. TSMC IS GETTING SUPERIOR YIELDS EVEN TO WHERE THEY WERE PRODUCED AT HOME.
WHAT DOES IT MEAN FOR THE GENERAL DEMAND CYCLE THEY ARE THEME? -- THEY ARE SEEING? MEANDEEP: THE OVERALL CAPACITY, YOU LOOK FIVE NANOMETERS 35% OF THE TSMC OVERALL REVENUE. THE FACT THAT THEY HAVE THE PRICING POWER IS BECAUSE OF THE LEADING NOTES. THIS IS ONE OF THE MOST POPULAR LEADING NOTES. HIGHEST -- HIGHER THAN TSMC'S OWN FABS. THAT'S A BIG DEAL.
I CAN IMAGINE HYPER SCALARS LIKE NVIDIA, APPLE, AND MICROSOFT GOING TO TSMC BECAUSE THEY WANT THEIR LATEST PRODUCT TO HAVE A CHIP MADE ONSHORE SHORE IN THE U.S.. I WOULD EXPECT 20,000 WAFERS TO BE SOLD OUT ON DAY ONE IF THE MARKET IS TO BE BELIEVED THAT THEY ARE AHEAD. ED: I THINK WE HAVE TO LEAVE IT. I AM GLAD YOU CAME ON. I THINK THE MARKET MAY HAVE PRICED IT IN A LITTLE BIT.
HAVE A GOOD WEEKEND. CAROLINE: THAT DOES IT FOR THIS EDITION OF BLOOMBERG TECHNOLOGY. AN IMPORTANT ONE THINKING ABOUT CHIP MANUFACTURING IN THE U.S.. ED: A HUGE WEEK IN THE WORLD OF TECHNOLOGY. THE BLOOMBERG TECHNOLOGY
PODCAST IS YOUR FRIEND. RECAP THERE. WHEREVER YOU ARE IN THE WORLD, HAVE A FANTASTIC WEEKEND. SHOUT OUT TO THE TEAM IN NEW
2024-10-28 09:15
