← Bloomberg Businessweek
Loading summary
Transcript184 lines
- [00:02]
A
The news doesn't stop on the weekends.
- [00:04]
B
Context changes constantly, and now Bloomberg is the place to stay on top of it all.
- [00:09]
A
Hi, I'm David Gura. Join us every Saturday and Sunday for the new Bloomberg this Weekend.
- [00:14]
B
I'm Christina Raffini. We'll bring you the latest headlines in depth analysis and big interviews, all the stories that hit home on your days off. And I'm Lisa Mateo. Watch and listen to Bloomberg this weekend for thoughtful, enlightening conversations about business, lifestyle, people and culture.
- [00:29]
A
On Saturday mornings, we put the past week's events into context, examining what happened in the markets and the world.
- [00:36]
B
Then on Sundays, we speak with journalists, columnists and key political figures to prepare you for the week ahead. Join us as soon as you wake up and bring us with you wherever your weekend plans take you.
- [00:46]
A
Watch us on Bloomberg Television, listen on Bloomberg Radio, stream the show live on the Bloomberg Business app, or listen to
- [00:52]
B
the podcast that's Bloomberg this Weekend. Saturdays and Sundays starting at 7am Eastern on February 28th. Make us part of your weekend routine on Bloomberg Television Radio and wherever you get your podcasts at Charmin. We heard you shouldn't talk about going to the bathroom in public, so we decided to sing about it. Light a candle, pour some wine, grab a roll the soft kind for a little me time. Charmin Ultra Soft Smooth tear wavy edges for my rear so let the softness caress your soul Just relax, you're on a roll Let her rip.
- [01:29]
C
Charmin Ultra Soft Smooth Hair Charmin Ultra
- [01:32]
B
Soft Smooth hair has the same softness you love now with wavy edges that tear better than the leading. Enjoy the go with Charmin. Carvana is so easy. Just a click and we've got ourselves a car. See so many cars. That's a clicktastic inventory.
- [01:47]
D
And check out the financing options payments to fit our budget. I mean that's Clickonomics101 delivery to our door.
- [01:53]
B
Just a hop, skip and a click away and bought. No better feeling than when everything just clicks. Buy your car today on Carvana. Delivery fees may apply. Bloomberg Audio Studios Podcasts Radio News this
- [02:17]
A
is Bloomberg Business Week Daily reporting from the magazine that helps global leaders stay ahead with insight on the people, companies and trends shaping today's complex economy. Plus global business, finance and tech news as it happens. The Bloomberg Business Week Daily Podcast with Carol Massar and Tim Stenovec on Bloomberg Radio.
- [02:40]
D
I know Ed Ludlow and Jay Goldberg are watching clear screens closely. I want to bring both of them in as we do await these earnings. Ed Ludlow is the co host of Bloomberg Tech on Bloomberg tv. He joins us from the San Francisco bureau. And Jay Goldberg is with us to a senior analyst, semiconductors and Electronics at Seaport Research Partners. He's still the only analyst on the Bloomberg terminal who has a sell rating on Nvidia. Jay, is it, is it lonely in that corner?
- [03:08]
E
It's getting less lonely by the day.
- [03:09]
D
Is it. How come?
- [03:11]
E
I mean in Q4, November, December, I had a lot of newfound friends.
- [03:17]
D
Okay.
- [03:18]
E
Right.
- [03:19]
D
Okay.
- [03:20]
E
Well, we'll see me being right, it was just I think the market is sort of rotating out of AI or de risking a little bit.
- [03:27]
D
Yeah. Okay. We'll see and we'll see what the numbers say today. Is there, is there a chance that and look, I know that I don't want you get in trouble with compliance or anything, but I ask you this every quarter. Can you hear anything from Nvidia today? And I'm going to have to interrupt you if we do get those numbers. Are we going to, are you going to hear anything from Nvidia today or could you hear that would make you change your view to at least neutral or buy?
- [03:51]
E
It's pretty unlikely. My concerns are they're capacity constrained and I think that is going to limit the amount of upside that they can deliver to revenue for the next few quarters.
- [04:01]
B
All right, sit tight. We're going to continue to away. Jay Goldberg is with us or Ed Ludlow is with us. Keep in mind, Tim, you mentioned earlier when we talk with our own Ian King 3 months ago In Vetti. Nvidia. Nvidia, excuse me. It beat the stock went up a little bit and then we saw it go down the next day. So, you know, high in terms of expectations, although the stock has been beaten up here at Ludlow as we await those results. Top thing you're you're watching out for here.
- [04:27]
C
Well, usually hits it exactly 20 minutes past the hour. So I'm a little bit on edge. And one is what's behind that And I just state that as facts because I always go back and double check myself on the terminal EVT go. Your last guest said that you know for the outlook for the current period, April quarter, first fiscal quarter, that he was about 73 to 74 billion dollars in sales overall. That's above consensus, but it is not as high as the most bullish estimates. Right. And so we started this year with in video and gents Wong at CES and there was actually quite a lot more update in those on stage and in front of camera appearances than perhaps at the time we appreciated in terms of Them going beyond that. That original $500 billion forecast for calendar 26, for example. So, you know, you guys have done all week. I guess this is quite tense for the market because even the really good results may not be good enough.
- [05:24]
D
Yeah, Ed in, in made that point on our, on our program because we ask, you know, and it's different every quarter, but in recent quarters, this has been such a big event. But Ian made the point. Look, there's not, you know, we've heard a lot from Jensen already about demand and so investors have that information. So, yes, we will get, obviously we'll get new information when the company reports its results and when we look at the, you know, expectations and commentary. But like you said, a lot's out there already.
- [05:55]
C
Yeah. So basically this forecast for $500 billion, at the time, it was over five fiscal quarters. And it was something that he said toward the end of last year in Washington, D.C. in D.C. that was just for Blackwell Systems and then Rubin Systems, but it didn't take into account any revenue whatsoever from China. Then what happened was Bloomberg's Ian King asked Jensen at a press conference how that number was looking three months on. And what he said was, well, we're tracking beyond it and that there may be some contribution from China. But right now, like until the print hits, those are imponderables. We. We don't know or we are pondering them, I guess. They're not within the forecast, nor are they within what Nvidia has actually stated. So again, I, I'm just kind of noodling here, guys.
- [06:44]
E
I.
- [06:45]
C
It's difficult. Bear with me with the audience. I don't think Nvidia's reported late. Late being later than 20 minutes past since like 2023. So I don't know.
- [06:55]
B
No, I think you're right to go there. We're looking at our live blog, which is the whole team here at Bloomberg
- [07:02]
D
right now is with us.
- [07:03]
B
But Sarah Fryer, our big technology team leader, she's like, Nvidia earnings are usually up by 420. Still waiting. I don't want to speculate, but it is unusual.
- [07:12]
D
And this happens meta a few quarters ago and it was nothing.
- [07:16]
B
Yeah, it does happen.
- [07:18]
E
Yeah.
- [07:19]
C
Can we talk quickly about margins? Unless the numbers, like here. Yeah, you know, like, it's interesting that everyone discusses margins. This is a company that has 75% gross margin and we know that the economics of this industry are brutal. But something interesting has happened in recent months, which is that Nvidia owns more of the content of the server design. It's not just the GPU anymore, it's the little plug ins around the gpu. And those may not be major drivers of revenue growth, but they have would appear supported margins. But that creates some jeopardy for this print because if you have a gross margin of 75% and the street and I think your last guest talked about this is the profile in terms of their risk tolerance that they like of a company like Nvidia. They come to have an expectation. And so don't just look at the earnings statement, but when the CFO letter hits, look for the section on margins and whether that there's an indication that 75% gross margin going forward is, is the norm, the status quo, so to speak.
- [08:15]
D
I mean that's an incredible status quo for a company in the hardware business. Jay Goldberg, I want to bring you in here on the 75% margins. I mean we heard this from Ian King earlier. These are software margins, not hardware margins.
- [08:27]
E
Yeah, I mean strong agree with what Ed was just saying is I think the, the bigger risk to my thesis or the bigger question mark.
- [08:34]
D
Yeah.
- [08:35]
E
Is going to be margins. Like we have a pretty good fix on where you know what the revenue is going to look like. Few puts and takes. But the margin question is a big one. They make a lot of money, money from memory. They buy memory from the memory makers and mark it up to their full margin. That's a lot of earnings for them. Their competitors don't do that. And we all know about the memory shortage. Is Nvidia going to eat it? Is, are they going to be able to pass on the, the memory cost to their customers? I think that's, I think that's going to be an area that the Street's going to focus on a lot is how does, how does their margin, their gross margin outlook look?
- [09:06]
B
All right folks, we are talking with our Ed Ludlow and of course we've also got with us Jay Goldberg over at Seaport Research Partners. We expected that Nvidia would have had its results out about seven minutes ago. We're still waiting to 420. As Ed reminds us, this is the time that they have reported over the last few years. So we're kind of glued to our Bloomberg as we speak, just waiting for it to cross. Having said that, as we await the stock is just up about 410 of a percent here in the aftermarket. I'm not going to read anything into that, but we did see the stock higher also in the regular trade today.
- [09:41]
D
Jay, I want to go back to you as we do await These numbers, you mentioned some investors having AI fatigue. And indeed we've seen in video in this narrow range, really going back to just a few months ago. Explain more about how you're interpreting AI fatigue. Because there's, there are different, different companies are working in different spaces here. And Nvidia, I think many would argue, stands in a league of its own given the demand that it continues to see from the hyperscalers.
- [10:11]
E
So I think the issue is there are so many constraints across the industry.
- [10:15]
C
Right.
- [10:16]
E
We're short on chip capacity, on packaging, on copper, on electricity, on substrates. All these things we haven't really thought about in a long time are very tight. And so that feels a little precarious. And then on top of it, you have a lot of questions about how these data center, data center financing is going to work. There's a whole lot of financial engineering taking place on the construction side. And I think people look at that and they sort of think back to, you know, past, past periods in economic history of financial engineering going crazy. And it just, I think in late last year, it caused people to reassess how much exposure they want to AI. Even if you're not owning Nvidia stock, you probably have AI exposure in your portfolio just because the build out is so spread out across the economy.
- [11:00]
D
Yeah, right.
- [11:02]
E
And so you can own energy stocks, you can own power plants, chemicals companies. All of them have a fair amount of AI exposure to growth. And so I think that sort of, the market repriced that a little bit. And then you have Nvidia who, like I said, just is sold out. And once you're sold out, there's no upside.
- [11:21]
F
Well.
- [11:22]
E
And that sort of stock is traded sideways for six months.
- [11:25]
D
Ed, come on in here because Jay got me thinking about constraints. Go ahead.
- [11:28]
B
Well, the only thing I wanted to point out is that, you know, we got Salesforce. No, no, Salesforce earlier, right after the market, and it's down about 4%. And some of it has to do kind of feeding into the fears that are out there a little bit. They gave a lukewarm outlook for sales growth. I mean, it's Nvidia and then it's the others because it's just been an interesting market environment and as of late in terms of that scare. And it's been playing its way in a lot of areas, in particular in those software companies.
- [11:58]
C
Yeah, look, the difficult thing with, with all of this is that the data center that gets built tomorrow with the latest generation of video GPUs, the software results of that are in the future. Right. And the way that gentleman has explained it previously is that imagine if they were a handbag company. Bear with. And they said to the market, here are our next five seasons of bags. We're going to tell you in advance the next five years worth. Nvidia's argued for a really long time it has told the market from the supply chain to its customers what it is going to do. And to its credit, it has delivered those generations of technology annually to a, to a relatively accurate timeline. So that's why we track capital expenditures. Right. Capital expenditures are a commitment for a calendar or a fiscal year. In most cases, Nvidia is the main beneficiary of that. The problem with Salesforce and some of the other corners of the software market is that they, you know, this is them showing the results of investments that they made in prior years. And those two timelines don't line up. And for investors, like that's really hard. Again, I'm not an investor. This is just how it would be relayed to me, you know, on the show or in the course of it being out there reporting. And you kind of have to sympathize with that.
- [13:15]
D
You know, we're, I want to remind everybody we are waiting for Nvidia earnings usually reporting at 20 past. It's 431 here in on Wall street. And we're going to be speaking a little later about Salesforce or maybe even more a little sooner if we don't get these Nvidia.
- [13:30]
B
There we go.
- [13:31]
D
There they are.
- [13:31]
C
Here we go.
- [13:32]
D
All right, go ahead, Carol.
- [13:33]
B
Let's go to actually the outlook first quarter revenue forecast beating estimates. The company saying for the quarter sees revenue of 76.44 billion to 79.56 billion. That is easily above the street estimate of 72.78 million. Let's go back to the fourth quarter data center revenue that coming in Better than expected, 62.3 billion versus the street estimate of 60.36 billion. Nvidia saying computing demand is growing exponentially. Fourth quarter adjusted gross margin, we expected 75%. We got 75.2%. Fourth quarter revenue coming in overall 8.1 billion. Better than the street estimate of 65.91 billion. Tim, we're seeing that stock up now about 2.2% in the aftermarket.
- [14:19]
D
Yeah. Just to remind everybody where we are with these numbers. The first the company sees first quarter revenue coming in $76.44 billion to $79.56 billion. That beat estimates handedly, handily of $72.78 billion. As Carol mentioned Nvidia CEO Jensen Huang saying in a statement, computing demand is growing exc exponentially. We also fourth quarter data center revenue worth repeating a beat there. $62.3 billion. The estimates for 60.36 billion. And that gross margin coming in above estimates at 75.2%.
- [14:55]
B
Our Sarah Fryer on our live blog saying that shares are growing up on that data center revenue beat. Hey, Ed Ludlow, come on in. I know you're looking at these numbers. What jumps out for you?
- [15:05]
C
Yeah, I mean straight to the outlook. And by the way, I would have done the same thing. Go right there. You know, revenue in the fiscal first quarter, 78 billion dol plus or minus 2%. You know, a consensus was really high. But like going into this, it's a very simple equation. There were many names from across sell side and buy side that said they wanted to see Nvidia beat revenues overall in the current period by the multiple billions of dollars, you know, against consensus. And so one thing I would say to, to confirm something is that the fiscal first quarter, which is the, the April quarter, does not assume any compute revenue from China in the outlook, does not factor in any compute revenue of China. That I guess is something to check off the list. It was one of the questions we had.
- [15:53]
D
I want to bring in Jay Goldberg from Seaport Research partner senior analyst through Semiconductors and Electronics. He joins us also from San Francisco. Jay, any anything in here that confirms your thesis or does it sort of go against the sell rating that you have on Nvidia?
- [16:09]
E
Yeah, I mean it goes, I mean it's a good quarter. It's a good quarter and a good guide. It's, it's above, above consensus is above my expectations, but good for them. We're still waiting to see a lot more detail.
- [16:20]
D
What do you want to see?
- [16:21]
E
I want to see, I want to hear more how to talk about gross margin for next quarter. I think that's going to be in the CFO commentary.
- [16:27]
D
Yeah, just go ahead.
- [16:29]
C
Yeah, no, I don't have it yet, but it will be in the CFO commentary.
- [16:33]
D
But 75.2% versus 75% expectations. I mean can, can Ed, can you use that as sort of a guide for, for how the company could see first quarter?
- [16:42]
C
I mean on a basis point. Basis. Yeah. Look like margins are impacted by a number of things. It has been a sell side question on prior calls, the percentage of a server that Nvidia contributes to. And again, what's changed in the period is Nvidia starting to sell. For example, CPUs a standalone product and that was a part of the meta deal that was included. They talked about Core Weave being an early user of CPU as a standalone product. You know, how does that impact the margin profile going forward? But yeah, I mean what they do is they own more of the server and that has been one of the ways in which that they have got margins to where they are. And clearly being.2% above you know, where, where the hopes were is not a bad thing.
- [17:32]
B
Yeah, I'm looking at that CFO commentary. As we know, revenue expected to be 78 billion plus or minus 2%. And as you correctly pointed out, not assuming any data center compute revenue from China in their outlook. GAAP and non GAAP gross margins expected to be 74.9% and 75% respectively. Plus or minus 50 basis point inclusive of a 110 of 1% impact from stock based compensation expense expense. Just looking at what else we have here, operating expense of GAP and non GAAP operating expenses to be approximately 7.7 billion, seven and a half billion respectively. Including that's inclusive of 1.9 billion of stock based compensation expense.
- [18:14]
D
A headline getting my attention is Nvidia says that hyperscalers were just over 50% of 4Q data center revenue. Jay Goldberg, I want to repeat that headline for you. Hyperscalers were just over 50% of fourth quarter data center revenue. Is that a sign that, that Nvidia is diversifying revenue? Who, who, who made up the other half of data center revenue? Is it automakers? Like who's buying?
- [18:39]
E
Well, I think that's one of the most interesting things that's taking place within videos is they're not just reshaping the semiconductor industry, they're trying to reshape the cloud computing industry as well. And that's why we see all these new clouds getting investment from or support from Nvidia. Nvidia would much rather have 100 Neo Cloud customers, three hyperscale customers, of course, and they're doing a really good job of creating that, willing that into existence.
- [19:02]
D
So, so those other customers, Ed, come on in here. Those other customers are like the core Weaves and the other new clouds.
- [19:10]
C
Yeah, I mean what is still important in this fact is that obviously the vast majority has been the hyperscalers plus Metta. Right. And so they've wanted to kind of switch between a story, what they used to call an AI factory. At first an AI factory was an on Prem data center, the enterprises and maybe some of the NEO clouds would operate themselves. Now, an AI factory is what they define any data center that's running AI workloads in. So they have chopped and changed between that story. But its origin was that they wanted to go beyond the hyperscalers to have people own their own infrastructure for AI workloads if they were say a software company or an enterprise of a slightly different size.
- [19:55]
B
You know, it's interesting, I'm looking for supply constraints and they seem to say in the CFO commentary I'm seeing it in terms of gaming. They say we expect supply constraints to be a headwind to gaming in the first quarter of fiscal 2027 and beyond. But not so important, right Ed? I mean we want to really just see if that's a problem in the data center area.
- [20:14]
C
Sadly, you know, my history with Nvidia, you know, before Silicon Valley and covering the data center thing was gaming and you know, it's now such a small piece of, of revenue. It's, I mean, Jay can jump in, but really it's not where anyone's looking right now. There is some discussion later on as it relates to the balance sheet and cash flow on, on things to do with, with supply. But you're right that what they're basically saying is that that was the, the gaming was the segment that was impacted. And I don't know that that is having any effects really. And how we see the stock trading in after hours.
- [20:51]
D
Well, Nvidia shares up 3.4% right now and in fact we're seeing Broadcom, TSMC and Micron shares follow Nvidia higher. Jay Goldberg, come on in here and talk a little bit about the broader repercussions of a print like this outside of Nvidia, what's the signal that it sends not just to hardware makers, but to the entire market?
- [21:11]
E
I think there are always concerns about how, how long the spend is going to keep going. And we had certainly had some positive data points about that two weeks ago when the hyperscalers reported, Facebook reported they have very strong capex numbers. This just continues that trend. And I don't want to say it's a rising tide that lifts all boats, but it's, it is 6, $700 billion in CapEx this year and that's going to, that's going to spread across the entire ecosystem.
- [21:35]
B
No, and I want to go back to, and I totally get like gaming not important, but I was like looking to see if there's any supply constraints in the rest of their universe. And I just thought it was kind of interesting that I haven't seen anything along those lines. It was just in regards to gaming. So is that a good sign that we haven't seen anything that the company has said so far in terms of supply constraints for the rest of the business or I don't know, is it not that important?
- [21:58]
C
Well, you know, I leave it to, to the analysts to model money left on the table if there were any, so to speak. But given the outlook in terms of stuff sales and where, where it came in relative to consensus, you know, Nvidia, it's an enviable position to be in, right where demand exceeds your ability to supply anyway. But going back to that five year handbag analogy of a few moments ago, you know, the other argument that gentleman Nvidia have made quite consistently is that if you tell your suppliers what you plan to do five years in advance, then the rest of the supply chain can, can help prepare with you and keep up. And you know recently that that's been most difficult in memory, but memory shows up in pricing, you know, and if you're Jensen Huang, I'm sure you can make a phone call and make sure that the corresponding high bandwidth memory that you need is there or thereabouts.
- [22:51]
B
Quick check on NASDAQ 100 many futures here in the aftermarket and they're up about 1.8%. So we're certainly seeing a lift to the overall market. Jay Goldberg, come on back in. What do you what top of mind when we get to this conference call in terms of what you want to hear? I know we talked a lot about margins earlier, but what is it?
- [23:12]
E
Yeah, I mean I think this, this margin stuff is important because what I'm sort of reading between the lines is they had to negotiate pricing with the memory memory makers and the memory makers have the most leverage they've had in a decade and we don't see any impact on Nvidia's numbers. Compare that to pretty much any other electronics company out there today, which is warning about memory. I'm sure Nvidia is feeling some of that. But the fact that their gross margins are guiding to at least in line tells me that they're just going to price on those memory increases to their customers, which is a testament to their, to the, to their pricing power. To their power, their market position.
- [23:50]
D
Jay Goldberg. Jay, we're going to have to leave it there. We're going to give you time to get ready to jump on that call. Jay Goldberg, a senior analyst, semiconductors and electronics for Seaport Research Partners. Once again, Jay, the only analyst tracked by the Bloomberg Terminal who has a sell rating on Nvidia and want to give you the last word. You've spoken to Jensen Huang many, many times. What's a question that you would have for him on the earnings call tonight?
- [24:15]
C
Yeah, like ultimately it just always comes down to a projection of confidence that all of the stories we've been over in more than the last year are still intact. You know that the great build out of infrastructure is early, that they have long horizon visibility into what's going on. All Nvidia can control I suppose is the roadmap to go from one generation of compute to the next. And so they talk about in the CFO document margins being supported by the ramp up in Blackwell and mix of new products. Well, well, when is that mix change? When does Vera Rubin really kick in and then go beyond that? That's kind of how the street would look at it, I think.
- [24:55]
B
All right, we're going to leave it there and we know you're busy as well. And Ludlow, thank you so much as we weighted those numbers then helping us break them down, co host of Bloomberg Tech, of course, on Bloomberg Television. Catch it at 11am Wall street time Monday through Friday.
- [25:10]
D
Stay with us. More from Bloomberg businessweek Daily coming up after this.
- [25:18]
B
You can get the news whenever you want it with Bloomberg News Now. I'm Amy Morris.
- [25:23]
G
And I'm Karen Moscow here to tell you about our new on Demand news
- [25:26]
B
report delivered right to your podcast feed.
- [25:29]
G
Bloomberg News now is a short 5 minute audio report on the day's top stories.
- [25:34]
B
Episodes are published throughout the day with the latest information and data to keep you informed. Yes, there are other products like this from a variety of news organizations, but they usually rerun their radio newscasts throughout the day. That's not what we do. We create customized episodes that can only be heard on Bloomberg News Now. And we don't wait an hour to publish breaking news.
- [25:57]
G
When news breaks. We'll have an episode up on your podcast feed within minutes.
- [26:01]
B
So you're always getting the latest stories and developments. Get the reporting and the context from Bloomberg's 3,000 journalists and analysts. We're all over the world. Listen to the latest from Bloomberg News now on Apple, Spotify or anywhere you listen.
- [26:16]
A
You're listening to the Bloomberg Businessweek Daily Podcast. Catch us live weekday afternoons from 2 to 5pm Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app or watch us live on YouTube.
- [26:30]
B
Nvidia shares continuing to trade higher. A couple of headlines also crossing that we want to bring to you. Nvidia says it's secured supply to meet demand for several quarters. So we talk about supply constraints often when we're talking about Nvidia and the demand. Also Nvidia saying you and the United States granted a license to ship H200 chips to China based clients. So they've granted a license for specific China based customers. The US licenses to ship small amounts of the H200 to China. So we were looking for some clarification on its business in China, something that they've certainly been looking for.
- [27:07]
D
We got a great Bloomberg Intelligence roundtable. Mandeep Singh is global Head of Technology Research for Bloomberg Intelligence. He joins us here in the Bloomberg Interactive Brokers studio. He covers Nvidia, he covers Snowflake and more. Also, Anurag Rana is senior Technology Analyst for Bloomberg Intelligence. He joins us from Chicago and he covers Salesforce. So we're going to talk software, we're going to talk hardware. Mandeep, I want to start with your reaction to in video. It was a beat. It was, I mean a very good quarter. Your reaction to margin and what is actually holding out margins here because 75.2%. Yeah.
- [27:41]
H
No mention of any impact related to memory costs, which is surprising.
- [27:45]
D
And why is that surprising? I know memory costs have gone up. But Nvidia is such a big company. Don't they have pricing power?
- [27:50]
H
They do, but purchasing power rather. They clearly did a great job in terms of securing that supply. And they don't have the premium. They don't have to pay the premium that everyone else has to pay.
- [28:01]
D
On the hardware side, they said secured supply to meet demand for several quarters. What, several?
- [28:06]
H
Well, I mean in this case at least.
- [28:08]
D
This is like the Fed.
- [28:09]
B
But they're saying that they've got it. That's a good thing.
- [28:11]
H
They have got it and they're guiding to mid 70% gross margin for next quarter as well. So clearly memory not an impact at all in terms of the margins. The thing that is clear is they are selling to existing customers, not just GPUs, but systems. And that's the big difference between an Nvidia and amd. AMD wants Meta to use their chips and integrate it.
- [28:40]
B
Right?
- [28:41]
H
Nvidia is actually selling to their customers entire systems that have higher ASP's. They are helping them reduce the token cost. And that's where the customers don't mind paying that extra premium that Nvidia is charging because overall the total cost of ownership is lower than if you were to standardize on any other chips. And that's what's Reflected in their print is look their customers see the value.
- [29:09]
B
So well done Nvidia, right by doing
- [29:11]
H
the whole thing and the Blackwell architecture that's really taken off, I mean all the concerns around the migration from Hopper to Blackwell, I mean they just proved that Blackwell will be probably a bigger product in terms of their chip architectures.
- [29:26]
B
Does this, does this in your mind? I mean I always feel like you're like the calm voice of saying the air spend is still happening. Like everybody relax, it's accelerating but, but it's accelerating. That's what you're getting from this.
- [29:38]
H
I mean look at Nvidia's growth in the last fiscal quarter it was around mid 60% they're pointing to 77% growth in their fiscal 1Q so that goes to show and the proof point you can see in the hyperscaler capex. The hyperscaler Capex seems to be going up as well. So it's underpinned by healthy fundamentals. We know why Nvidia's top line is accelerating, right? Because the CapEx seems to be accelerating and all this points towards more inferencing, more demand for AI compute and we are hitting that phase where it's not just about training or whether it will happen or not. It's happening.
- [30:18]
B
So the roi, the usage, right, we're
- [30:20]
H
seeing it, the usage is happening and companies are consuming the compute. It's going to get reflected in the cloud revenue next quarter. It's going to get reflected in all the possible forms of their inferencing will show up.
- [30:34]
D
We're going to, we're going to bring on rock in in a second and talk salesforce because I think that's a good transition to talk about what companies are doing with AI and the message at least that salesforce trying to make with agentic AI. But before we get there, Mandeep, I do want you to weigh in on what Carol mentioned earlier about the China business. H200 shipped under a new program subject to a 25% tariff. Nvidia discloses US government in a 10K filing granted license by the US in February of 2026 the US license to ship small amounts of H200 to China for specific China based customers. What does our investing audience need to understand about what it can sell to China and the impact on that financially?
- [31:14]
H
I mean it used to be China used to be mid single digit percentage of Nvidia's overall data center revenue and Jensen has said China is about a $50 billion addressable market when it comes to chips and so the fact that they're allowed to sell something now to China doesn't mean it's going to grow at the same rate as their overall top line, which is, you know, 77%. And that excludes the China number. But it's all incremental revenue. And this print shows there is just insatiable demand for Nvidia's chips and whoever can get it will buy it. So it's just a question of whether Nvidia is willing to sell it to them or not.
- [31:54]
B
All right, so let's go to Salesforce. We do want to bring in our Anurag Rana, senior technology analyst at Bloomberg Intelligence. He's in Chicago. Shares of Salesforce Anurag are down about 4 1/2% percent in the aftermarket. Some of the red headlines that we crossed on the Bloomberg company in terms of the outlook sees first quarter revenue of 11.03 to 11.08 billion. That's above the street estimate of 10.99 billion. Also increasing its share buyback authorization to $50 billion. Walk us through. Because this company has certainly been under a lot of pressure. It's down about 50% since late 2024.
- [32:33]
F
So there are two things that are happening right now. The first is given so much spend going into AI, the non spending is the one that's under pressure and that is hurting companies like Salesforce, Workday, Accenture and so forth because companies have, or the clients don't have that much money to spend in terms of how they're allocating. Spending was on. The second big piece right now is the market's extremely worried about software companies getting disrupted by all the model providers and all the AI native companies. So Salesforce are getting hit by two different ways. But the results, frankly, they were, I mean, I wouldn't say they were disappointing. I would say they were stable in line in terms of what they were saying they're going to do. So from our side, you know, it is just going to take some time to sort out.
- [33:20]
D
So Anurag, the question I think a lot of people have, excuse me, about a company like Salesforce and you know, we could go through any other software company, not any other, but many other software companies, and ask you the same question is about the threat from artificial intelligence. And Marc Benioff was, was very clear in the press release to say that this is a company that has like relaunched, I don't have the exact wording in front of me, but relaunched as an AI, an agentic AI company. Is, is it really under threat? And specifically like what is the threat from cloud, from anthropic or from open air that investors are so worried about and is it warranted?
- [34:02]
F
So the question is the answer to the if is it warranted? I mean, I think it's going to take some time to play out because if the models get really smart, then why do you need a manufactured software like this? That software can do a lot of what you need to do in terms of managing your Salesforce or customer service. Now the question is, in our view, when a company like Salesforce is there, there are a handful of their products that they have, they have, that they sell into the enterprise, whether it's customer service, cloud or sales automation cloud. Those are the ones. I think they have a little bit better position of not being disrupted, but they have other visualization tools or some other smaller products that may not be the ones but anybody would pay for it. So I think that is a lot that needs to be done from Salesforce in terms of adding more capabilities to its core product and not be, you know, change the narrative around it.
- [34:55]
B
You know, the narratives have been so interesting on AI, as you really well know, looking at names like Snowflake down about 1.3% here in the aftermarket, we're talking about Salesforce and that stock. Just a real quick rehash here on the Bloomberg, we're seeing that stock stock still down about four and a half percent here in the aftermarket. And then of course you've got in video up about 2.3%. You put out some great research this week, Anurag, you and the team about the haves and have nots in a disruption. What do we need to know at this point? Especially when everyone says, folks, we're still early in on this, we don't really know how it all plays out.
- [35:32]
F
You know, I think that's the most important thing is we are very early in the inning. But at the same time, you know, when people are worried they'll entirely sell the entire sector. We have seen that numerous times. So when we looked at this thing, I mean, the entire team worked on creating a framework of, you know, when we see a company, does it have high market share? Does it sell to very large companies versus smaller companies? Is it a platform, is it a system of record? All those things takes into account, you know, kind of the history of a company. So let's say a company like SAP that's been around for 50 years, you use it for your core accounting reasons, supply chain, I think something like that is better entrenched than a very small company that's probably doing one particular function or selling only to the small and medium customers.
- [36:17]
B
Hey, final question here on Salesforce. Just going back as we watch this stock down 4.6%. Top of mind. I know I always ask you guys this, but when the call starts with the company and the C suite and analysts and investors, what must be asked,
- [36:31]
F
I think the biggest thing is going to be like what are you doing to change the narrative around them being disrupted by AI and how are they adding more AI capabilities across their entire suite?
- [36:43]
B
All right, love it. Anurag, thank you so much. Anuragrana. His research certainly on the AI world and also on Salesforce. We'll be looking for that later on today. Anuragrana, senior technology analyst at Bloomberg Intelligence out there in Chicago.
- [36:58]
A
This is the Bloomberg Businessweek Daily Podcast. Listen live each weekday starting at 2pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg 11:30.
- [37:17]
B
Geopolitics some certainly mentioned in President Trump's speech last night. The president in his State of the Union speech focused on the economy and his view included statements about what we just talked about with our own Mike McKee. Inflation is plummeting, he said. He said incomes are rising F and he also talked about Friday's Supreme Court decision that struck down the president's global tariffs.
- [37:39]
H
An unfortunate ruling from the United States Supreme Court. It just came down.
- [37:44]
B
It came down.
- [37:45]
H
Very unfortunate ruling.
- [37:50]
B
But the good news is that almost
- [37:52]
H
all countries and corporations want to keep the deal that they already made. I use these tariffs, took in hundreds of billions of dollars to make great deals for our country, both economically and on a national security basis.
- [38:07]
B
I introduced the great health care plan.
- [38:10]
H
I want to stop all payments to
- [38:13]
B
big insurance companies and instead give that
- [38:15]
H
money directly to the people. The roaring economy is roaring like never before.
- [38:21]
B
Our country is winning again. In fact, we're winning so much that
- [38:26]
H
we really don't know what to do about it.
- [38:29]
B
People are asking me, please, please, please,
- [38:32]
H
Mr. President, we're winning too much.
- [38:34]
B
Our nation is back, bigger, better, richer and stronger than ever before. All right, everybody. That, of course, was President Trump last night at the State of the Union address. We should point out his speech was criticized by Democrats, including US Senator Elizabeth Warren, who said he had nothing to say about issues like capping credit card interest rates and making child care more affordable. Let's get a policy view of last night's address from President Trump and what policies and actions that may still be coming that could impact the future outlook for the United States. Great to have back with us, Libby Cantrell. She is managing director, head of public policy for pimco. She joins us from pimco's offices right here in New York City. Libby, welcome back. Great to have you here. Let's just talk broadly about this speech. What stood out for you and what do you think should stood out for the investing public, American citizens at large, the business community, and I think about American citizens who still think about this affordability issue. So what stands out on those fronts?
- [39:38]
G
Yeah, Nice to be with you. I mean, this was, you know, there was more performance here than, than policy. We would argue there was a bit of a spiking of the football in terms of really sort of reinforcing some of what President Trump has perceived as victories. The one big beautiful bill closing the border as some of the other immigration policies that he has pursued and also some of the foreign policy wins that he is characterizing at least as, as wins. So I think that this was in some ways a lot of kind of red meat for his base as, as supreme as, as these addresses oftentimes are. Now, he did talk about tariffs, as you, as you mentioned. I think that to the relief of many Republicans in that chamber, he did not call on Congress to take a vote on tariffs. I think that is something that probably would have failed anyway but also would have been politically difficult for, for Republicans. But by and large, this was, I think, a pretty typical State of the Union address in many ways. It was again, more of a rehashing of sort of the political winds and pretty light on policy details and light on kind of a roadmap, I think, for a lot of congressional Republicans heading into the midterms.
- [40:57]
D
Yeah, I'm really glad you went to the midterms because that's, that's exactly where I want to go and try to understand from you if it actually moved the needle on, on how people could vote come the midterms, because that's, that's what Republicans and Democrats are focused on right now.
- [41:14]
G
I think it was a bit surprising that there probably there were not arguably more policies that he'd actually highlighted in other speeches and other venues highlighted in last night's speech. And he did talk about this ban that he wants Congress to codify in terms of institutional investors investing in single family homes. But he didn't really talk about some of the other proposals. To Senator Warren's criticism, she remarked that he did not talk about you know, capping credit cards and what have you. Now, I don't think any of those will actually get effectuated into policy. Those need Congress anyway. But in terms of really leaning into that affordability sort of framework and theme, he didn't really give Republicans all that much. Again, I think what his hope is and what a lot of Republicans hope is is that the voters sentiment around the economy will be different come this fall. Now, of course, that one big beautiful bill, people will be getting refunds on average, you know, $4,000, about $1,000 extra in terms of a refund relative to last year. So I think the hope is that there will be more optimism and that folks will have a different perception of affordability. And so maybe he won't need to lean into some of those policies. I think that was maybe last night was maybe a tell of that, of that thinking.
- [42:36]
B
Libby, he did focus on the stock market, certainly something we focus on here at Bloomberg. But you know, talking about how good that was. Right. And wealth created and good for investors. But is that always a good read or is that even a good read on kind of the state of the U.S. as a nation and as an economy?
- [42:55]
G
Well, I think there are lots of examples where, you know, voters have, you know, one view of things and the stock market is doing something different. I think if you talk to President Biden, I think that was one of his frustrations and his economic advisers frustrations is that actually the market was doing quite well and the economy objectively was doing pretty well, but voters just didn't feel it. So perception is reality here. And going into these midterm elections, again, I think there is a hope that voters will feel better about things. And I think to President Trump's credit, in terms of the Trump accounts that were codified into one big beautiful bill, this idea of broadening that out and giving folks access to retirement accounts who may not have access to traditional 401k plan. So I think he is trying to tie the, the stock market performance to kind of everyday people's lives. However, you know, we'll see. There's a lot of distance between here and there in terms of getting that actually effectually into policy.
- [43:56]
B
I think a lot of folks think what a great idea, right, to get. If we talk about wealth creation, this is a great way to do it. But I do also think about how do we pay for all this stuff and when do we think about kind of the fiscal house and when that's going to matter. I know, you know, go back a decade or so and it was in every conversation I talked about here at Bloomberg or even longer than that. Then it went away and now it's back again. So I just think about when do we have to kind of when does that all come home to roost or is it already.
- [44:24]
G
Yes, I think if you contrast this speech with the speech last February where President Trump was really leaning into this idea of doge and cutting federal spending and talking about the deficit. There was no mention of the deficit last last night. And in fact, he talked about how important Social Security and Medicare were and how those would not be touched. As you all know, those are important programs, bipartisan, you know, why? Bipartisan support, however, they're both of their growth are expensive as well. You know, our view here is that while there is no kind of immediate fiscal reckoning, I mean, the bond market, as you, as you all know, hasn't necessarily necessarily the bond vigilantes having to come out here and, and discipline Washington, but it's probably a question of, you know, when, not if, that there will be an inflection point where members of Congress will have to actually do something in terms of sort of the fiscal trajectory. It doesn't look like it's close. There's not a lot of political appetite to increase taxes or reduce spending. You know, our view is it's sort of 6 to 7% deficits as a percentage of GDP, there will be a limit to that. And whether it's the bond market that is imposing that discipline or when it's, you know, Social Security trust fund starting to kind of go bankrupt, so to speak, which is expected to happen in the early 2030. So we do think this is, you know, again, a question of when, not if. But it's just the win is probably not, you know, under President Trump's term, at least as, you know, know, if, if what, what the market signals are saying now, you know, Libby, you know,
- [46:01]
B
you've seen different market cycles, different economies under different presidents. We've talked about this a little bit earlier with our own Mike McKee. How do you describe the Trump economy? Is it a good one?
- [46:11]
G
Well, I think that, you know, and again, there is a limitation to how much a president can actually impact the economy. So this is, you know, for better or for worse presidents, President Trump included, they like to take, you know, take sort of credit for when things are going well, but also to sort of avoid any of that blame when, when they're not. You know, I think we would characterize this economy, you know, this sort of, you know, K shaped two Speed economy is quite real. Where are you know if you just look at the components of GDP obviously, you know I remember related capex fueled a lot of growth last year as did the high end consumer. I think there is a hope in 2026 and again this is what I think Republicans are banking on that the breadth of that economic growth is broader and that this sort of the consumer at the kind of middle to lower end starts feeling better about things and starts participating in the economy. But if you, if the economy just is predicated on kind of AI related CapEx and the high end consumer that makes for a relatively fragile economy. And if you sort of see any kind of wobbles in the, the labor market for instance, that could have maybe a non linear impact. So you know I think it is a, it's a, it's a stronger economy, it's been a resilient economy for sure.
- [47:36]
B
Right.
- [47:37]
G
But again I think of Republicans are hoping that you can sort of broaden out the source of that growth growth and that they'll actually be rewarded then you know, come November.
- [47:45]
B
But that I spend the impact on the market sending it higher and then you know, the wealth created among affluent spenders. That is something that Greg Dacko has certainly talked about a lot for us from ey Parthenon and the importance and if that starts to come undone that could be problematic.
- [48:01]
D
Tim hey Libya. I want to shift gears a little bit and talk geopolitics because ahead of the speech the president and he's gotten quite a bit of criticism in recent months even from within his own party about focusing too much on geopolitics. And while he didn't talk too much about geopolitics, what he did frame last night was you know, Venezuela and the ouster of Maduro, that being a win for, for oil companies and Americans who are getting oil and will get oil from Venezuela. And just now we are learning that Cuba has shot four dead in a clash with a Florida speedboat. That's just breaking news just in the last few minutes. I'm wondering about geopolitics though and the political risk for a president who came in and said, you know, no more on a platform, no more foreign wars, wants to end wars for focusing so much on geopolitics within his first year in office. Is that alienating some of his base?
- [48:51]
G
You know I think, I think, I think it's confused some of his base for sure, as you said that there is a wing of the sort of Trump base that you know is more isolationist. I think Those folks thought that, you know, President Trump would be sharing in that view. He obviously, you talked about ending the war in Ukraine. That has not happened. He's talked about, you know, bringing kind of peace globally. I think you could sort of quibble about whether that has actually been true or not. And then to your point, he has focused on, you know, some of these more specific operations. Now, I think, you know, Venezuela, the way that they would characterize, the White House would characterize this as this is an extradition, kind of a high profile file arrest, if you will, that required a lot of resources of the US Government, but was quite different from regime change. We'll see kind of how that, how that plays out. But I do think, Tim, you're right to sort of focus on this politically because, you know, midterms are all about turnout. It's not about persuasion. Right. You need to get your base turned out. You need them to get excited. Whereas a general election, it's about sort of persuading folks who might be kind of of on the fence again, midterms, all about kind of your base turnout. And if your base is at all, you know, feeling maybe a little bit less enthusiastic about you, they may not turn out. And so I do think this, you know, we'll sort of see how this kind of movie plays out. But you could see President Trump, you know, maybe kind of be forced by his own party to be less focused on these issues because they just doesn't, doesn't have sort of the, the galvanizing effect as, you know, the kitchen table, gas and grocery issues you typically, you typically have. The last thing I'll just say, though is I think President Trump was quite clear about what his framework was he was using yesterday as it relates to Iran. He definitely did not close the door on potential intervention. He also didn't necessarily endorse that he was going to do this either. So he was using sort of this clear framework about, you know, about Iran's ability to develop a nuclear weapon and what have you as kind of a litmus test. So I think he, he's trying to be more clear about what it would require to engage. But again, politically, he may be forced to back that back office as we get closer to the midterms.
- [51:07]
B
Libby, going back to the affordability issues, we know President Trump and Vice President J.D. vance are hitting the road tomorrow and I believe on Friday to kind of test their affordability message with voters in Texas and Wisconsin this week. So things like, you know, obviously the tax cuts that are already part of his Big beautiful bill, these new savings accounts for kids, maybe banning of institutional investors from buying homes, you know, although we didn't get anything more on that. Are there policies or clarifications of policies or implement implementation of policies that are likely to come leading up to, to the midterms that you think kind of improve the affordability issues for those who will be voting?
- [51:51]
G
I think the reality is, is that even if President Trump wants to see some changes, it's going to be very difficult for Congress to get anything done before the summer, which is really the de facto end of this Congress. That's when they will adjourn for their sort of summer, traditional summer recess for them to really go back to their districts and to campaign. So in terms of the Runway to actually effectuate policy, we are talking about a very short one, you know, to July, basically. And we don't see Congress moving. We don't see them passing another tax bill, another spending bill, another bill that prevents, you know, institutional investors from, from buying single family homes or what have you. There is a housing bill that they may be able to pass both chambers and get signed into law, but that is likely going to be it. So I think kind of for all intents and purposes here, Trump will have to lean on those policies. He can effectuate unilaterally, which is the agencies buying, you know, agency nbs as one thing that he did not talk about in his speech. It's kind of for us, you know, bond nerds over here. But, but, you know, we do think that's actually that deregulation, those are two things that he can and will, we think, continue to lean on to help improve at least mortgage rates and, and sort of, you know, the rate environment in general and hope, hope that that will actually trickle down to some kind of the perception again of affordability among voters. But outside of that, we do not expect Congress to move really, period before between now and the midterms.
- [53:28]
B
All right.
- [53:28]
D
I don't recall seeing mentions of agency MBS on the prediction market.
- [53:31]
B
Wait, that's when they all stood up. Remember, they like the.
- [53:35]
E
Exactly.
- [53:36]
G
The only bipartisan moment we saw was at our agency MBS together.
- [53:42]
B
Libby Cantrell, you rock. Managing director, head of public policy over at pimco, joining us right here in New York City.
- [53:49]
D
Stay with us. More from Bloomberg businessweek Daily coming up after this.
- [53:58]
B
This is Tom Keene inviting you to join us for the Bloomberg Surveillance podcast.
- [54:03]
H
It's about making you smarter every business day.
- [54:06]
B
I'm Paul Sweeney. We bring you complete coverage of the US market open. We cover stocks, bonds, commodities, even crypto. All the information you need to excel. And I'm Alexis Christophers. Bloomberg Surveillance also brings you the analysis behind the headlines. We do that through conversations with the smartest names in economics, finance, investment and international relations. We do all this live each and every weekday, then bring you the best analysis in our daily podcast.
- [54:32]
F
Search for Bloomberg Surveillance on Apple, Spotify,
- [54:36]
B
YouTube or anywhere else you listen.
- [54:39]
A
On the east coast, listen at lunch
- [54:40]
B
and on the west coast, listen as soon as you wake up. That's the Bloomberg Surveillance Podcast with Tom Keene, Paul Sweeney and me, Alexis Christofforos. Subscribe today wherever you get your podcasts. Bloomberg Surveillance Essential listening each and every business day. When my mom got sick, she felt powerless. Insurance denied her meds. Her doctors talked over her and they couldn't agree on anything. She kept getting worse. And then you found solace for me. They gave me my own healthcare advocate. My advocate found better doctors, scheduled my appointments and got my medications approved. She even joined my appointments and made my doctors work together. For the first time, my whole care team was listening to each other and to me. I was going to pay for it. But then we learned that solace advocates are covered by Medicare. I used to feel helpless, too. Now I know my mom has an advocate.
- [55:29]
A
Solis advocates are healthcare experts who spent years helping patients. 96% of patients report better care. With an advocate, that means better health outcomes, less stress and finally feeling heard. Have Medicare. See if you qualify@sollushealth.com or call 8887 SOLACE 888-7s-O L A C E. That's 8887 SOLACE.
- [55:51]
B
Don't face the healthcare system alone. Find SOLACE. Visit SolisHealth.com today.
- [55:57]
A
You're listening to the Bloomberg Business Week daily podcast. Catch us live weekday afternoons from 2 to 5pm Eastern. Listen on Apple, CarPlay and Android Auto with the Bloomberg business app or watch us live on YouTube.
- [56:11]
D
Cuban forces killed four people and wounded six. Six others who were traveling in a speedboat with Florida tags after they opened fire on the island's border patrol, the government said. With us is Dan Cancell, bn Bloomberg News Miami bureau chief. He joins us from our Miami bureau. Dan, we're trying to understand what exactly is going on, who, who these individuals were and what they did. And we're hoping you can shed some light on it. What do we know about the four people who were killed?
- [56:38]
A
Yeah, very little you know. The source of the information as of now comes from The Cuban military, as you mention, the statement dropped about an hour or so ago where they mentioned that this boat with Florida registration carrying 10 passengers ran into this incident conflict with the Coast Guard with four dead and six injured. They haven't identified the nationality of these individuals, obviously released any names. And on the US Side, we don't have any information either corroborating that information or providing new details. So as of now, it's a bit of a sit and wait to see if the Cubans release, you know, additional information. But obviously there's a big backdrop here, right, to what's happening between US And Cuba relations.
- [57:24]
B
Let's talk about that, because we did know, I think, earlier today the US Announced that it would ease restrictions on Venezuelan oil exports to Cuba's private sector for humanitarian reasons. We know Canada has announced an aid package for Cubans because of President Trump's oil blockade. So kind of where are we? I mean, 10 tensions are high right now between the US and Cuba.
- [57:48]
A
They are, yeah. I mean, since January 3rd, when Maduro was captured in Caracas, obviously Venezuela was the biggest ally and benefactor for the Cuban regime. And so taking those oil flows and that support away from the Cubans has created a lot of tension. And obviously, the situation on the ground in Cuba has deteriorated in terms of energy supplies and other sorts of supplies. So the US has not come out with a real clear strategy on what they hope to accomplish in Cuba. But clearly there are some new headlines about supplying the private sector with fuel versus so trying to go around the regime in helping the people and avoid a bigger humanitarian crisis.
- [58:36]
D
Yeah, I mean, and again, the information we have, Dan, on this is very limited. And you make a good point about the backdrop of this and what it means in the context of everything that's happened in 2026 thus far. That said, there has been reporting around where this boat at least was registered to. What can you tell us about that? And if that offers any indication about who was actually in the boat?
- [59:02]
A
Yeah, listen, so far all we have is that is a registration number, which curiously, the Cubans did provide in their statement. It's not, you know, it's not returning anything solid as we look into that and report on it. You know, so you can, you know, you can kind of imagine this could be people out for, you know, fishing, but, you know, apparently they were armed. Right. So maybe not. We could be talking about people trying to bring supplies, you know, to Cubans whether, you know, whether it's food goods, whether it's illicit. Right. Kind of smuggling operation. So it's really kind of up to our imaginations here, you know, in terms of what could have been happening and the fact that the US Coast Guard has not issued a statement or verified this is something that we're obviously waiting for.
- [59:49]
B
We do have US Representative Carlos Jimenez out on social and he's saying Cuba, the Cuban government must go to quote, the dustbin of history. He posts this after Cuba clashing with the US Speedboat and he calls, quote, again his words, murder, Cuba killing of US Speedboat crew. But, but as you said, we don't know a lot. We have to be very careful. The devil is always in the details. And we are waiting some kind of statement from the US Government, correct?
- [60:17]
A
Absolutely. I'd say he's among the more hardline of the Cuban Americans in Congress. And so it's not rare that he'd have that rhetoric today. And again, we need to figure out exactly who these people were from the US Perspective. Are they US Citizens? Are they Cubans? And so we just, just there's so many things we, that we need to figure out here.
- [60:41]
B
Yeah.
- [60:41]
A
I think the one thing again is, you know, what's changed recently is that the private sector in Cuba is now authorized to import fuel. Right. For, for the first time. And so, you know, could people be running, you know, big jugs of gasoline or diesel right across the less than 100 miles that separate the two countries. So again, it's just a theory or one possible scenario. Right. I just don't know.
- [61:06]
B
One more line from Representative Jimenez's statement on social he's calling for an investigation of the Cuba incident. But we would all concur that we need to know some more in terms of the details and find out exactly what happened before we can move forward. Dan Kinsel, thank you so much. He is Bloomberg News Miami Bureau chief joining us from our bureau in Miami. We're going to kind of stay on. I don't know whether you want to call this geopolitics or just tensions. Global tensions and just finding our way forward when it comes to relationships between countries. But also throw things like technology and military and it kind of all gets interesting and a little tough.
- [61:42]
A
This is the Bloomberg businessweek daily podcast available on Apple, Spotify and anywhere else you get. Your podcasts listen live weekday afternoons from 2 to 5pm Eastern on Bloomberg.com, the iHeartRadio app, TuneIn and the Bloomberg Business app. You can also watch us live Every weekday on YouTube and always on the Bloomberg terminal.