Tesla Earnings Miss Despite Record Third-Quarter Sales Surge

Summary

Bloomberg Businessweek – Tesla’s Earnings Miss, Automation at Amazon, and Quantum Leap in Chattanooga

Episode Date: October 22, 2025
Hosts: Carol Massar, Tim Stenovec, Ed Ludlow

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Episode Overview

This episode covers three big stories impacting the business and tech landscape:

1. Tesla’s third-quarter earnings miss—delving into why profits fell short despite record sales, and the persistent doubts about Full Self Driving (FSD) and the elusive robotaxi future.
2. Amazon’s robotics and automation push—Amazon Robotics' Chief Technologist, Ty Brady, unpacks the company’s latest advances in warehouse and AI-driven automation, and their real impact on jobs.
3. Chattanooga’s quantum computing revolution—the city’s mayor and a local utility executive discuss how America’s first commercial quantum network is attracting investment and innovation beyond Silicon Valley.

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1. Tesla’s Earnings, FSD Controversy, and the Elusive Robotaxi

The State of Tesla (02:00–14:17)

• Tesla fell short of Wall Street profit expectations for Q3, despite a surge in EV sales.
  • Shares dropped 2% in after-hours trading.
  • Ross Gerber (Gerber Kawasaki): “We’ve cut our [Tesla] position by 60%.” (02:48)

Gerber’s Outlook on Tesla

• Current Position: Holding, not actively buying or selling.
• Clients either strongly believe in Tesla or have sold their positions.
• “We’re not recommending to buy Tesla... more likely recommending to sell Tesla for investors up at these prices because you’re getting such a premium valuation.” —Ross Gerber (02:57)

The FSD Debate: Does It Work? (03:42–09:00)

• Skepticism on Vision-Only Systems:
  • Ross doubts that Tesla’s camera-only FSD technology can deliver on full autonomy. “I don’t think Elon [Musk] gets how humans work. I think he gets how machines work. Tesla’s in a pickle if they can’t solve for full self-driving... nothing’s going to get me excited about Tesla until it drives me home.” (03:42)
• User Perspective:
  • Tim Stenovec: Daily FSD user on Model Y, but won’t trust it fully: “I would never get in the back of the car and turn it on. I also would not put my little baby boy in it either.” (07:29)
• Road to Robotaxi Is Unclear:
  • Discussion on the gap between selling advanced FSD as a consumer product and developing an Uber-like robotaxi service—“extremely difficult,” even if the tech advances (06:05, Ross Gerber).
  • “There’s already several cab services... that are all very good at what they do. Even if Tesla gets this to work, it’s still a tough business.” —Ross (06:05)

Technical Deep Dive: Vision vs. Lidar Debate (08:34–10:21)

• Tesla FSD is vision-only; competitors like Waymo use redundant sensors (lidar, radar) for higher accuracy and safety.
• Economic Argument: Tesla claims multiple sensor setups aren’t scalable for affordable vehicles, but competitors argue it’s required for safety and robustness.

Will the Robotaxi Dream Happen? (10:21–14:17)

• Ross Gerber: “Humans love to drive... I just don’t see people giving up cars anytime soon for practical reasons.” (10:58)
• Generational divide: Younger people less attached to driving, but entrenched car culture and current city infrastructure make widespread adoption hard.
• Legislation Limbo: U.S. federal legislation enabling steering wheel-free robotaxis is stuck, highlighting regulatory and real-world hurdles.

Notable Quotes

• “Elon Musk is often late on his predictions but gets there in the end.” —Tim Stenovec (13:00)
• “Unless we rejigger cities and start from scratch... I just don’t see how you implement that... millions already have their commuter lifestyle.” —Ross Gerber (11:22)

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2. Inside Amazon’s Robotics Revolution

Amazon’s Robotics Announcements (17:29–29:12)

What’s New in the Warehouses? (18:35–20:09)

• Blue Jay “Manpiulation” Robot: Reduces labor needs for repetitive picks; can handle 75%+ of network inventory. Developed in just over a year using advanced AI (18:58).
  • “With Blue Jay, you can take three assembly lines and put it in the same footprint of one.” —Ty Brady (18:58)
• Collaborative Robotics Philosophy: Amazon’s robots increasingly eliminate the “menial, the mundane, and the repetitive,” freeing up workers for higher-order tasks.

Scaling for Efficiency, Not Just Cost Cutting (21:16–23:11)

• Amazon’s focus: Efficiency, throughput, worker safety—not explicitly on job cuts.
  • “When you do collaborative robotics... it allows you to be more productive and when you’re more productive, that allows you to invest more in people.” —Ty Brady (21:58)
  • Over 700,000 workers upskilled so far.
  • Modern robotics are more about movement, sortation, perception, and safety than just speeding up tasks.

Workplace Impact: Fewer Jobs? (23:11–26:03)

• Labor Concerns:
  • NY Times reported on Amazon execs seeing a shift that could replace 500,000+ jobs with robots in the next decade.
  • Brady’s Response: “The last 10 years... we created hundreds of thousands of new jobs and new job types... No employer has employed more people in the US in 10 years.”
• Job Evolution: “I’m very bullish on eliminating every menial, mundane, and repetitive job out there.” —Ty Brady (25:05)
  • Amazon claims a 30% reduction in injury rates due to robotics.

Seasonal Workforce and Automation (26:03–27:03)

• Despite automation, Amazon plans to hire over 250,000 temp workers for the holidays in 2025. “Those are good paying jobs. Really happy about that.” —Ty Brady (26:31)

International Robotics Trends (27:03–28:00)

• Ty Brady downplays robotics “hype videos” from overseas, stressing Amazon’s real-world, at-scale deployment: “Our world is about application. Our world is the reality.” (27:37)

Notable Quotes

• “History has shown, we continue to create jobs... with the goal of two things. Can you have it all? Can you be more productive... and can you also create a safer environment for our employees?” —Ty Brady (25:05)
• “You have to build your robotics in the right way, that empowers people.” —Ty Brady (25:55)

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3. Chattanooga’s Quantum Leap: Building a Next-Gen City

Quantum Network Innovation (32:03–43:31)

Political Environment and City Operations (33:07–35:03)

• Mayor Tim Kelly (Chattanooga, TN): Focuses on practical city management, staying above partisanship, and making Chattanooga a hub for inclusive civic innovation.
  • “If Republicans think I’m a Democrat and Democrats think I’m a Republican, I’m probably doing a pretty good job.” —Mayor Tim Kelly (33:34)

How Chattanooga Became a Quantum Trailblazer (35:03–36:13)

• Leveraged a federal loan in the '90s to build a fast municipal fiber network.
  • Result: First U.S. city with commercially-available quantum networking (since 2022), luring talent and partnerships (IonQ, Nvidia, Oak Ridge National Lab).

Quantum + AI: Practical Benefits (36:13–41:55)

• Quantum’s killer app: optimization, especially for energy grids and logistics. Currently, in pilot partnerships to solve energy distribution and demand.
  • “Quantum computer...can solve things at a much faster rate, which uses less energy than a classical computer.” —Janet Rayberg, EPB (37:32)
• Regional energy mix: Hydro, renewables, gas, and a growing nuclear footprint via TVA.
  • “There’s no way around nuclear,” says Kelly (38:30), predicting more use alongside renewables.

Attracting Talent and Business (40:15–41:09)

• Chattanooga saw 10–12,000 new knowledge workers move in during the pandemic.
  • “If you build it, they will come mentality?... Yes, they have come.” —Mayor Tim Kelly (40:42–40:44)
• Quantum computing seen as a differentiator vs. “usual suspects” for tech cities.

Education, Equity, and the Quantum-AI Future (42:03–43:31)

• Quantum and AI will converge: “I don’t think it’s one or the other. I think it’s going to be a combination...to build algorithms more efficiently.” —Janet Rayberg (41:36)
• Mayor Kelly stresses workforce reform and inclusive growth in the age of AI and quantum: “The long game is...change the way we do education and workforce development so we don’t leave people behind.” (43:04)

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Memorable Quotes & Moments

• “Nothing’s going to get me excited about Tesla until it drives me home.” —Ross Gerber (03:42)
• “I would never get in the back of the [Tesla] car and turn it on. I also would not put my little baby boy in it either.” —Tim Stenovec (07:29)
• “Our world is the reality.” —Ty Brady on Amazon robotics vs. hype (27:37)
• “You can get 25 gigs of speed at your house in Chattanooga... you can also do quantum computing on large loops of dark fiber.” —Mayor Tim Kelly (35:24)
• “If you build it, they will come mentality?... Yes, they have come.” —Mayor Tim Kelly (40:42–40:44)

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Timestamps for Key Segments

• 02:00 — Tesla’s Q3 earnings, Gerber’s investment strategy
• 03:42 — FSD skepticism and value proposition
• 06:05 — The “robotaxi” business challenge
• 08:34 — Vision-only vs. lidar debate for autonomy
• 10:49 — Car culture and autonomy hurdles
• 13:00 — Tesla’s long-term prospects
• 17:29 — Amazon’s billionth robot announcement
• 18:58 — “Blue Jay” AI robot and warehouse innovation
• 21:58 — Data, efficiency, and labor in Amazon’s robotics push
• 23:58 — Automation and the future of jobs at Amazon
• 26:31 — Seasonal hiring and collaborative robotics
• 32:03 — Chattanooga’s quantum network and economic vision
• 37:32 — Quantum computing’s potential energy benefits
• 40:42 — Chattanooga’s tech boom and “if you build it” urbanism
• 43:04 — Workforce equity for a quantum/AI-powered economy

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Tone and Style

The conversation is candid and occasionally skeptical, especially when discussing the practical challenges of “revolutionary” technologies like FSD and robotics. There’s measured optimism about innovation but a clear-eyed assessment of risks, regulatory delays, and labor impacts. The Chattanooga segment, in contrast, radiates pragmatic civic optimism and a belief in building opportunity from the ground up.

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Transcript

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[Carol Massar]

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Bloomberg Audio Studios Podcasts Radio News this 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 Burg Business Week Daily Podcast with Carol Massar and Tim Stanweck on.

[Carol Massar]

Bloomberg Radio well back to Tesla shares down 2% in the after hours, the company posted third quarter profit that fell short of Wall Street's expectations despite record EV sales. I want to bring back Ed Ludlow, he's the co host of Bloomberg Tech. And also bring in Ross Gerber. He's President and CEO of Gerber Kawasaki wealth and Investment Management. Got more than $3 billion in assets under management. He joins us from Santa Monica, California. Ross, you now have about $80 million of Tesla shares, down from 100 million earlier this year. At it at your peak, how much Tesla stock did you own?

[Ross Gerber]

I think we had about one and a half times more than we have today.

[Carol Massar]

So that's not that much more.

[Ross Gerber]

No, we've got it our position by 60%. So that's, that's fairly large.

[Carol Massar]

Are you, are you buying or selling today or buying or selling Right now.

[Ross Gerber]

Neither. Neither. You know, you know, Tesla is a hold for us. You know, the people who are holding the stock at our firm, our clients very much believe in Tesla and don't want to let go of their shares at all. And then, you know, the clients that don't want to own Tesla don't own Tesla anymore. But we're not recommending to buy Tesla or per se, more likely recommending to sell Tesla for investors up at these prices because you're getting such a premium valuation. But, but in general, we've just been holding the stock because, you know, we're, we're kind of stuck with our position right now.

[Carol Massar]

What about you? We, because we check in with you quarterly and you, you've really changed your position on the company in recent years, in recent quarters. And your position on Elon Musk too. Are you a believer in the company right now?

[Ross Gerber]

Yes and no. I, I still own Tesla stock as well. Personally, not a lot, but, you know, I like to have some because I bought it at a do a share or $1.50. So it's like fun to have in my portfolio still. But that said, I don't know what's going to happen with full self driving. I just don't think it works. And I think Vision only systems don't work. And I'm very sure of this now, even though I'm not an engineer. I can explain to you how humans drive. And I don't think Elon gets how humans work. I think he gets how machines work. And so I think that Tesla's in a pickle if they can solve for full self driving. Like I could get in my car right now and push a button and it drives me home. Like I can get in a Waymo right now and it'll drive me home, no problem. Then I think Tesla has a reason to buy the stock because now they've got their products working and they can grow from there. But as far as waiting for robots and cabs to pay off, it doesn't matter if full self driving doesn't work and full self driving doesn't work. So nothing's going to get me excited about Tesla until it drives me home.

[Amazon Business Advertiser]

Mm.

[Ed Ludlow]

All right, good stuff. We're talking with Ross Gerber. Ed Ludlow, I know you're reading over stuff. Come on into the conversation with Ross.

[Tim Stannweck]

Yeah, I mean, you know, just going through the deck. The way that Tesla explains it is that they had lower FSD revenue recognition in this quarter because of the timing of previous generation releases of FSD in The same period a year ago. You know, I'm not a Tesla shareholder, as you guys know, but I do drive a Model Y. In fact, I use FSD every day for about 60 miles, 30 miles to work, 30 miles back. I'm not on version 14 yet. But Ross is speaking to the question which is always there, explain the jump or the steps to the end result. The end state. The end state is Robo Taxi. Right. If tester is to be believed. And right now, you know, the street seems kind of split on whether we understand how we go from a software platform that consumers pay for as a one off or a subscription package to a world where the vehicles built on a, on a common software platform or iterations of that platform power a proprietary ride hailing robotaxi service. You know, it's difficult to see the jump and Ross can speak for himself, but just in the reporting, that's, that's what we hear all the time.

[Ross Gerber]

Yeah, I mean you're 100% right in that these are completely different businesses, right? Like selling cars that drive themselves is an Apple business model. And that's why I always love Tesla. When I first found Tesla, I was like, this is the Apple of cars, right? Like you build hardware and with great software and then you make money on services, right? And that's really where Tesla's making a ton of money right now, is on services and energy storage, which are still great businesses for Tesla. But when you talk about building an Uber like platform, this is an extremely difficult thing that it took Uber almost a decade or more to make money doing. And Uber's very, very good at this. Now the only way they've been able to make money is by charging substantially more for the rides because Uber is not cheap anymore and they had to subsidize rides for a decade just to build that business. So when you actually think about Tesla scaling, if there was no competition, that'd be one thing. But there's already several cab services I can take right now, whether it be Uber, Lyft or Waymo, that are all very good at what they do. So you know, even if Tesla gets this to work, it's still a tough business. And the second thing, I would just say, Ed, you use full self driving a lot. Obviously you probably, if I ask, do you feel comfortable turning it on and going into the backseat of your car and letting you drive that full 30 miles home?

[Tim Stannweck]

I've never done that or attempted it. And I think, you know, I post quite a lot on X my experiences. Like I say today, this is what happened. You know, I would never get in the back of the car and turn it on. I also would not put my, my little baby boy in it either. But the way that I've tried to track it is generation by generation. How is it improved on the route that I take every day? The one area really struggled is with the toll booths on the Golden Gate Bridge. You know, that can be precarious. And you can see my post on that. On your point in the in the air graph of the shareholder deck. The way that Tesla explains it is that the latest version of fsd, they say has a substantial amount of the source code in the Robotaxi version. And by putting it out into the real world, it gives them valuable real world data to help them improve a future Robotaxi service. I don't, I don't weigh in on that one way or the other. I'm just saying that's Tesla's explanation on the link between the two. The consumer facing FSD and the same code base that will be used to power a future Robotaxi service.

[Carol Massar]

Hey, Ed, Ross made the point that he doesn't believe vision only FSD or vision only self driving works. Can you talk a little bit about that technology that Tesla uses versus the other companies, namely Waymo and Amazon, Amazon subsidiary as well?

[Tim Stannweck]

Yeah. So very simple when we say vision based system, the inputs for the vehicle are only cameras. On a Tesla, the cameras capture, capture optical data from around the vehicle and use the underlying algorithm to make an onboard decision interpreting the world around them. The opposite academic view is that you need to paint a richer digital picture of the world using other forms of data gathered by lidar radar and in some cases even going beyond that. You know, like there are, there are varying degrees of lidar spinning or stationary or static. Sorry. The economic argument that Tesla and Elon Musk have always made is that having a vehicle that has multiple sensors on it is not scalable. You know, there is no end result where the vehicle could be affordable for a consumer or profitable for an operator of that system to run. The other Robotaxi companies like Waymo or Zoox, who do have multiple sensors and custom versions of them say that you have to have them for redundancy. So if one of those digital pictures fails, that is the vision one, the cameras fail or the radar fails, you can still be safe because you have a rich enough digital picture of the world around you for the vehicle to make a decision based on the circumstances presented in front of it.

[Ed Ludlow]

So let me put this question to Both of you. And let me just start with you, Ross. I mean, I've gotten in a waymo. I love it. And I've sat in the backseat, I've closed my eyes for like a 30, 40 minute trip to an airport. I have loved it. So FSD full self driving. Is it. Are we crazy to think that that's going to be our world going forward, or do we have to change our infrastructure dramatically to make it possible going forward? Like trying to understand. Because if the model is so tough.

[Carol Massar]

The infrastructure is the hardest part. Would be the hardest part.

[Ed Ludlow]

Well, I'm just thinking if it's such a tortured model, like, are we crazy to even be talking about it?

[Ross Gerber]

You're getting into one of my favorite discussion debate issues out there right now, which is the future of what mobility actually looks like. And my basic premise is that humans love to drive and are not giving it up. And I'm now raising my children. I thought when I had children that we would have had this master, that my kids would never learn to drive. But my kid's learning how to drive now. You know what I'm saying? And people love to drive. Now. Younger people don't love to drive as much as older people. That's one thing in our surveys we've noticed. Okay, but I'm not giving up driving. And if I live another 30 years, I'm still going to love driving. And I love cars and I love driving fast and I love like, you know, driving the one freeway, you know, whatever you want to call it. But you know, humans love the independence and the functionality of having their own vehicle. We've had, it started with the horse. We all had our own horse. You fought to the death to protect your horse. And, and I just don't see people giving up cars anytime soon for a lot of practical reasons. Like when you're doing errands and you have to store stuff in your car or pick up your kids and then go to soccer, it's like you're not going to be taking cabs everywhere. That's just not a realistic view of the world. So unless we rejigger cities and start from scratch, where I think the biggest use case would be in very dense urban environments that are very difficult for people to drive. Just saying, no more cars. It has to be caps. That makes sense in New York City or downtown L. A, let's say. But I just don't see how you implement that because it's like millions of people already have their commuter lifestyle. And I just don't see how that changes.

[Ed Ludlow]

All right, so Ed Ludlow brings us back then to Tesla. If they keep talking about fsd, I mean they're an EV company and a lot more we know that. But I don't know, is it enough? I don't know momentum? I look at the valuation like what is this company going forward?

[Tim Stannweck]

Well, I repeat the same thing I've said every quarter for eight years. Elon Musk is often late on his predictions but gets there in the end. And Tesla is clearly committed to this. That's part one. You know, largely Tesla has made economic benefit arguments and the industry has as well. There are people that disagree with Ross in that car ownership as a model is in doubt. You know, there are multiple reasons from the cost of owning and operating a vehicle through to generational attitude and appetite to go out and get a driving license that people feel will make the technology more pervasive and be adopted. Where people are to going agree with Ross is the environment, the infrastructure. And you. I go back to the reporting always I have to go back to what we've actually reported, which is there is a piece of legislation currently dormant and is not moved beyond the proposal stage that we reported Elon Musk and other Tesla staff lobbied very hard on, which is to have some federal level framework where purpose built robotaxis that don't have steering wheels or pedals can be deployed unfettered in the real world. But it doesn't address that what happens with the rest of road users. And that's where academics believe we're heading for a real issue.

[Ed Ludlow]

All right, and Ludlow, we know you've got some stuff to do off of these earnings so appreciate your input throughout the day today and certainly off of Tesla's earnings. All right, we got to run. Always enjoy talking with you Ross. Thank you so much. Ross Gerber, President Chief Executive Officer of Gerber Kawasaki wealth and Investment management. More than 3 billion in assets under management and they own about about $80 million worth of Tesla shares.

[Carol Massar]

Stay with us. More from Bloomberg Businessweek Daily coming up after this.

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[Ed Ludlow]

Bloomberg's Thomas Black he recently wrote an opinion piece and he talked about the hype around humanoid robots being pretty high, with forecasts of nearly 1 billion humanoids in service by 2050. But the reality is that most people overestimate what robots can do at this point in their development. Got to say though, one company that's been using robots a lot and for a long time and has deployed its 1 billion millionth robot happens to be one of the world's largest market companies out there, it's also a household name. So we wanted to check in once again with Ty Brady. He is chief technologist at Amazon Robotics. He joins us from Amazon's delivering the Future 2025 event from Amazon's Duo 3. It's a delivery station in Millipedis, California. And so we kind of want to find out where they are in terms of the world of robotics. Ty, I got to tell you, Tim and I love talking to you. Last time, so, so glad to check you again. First of all, this event where you are, I mean, right now I just see a curtain, but I'm assuming there's lots of stuff happening at the event. Who's there? What's going on? Tell us a little bit about it.

[Ty Brady]

Yep. Well, first of all, thank you so much for having me on. I really appreciate it and I enjoyed our conversation as well. It's just great to be here. We are our fourth Delivering the Future event here, and there's a bunch of press that we have here and we made a couple of big announcements in robotics today.

[Ed Ludlow]

Can you tell us about them?

[Ty Brady]

The first is in our manipulation robot that we call Blue J and what Blue Jay. The way that you can think of that is that you can take three assembly lines and put it in the same footprint of one. What it does is help eliminate the menial, the mundane and the repetitive. And it could pick more than 75% of the inventory that we actually sell in our sortable network, which is a really big deal. I'm really proud of that. And I'll also say there's just something interesting about Blue J as well, as compared to. To our other bird manipulation systems, Cardinal, Sparrow and Robin, that took us about, about three years to kind of design deploy and get out to our frontline employees. We have actually done Blue Jay with the power of AI in just over a year. So it's really have accelerated the pace of innovation.

[Carol Massar]

I think when a lot of people think about Amazon and robots, I just want to jump in because we don't have a ton of time, but I want. We'll get to some of the other announcements. They think about the Kiva systems robots. The big acquisition at the time, you know, 2012, that was a big acquisition for Amazon and they've seen pictures of the way that those can move large loads of things across warehouses. But if you were to go into a state of the art Amazon warehouse today, what would you see? That's. That's in addition to those Kiva robots.

[Ty Brady]

Yeah, in addition to our. The world's first goods to person fulfillment strategy, which was a really good idea where we have more than a million robots that we manufacture actually in Massachusetts doing that job. Every day you're going to see more of the unstructured, structured fields, right? So you're going to see green robot that we call Proteus that can move big cargoes of, of packages to the right dock at, at the right time. You're going to see many more manipulation systems that they have in there, eliminating kind of the repetitive motions that we have. No one wants to lift a 50 pound box box all day. Robin does that, Cardinal does that. Moving it into some of these Proteus boundaries, carts that we have. You're going to see much more collaborative robotics. Right? So that's where we build our robotic systems to enable people to augment what people are capable of. And we really believe in the philosophy of people and machines working together. How can we build the tool set that enables our employees to do their job not only more efficiently, but also with better safety in mind?

[Ed Ludlow]

All right, so there's this robot arm called Bluejay. You just talked about it. You guys are using this AI agent called Eluna. And then you're also working with augmented reality glasses to be worn by drivers in delivery trucks in the field. There's like so much going on. Step back for a moment because you guys have a lot of data. You look at what you're doing. I'm just curious. Investors who are thinking about Amazon and what you are doing, how do they think about the long term, like roi, return on investment. When it comes to the investments you guys make in robots, is the goal about labor efficiency, efficiency, throughput speed, or is it margin expansion kind of tie across your fulfillment operations? What is it?

[Ty Brady]

Yeah, well, definitely efficiency. We think about efficiencies and how can we gain efficiency through all the chain of our fulfillment processes? For sure. And you mentioned data, and data is the fuel for AI systems. Data has allowed us to bring, think of the, the body of being our robotics, but bring the mind to robotics, allowing it to be more adaptable, more fluid. You can almost think of this as the ability to pour our robotic systems into any size, building, any scale of building, to amplify what our employees are already doing. We want to give them an amazing tool set. And we see that when we do that, we're more productive. Right. When you do robotics. Right. When you do collaborative robotics, where you need both people and machines doing what they do best and they do different things better, that it allows you to be more productive and when you're more productive, that allows you to invest more in people. We've upskilled more than 700,000 of our employees, which is a great stat. And also in our robotics, we've expanded from the KIVA days. We've expanded from just a movement solution to now movement and mobility and sortation and storage and perception systems, packing systems that really changed the game for our customers. That's a big deal to us.

[Ed Ludlow]

But Ty, you know, will you need less workers? And I gotta bring it up, you know, the Times had a story out. They talked about interviews and a cache of internal strategy documents that they saw that it reveals that your execs think that the company's on the cusp of its next big workplace shift. I'm reading from the Times and replacing more than half a million jobs with robots. So, you know, we know things change. I'm not in a horse and buggy anymore. I don't make things piecemeal. I get it. I don't get tons of faxes and I don't get tons of pieces of physical mail. Thank God. Things change. Having said that is Amazon. Do you guys believe that you're on the cusp of a workplace shift and that you won't need as many workers because the advancements in robotics.

[Ty Brady]

Well, there's no doubt that things change. I mean, we're actually really proud of that at Amazon, is that we avoid stasis at all cost. We change and we adapt. And the nature of tasks definitely changed. There's no doubt about that. We are laser focused on efficiencies inside of our buildings. But when it comes to that article, that article was speculating 10 years out, right? That's a 10 year speculation. And it's hard to say what's going to happen in the next 10 years. But I can tell you what happened in the last 10 years. The last 10 years, which is when we seriously invested in robotics, that we created hundreds of thousands of new jobs and new job types. And there's been no employer in the United States that has employed more people than Amazon in 10 years. I mean, that's the power of efficiencies. And building your robots in a way that's applied and real, that actually augments the human potential.

[Ed Ludlow]

All right, My brother said I'm not like a dog with a bone. So wait, so does that mean 10 years out? It could be less jobs or we just don't know or you don't think that's the case?

[Ty Brady]

Well, you have to think about. I mean, there's Jobs and there's tasks, right? So of course we're changing the nature of tasks. Like I'm very bullish on eliminating every menial, mundane and repetitive job out there. Nobody wants to do that. So we were going to Change those tasks 100%. But we can. Again, as history has shown, we continue to create jobs. Right, with the goal of two things. Can you have it all? Can you be more productive, which means more efficiency? And can you also create a safer environment for our employees? And we're actually doing both. That's what history has shown in the last 10 years. We have better than 30% reduction in our overall recordable injury rate over the last five years because of our robotics. And also much more efficient. For example, our latest generation fulfillment center in Shreveport is 25% more efficient the order. So you can have it all, but you have to build your robotics in the right way that empowers people.

[Carol Massar]

We're speaking with Ty Brady, chief technologist at Amazon Robotics. When we think about hiring for these one off or seasonal events like the holiday season or Amazon Prime Day, I'm wondering how you're putting pencil to paper right now and thinking about those numbers and to what extent automation has reduced Amazon's, Amazon's dependency on seasonal or hourly labor for holidays, for Prime Day. What does that look like? Or what will that look like this year, next year?

[Ty Brady]

Well, it's the same philosophy of empowering employees, whether they're, they're temporary or the full time employees with the world's best machines that help them do their job. It's the same philosophy. I'm really proud of the fact that this year we're going to offer more than 250,000 temporary jobs for our employees to come in during the holiday season. Those are good paying jobs. Really happy about that, really pleased with that. And I'm really pleased with the work that our women and men have done in the robotics field, designing the pioneering these new physical AI systems that help them do their jobs better.

[Ed Ludlow]

I got to say one thing that I've been thinking a lot about is what's going on overseas, whether it's China, whether it's Japan. Bloomberg has done some reporting about service industries in Japan because they have a labor shortage that they are leaning increasingly on robotics. Have you been over there and looking at what they're doing? And I'm just curious if you're seeing some things that are pretty impressive and that the US as a creator of things or its role in the robotics industry has to keep a watch on what's Going on in other countries.

[Ty Brady]

Yeah, I think it's easy, especially in robotics, to get distracted about what other people are doing. I think anybody can make a YouTube video. I think anybody can kind of pop in and overflight something. But if you come into our world, our world is all about application. Our world is the reality.

[Ed Ludlow]

All right. We were talking with Ty Brady, chief technologist, robotics at Amazon. Of course our shot froze. That's the world of technology. We're talking a lot about technology. Stuff happens and we're hoping we can get Ty back. Just to finish up this conversation.

[Carol Massar]

Maybe the robots are using all the wi fi.

[Ed Ludlow]

Her robots like.

[Carol Massar]

I don't like what that is a connectivity thing though.

[Ed Ludlow]

Well, it feeds into the Right.

[Janet Rayberg]

Like you.

[Carol Massar]

So it's all a question about resources.

[Ed Ludlow]

Got charged these puppies. Can't just plug them in, right? If they're.

[Amazon Business Advertiser]

I don't know.

[Carol Massar]

Hey, we need recharging too. Okay.

[Ed Ludlow]

Yeah, it's called food and sleep.

[Carol Massar]

Yeah.

[Ed Ludlow]

For Tim, it's called robust food, food and sleep.

[Carol Massar]

You know, I will say, do we have Ty back?

[Ed Ludlow]

Can we grab him for 20 seconds? Ty, 20 seconds. Forgive us. Your final thoughts here.

[Ty Brady]

Sorry about that.

[Ed Ludlow]

No, it's okay.

[Ty Brady]

Let it go. I'm ready for you.

[Ed Ludlow]

Okay, 20 seconds. Just final thoughts for our audience because we gotta run.

[Ty Brady]

So final thoughts is that robotics, when done the right way, when you reframe your relationship with machines, you can enable more productivity, create greater efficiencies and create a more safer environment for employees. And this collaborative mindset that we've had, that we've done for the last 10 years, really does make the day.

[Ed Ludlow]

Ty Brady over at Amazon, so appreciate it.

[Carol Massar]

Stay with us. More from Bloomberg Businessweek Daily coming up after this.

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[Ed Ludlow]

We love talking to mayors.

[Carol Massar]

We do, we do. We also love talking quantum computing. And there is news in quantum computing today. Google running an algorithm on its Willow quantum computing chip that can be repeated on a similar platform and outperformed classical computers. We spoke a little bit about this with Ed Ludlow earlier. The folks in Chattanooga, Tennessee have been thinking a lot about quantum computing for years. The first commercially available quantum Network in the US was established there back in 2022. Back with us is Mayor Tim Kelly. He's an independent. He's the mayor of Chattanooga, Tennessee. Also with us is Janet Janet Rayberg. She's the President and CEO elect of epb, formerly known as the Electric Power Board of Chattanooga. Provides energy, Internet, phone and more in and around the Chattanooga area. They both join us here in the Bloomberg Interactive Brokers Studio. We should note that last year, Bloomberg Philanthropies named Chattanooga one of 25 cities selected for its American Sustainable Cities program. Bloomberg Philanthropies is founded and supported by Michael R. Bloomberg, the founder and majority owner of Bloomberg lp And Chattanooga's Sustainable cities program is still ongoing. Chattanooga also part of the Bloomberg Harvard leading city procurement reform program.

[Ed Ludlow]

We're big believers in full disclosure. Great to have both of you here in studio with Tim and me. Mayor Kelly, I just have to first ask you a broad question because we do want to talk a lot about quantum computing and energy in general. Like, because there's just so much going on, the environment today. How is it in terms of running your city? Being a mayor in a political environment, that's a tough one. An economic environment, that may be tough.

[Mayor Tim Kelly]

Yeah, it's tough. But, you know, running cities is an eminently practical exercise. And I will say, you know, our, our mayor's races are nonpartisan. They always have been. And I stayed in that lane. Again, I mean, I, I'm not here to catalog my political beliefs. They're. They're pretty confusing to most people anyway. I'd say if, you know, Republicans think I'm a Democrat and Democrats think I'm a Republican, I'm probably doing a pretty good job. So, you know, I. Look, that has served me well in this environment because again, I believe, as does a lot of folks at Bloomberg, as do rather, but that cities are really the foundation of our economy. That's where 90% of the GDP is generated. It's where all innovation is generated. So I'm focused on whatever is best for Chattanooga so I can work and have managed to work with people on both sides of the aisle and, you know, in the best interest of myself.

[Amazon Business Advertiser]

City.

[Carol Massar]

Do you. Do you find yourself getting pulled into the social issues that seem to define our era right now, the stuff that does dominate cable news, whether you're talking about the right or the left?

[Mayor Tim Kelly]

Yeah, I mean, the. I found myself, you know, I find people attempting to pull me into those, but I think I've gotten pretty good at wrestling my way out of them and trying to just translate back into simple terms, you know, is this what's best for the city? You know, does it work or does it not work? I mean, sometimes you can't avoid those political issues. It's not as though, you know, I don't have my own beliefs. But again, I think you just, as a mayor, have to take a thoroughly practical approach to what's going to work best for the city.

[Amazon Business Advertiser]

All right.

[Ed Ludlow]

So when you think about what's best for the city, let's talk about that. Because you are on the ground talking to people, what they need, what you need to make sure you have a good economy, strong economy, not just today, but in the future. That quantum computing. Bet you made it back in 2022. Tell us about, kind of give us an update or for someone who didn't hear the conversation when you were last on with this, kind of where you guys are with this.

[Mayor Tim Kelly]

So I'll give you the Cliff Notes version, which is that, you know, we took advantage of a large federal low interest loan way back when during Clinton and Gore to put in a giant municipal fiber network. And that gave us the first and fastest municipal fiber network in the country. We had a lot of folks move in during COVID because, you know you can get one gig of symmetrical speed for 67 bucks a month. Yeah, pretty great. You can get 25 gigs of speed at your house in Chattanooga. But it turns out that you can also do quantum computing on large loops of dark fiber. One particular type that uses photons and trapped ions, which is where IonQ began to become interested in chatting. So we opened and Janet can talk more about it. The first commercially available quantum network and it is starting to attract a lot of investment and attention.

[Carol Massar]

So Janet, come on in here because one thing that we're trying to understand is what the practical applications of quantum technology are. We spoke with Ed Ludlow, the coast of our Bloomberg Tech program a little earlier and Carol agreed. I mean, you thought health care first. He said health care also. This is one area of application, but it's still kind of the world where we're thinking about what this tech can do, not necessarily seeing what it can do. Have we seen any material things be developed as a result of this technology and what you're doing in Chattanooga?

[Janet Rayberg]

Yeah, so IonQ has been working on a lot of different type of application with different industry. And so we were interested because we're an electric company and so we have all the data for them to help us optimize our grid. So we're doing a partnership actually with IonQ, Nvidia and Oak Ridge National Lab as a four way partnership to help use hybrid computing intelligence. Quantum computing can get to where it needs to be to help us with some great optimization problem that we can't.

[Ed Ludlow]

Solve today in terms of energy demands. Tell us about that. That is like what you are seeing front and center. We, you know, the AI conversation narrative has moved from the spend and chips and so on and so forth like to basically, all right, do we have enough power to do all of this? And there is certainly a power scramble among the big hyperscalers. What are you seeing on that front?

[Janet Rayberg]

Yeah, and I think that's a nationwide issue with the energy problem. And as AI gets better.

[Ed Ludlow]

Energy problem, right. Yeah.

[Janet Rayberg]

I mean, as AI gets better and better, the more energy that it's going to need. And so that's where quantum comes in. Very important to the, to part of that solution is that quantum computer, once it gets to the phase that it needs to be, is it can solve things at a much faster rate, which uses less energy than a classical computer because it can do things in parallel versus sequential. As a classical computer today, where do.

[Carol Massar]

You get the energy that you sell to people in and around Chattanooga?

[Janet Rayberg]

Yeah, so we buy it from tva, Tennessee Valley Authority. And so they generate the power and we distribute it to our customers.

[Carol Massar]

How do they generate it?

[Janet Rayberg]

They have a diverse mix of portfolio from hydro, different types of renewables to natural gas. And so, you know, they're continuing to look at other options.

[Carol Massar]

Do you see that mixed up? Go ahead.

[Mayor Tim Kelly]

No, I was just going to say they're also very much on the front foot in terms of advanced nuclear.

[Carol Massar]

Do you, do you see that mix? This is to either of you, do you see that mix changing and focusing less on renewables, more on nuclear as a result of the, the changes out of Washington?

[Mayor Tim Kelly]

I think you're going to see that. You know, and again, regardless of your political affiliation, if you just kind of look at the math, there's, there's no way around nuclear.

[Carol Massar]

Right.

[Mayor Tim Kelly]

I do think they are giving us or EPB more latitude to generate some of our own power because of the anticipated demands. And I think we still have a lot of headway on solar. So I mean, I think we'll, we'll continue and we've got a lot of things we can do with hydro. We're going to actually start using and biogas at our wastewater treatment plant to generate electricity. So we're looking at any and all ways that we can generate because my.

[Ed Ludlow]

Understanding when we talk about smarts, the small modular reactors, it's 10, 15 years.

[Carol Massar]

Will Wade reminds us who covers this here at Bloomberg News, that we are not there right now.

[Mayor Tim Kelly]

It's a while we are not, but we have a pretty significant nuclear footprint. With TVA already in the tension, what.

[Ed Ludlow]

Would you tell people who are still kind of nervous when it comes to the nuclear footprint that you guys have? You know, but, you know, I do know fine People do it, okay, do it across the country or do it in another country. But you know the feeling here in the United States.

[Carol Massar]

I mean, I grew up next to a nuclear power plant. I'm fine, right? I'm a little weird.

[Public Investing Advertiser]

I'm a little weird.

[Ed Ludlow]

What would you say about that?

[Mayor Tim Kelly]

Well, I mean, the technology has come a long, long way. Yeah, that's what I would say. I mean, I'd say go do your research, do your homework. They're not. I mean, that's why we have these discussions. That's why we have the fears. But, but there's just not. Absent fusion, I will say the state, in the University of Tennessee is also working very, very hard on fusion technology. Absent that breakthrough, there's really not a.

[Ed Ludlow]

That's what I'm waiting for.

[Carol Massar]

When we talk, we're talking about quantum today and we're talking about Google, we're talking about Silicon Valley. How do you get people to think about Chattanooga, Tennessee and not Silicon Valley, not New York City, not Austin, Texas when they're thinking about where they want to live to have a job in.

[Mayor Tim Kelly]

Technology coming on Bloomberg is a great first step. Now we, I mean, look, we talk about this all the time. It's a, it's a mid sized southern city with kind of a funny name and there's a bit of cognitive dissonance there. So you know, look, we are out telling the story. I mean, I was just in Detroit last week at a sustainable mobility conference. We were at the Quantum World Congress. I mean at some point it's, you know, the evidence is mounting. We are, it's not just smoke. We are doing the work and it's working.

[Amazon Business Advertiser]

Working. Is it?

[Carol Massar]

Is it? If you build it, they will come mentality?

[Mayor Tim Kelly]

I think so.

[Carol Massar]

Have they come?

[Mayor Tim Kelly]

Yes, they have come. I mean again, we had, you know, we now have independent verification that, you know, 10, 12,000 people moved to Chattanooga during the pandemic. Very, you know, degreed, talented people that could work remotely. And I think again, our job, my job as mayor is to help break that glass ceiling so that we have the level of business investment and again can build up our academic horsepower to be able to sustain those knowledge economy jobs.

[Ed Ludlow]

Janet, you know, when we think about quantum computing, we spend so much time just talking about, you know, large language models and generative AI and kind of where that's going. Gentic AI. You just talked about the power aspect or the use of less power when it comes to quantum computing. But I mean, should our conversation be shifting in terms of what we are having for an investing audience. When we talk just so much about AI generally versus Quantum.

[Janet Rayberg]

Well, I think that with quantum computer, when it gets to, you know, the level it needs to be, you can team it up with AI and get even more powerful algorithm that comes out of it to be able to solve more complex problems. So I don't think it's one or the other. I think it's going to be a combined of, you know, how do you combine that and use less energy and be able to build algorithm more efficiently?

[Ed Ludlow]

So help me, because when we talk about the data center build out, so does that go hand in hand with the build out of quantum computing? Is that part of it?

[Janet Rayberg]

So right now it's, you know, the, we're building a quantum computer to kind of learn more and be able to help accelerate and advance that technology with companies like Ionq. And I think once it gets to where it needs to be, then it will. We can team it up with AI.

[Ed Ludlow]

Okay.

[Janet Rayberg]

Yeah, yeah.

[Mayor Tim Kelly]

And many of the implications with quantum.

[Ed Ludlow]

I'm asking basic questions because I feel like we spent so much time talking about the AI, but this is something that increasingly is coming into the dialogue.

[Mayor Tim Kelly]

Yeah. Now I'm just going to take the logistics. Is a huge vertical in Chattanooga as well. And I think the implications for quantum for logistics have huge implications for lower power demand and a lower carbon footprint.

[Carol Massar]

Right.

[Mayor Tim Kelly]

Because you're going to waste a lot less time getting stuff from A to B.

[Ed Ludlow]

Right.

[Mayor Tim Kelly]

With, with route optimization we're going to.

[Ed Ludlow]

Have to do because we talk about like the power drag or the power demand and the cost. Mayor Kelly, I'd be remiss not to ask you. You are trying to build a city where everyone, everyone has an opportunity to thrive and prosper. We talk so much about the K shaped economy. There's a lot of people who aren't thriving and prospering in this environment. 35 seconds. What's a message to send to everybody?

[Mayor Tim Kelly]

Well, we are working very hard to reform our workforce development system so that we, so that we don't leave folks behind. And I think we have some significant opportunities to do that. And we are in the midst of doing that. Again, it's tough out there and I think it's going to fall more to the state government and to philanthropy, frankly, to kind of take up the slack in the meantime. But I mean, we have to play the long game. And the long game is we need some significant change to the way that we do education and workforce development in this country so that we don't leave people behind.

[Ed Ludlow]

Yeah, it does feel like in terms of education, we're starting to think about that. Come back soon. I'd love to kind of continue this conversation if we if we may, Mayor Tim Kelly of Chattanooga, Tennessee and Janet Rayberg. She's the President CEO Elective east, joining us right here in our Bloomberg Interactive Broker Studio.

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