Amazon Looks to Raise At Least $37 Billion with Bond Sale

Summary

Podcast Summary: Bloomberg Tech – "Amazon Looks to Raise At Least $37 Billion with Bond Sale"

Date: March 10, 2026
Hosts: Caroline Hyde (New York), Ed Ludlow (San Francisco)

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Overview

This episode of Bloomberg Tech centers on Amazon’s massive new bond offering—potentially reaching $42 billion—to fund capital expenditures amid the ongoing AI boom. The hosts analyze how this fits into broader trends of tech giants leveraging debt markets, the effects on credit and capital spending, and investor sentiment. The episode also covers latest moves by the Pentagon to adopt Google AI tools, Oracle's approach to capital expenditures for AI infrastructure, high-profile AI startup funding news, and a deep dive into HPE’s strong quarter amid AI hardware demand and supply chain complexities.

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Key Segments & Discussion Points

1. Amazon’s Historic Bond Sale and the “Capex Crunch”

Timestamps: 02:11–06:19

• Ed Ludlow highlights Amazon’s plan to raise up to $42 billion (including euro and US dollar tranches), in what may be the biggest corporate bond issuance of the year, possibly ever. Longest bond matures in 2076, at 1.55% yield above treasuries.

  • "The goal is to raise up to $42 billion, maybe up to 10 billion euros. And we know the story, right? Capital expenditures this year, $650 billion or so across the hyperscalers." (03:10)
  • The bond sale caters to varied investor classes with 19 different tranches (different expiration dates/currencies).

• Caroline Hyde adds context:

  • Amazon’s absolute debt load is growing, but demand among bond investors seems strong, even as equity holders once punished the stock for $200 billion capex plans.
  • "The bond market is going to lap this up, it feels like." (03:51)

• Antonio Neri (HPE CEO, also weighing in as a guest):

  • Jokes: "Wow, they must be selling a lot of books." (04:19)
  • Emphasizes how bullish this is for credit markets—hyperscalers now “serial issuers.”
  • "The $100 billion plus debt club is growing... There’s always going to be a constant need to refinance and push out the curve." (05:20)
  • Amazon faces $20B in maturities over three years—expect more such activity.

• Ed Ludlow believes the bondholder demand will compress spreads, possibly by 20–30+ basis points.

  • Points to strong demand from underinvested European investors.
  • "They're willing to take down any Amazon bonds across the curve almost at any price because they're so underweighted." (06:25)

Notable Quote

• Antonio Neri: "These hyperscalers are effectively becoming serial issuers. The $100 billion plus debt club is growing." (05:20)

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2. AI Spending, Tech Earnings, and Investor Concerns

Timestamps: 07:29–12:41

• Oracle’s Capex Dilemma:

  • Analyst Gabriella Borges (Goldman Sachs) discusses Oracle’s balancing act: raising under $100B in debt for a $500B cloud backlog.
  • Gross margins on these projects: 30–40% over contract lifetimes.
  • "What we've noticed... is that it's less about the specific numbers and... more about their ability to fulfill some of these contracts over a longer time frame." (09:28)
  • Oracle manages concentration/customer risk (OpenAI is a major client); leverages “fungible capex” to adapt facilities to shifting demand.

• Investor Sentiment: OCI division's intra-quarter volatility affects expectations; investors need to see “clean prints” (steady results) for the stock to perform post-earnings.

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3. Geopolitics, Defense, and AI

Timestamps: 14:50–19:41

• The ongoing Iran conflict is fueling oil price volatility; the US and allies (G7) are preparing contingency oil stockpile releases.
• Tyler Kendall (Bloomberg, Washington):
  • Reports that Iran is not interested in a ceasefire and continues efforts to block oil exports.
  • Electronic warfare and jamming in the Strait of Hormuz are keeping vital shipping lanes essentially closed.
  • "The President reiterated that he is prepared to send a naval escort into the strait to help those tankers through." (15:27)

AI in Defense:

• The Pentagon is deploying Google’s Gemini AI agents for unclassified work—potentially expanding to classified systems.
• Katrina Manson (Bloomberg) notes 1.2 million Defense Dept. staff are now using Gemini chatbots; agents will automate more tasks.
  • Anthropic, previously a competitor, is now out after legal battles.
  • The Pentagon’s AI deployment extends to real-time targeting in Iran via Maven Smart (from Project Maven, launched 2017).

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4. AI Legal Tech Funding: Lagora’s Rapid Rise

Timestamps: 20:06–24:13

• Max Unistrand (Lagora CEO) explains raising $550M at a $5.5B+ valuation, mere months after prior round.

  • Huge demand in US legal market; expansion in cities like New York, Chicago, Houston.
  • The sector is still early—“zero-to-one; now we are on the journey of one-to-ten.”

• Lagora stands out by anchoring on both local legal data and enterprise client data; focus on end-to-end, agentic workflows (not mere “copilots”).

  • Revenue is currently seat-based; future likely to move to consumption/outcome-based pricing as models handle more autonomous work.

• Competition/Defensibility:

  • Build on foundational LLMs (GPT-3.5+) but differentiate via integration, permissions, and client network effects.
  • “Every quarter the ground shakes a little bit. The new models are capable of new things.” (24:13)

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5. Tech Supply Chain: Apple in India, Product Delays

Timestamps: 26:56–29:26

• Mark Gurman (Bloomberg): 25% of iPhones are now made in India, up from 20% a year ago; shift driven by tariffs and global diversification.
• Apple’s anticipated Smart Home display is delayed, awaiting roll-out of new AI-driven Siri upgrades. This epitomizes Apple’s all-or-nothing approach:
  • “If one piece is not working, you can’t release the entire thing.”

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6. Global AI Startup Funding Frenzy

Timestamps: 30:20–37:40

• AMI (Advanced Machine Intelligence)

  • Natasha Mascarenas (Bloomberg):
    • Yann LeCun’s new startup AMI raises $1B+, focusing on world models for real-world interfaces (robotics, spatial data).
    • Rejects Silicon Valley’s LLM-centric approach.
    • Not targeting consumers directly, more enterprise/industrial AI innovation.
    • Potential collaborations with Meta (LeCun’s former employer) possible.

• Thinking Machines Lab

  • Rachel Metz: Nvidia invests, supplying massive computing resources (Vera Rubin systems). Company founded by ex-OpenAI CTO Mira Murati.
  • Product “Tinker” helps enterprises fine-tune AI models. Future ambition is to build and commercialize large foundational models; unclear specifics, but company already valued at giddy heights ($50B reported).

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7. Hewlett Packard Enterprise (HPE) Earnings & Supply Chain Pressure

Timestamps: 39:13–48:09

• Antonio Neri (HPE CEO):
  • AI hardware demand is robust—especially in enterprise and “agentic AI” for companies.
  • Juniper Networks acquisition is driving “double-digit growth” in networking, with networking now accounting for nearly 30% of profit.
  • Main hardware supply constraints: DDR5 and NAND/SSD (strong demand, slow supply ramp), less so high-bandwidth memory (HBM).
  • HPE is being strategic, prioritizing certain customers and remaining flexible on pricing—anticipates price hikes will continue into 2027 due to supply imbalance.
    • "We do not have enough supply against the order intake and the backlog, because otherwise we'll have even a higher outlook." (42:54)
  • Backlog now at $5B+, and free cash flow outlook was raised up by $200M.

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Notable Quotes & Memorable Moments

• Antonio Neri (HPE):
  • "These hyperscalers are effectively becoming serial issuers. The $100 billion plus debt club is growing." (05:20)
  • "It's the [memory] DDR and NAND or the SSDs... DDR5 and the NAND part which is the SSDs [are the bottleneck]." (46:08)
• Gabriella Borges (Goldman Sachs):
  • "If AI demand remains strong... someone should be able to come in and pick up that capex in the event that it needs to be moved around." (11:53)
• Max Unistrand (Lagora):
  • "The market has only done 0 to 1. Now we are on the journey of 1 to 10 and 10 to 100." (21:10)
• Natasha Mascarenas (on AMI):
  • "This is one of the largest venture rounds raised ever in Europe, and it is actively one that has not included a lot of the traditional Silicon Valley investors." (32:54)

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Timestamps at a Glance

• Amazon Bond Sale News: 02:11–06:19
• Oracle Analysis: 07:29–12:41
• Defense/AI with Pentagon: 14:50–19:41
• Lagora Funding & Legal Tech: 20:06–24:13
• Apple Supply Chain/AI Delay: 26:56–29:26
• AI Startup Funding (AMI, Thinking Machines): 30:20–37:40
• HPE Earnings, Hardware & Supply: 39:13–48:09

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Summary

The episode captures a pivotal moment for enterprise tech, as Amazon redefines corporate bond market scale to fuel an AI arms race, and “hyperscalers” become heavy, serial issuers of debt—a shift that opens new opportunities and risks for investors and the entire tech ecosystem. Amid intensifying global conflict and supply chain flux, both demand and competition for AI infrastructure are surging; new and established tech giants alike are scrambling for capital, innovation, and talent. Emerging AI platforms in law and real-world applications see outsized funding, even as startups race to define differentiated value and defensibility. Meanwhile, legacy tech hardware providers such as HPE are riding a wave of AI-driven hardware demand—though unable to fully capitalize due to supply constraints that may persist well into 2027.

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For anyone seeking to understand today’s biggest tech finance, innovation, and geopolitical trends—from Amazon’s mega-bond to the next frontier in enterprise AI—this episode is essential listening.

Transcript

[Caroline Hyde]

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[Ed Ludlow]

This is Bloomberg Tech. Coming up, Amazon kicks off what is likely to be one of the biggest corporate bond offerings ever in a bid to pay for the AI boom.

[Caroline Hyde]

Plus, Google introduces AI agents across the Pentagon's workforce to automate create routine jobs. This is the Defense Department's fight with

[Ed Ludlow]

anthropic drags on and Hewlett Packard Enterprise project sales topping estimates on AI hardware demand. We'll break it all down with the

[Caroline Hyde]

CEO, but now we break down volatility in the market. We want more focus in on the Middle east, the conflict with Iran and the fact that it has been upped in terms of aggressive force coming from the US to Iran today. But also aggressive moves in oil markets just drag down Brent down 10%, significant volatility in the oil contract. But it means we're actually seeing some push higher in the stock market, a regain on the NASDAQ 100. In fact a second straight day of gains at all of this as we think about really the end goal and whether this will be a short term or long term conflict.

[Ed Ludlow]

I'm looking at the latest in what's been a wave of AI related bond sales and it's Amazon. So this is what Bloomberg's reporting. Both US dollar denominated and euro denominated bonds in the US 11 tranches of high grade. The longest duration I think 2056 with 1.55% yield over treasuries. But the goal is to raise up to $42 billion, maybe up to 10 billion euros. And we know the story, right? Capital expenditures this year, $650 billion or so across the hyperscalers. And many of them have looked to debt markets, looked to raise money through bond sales to finance that capex. There's a lot to dig into here.

[Caroline Hyde]

There is. And we're going to continue the conversation therefore with Robert Schiffman, a Bloomberg intelligence. He's out with a reaction to this morning saying that the bond sale is, quote, likely to draw considerable demand despite a growing absolute debt load that's poised to increase again next year as spending rises. The stock had been punished when they told us that they were going to be spending up to 200 billion on capital expenditures. But the bond market is going to lap this up, it feels like.

[Antonio Neri]

Yeah, you know, my first thought was,

[Ed Ludlow]

wow, they must be selling a lot of books.

[Antonio Neri]

My second thought is this is so

[Ed Ludlow]

wildly bullish for the credit markets and in particular for tech.

[Antonio Neri]

In possibly the worst potential macro environment,

[Ed Ludlow]

bondholders are coming and saying, we want to own you, we want to own you in size and we're confident that your future growth plans are going to play out. And even though there's so much spending

[Antonio Neri]

and we know more bonds are likely to be coming, people are going to

[Ed Ludlow]

be lining up for this deal. I actually just misspoke the board. I said 2056, actually 2076, the longest maturity that Bloomberg's reporting. Amazon thinking about, the one that would yield 1.55% over treasuries. How does this kind of stack up in the history of corporate debt markets? Recent and historic. Right. We talked a little bit about what Alphabet's done most recently. Oracle is a slightly different credit profile, but like a lot of focus on that too. Well, this is going to be the biggest bond deal of the year, it looks like, by far.

[Antonio Neri]

And I'll tell you, I think people

[Ed Ludlow]

just need to get used to this. These hyperscalers are effectively becoming serial issuers. The $100 billion plus debt club is growing. So not only do we have new current large needs, but just think about it, over the next handful of years as bonds mature, there's always going to be a constant need to refinance and push out the curve.

[Antonio Neri]

Amazon itself has $20 billion of debt

[Ed Ludlow]

maturing over the next three years. So this is going to be a constant and look for more of this action.

[Antonio Neri]

Again, I think bondholders can take huge advantage of this.

[Ed Ludlow]

The type of concessions that are being offered here seem wildly wide to me. I actually think the demand is going to be so strong they're going to come in dramatically, maybe 20, 30 plus

[Caroline Hyde]

basis points and they're tapping just every type of part of the market. You've got like 19 different tranches, so different expiration dates ultimately of when the debt is going to be coming due, but also different currencies as well. How are they managing to satiate all the type of investor out there?

[Ed Ludlow]

You know we talked about this when Alphabet came that they were doing, you

[Antonio Neri]

know, small tranches of Swiss francs and

[Ed Ludlow]

British pounds and why they weren't tapping the Euromarket. You know, the Euromarket is widely, I think, under invested in technology and they're somewhat, probably price agnostic. They're willing to take down any Amazon bonds across the curve almost at any price because they're so underweighted. So I think there's a huge untapped market there that we're going to see other companies come and grab as well. That's the Bloomberg intelligence react from Robert Schiffman. I would say the details of Amazon's bond sale according to Bloomberg sources and Bloomberg saying that the US side at least might price. Today a separate story. A court ruled that Perplexity must stop using its own Comet web browser agent to make purchases on Amazon's marketplace. Amazon sued, accusing Perplexity of computer fraud for not disclosing when Comet was shopping for a user and refusing to stop when asked. The order also bars access to password protected parts of Amazon systems and requires destruction of Amazon data, with enforcement paused for a week to allow for an appeal. Perplexity is yet to respond to messages seeking comment.

[Caroline Hyde]

Cara, It's a vast company that of course is about E commerce and about cloud. Let's talk about Oracle now because it's about cloud and software and its earnings are after the bell. It comes off the recent Bloomberg reporting that Oracle and OpenAI have ended plans to expand that flagship datacenter project in Texas. What will investors be looking for in the company's results? We want to talk it all Through Gabriella Borges, software sector analyst at Goldman Sachs Research. How much of this is a test of Oracle's old bread and butter software? Or a test of how much investors are willing to, well, stomach the capex of getting into the cloud and furthering the AI focus? Yeah, hi, it's great to be back. Good morning. I think you touched on it perfectly there where the capex makes sense if you can justify the unit economics that are attached to the infrastructure projects. And so Araco has given us a couple of nuggets in this regard. They've told us that they expect expect to be able to spend less than 100 billion in debt raised in order to be able to fulfill north of 500 billion in cloud backlog that's now on their balance sheet. Those are commitments from customers for the next five, six years. They've also told us that the gross margin on these projects is 30 to 40% over the lifetime of a contract. So that's typically five to six years. And so if you put those two data points together, whatever incremental information we can get from the the management team tonight that helps make this less of a black box I think will go a long way because we are worried about turning cash flow negative. We are worried about maybe some of the ability to drive revenue growth to substantiate the capital expenditure spend. What do you need to see in terms of growth and pointing to growth? Because the stock is actually pretty cheap now. Yeah. So when you actually break down the phases of the different facilities coming online, so Abilene for example in Texas, that's a 1.2 gigawatt capacity facility where Oracle has already said that the 4.5 gigawatts that will be coming online to fulfill their existing commitments, they already have all the leasing agreements for that already signed and ready to go. What happens next is as the revenue comes online, we expect to see is really nice gross profit acceleration. In Oracle's for co business that includes, includes the big part of OCI that's tied to some of these contracts. That's Oracle Cloud. We expect to see that as we go through the year. And so what we've noticed over the last three or four quarters with Oracle is that it's less about the specific numbers and some of the short term dynamics in a given quarter and more about what they say about their ability to fulfill some of these contracts over a longer time frame. Which is why just taking a step back, I do think you'll see gross profit acceleration and investors will be looking for that as we go towards the end of this year.

[Ed Ludlow]

Gabriella, I hear you on that. But you know the streets expecting the infrastructure unit to grow almost 80% in the quarter. You know, what if they're off by a few percentage points? Because you know, in general that's been the formula, right? A very high bar for, for tangible AI related growth in those infrastructure divisions.

[Caroline Hyde]

Yeah, I think you're making a really good point point here because we have seen for a couple of quarters now that the OCI estimate intra quarter can move around and part of that is the timing of any one piece of facility coming online. I do think though, what we're seeing from a demand signal standpoint is still very strong. And coming back to Abilene, Abilene has been ramping really nicely over the last three months. The one other thing I'll say is Oracle stock does react to reports of potential delays, for example. So as we've gotten more headlines out of out of the news flow over the last two, three months now, I think expectations do move around. All of which is to say what we've seen during software earnings season is you've got to have a clean print for the stock to work on the print. And so at I hear you there, it's it's got to be a clean print for the stock to work on the front.

[Ed Ludlow]

What I reported with the team in the case of Abilene was that simply Oracle and Crusoe decided not to proceed from an with an expansion from 1.2 gigawatts to 2 gigawatts and that Crusoe was negotiating with Matter to come in and take that additional capacity which many of your colleagues on the sell side pointed out might not have been reflected in RPO anyway. But what the story does highlight, and you made the point a moment ago on the 4.5 GW Agreed, is concentration risk on one customer, which is open AI. Is that something you model for?

[Caroline Hyde]

Yeah, we do actually in a couple of different ways. So we take a discount to our open air forecasts and to what Oracle has said their open air backlog is to account for dynamics like the one you're talking about, the extreme customer concentration risk. The other thing I'll mention here though is Oracle will tell you that they can have fungibility of capex. What does that mean? That means you can actually reconfigure a training cluster to be able to serve inference use cases. It means you can reconfigure for one customer to serve another customer. So there is some fungibility there. What that means is that if AI demand remains strong and that in turn relies on enterprise adoption, which we've spoken about before, then someone should be able to come in and pick up that capex in the in the event that it needs to be moved around. And it comes back to this idea of fungibility.

[Ed Ludlow]

Gabriella Borges, Goldman Sachs Research Analyst Looking ahead to Oracle, which is after the bell. Thank you very much. Coming up, we're going to have the latest on the expanding use of AI by the Pentagon. That's next. This is Bloomberg Tech.

[Caroline Hyde]

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[Caroline Hyde]

is totally and decisively defeated.

[Ed Ludlow]

That was U.S. defense Secretary Pete Hegseth weighing in on the war in Iran during a briefing. The Pentagon says it's conducting the most intense day of attacks yet. This as the Islamic Republic has been firing drones and missiles at targets across the Middle East. In return, let's bring in Bloomberg's Washington correspondent Tyler Kendall. I saw A lot of the headlines on the terminal this morning, for example, around drone activity in the Gulf, the uae. We continue to hear from this administration on or at least field questions on the timeline for this war. What's the latest we need to know?

[Caroline Hyde]

Yeah. Hey Ed, good morning. Well, as you heard there, Secretary Hegseth said that the U.S. will quote, not relent until until all of its objectives are achieved. After yesterday, President Trump appeared to suggest that the US Was ahead of schedule when it comes to maintaining its goals in the region. But then we heard from Iran this morning and a new statement from the country's parliament speaker saying that Iran is, quote, not at all interested in a potential cease fire deal. And the IRGC released a statement overnight vowing to continue, continue to block oil exports. Now, President Trump yesterday had threatened to widen the list of U.S. targets to electricity infrastructure if attacks in the Strait of Hormuz and disruptions do continue. I will point out that the President reiterated that he is prepared to send a naval escort into the strait to help those tankers through. But when the Joint Chiefs of Staff Chair Dan Kaine was asked about this earlier this morning, it does not appear that any of those plans have been put into motion. Bloomberg News is also reporting that electronic warfare is now jamming signals in the critical waterway which at this point really does remain effectively closed. And in Caroline, within the last hour we got the headline that G7 nations are now asking the International Energy Agency to prepare scenarios for the potential release of emergency stockpiles as these oil flows continue to be impacted in the region. On the oil markets certainly moves and despite the news flow, Tyler Kendall, we so appreciate it. Let's stick with Defense News because Bloomberg has learned that Pentagon plans to add Google's AI agents to handle unclassified work and is in talks to bring those tools to the classified and top secret cloud. Bloomberg's Katrina Manson has been reporting on this and in fact continues to report at the very edge of AI adoption within the Pentagon. Look, what is Emil Michael talking about in terms of Google? Is this because they're having to force out anthropic? This I think is fair to see as separate. When Emil Michael came in in this senior role very focused on AI back in August, he told me he was shocked that the Pentagon had adopted so few AI tools. It's brought in chat bots. That's thanks to Gemini. It's had those for the last three months. 1.2 million people in the Pentagon have used those or in the Defense Department writ large. Now they're adding agents. So that's going to automate some tasks that corporations, of course, across the country are already trying. But it is interesting timing because at this very moment they're bringing Gemini agents onto unclassified networks and really quite pleased that they have this partner in Google at a time that clearly Anthropic has been cut.

[Ed Ludlow]

24 hours ago on this program, we broke the news of Anthropic suit against the Defense Department Department. Late yesterday evening we got more of a detailed response. What is the Pentagon's official position and what does it see in this suit from Anthropic against it?

[Caroline Hyde]

Emil Michael told me that he was expecting this. He doesn't think that bringing this to the courts is a way to resolve this problem. And he said, comey, quite simply, we're moving on. So I do think that in this news today, the focus on Google, of course they've recently struck deals with X and OpenAI to start operating on the classified cloud. The Pentagon is really saying we have three partners now that we feel comfortable with and we are not expecting to go back to Anthropic. Can you give us the context of just how much AI is playing a role within the very here and now geopolitical issue of Iran and the conflict there? From our reporting we understand the centcom, the central US Central Command conducting the the operations in Iran is relying on a variety of AI tools. And from separate reporting we understand that means Maven Smart system. This comes out of Project Maven, an effort started in 2017. You have a book coming out on. I do, yes, I do, yeah. Thanks. And that helps narrow down targets. Of course, Centcom is hitting, I think they've hit 5,000 targets in 10 days now. So an extraordinary number for the US to be churning through and at the same time is helping with processes that enable fast movement.

[Ed Ludlow]

Bloomberg's Katrina Manson with the latest reporting deep on what the Pentagon is doing with AI. Thank you very much. Now coming up, I start up. Lagora raises $550 million, boosting its valuation to 5.55 billion. We speak with the CEO Max Unistrand next. This is Bloomberg Tech.

[Caroline Hyde]

Nagora, an AI platform built for lawyers has just raised a massive $550 million in a series defunding round pushing its valuation to in excess of five and a half billion. Joining us now to talk about the raise, the company's growth, growth and the future of AI and Laura's Lagoa CEO Max Unistrand. Max, this is only a few months after you just raised your previous series I mean, what are you going to be doing this using this money for?

[Ed Ludlow]

We are investing in the United States. We landed in New York a year ago. This was the first week in 2025, New York Legal Week, when Lagora launched in the United States. Now we've opened in New York, we've opened in Denver, Chicago, Houston. We're investing in the product and the infrastructure and in customer support teams to support the astronomic demand that we're seeing from the US and that is what

[Caroline Hyde]

the VCs are responding to here, the fact that you are signing more and more legal professionals to come and join your platform. But yesterday we just had Harvey on and word has it that they're a competitive force out there. How are you seeing your space in the world? How are you unique versus a Harvey, for example?

[Ed Ludlow]

So I think legal tech has for a long time been sort of stuck in the pre digital era with labs. We're seeing a wave of companies come and automate tasks, build new systems and it's a, it's a renaissance for the industry. So there's lots of companies growing very quickly. There's a lot of greenfield opportunity. We started in Stockholm, Sweden just three years ago and now we've landed here. We're expanding with big law firms, with big enterprises prices. I think the reality is that this market has only done 0 to 1. Now we are on the journey of 1 to 10 and 10 to 100. There's so much left to build and that's our opportunity and our challenge. Max was interesting about. What you just outlined is different jurisdictions, right? You're talking about American law, Nordic law, European law. Take us inside building Lagora and the necessary data sets to be able to service the legal profession in those different markets where laws and filings are completely different. So in order to build systems and agents that perform real work, there's really two different types of data that you need to work with. As you said, it's the local jurisdictional data, the case law, the legislation, and then it's the firms and the enterprise's own data. And it's the combination of the two within a platform like Ligora that becomes incredibly valuable because I think these systems used to kind of feel like co pilots. You were working together with them on small tasks, but now you're actually able to offload entire end to end, I mean agentic workflows and the systems are performing end to end work for you. So when we started out in Stockholm, Sweden, I mean that market is smaller than one of the Big law firms here in New York. So we really practice that muscle. And now that we're here, I'm an engineer, we really lead with a product. Max. I suffered through law school and I'm the son of two lawyers and I brought that up yesterday so I'll be consistent. And I know from, from that context that lawyers bill by the minute, sometimes scanning barcodes for 5 minutes of work, 15 minutes work. How do you charge and structure your revenues for, for the platform? So we charge on a seat basis today. I think that is the easiest way for some of these customers to buy. But as we move towards this world where the Gore is performing more end to end work, I think both consumption and outcome based pricing models will make a lot of sense for our clients and also in turn their clients. Right. The way that law firms are charging for tasks that I can perform together with them will have to move from a billable outcome, our model to more of a fixed fear outcome based system.

[Caroline Hyde]

Can you just set the scene here? Because you're building upon in many ways the innovations of Anthropic. But Anthropic is also doing its own claw plug in for law. How does this competitive environment unfold for the future businesses? You want to sign on, how do they decide between you Anthropic, Harvey. What they already have as point solutions?

[Ed Ludlow]

Yeah. So I mean Ligora wouldn't exist without the LLMs. We were founded in late spring of 2023 off the back of the release of GPT 3.5. That was the first time the models became good enough to build any real software on. In the beginning were so many issues around the models, you had to reduce the hallucinations, you had to guardrail them. We had to build a lot of systems around them. Today we are very focused on bringing the capabilities of those models into an enterprise level legal setting. So when we work with a law firm like White and Case or Cleary Gottlieb, they are deploying Lagora and they're turning over, you know, billions of dollars using our system. And the interesting thing for us is every quarter the ground shakes a little bit. The new models are capable of doing new things, which needs to be reflected in our product roadmap. We cannot place plan for a year ahead because three months, in six months the capabilities might have changed. So our product has to change. Max, we just had 20 seconds. But I think what Caroline's question is, what is your moat? Do you have a moat? I think we have a real mode, of course. I mean the way that we're deployed within these enterprises connected to their data, the way that we've set up the permissions, the way that we work with delivering work. For instance, Debavoise just launched their client portal on the go where they are connecting their work to their external clients. So there's a real network effect within our product. To Max Yin Strand of Lagora, thank you very much for your time here on Bloomberg Tech. Now coming up, Apple's latest product is delayed as it awaits the debut of its new AI Siri. We have more on that Bloomberg reporting and some supply chain coverage as well with what's going on with Apple. It's half time. Don't go anywhere. We'll be right back. Bloomberg Tech. Welcome back to Bloomberg Tech. Technology stocks actually in particular are now pushing higher, having seen the Nasdaq 100 lower earlier in the session. Actually, that chart tells the story pretty well. But a lot of the story is still what's happening with the war in Iran, the movement in oil, general risk sentiment around geopolitics earnings. After the bell, we get Oracle earnings. And so once again, we kind of focused on the story and capital expenditures. Amazon is up by almost half a percentage point. The big story of the day that we hit earlier in the program is them looking at a bond sale, US dollar denominated and euro denominated of up to $42 billion. And we had the details in the program earlier. Oracle is treading water, of course, ahead of its print later today. But that is the story once again, the credit conditions, the capital expenditures and whether this build out is intact.

[Caroline Hyde]

We've got plenty more on the story and supply chain stories now because Apple's manufacturing pivot to India and away from China is picking up momentum. IPhone production in the country surged 53% in 2025 and now accounts for roughly a quarter of all iPhones made globally. For more, Bloomberg's consumer tech and Apple managing editor Mark Gurman joins us now. And Mark, let's start with the supply chain element of things. They've done this swiftly and effectively.

[Ed Ludlow]

Yeah. Our colleagues in India reporting that now about 1 in 4 iPhones are produced in India. This is a bit of an acceleration. About a year ago it was one in five iPhones and a lot of the phone production in India. That pivot happened because of tariffs. About a year ago. Apple looking for ways to produce the phones without that potential tariff hit for devices built in China and then imported into the United States. And they're going to continue doing more in India. They've got AirPod development happening there at some point, more accessory development happening there, more underlying component development happening there. So India, not only big for Apple in terms of growth in retail, but also for underlying manufacturing, not only in India, but in other parts of the world as well. The other piece of reporting you have out this morning, Mark, is about the Apple Smart Home display. Now, in my house, I right now have a lot of Amazon Echo devices. And so my understanding is that the Apple Smart Home display is like most akin to Amazon's Echo Show. What are you learning? Why delayed. What's behind it? Yeah, this device very much based on the new Siri and the new AI features Apple has been working on. Those features have yet to come to market. Those continue to be delayed. And as those features get delayed, the hardware gets delayed. Because as you know, Apple's very much a hardware and software and services integrated company. It's all one kit. It all comes together. So if one piece is not working, you can't release the entire thing. It's a pretty nifty device. You can walk up to it and it can know who you are and give you personalized content. And that very much relies on those new Siri features that the company announced a couple of years ago. They're now aiming to roll them out before the end of the year. And so this device instead of launching this month, likely to launch around September. Famous Mark Gurman and all things Apple. The Apple summary. Thank you very much. There's a lot more news out there, Carrie.

[Caroline Hyde]

There is, Ed, and it's time now for talking tech. And first up, BYD is exploring options to enter the world of F1 racing, according to sources in a bid to boost the EV maker's global appeal. Now the move would mark a rare attempt by a Chinese manufacturer to take on a sport dominated by European and US teams. Plus, China's enthusiasm for all things open Claw is igniting a stock rally among local tech firms moving swiftly to embrace the Open Source AI program. Now remember, OpenClore is an agent that leverages LMS including anthropics Claude to perform daily functions. And the tool has garnered a cult like status in China. And Polymarket is enlisting firms including Palantir to help police its force contracts. This is a prediction market faces really intense scrutiny over insider trading. It's all according to the sources who say that the firms will prevent and report suspicious activity with a monitoring system the Polymarket is building out at.

[Ed Ludlow]

Okay, coming up, a three month old startup founded by AI power pioneer and LeCun has raised over $1 billion in seed funding. To tell you about the company called Advanced Machine Intelligence. That's next. This is Bloomberg Tech, A startup founded by French AI pioneer Yann LeCun has raised over $1 billion in its initial funding round. Advancement Machine Intelligence, or AMI, is focused on building world models that use visual and spatial data. Bloomberg's venture reporter Natasha Mascarenas wrote the story and joins us now. The Internet has kind of reacted by oh, another one. And what is it that they do? But you know, there's a history with Yann De Kun and his work with matter in particular. Let's start with the vision for ami. What is it they're seeking to break through on?

[Caroline Hyde]

Sure. I mean, Yann Lecun has been a long critic of alarms being the best way to advance AI. So AMI is a new company that's focused on world models. The idea is that they are going to be able to integrate with enterprises like robotics companies or car manufacturers and help build AI that can operate in the real world versus being something that consumers, everyday consumers interact with via chat bots and so less focus on text and think more around spatial data, visual data, and trying to operate again in real world and real industries and maybe even the future of defense. There are so many interesting parts to this story, Natasha, that I want to dig in on. But what caught my eye is someone who sat in New York, they're not going to be in Silicon Valley. This is because they really feel that there's. What did he call it? That they've been LM pilled there. This is a European story at its heart, but it's also a non Silicon Valley one. You're exactly right. I mean this is one of the largest venture rounds raised ever in Europe and it is actively one that has not included a lot of the traditional Silicon Valley investors. When I asked John about that decision, he said that Silicon Valley investors were looking for really high ownership in the business and he believed that it was important to try and attract talent that wasn't just. Just focused on building within the large language models, which means not going to where people are working for Anthropic OpenAI, even his former employer Metta and trying to go to different geographies. Now I did ask if he will have to raise from Silicon Valley eventually and he said he's definitely open to that for his next round.

[Ed Ludlow]

The Kumas at matter for almost 15 years, more than 10 years at least. Is there any evidence or report reporting that that that's the way they go? Some kind of relationship with matter. Some collaborative work? Something like that, yeah.

[Caroline Hyde]

So at this point Meadow is not listed as an investor in the new business, but we did ask him about possible partnerships which he did confirm. So while the average consumer may not interact with his new company through a chat bot, there's not too far of a world where we could see it showing up in the Meta Ray Bans or other AI wearables that matters working on. So we're definitely tracking the possible partnership and he confirmed that there are ongoing discussions there. Natasha Mascareness Just scoop after scoop. We so appreciate coming on with that reporting. Let's now talk about another funding or indeed relationship in video is investing in Thinking Machines lab. It's an AI startup founded by OpenAI executive Miramarati. Now Nvidia is set to provide its Vera Rubin systems to power Thinking Machines AI models models as part of a multi year agreement. Bloomberg reporter Rachel Metz joins us some more. So what is Thinking Machines Lab doing? Yeah, so this company, they are building their own AI models and they have a deal that they just announced with Nvidia. They are getting investment from Nvidia and they are also going to be using quite a lot of Nvidia's chip power to train and run their AI models.

[Ed Ludlow]

I posted your story on X and you know, noting that up to a gigawatt of Varirubin or minimum of a gigawatt sorry, very Ruben systems. Like that's a lot of compute. But the unknowns are is Nvidia making this investment in cash or chips in lieu of cash? We just don't know. And the response that everyone gets back is so what does Thinking Machines do? What is Thinking Machines other than I

[Caroline Hyde]

okay, so so far Thinking Machines has released one product and it is called Tinker and it came out last year and that is a software that companies can use to fine tune AI models. What they're working on as well is some AI models. It's not quite known yet what the details of those are. It sounds like they will be things that will be useful to a range of enterprises models, but it's not entirely clear yet if they're going to be focused on specific uses or if it's going to be more general kind of thing like the models that underpin say chat, CBT or cloud. To have just issued or developed a model called Tinker and already be talked of as in the realm of a $50 billion market capitalization. It's on us to remind ourselves why Miramorati is taken so seriously by this market. For a hot second second, she led OpenAI, but really she was the CTO, right? Yes, she was the CTO. Opening is she's worked at a number of tech companies over the years. So she's been in the industry for quite a long time. I think the challenge that she's facing here with this company is can she build large language models? Not just can she build them. A handful of companies can build them. They require obviously a lot of money, a lot of experts, expertise and a lot of data. But also can she then convince companies or some other form of customer to pay for them? Tinker is an effort to help people fine tune models. So it's not quite up to having. It's not the same as having a model and then having people use it, but that was sort of their first step into business and they do have customers for that. So it'll be interesting to see see over the next year or so what happens with their business.

[Ed Ludlow]

We'd reported at the end of last year that the Thinking Machines was going out doing an early round at like a $50 billion valuation when it was basically a handful of people. And then what followed was all kinds of media reports about internally things not being well. Right. People leaving. We never really got to the bottom of it. I mean this is a big piece of news for them. But do we have a sense of how it's going otherwise beyond getting the backing of Nvidia?

[Caroline Hyde]

Yeah, that's. That is a bit of a question mark. We know that the company has about 100 employees and it has, as you mentioned, it recently lost some employees who went back to OpenAI initially. When Mira Marathi started this company, she started it with a quite a number of people that came from OpenAI. So that was certainly a signal if people were going back to, to that company that they had come from. But I mean I think this is still a very new company and sometimes these things take time to get going, get off the ground and we'll see what happens throughout the rest of this year.

[Ed Ludlow]

Bloomberg's Rachel Matt's top reporting. Thank you very much. Now, coming up on the show, HP exceeds expectations on its forecast for the current quarter. It's all about demand and all about hardware demand. We can discuss what's on going driving that outlook next with HPE CEO Antonio Neri. This is Bloomberg Tech Travel. Smarter, Not Harder at America's Best Value Inn by Sonesta. With convenient locations from coast to coast and value pack comfort at every turn, it's a practical choice for road trips, quick getaways and everyday travel. That keeps things simple without sacrificing comfort. And when you're a Sonesta Travel Pass member, staying at America's Best Value Inn means earning points toward free nights, upgrades and more every time you stay. Go to Sonesta.com to book your stay and unlock the best rates with Sonesta Travel Pass here today, Rome tomorrow. Join [e-mail] Terms and conditions apply. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across hr, IT and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM, Adobe, Acrobat Studio.

[Caroline Hyde]

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[Ed Ludlow]

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[Caroline Hyde]

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Run a smoother business when you're all aligned. Do that with Acrobat. Learn [e-mail] do that with Acrobat. Shares of HPE modestly higher up about 6/10 of 1%. Been chopping around in the stock session, but the company gave a strong sales and revenue projection for the current quarter. What's driving it? Demand. Demand for hardware in particular. Let's discuss with HP CEO Antonio Neri and let's start with that. You know, clearly there is some staying power in that demand at rack scale. You know, crystallize it for us. What are you seeing in real time?

[Antonio Neri]

Yeah, good morning. Thanks for having me. We saw tremendous demand throughout the quarter. I think the momentum in AI continues in the build out of the data center. But what I'm really pleased is the momentum we see in enterprise. In fact, most of our revenue in AI that we recognize in Q1 came from the Enterprise segment, which shows you two key elements. One is the adoption of Agentic AI into the company's workflow. And second is the growing of inferencing. A lot of focus is always around the training and, you know, training these new models. But for us, our focus has been both the sovereign space and the inferencing and enterprise space. But in our portfolio, we saw tremendous momentum in networking our strategy with journalists has paid off. And that's why we see double digits year over year growth in the order intake.

[Ed Ludlow]

You know, post Juniper networking is, is, is upside for you, right? I think you have a lot of confidence that growth will come in networking for the audience that doesn't understand what it is you do in that space. Why is networking on the rise in parallel with just kind of the broader AI hardware demand that you're seeing?

[Antonio Neri]

Well, I do believe, and this was the core thesis of the Juniper acquisition, that the next inflection point in terms of disruption will come from the networking connectivity layer. Think about when you build a data center. You have to connect this data center to all the data centers through the Internet. And that's what we call data center interconnect. Juniper has one of the most innovative products in the routing space. By the way, this past quarter we grew mid 20% in the order intake. And then once you are inside the data center, you need to be able to connect large amount of GPUs and CPUs together. And that's why you need the data center, data center switching portfolio in addition to some of the other core tenants of the technology. And they are, you know, the Juniper portfolio grew mid 40% in the order intake. So I will say for us, that has been a core tenant. That's why, you know, now they represent almost 30% of the company revenues, but more than half of the profit. And for us, that's also the ability to raise the outlook for the remainder of the year and also the outlook in free cash flow, because the structural margins of that business and the working capital efficiency are very, very different than the rest of the portfolio.

[Caroline Hyde]

I mean, you actually said, look, you're not done raising prices. You talk about discipline in what is a very dynamic environment. Antonio, talk to us about, well, how you're weathering the supply chain issue. In particular the cost, the memory costs at the moment. How do you navigate that?

[Antonio Neri]

Yeah, I mean, obviously the demand and supply has a huge mismatch and you actually need to go back all the 22, 23 time frame to understand how we got here, accelerated by the hypercycle we see in the space. But fundamentally, in our guidance, the new guidance, the new outlook that we raised for 2026, we included our ability to see the supply that we need to convert that into revenue and profit. But the reality is that we do not have enough supply against the order intake and the backlog, because otherwise we'll have even a higher outlook. So what we're doing, we have taken three very unique Steps number one is securing as much supply as we can. But again we don't have all the supply that we would like to have. Number two is taking a very agile posture when it comes down to pricing. And as I said yesterday, we are not done raising pricing. I think that that cycle will continue well into 2027 although we will hope that we will reach some sort of elevated pricing stability in 2026. And number three, you know, my experience have taught me that ultimately you need to have direct, transparent conversation both with customers and our partners. Last week I was in Europe, I met more than 20 customers at the Mobile Congress in London and they appreciate that level of transparency, understanding the environment we're in.

[Caroline Hyde]

I mean you're actually foregoing supplying some equipment to mobile service providers so you're being choosy with who you work with at this time of geopolitical angst. And when we question how much the Middle east is going to be able to build out the data center capacity as we'd once thought. Has the Iran conflict impacted your view on the world or indeed the supply

[Antonio Neri]

of the world and chips not on the supply side. Caroline. Obviously our first priority because we have businesses in that region, whether you Qatar, Bahrain, Saudi Arabia, Israel. Right. Is the well being, the safety of our employees. We have approximately 1,000 employees in that region and the good news of are doing well at this point in time. But from a supply perspective, no. But obviously as the conflict may gets elongated may have other implications particularly on the logistics side of the equation. You know, look, air freight routes are a little bit more complicated. We don't use boats or ships for transporting our equipments. But over time we, we have to assess if there is a revenue impact. What I can tell you right now there is even more demand than we saw particularly three or four months ago. So we have to navigate that together and we have to be smart about it.

[Ed Ludlow]

Antonio, you have never let me tear apart an HP server and that's okay. But if I got my hands in the compute tray, you'd have the high bandwidth memory around the GPU, wherever it comes from. You'd have the DDRs around, around the CPU and somewhere you'd have the SSD, NAND, flash memory. Be very, very specific of those three. What's the biggest impact to you right now in constraining your sales and your outlook?

[Antonio Neri]

Very simply is DDR and NAND or the SSDs HBM less constrained. But obviously a lot of the allocation on the capacity has moved there and as you know there of is lot a also transition from the prior generation of HBM to the new generation of because you need more memory channels but it's really the DDR4 and which now nobody almost use it but DDR5 and the NAND part which is the SSD

[Caroline Hyde]

you said just earlier. Look you one of your three key steps you took was to get as much supply as you could to ensure that that was locked in. You wish you could have more. Who is it that you need to push more? Who is it that you need to have more security for? How can you perhaps get hands on further supply going forward?

[Antonio Neri]

Look, we have a long standing relationship with the three core suppliers that provide DDR memory and HBMs and there is a little bit larger ecosystem for the NAND space but we have in weekly engagements with them. We are looking to swap components, drive in different configurations but the reality all

[Ed Ludlow]

of them are significantly constrained Caroline Antonio, just 20 seconds. What's the dollar figure? Dollar terms of what was left on the table. How much better the outlook could have been?

[Antonio Neri]

Yeah, it's pretty sizable I will say. You know we guided five pennies on the midpoint of the the range and then we raise our outlook for free cash flow by almost 200 million at the midpoint. But the backlog is very very large at this point in time. If you think about the system backlog is over 5 billion. We raise again the network in for networks for AI goal for the year. So it's a very sizable backlog. So we hope we make progress as we go along. But we categorize we level this as a prudent guidance at this point in time.

[Caroline Hyde]

Antonio Neri, CEO of hp. Thanks for the candid conversation. We appreciate it. Now that does it for this edition of Bloomberg Tech.

[Ed Ludlow]

Ed, great interviews, great Bloomberg reporting. Recap it on the podcast. You where to find it on the terminal and online on Apple, Spotify and Iheart. This is Bloomberg Tech.

[Caroline Hyde]

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