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Deloitte Representative
The right technology can strengthen human judgment. That's why Deloitte brings together AI and data analytics with multidisciplinary teams who can help you connect the dots across your enterprise, from risk to operations to customer needs. So opportunities don't slip by and surprises don't spread. Because the smarter your systems, the sharper your instincts. That's how technology makes people better at what they do best. Deloitte Together makes progress. Learn more@deloitte.com TogetherMakesProgress Being a small business
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Chase for Business Representative
owner isn't just a career, it's a calling. Chase for Business knows how much heart and effort go into building something of your own. Manage all your business finances, from banking to payments to credit cards, all in one place with Chase's digital tools. Plus access online resources designed to help your business thrive. Learn more@chase.com business chase for business make more of what's yours the Chase Mobile app is available for select mobile devices. Message and data rates may apply JP Morgan Chase Bank NA Member FDIC Copyright 2026 JPMorgan Chase Co.
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IBM Representative
So there's a lot of noise about AI, but time's too tight for more promises, so let's talk about results. At IBM, we work with our employees to integrate technology right into the systems they need. Now a global workforce of 300,000 can use AI to fill their HR questions, resolving 94% of common questions, not noise proof of how we can help 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,
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Chase for Business Representative
Bloomberg Audio Studios Podcasts, Radio news.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Bloomberg Tech is live from coast to
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Chase for Business Representative
coast with Caroline Hyde in New York
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
and Ed Ludlow in San Francisco.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
This is Bloomberg Tech. Coming up, China tightens its grip on AI, this time targeting overseas travel by top AI professionals.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Plus how big banks are looking to hire more AI specialists and shrink traditional banking roles.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
And we'll look at the tech IPO landscape as Space X kicks off an IPO bonanza.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
And quite the timing for any sort of IPO right now because at a new record high. Once again, Ed, it's risk on and that means we're buying semiconductors, we're buying Hardware. The NASDAQ 100 at a new record high. We're at up 1.7% on an intraday basis. That is we're looking at the semiconductor index on fire, up 5% for the stocks. Why dig into some of the individual movers? We're seeing Micron at a new record high as we see analysts all PILING an extraordinary uplift from UBS in terms of a price target that more than doubles from where it's currently trading up 17% for micron. But also, you're shining a light. What's happening with Qualcomm getting a real boost as well as we start to see new buyers of its Asics. It's all about the hardware ad.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
From Asia to the US Session, there's a massive rally in chip stocks also because of a breakthrough in technology. China's Huawei says it has a new technique, logic folding, that changes how a signal passes through a transistor. So you can do away with extreme miniaturization. You don't have to worry about the limits of extreme ultraviolet lithography. It's a new design, but also method of chip manufacturing. And that has really sent all kinds of chip stocks or supply chain exposure stocks sending much higher. Here's the catch. This is a technology that's many years away. Let's get more with Bloomberg Senior Tech editor Mike Shepard. You know, so interesting because Huawei is coming out saying we've got something here technology wise, but you're going to have to wait until the next decade to see it in a race with tsmc. Give us more detail.
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Bloomberg Senior Tech Editor Mike Shepard
Well, they are promising something that people have been wondering about, what would be the next version of Moore's Law. And that is the idea that every two years you would see a doubling of the number of transistors that you could fit on a tiny chip. And in recent years, that has started to slow because the chips have just gotten so small and so much harder to produce and really requiring such sophisticated machinery, like the kind of EUV machines produced by asml, the Dutch company, that really has a stranglehold on that. And that has really been a bottleneck, especially for China, which faces export controls on being able to acquire that technology. So their solution, innovate around the problem, at least in the view of Huawei. They are promising this new method and even a new law to define to pack all those transistors onto a chip and they are calling it Tao's Law and really trying to forge their own path. Now, the cautionary note, of course, Ed, is that this is all theoretical right now. They say that in the Kirin chip, the new line coming up soon, we may see signs of it, but it may take years. And Ed, can they produce it at a yield that produces a profit for them?
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
But the focus clearly is on owning their own supply chain, controlling it, and they're also looking at to control their own Talent chain. It feels as though as well might more limitations on those building startups in the country.
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Bloomberg Senior Tech Editor Mike Shepard
Carol we are seeing this competition between the US and China for leadership in artificial intelligence and advanced technology not only in the chip and software arena, but in the people arena and sphere as well. And what China is doing is saying to its AI researchers that look, if you want to go outside the country for leisure, for business, you have to come to us first, come to the authorities for permission. Now for years they have required this sort of okay ahead of any sort of travel for college researchers, for nuclear scientists and even executives at state owned firms. But now they are extending this reach into the private sector and specifically for companies that deal with artificial intelligence which just like the US has declared for China it is a national strategic priority. And that also includes the personnel who produce it, the researchers, the scientists, even the executives and founders. We don't know how restrictive Carol this will be. Is it an automatic no? Does that mean you can never go to the us? Is it more pro forma rubber stamp? We just want to know where you are. But nonetheless it is a signal that they want to keep those resources that crown those crown jewels of knowledge there at home.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Particularly after we see the investigation into the Manus purchase by matter as well. Bloomberg's Mike shepherd always across all things geopolitics. We want to now get you all across the markets more broadly. APEC Oscar Deshka is with us Swiss quote senior market analyst look, we are seeing once again a furious rally whether it be in hardware in China, whether it be the US names as well. Can it continue?
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Swiss Quote Senior Market Analyst Oscar Deshka
Well that's a billion dollar question. I guess. We have seen this optimism take over again since especially three months the Iran war started as investors just try to forget about the problems. The funding for the financing of new dad on on debt and the restrictions and then the competition and then supply chain problems and decided to just focus on the potential. And hardware is at the very center of this huge potential for AI adoption. The demand is strong. We know that the results from the technology companies especially in the US have come in better than expected. They beat estimates and it looks like yes this could continue. But on well there are some problems and that risks there are building today. One the macroeconomic set up. The macroeconomic backdrop is not necessarily ideal. The rising borrowing costs are at risk. The other risk is the energy crisis, the supply chain problems and the competition.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
I pick our markets to seem are writing that stocks are rising because of Iran peace hopes. But I'm looking at the S&P 500 information technology massively outperforming the NASDAQ 100 pushing records. Semiconductors are going absolutely bonkers because of the Huawei report. I think you just heard Shep give the details of Huawei's new chip manufacturing process. What's happening right now in tech?
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Swiss Quote Senior Market Analyst Oscar Deshka
Well, in tech well tech has become one major driver of the global markets. It's not only the US but we also see it in the emerging markets with Korean memory chip makers for example, really carrying this rally almost alone on their own shoulders to all time high levels. Whereas the rest of the sectors are struggling. They're struggling with an un ideal macro kind backdrop. Rising yields, rising borrowing costs and supply chain risks. So what we see today is that the market breadth between the technology sector and the rest is increasing in a way that when we look at the MSCI markets, while the rest of the market as if you just strip out sk, Hynix, Samsung or TSMC for example, while they have fallen to the levels that we have last seen during the April dip last year post deliberation day,
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
this hardware focus and momentum has really made certain names start to outshine here in the US I'm all eyes on Micron. We actually spoke with the CEO of Micron on Friday. Just listen to what he said about the memory stack side of the business.
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Micron President and CEO Sanjay Mehrotra
Of course the demand for memory has really surged and that is because of the importance and the value and the capability of memory that is really essential for all advanced systems. And yes, there is a shortage, but Micron is working hard to increase supply through these projects here in America, here in Manassas, Virginia, Boise and New York. And we see this shortage continuing beyond, well beyond 2026 time frame.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
In fact, this is an industry that we knew for booms and busts, but at the moment it's just on a one way boom trajectory. Do you think that really is the right way for the market to be seeing it right now?
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Swiss Quote Senior Market Analyst Oscar Deshka
Well, obviously there is never just one way, especially when we are looking at the market prices. They are parabolic. So in terms of technical levels or in terms of what happened in the in the past, we do expect a correction because the valuations have gone absolutely ballistic and we know that there are boom and bust circles in this industry. It is just that AI and the demand for air hardware will probably make these cycles a little bit longer than they have been before. But they are not going to just, you know, make them an existent anymore. So I think that there is a risk that all of those who are predicting that there Will be no bus cycles anymore in the memory industry are probably mistaken.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Apex, good sky or Swiss quote all across the news in the markets. Thank you so much. Coming up, we're going to hear a lot more from Micron CEO on demand for memory and what they're doing to address the supply constraint. This next this is Bloomberg Tech. Qualcomm reached a deal with tick Tock owner ByteDance to supply chips for data centers. That's according to sources, marking a key win for a company trying to expand from smartphone processes into infrastructure. Bloomberg's chip reporter in King just broke that story. The markets responding Qualcomm up 7%, a fresh record high. You remember when Cristiano was on the show a few weeks ago and he wouldn't say who the customer was, he was saying, oh, it's a hyperscaler, it's ByteDance.
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Bloomberg Chip Reporter in King
This is according to our reporting. Yes. And we believe there's more to come, that this is kind of a breakthrough for them in at least one area of this market. And according to our reporting, we expect more to come on the customer list
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
and it's millions of Asics. And so where, why does a company like bytedance come to Qualcomm at this moment?
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Bloomberg Chip Reporter in King
Yeah, I mean Qualcomm has a long history of in the chip industry. It's very skilled, it's very, it was a pioneer of something called SOC system on chips which is putting a lot of components together on one piece of silicon and it's done very well in very high volume market. So obviously it has a lot of skills that would be useful if you are trying to get your own solutions to market and volume quickly.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
So this is what's interesting about the Asics part. Right. Qualcomm is a fabless chip maker but essentially instead of having it its chip, it's doing it on behalf of a customer. Kind of how Broadcom's done for various people. For example, tpu. How does that work?
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Bloomberg Chip Reporter in King
Yeah, I mean the way it looks at the moment and we'll get more when Qualcomm does its analyst day coming up this summer. And they're pursuing two strategies, their own chips, their own processes. So rivals to Nvidia's products if you like. But also the, the Broadcrumb strategy as well, which is, look, you've got your ideas, you've got your designs, but you don't really know quite how to get this done in the kind of volumes that you need to do. Give it to us, we'll get it across the line for you. That's kind of the role that they're
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
looking at here in King on all things Qualcomm. We thank you so much. We've got plenty more on chips because shares of Micron absolutely spiking today. It is now a $1 trillion company if it holds this almost 17% gain. UBS actually raised its price target on the memory chip maker to a street high of, get this, $1,625 up from 535. And the new target implies the company's valuation could reach 1.8 trillion. Now on Friday, Bloomberg's Tyler Kendall sat down with Micron President and CEO Sanjay Mehratra about the company's expansion of chip production right here in the United States. Take a listen.
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Micron President and CEO Sanjay Mehrotra
Memory today is absolutely key across all industries that have electronic systems. And Micron is of course investing in Boise, Idaho, building our leading edge fab. That's for leading edge folks. Memory that goes into smartphones, PCs, servers and that leading edge memory in Boise, Idaho will bring first wafers out middle of next year and then ramp up from there on. We'll have a second fab in Boise, Idaho soon to follow that start first wafers by end of 2028 there and then we have production planned for Syracuse, New York area where we'll build over time mega cluster or four fabs. And you can see $200 billion of investments that Micron is making here in America to bring these long life cycle production that will be managed here in Manassas, Virginia along with production in Boise, Idaho and Syracuse, New York. And that will bring Micron's total production over the course of about next 10 years as we ramp up all these multiple fabs to about 40% of our production. By comparison, it is about 10% today. And all of that 10% comes from this site here in Manassas for Micron. And this will totally add investments, massive investments in long lifecycle technology nodes as well as leading edge technology nodes to serve these vast markets that are really surging in demand driven by AI, Micron is going to be bringing those investments, that's semiconductor manufacturing and in the process create 90,000 new jobs here in the US as well.
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Bloomberg Consumer Tech Editor Dana Wahlman
Well, on this point of demand and how this investment is seeking to help reach that growing demand, I'm wondering how long do you expect the shortage of memory chips to last? When can we expect an easing?
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Micron President and CEO Sanjay Mehrotra
Of course the demand for memory has really surged and that is because of the importance and the value and the capability of memory that is really essential for all advanced systems. And yes, There is a shortage, but Micron is working hard to increase supply through these projects here in America, here in Manassas, Virginia, Boise and New York. And we see this shortage continuing beyond, well beyond 2026 timeframe. But the important thing is that Micron is working hard with our customers, working also on the long term supply agreements with our customers to really ensure that they can have predictability for supply. And of course, Micron can have the confidence for the investments that we are really committing to here for the long haul.
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Bloomberg Consumer Tech Editor Dana Wahlman
Well, historically, memory is a cyclical business, right? Periods of boom, periods of bust. I'm wondering if a $200 billion investment here in the US signals perhaps more of a confidence that that demand, that high demand is going to be permanent or are there concerns here that the industry could be overbuilding capacity?
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Micron President and CEO Sanjay Mehrotra
You know, of course what we are doing is building these fabs, which are very long lead time item, as you can see in terms of what we are doing in Boise and New York, it really takes several years just to build, construct the shell. How we equip that shell really very much depends on our latest assessments of demand at a given time. So important thing is to have that preparedness to meet the market demand. And memory has become a key enabler. It is a strategic asset for our customers today. It is a strategic asset for AI across consumer as well as data center industries. Because without memory, you don't really have that intelligence that is critically important, important for the future roadmaps that our customers have.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
That was Micron President and CEO Sanjay Marotra speaking with our own Tyler Kendall. Now coming up, big banks are looking to hire more specialists and shrink traditional banking roles. This is Bloomberg Tech.
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Deloitte Representative
The right technology can strengthen human judgment. That's why Deloitte brings together AI and data analytics with multidisciplinary teams. People with deep industry experience who can challenge assumptions and help you connect the dots across your enterprise. From risk signals to operational pressure points to shifting customer needs, Deloitte helps you see what's coming sooner so opportunities don't slip by and surprises don't spread. It's not just dashboards. It's real clarity in the moments your decisions are made. When models reveal patterns, people can ask better questions. When data and people are connected, leaders can move faster with confidence. And when your teams are aligned, smart choices can scale from the frontline to the C suite. Because the smarter your systems, the sharper your instincts. That's how technology makes people better at what they do best. Deloitte together makes progress. Learn more@deloitte.com TogetherMakesProgress the thing about AI
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IBM Representative
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, slashed 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.
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Chase for Business Representative
IBM, you need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process. Need a last minute pitch deck? Do that with Acrobat. Need to level up your presentation design. Do that with acrobat. You have 30 plus documents that need to be simplified into a proposal. Do that, do that, do that with Acrobat. Learn more@adobe.com do that with Acrobat.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Wall street, well, it's getting caught up in AI angst of course, and looking to hire more specialists and actually shrink traditional banking roles. Bloomberg has the latest on two highly sought after trainers in finance teaching Wall street bankers how to use tools. Get this, they're charging $25,000 a day for the training. Bloomberg. Sally Bakewell is here with one particular evidence that banks might be apologizing for calling certain people lower value human capital, but on the other side of things are still really committing to the training side of things.
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Bloomberg Reporter Sally Bakewell
That is right. I think what we're seeing here is Wall street having a little bit of an AI reality check. It's recognizing that AI is not just a tool for efficiency anymore, it is also a requirement for survival. And so we have these two former SoftBank fund managers who have, who are basically cashing in on that. They've set up this firm, it's called Wall Street Prompt. And it's essentially to teach elite banks, bankers how to stop their jobs from being automated. And indeed the eye watering number is that they can charge $25,000 a day and that they have a two month backlog. And what this really speaks to is that the biggest hurdle to banks now is not essentially accessing the software. They can get all of that, they can pay for that and they have invested millions of billions into doing that. But the hurdle is ensuring that their senior professional professionals have a kind of a fluid currency that makes them productive and that can keep the financial institution competitive.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Sally, what's wild about Wall Street Prompt is it's like less than a year Old and it has real customers like this is. This is obviously one of the most read stories on Bloomberg Tunnel. You get why, but just explain to us what they've achieved and also why they want to move to Singapore.
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Bloomberg Reporter Sally Bakewell
Right. So yeah, they were founded just last year and they have clients including bank of America, including Citi, including T. Rowe Price. And what they're doing is they're going into banks and they're having training sessions with 25 to 30 employees and then they're saying, you know, they're using Google, Gemini and alongside FBI style behavioral analysis in order to spot red flags in founder pitch videos, for example. They're also teaching them how to use ChatGPT and Claude in order to analyze earnings transcripts for the most market moving information and build financial forecasting models on that. Now they are potentially looking to expand in Singapore because that is where they have put particular focus on ensuring that anyone who wants to move into the financial sector is very affluent. So there is a bit of a competitive, competitive, competitive edge in Asia and Singapore in particular. And that's really shining spotlight on the need for US financial firms to do that as well. I mean we've heard from so many of them that JP Morgan has rolled out LM Suites, a generative AI tool. Goldman is working with. Anthropic. Bank of America says that it's made its developers more productive with AI and Jamie Dimon says he uses it every day. So the need is clear that they need to upskill their staff.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Bloomberg. Sally Bakewell Absolutely top reporting. Thank you very much. Pope Leo the 14th says I should be quote, disarmed to protect humanity from its dangers, calling for making AI more human, friendly and freeing it from monopolistic control. The comment comes as the Pope and Anthropic co founder Christopher Ola launch the Pontiff's first encyclical, a document called Magnifica Humanitas center of the Care of Human Dignity in the Era of AI. Bloomberg's flavor attendee joins us from Rome. Flavia. Fascinating. Let's please just start with the basics. The basics of the document, what's in it and I suppose summarizing like the Pope and the attitude towards AI.
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Bloomberg Correspondent Flavia Attendee
Absolutely. That was quite, I must say, the pretty powerful message that came from, from the Pope. Just just to give you an idea, this is the first encyclical by the new Pope elected last year. And also the encyclical itself is the most, the most important, the most official actor from so really includes some of the priorities of, of a new Pope and The fact that it shows artificial intelligence, and not only that, but the way artificial intelligence is changing our lives that might change our lives, our lives in the future. I think it's really, really say something. As you said, he actually used this word, disarming, disarmed needs to be discerned. It doesn't mean that the artificial intelligence must be somehow blocked or must be regulated. That was the main thing. And, and also the fact that it basically said that it must be used, of course, for, for, you know, for, for, for just for, for good intentions and kind of indicated that all the possible risks if, for example, indicated that the fact that using computing, using artificial intelligence in a warfare in the military and defense sector is really dangerous, adding in a quote, no algorithm can make war morally acceptable.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Seems to be a lot of things going on outside the Rome bureau right now. Flavio Rotondi of Bloomberg talking about what is about magnificent humanity that is ultimately what magnifica humanities is all about. And what's so interesting is about 135 years after the original Pope Leo talked about all the new things, the first industrial revolution, how to help humanity through that coming of age of technology. And now they look at the age of AI.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Yeah, $1.4 billion, 1.4 billion Catholics around the world. If you want to talk to someone about AI, one message is a pope's address, one way of doing it certainly.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Well, from the humanity question, a bit of M and A for you. How's that as a plot shift? Delivery Hero up next, this is Bloomberg Tech. Welcome back to Bloomberg Tech. And let's take a look at today's big number. Over $11 billion. That's delivery heroes current market cap as it stands. And that is after Uber has offered to take over the German delivery company in a deal that would value it at about 10 billion euros. Now clearly the market thinks it can be maybe pushed a little bit higher and get dig into that very thing. Now with the details, equities reporter Jordan Fitzgerald. So an offer being made, is there more being discussed on the table at the moment? Jordan, thank you.
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Bloomberg Equities Reporter Jordan Fitzgerald
Yes. So over the weekend, news broke that Uber made this, a €33 per share offer for German based food delivery company Delivery Hero. And like you said, this values the company at about 10 billion euros. But we don't have any guarantees yet. Delivery Hero has been reviewing its strategic options. It's important to note that Uber already has amassed a 20% stake in the company, but there's no guarantees here. The Financial Times report that Uber had rebuffed that Delivery Hero had rebuffed Uber's offer, but things are still up in the air.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Delivery Hero just stopped trading in Europe at $38.23 a share. So the market's kind of saying, you know, we see this going higher than €33 a share. But also like a lot of analysts and I think you've been writing about this, right, saying this makes a lot of sense to do this deal from
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Bloomberg Equities Reporter Jordan Fitzgerald
Uber's perspective, from Uber's perspective and from Delivery Heroes. Delivery Hero has been reviewing its options. Shares are up quite a bit for the year as the company has been going down the path of a strategic review. And for Uber, analysts are really saying that this is a strategically sound deal for them. Uber is in a space, the food delivery space, where things are consolidating. And like I said, they've already amassed the stake in Delivery Hero and Delivery Hero in particular gives them exposure on the delivery side to international markets, particularly, particularly in Asia and Europe where they're already offering rideshares. But they can expand into that delivery side and really grow their business.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Bloomberg's Jordan Fitzgerald, top reporting. Thank you very much. I want to get back to check on Micron because what is happening is nuts. It's up 17% in part because UBS upgraded its price target to $1,625 a share, which as you can say, see looking at your screen would be double, basically what it's currently trading at. But generally speaking, names absolutely ripping. This Tuesday, Micron, top of the heat. But as we talked about earlier in the show, it is a global story. Here to discuss the trade, Daniel Pilling, portfolio manager at Sands Capital, who counts Nvidia and TSMC among top holdings. It's just so interesting to work out what's going on here. I think that you would say similar to what I wrote about in the Tech in Depth overnight, Nvidia is sold out. So whether your goal in this market is to play this space X IPO for space based datacenter Orbital data center, or you're just trying to build out data center on Earth, demand is vastly outpacing supply. Does that sum it up?
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Daniel Pilling, Portfolio Manager at Sands Capital
Yes, indeed, I think so. And, and maybe to put some numbers behind it. So I think we think about I can break it down in three sort of bullet points, right? Like one, it's viral, so it's sort of like zoom in during COVID The growth is unparalleled and we can see this in the anthropic numbers too, though it's also highly underpenetrated. So you know there's a billion office workers in the world and a tiny, tiny fraction of them are actually using these tools as of today. We try to estimate it, it's maybe 2 or 3% so it's a very, very small number. And then three, you know, all this sort of virality and under penetration is hitting this market, the semiconductor market where you have companies that have long lead times, they're oligopolistic pricing power. So if you add all these things together it's likely we're going to be supply constrained for quite some time.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
How broad therefore should the holdings go? When I'm looking at some of the funds you manage, clearly you got with the program when it came to Nvidia, but you're also thinking about those that are offering not only chips but also also the entire vertical stack. When I think of Alphabet that you're in this, Microsoft and Amazon. But why not broaden into other areas of the chip stack? Because we've seen them just do so well.
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Daniel Pilling, Portfolio Manager at Sands Capital
Yes, we totally agree. So we actually also own memory companies such as sk, Hynix and Samsung in Korea. Memory is going to be an increasingly significant bottleneck. We are heavily exposed to semi capex companies business such as ASML and and LAM research to provide the equipment to the foundries of the world. I think one should also look at electricity companies so anybody that supplies electricity to data centers. One particular interesting business there that we own is called Bloom Energy. And then lastly CPUs. CPUs are back for us. That's particularly interesting on ARM. But agentic AI needs a lot of CPU. So I think you're right. One should look at the total stack and there's many, many winners across the entire stack.
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Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Daniel Our top story in the show today was news from Huawei on logic folding. Basically a new method of passing the signal through the transistor. Taking you outside of Moore's Law, you're not dependent on extreme miniaturization. The way the market responded first in Asia, then in Europe and then in the United States, everything was up, irrespective of their ties to Huawei. Why do you think that is?
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Daniel Pilling, Portfolio Manager at Sands Capital
Well, I mean I do think that in Asia in particular in China, there's a sense that they do not have access to asml nor leading edge chips from Taiwan semi. So any sort of announcement that they can make that might provide them the opportunity to build their own leading edge chips is much appreciated. Now the counter to that though is that this technology has been around for a while. This idea of sort of stacking chips ships on top of each other is also something that Taiwan Semi is has been pursuing for really a decade. The problem with it is that it's twofold. One, you have to stack them on top of each other and two, there's a heat dissipation issue which is very very difficult to solve. So time will tell but we're somewhat skeptical about the Huawei announcements as they are as of today.
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Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
How skeptical are you or not of just China's prowess when it comes to AI and owning its own supply chain right now?
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Daniel Pilling, Portfolio Manager at Sands Capital
Yes, I have to say we're very impressed what China has been doing. But the core issue remains as ever the same I think. So China does not have ASML and or lithography manufacturing capabilities that would allow them to build leading edge chips. So anything above sort of 5 nanometer plus so and, and as long as that doesn't change, they will struggle to compete with Nvidia. So the world with the SK hy, Nexus and Microns of the world and in our opinion there may be a decade away from that. It took 15, 20 years for Western nations to build something like ASML. So as long as that's the case they will struggle to compete.
- [33:26]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Daniel, how's your math been going post Nvidia earnings? Right. I think about the $1 trillion figure which is Blackwell Rubin calendar 25, calendar 27 and then what Nvidia said was they see hyperscaler capex 1 trillion for the coming 12 month period. So you're trying to work out how much should they capture in sales and how does that translate from video into free cash flow? Have you done that math?
- [33:51]
Daniel Pilling, Portfolio Manager at Sands Capital
Yes, the math we have actually done and I would humbly argue is equally interesting, maybe is. So Jensen has said something about 3 to 4 trillion CapEx for 2030 for the entire industry. So 3 to 4 trillion, an enormously large number. Now Nvidia tends to have something like we believe 60% market share across training and inference. Now if that number is true, which we actually find hard to dismiss, then Nvidia would generate something close to $40, $40 of earnings per share and close to $1 trillion of free cash flow by 2030. And that would indicate the stock that sort of five times earnings in that time period. So that to us was sort of a super interesting number. They've mentioned it before and it seems very, very large as of now. So you'd have to have a lot of growth in the anthropics of the world. But Jensen has shown over time that he tends to hit the numbers that he talks about. So we very positive on that.
- [34:45]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Daniel Pilling from Sands Capital, good at math. Thank you very much. Carry plenty of news headlines out there.
- [34:51]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
It's time now for talking tech. And yet first up, a Samsung union representing workers outside the ultra profitable semiconductor division has asked a Korean court to block voting on a tentative deal that would distribute about $26.6 billion in bonuses. Look, the smaller union is arguing that the agreement disproportionately favors Samsung's chip business, with semiconductor staff set to receive average bonuses about $340,000, compared with roughly $4,000 for workers in Samsung's digital experience division. Plus shares of Ferrari tumbling after the luxury automaker unveiled its first fully electric vehicle to a wave of negative reviews over its design. Critics and social media users compared the $640,000 Ferrari that's Luci to mainstream EVs, raising questions about the company's push into electric vehicles. And Johnny I Design and Honeywell, back to Quantinum, is seeking to raise as much as 1 point billion in an IPO. Now, according to an SEC filing, the quantum computing firm plans to sell 21 million shares priced between 45 and $50 each at the top end of the range. Now Quantum would be valued at roughly $2.7 billion.
- [35:59]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Okay, coming up, Space X scores another successful launch, fueling fresh speculation about the company's IPO prospects and Elon Musk growing dominance in the commercial space race. We have more on that next. This is Bloomberg Tech.
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- [39:14]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Taking a look at some of what's going on in the space sector. A lot of names are on the move simply by association validation that the space sector is legit. It is for real post SpaceX is S1 last week, but also after Space X's upgraded Starship successfully deployed mock satellites and returned to earth mostly unscathed. That was on Friday night. Bloomberg Space correspondent Lauren Grosch is with us for Space X. Success is the data right? So irregular perspective of really what happens in the end. This was a completely new re engineered new architecture V3 Starship and they wanted to see how it would work. How did it work?
- [39:56]
Bloomberg Space Correspondent Lauren Grush
I would say that it was a largely successful debut of the vehicle. As you mentioned, this is a completely redesigned version of Starship. Mainly it had a lot of new upgrades, new Raptor engines that were supposed to significantly increase the thrust at liftoff off also had a number of Upgrades to help with the reusability that they're after. And so, by and large, it was a successful test. There were some uncomfortable moments. For instance, that super heavy booster, which you can see climbing and sending Starship to space, once it separated, it was supposed to do a controlled splashdown or landing in the Gulf. And that didn't quite work as planned. It kind of spun out of control at one point and then seemed to break apart. And then also there was an engine out on Starship. So just a few moments where it did not go to go to plan. It was a little bit incomplete. But I think it was by and large a really successful mission for the debut of this upgraded version of the vehicle.
- [40:52]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
I love all the quotes from employee Kate Tice. So we were expecting the reentry to be super spicy and I guess that's what we got. But where does this put us in the longer term trajectory of the plans for satellites, for the business model for Mars and the like?
- [41:09]
Bloomberg Space Correspondent Lauren Grush
Yeah, I would say we're still marching forward. There are still some kinks to work out. For instance, you know, the big thing about Starship is that it's supposed to be fully reusable. That's never been done before. And so that problem that they had with the super heavy booster not doing that controlled landing complicates that on the path to that full reusability. But as they demonstrated during this mission, they were able to deploy satellites like they had planned. They were dummy satellites, but they did demonstrate that that could work. So it does seem, you know, it stands to reason that that could potentially happen soon. I know they're aiming that within the next year, but still there's, there's definitely a long road ahead in order to really fully unlock this vehicle for what
- [41:52]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
it's supposed to be and maybe Vindicator valuation, as we see some extraordinary footage coming from the launch on Friday night. Lauren Grush, thank you so much for breaking it all down for us. Let's get the latest on Space X's potential listing into the market as well as the wider IPO landscape because we've got Jay Ritter with us. He's Director of the IPO Initiative, University of Florida. Emeritus Professor. They call you Mr. IPO. So, Mr. IPO, tell us as to how we see a vindication in the market capitalization of Space X as it goes public. Because as Ed was writing in his newsletter today, an awful lot has to go right.
- [42:29]
Jay Ritter, Director of the IPO Initiative, University of Florida
I'm in complete agreement. An awful lot has to go right. But this is a great company. As Lauren was Indicating starship is an incredible engineering feat. It's complicated, but this is actually a competitive advantage. It's so difficult for a competitor to come up with something similar that's going to be able to lower launch costs as much as Space X can. That it's going to allow Space X to have a big technological lead over any potential competitor. And this will allow it to put Starlink satellite satellites into low Earth air orbit and offer Starlink Internet access at much lower cost than competitors can
- [43:23]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
J Professor Ritter, you are called Mr. IPO, if you don't mind me saying, because you're probably the most influential, most cited academic researcher in the field of IPOs of the last 40 years. What is different about this IPO and what is the same as those that you have studied deeply in your career?
- [43:46]
Jay Ritter, Director of the IPO Initiative, University of Florida
Well, what's different is this is going to be the largest private sector company ever to go public. Valuation of something like $1.5 trillion, dramatically higher than any other of the big companies that have gone public in the past. They've generally been large state owned enterprises with very large operations and profitability. This is a company where the market and venture capitalists have been valuing it based upon enormous potential future profitability. But as was mentioned previously, a lot of stuff has to go right to justify this valuation.
- [44:36]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
When you think about just the multiples that are going to be digested, and I know you've looked a lot into that, where does it sit in past and historical terms compared to those that did list? Because as we've been talking about time and time again across this entire network, look, companies are staying much longer private and they're coming in at extraordinary valuations. And so you wonder how much money is left on the table for a retail investor or a different type of investor that hasn't been funding it from day one,
- [45:03]
Jay Ritter, Director of the IPO Initiative, University of Florida
right? This is a company where last year it had $18.7 billion in sales. You know, bigger than just about any tech startup or, you know, private company that hadn't already been public has in terms of revenue at the time of going public, but it's also got the really huge valuation. And to justify a 1.5 trillion valuation, very big future profits have to be there. There have only been about 18 companies that have gone public in the US with inflation adjusted revenue of at least $100 million per year and a price to sales ratio of more than 40. At a 1.5 trillion valuation, SpaceX is going to be going public at a price to sales ratio of about 80. So there haven't been all that many companies that have done this before, but of those that have, on average, the stock has been disappointment to investors. Lots of things have to go right.
- [46:23]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Lots of things have to go right. Jay repeated throughout the S1 is a warning that they will be constrained by COMPUTE now in the future and Starship has to work very quickly. Is that just boilerplate or they have to say that,
- [46:38]
Jay Ritter, Director of the IPO Initiative, University of Florida
you know, it's technologically true that the profitability of sending people to Mars is very questionable, but the ability to get things going in the foreseeable future with Starling can be an enormous source of profits.
- [46:59]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Jay ritter of the IPO initiative, the University of Florida, they call him Mr. IPO. Thank you very much. Coming up, Google comes out with the Fitbit Air trying to catch up to WHOOP in the AI powered wellness space can have a look. This is Bloomberg Tech.
- [47:26]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Tech companies they are racing into an era of personalized health. And Google is out with its latest, latest product in the space, the Fitbit air, the new $100 screenless wearable, which represents a major evolution in what consumers can expect from fitness trackers. More let's speak to Bloomberg's consumer tech editor, Dana Wahlman. Now you have a whoop which might be a direct comparison here, but what's so interesting is Google having more of a sort of open way in which they're going to be allowing us to use our data.
- [47:56]
Bloomberg Consumer Tech Editor Dana Wahlman
Yes. So I'm, I think the business model is going to be quite more appealing for a wider swath of consumers. So you pay upfront for Google's hardware and then if you like you can just use Google Health for free as a free app. They do have a premium tier that offers a lot more interesting features and that's where you might be paying locked into a subscription model. But WHOOP is entirely subscription based. Technically you aren't even paying for the hardware itself. You're paying for these annual subscriptions and it if you ever cancel, your device is pretty much bricked.
- [48:26]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
The business models are so different between the two. Right. I mean like just last week we were talking about different form factor but aura ring and an ipo. You're the editor on the consumer tech team. We do reviews like we get into the tech how it works, what was the team's kind of like impression.
- [48:43]
Bloomberg Consumer Tech Editor Dana Wahlman
So we think competition is good. Sorry to sound so buttoned up there but competition is good I think for consumers and we like both is really sort of the the long and the short of it, WHOOP is still probably a better choice for more advanced users. It has a more data focused approach. So it pulls more data, it presents it in a very clean but sort of geeky way. I think if you are looking to interact with a device like this, really leaning into the AI, having a conversation with a coach that is proactive. Google's AI is more advanced than Whoops. I found it more natural, more conversational. It was easier, for instance, to explain, hey, if I wake up in the middle of the night, it's because my toddler woke me up briefly. It's not because I have chosen to wake up at 2am so having conversations like that is a lot easier. With Google's device, you will get more data still with whoop. And you will, in my opinion, see it presented in a way that makes a little more sense and is a little more aesthetically pleasing.
- [49:40]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
What's interesting is the way in which briefly, we're going to be using them so much more than sleep or heart rate and the like. Oh, I'm sorry, when we go using them more for. Like you're using for meal plans, for example, how you can fold it in more.
- [49:53]
Bloomberg Consumer Tech Editor Dana Wahlman
Yes, absolutely. So I used it for a combination of. I tried to use it really like any consumer would. I used it for a combination of sleep tracking, overnight analyzing my sleep and my readiness for the coming day. And I really played around a lot with the food tracking here. I took pictures of my meals. I said, how many calories is this? And actually the. The estimate seemed pretty accurate as far as I could.
- [50:16]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Right, Dana, Great getting up, Allman, and over to you.
- [50:20]
Bloomberg Tech Reporter/Host (Ed Ludlow or Caroline Hyde)
Yeah, check out the Full review on Bloomberg.com unfortunately, that does it for this edition of Bloomberg Tech.
- [50:25]
Bloomberg Tech Anchor (Ed Ludlow or Caroline Hyde)
Don't forget to check out the podcast you find on the terminal, as well as online on Apple, Spotify and iHeart. This is Bloomberg.
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