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Caroline Hyde
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Ed Ludlow
Bloomberg Audio Studios Podcasts, Radio news.
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Caroline Hyde
Bloomberg Tech is live from coast to.
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Ed Ludlow
Coast with Caroline Hyde in New York and Ed Ludlow in San Francisco. This is Bloomberg Tech Coming up, Oracle Data center financing being questioned Ellison's giant says the equity deal for its Michigan project is on schedule and doesn't include Blue Al Capital Capital Plus OpenAI is in talks to raise $10 billion from Amazon. We use its training chips. We have the story. And Waymo is in talks to raise more than $15 billion at a valuation that could exceed 100 billion. Details later in the hour, but we begin with our top story. Oracle Shares extending losses Worst day that we've seen since December 10, but the lowest Since June of this year, Oracle's largest data center finance partner, that's Blue Owl Capital, will not back a $10 billion deal for a 1 gigawatt facility in. Still, Oracle says that the datacenter project remains on schedule and said its development partner, Related Digital chose quote, the best equity partner from a competitive group of options, which in this instance was not blue out. For more we turn to Bloomberg's Brody Ford covering all things Oracle. You've talked about how certain datacenter projects that are going to be there for open air might be behind schedule. But have you heard and are we reporting out that financing is becoming more difficult to raise for these data centers?
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Caroline Hyde
The big context on Oracle is that they are embarking on a historic build out of data centers where it's really a logistical feat. It's quite a tight schedule they need to be on and if all goes right, it's transformational for Oracle and the entire industry. But all that needs to happen for that to get off is a couple things falling out. Right. And that's the issue with what we're seeing today is that the FT is reporting that there's been some issues in getting the financing for one of their big centers and that's giving investors a lot of anxiety that hey, are, are these lenders seeing something that we are not? That's what's driving the fear this morning.
- [04:09]
Ed Ludlow
What's interesting is you've been writing about the sheer scale of leases and I think leases is something different because it's off balance sheet. I think we're hearing it in a 10Q that they could have up to $300 billion worth there abouts in terms of their overall leases that eventually they're on the hook for paying. But yes, how is this different, how is this sort of financing different from capital expenditure and the like?
- [04:33]
Caroline Hyde
Right. So we're used to hearing about capital expenditures which is I'm going out and buying computers, I'm buying wires, I'm buying the data centers themselves. But what's becoming more popular is renting the data centers and that allows you to not pay everything up front and not have that be on your books directly. And so what we've seen is a big spike in these kind of future dated commitments that Oracle is the example that they have about 250 billion that they're on the hook for over the next 20 years or so. And most likely this Michigan data center would be one of them. It's just kind of, you know, one more pool of spending that we realize quite how large this Build out is going to be.
- [05:13]
Ed Ludlow
What's interesting I think is the Oracle is different from the other hyperscalers in that it's relatively new to this whole data center lease build out element. It used to be a software company. So is that something that also the market's trying to factor in? How good is it at this compared to Alphabet, Microsoft, Amazon, who've been in this game for a very long time?
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Caroline Hyde
Yeah, that's a huge part. I mean If Microsoft has 100 billion in commitments, people don't baton eyes much because their cash flow is quite a different style than of Oracle's. Right. I mean Oracle's spending is such a large percentage of its overall company size because it's making a very ambitious transformation. And now if you're a bull on Oracle you say yeah, well you know they are doing what it takes to transform their business. But a lot of things need to go exactly as planned for this to go right.
- [06:01]
Ed Ludlow
You're going to be across how all of it does go right or as planned. Ford across the Oracle story. Look, let's turn to well the company that's buying a lot of the data center or needs the datacenter compute from Oracle and it's OpenAI. It's in initial discussions to raise at least $10 billion from Amazon and we'll use some of the cloud giants training chips as well. For more let's go to Bloomberg's Matt Day who covers Amazon. Is this a circular deal?
- [06:27]
Caroline Hyde
Oh it sure looks like it if you roll the clock back a month. OpenAI bought $38 billion of compute capacity from Amazon. That was a seven year deal. It was primarily for Nvidia chips. You know, per, per this news that emerged last night looks like Amazon may be giving some chunk of that back an investment open AI.
- [06:44]
Ed Ludlow
So $10 billion in equity so that Open Air can continue to afford to buy compute of which is going to be buying from Amazon and its chips. But go to the chips part of this because Matt, this could be a real endorsement once again for training in the same way that Anthropic lent its name and its capacity for actually using them.
- [07:01]
Caroline Hyde
Yeah, that's right. Amazon also a close partner of anthropic, they've invested $8 billion in that company as part of a deal that got Anthropic to use Amazon's own homegrown AI chip for their models. Right. So this would definitely be a coup for Amazon's in house chip making effort which analysts are still trying to struggling a little bit to understand the effectiveness of to Date in part because there's just few enormous customers for this stuff. There's not a whole lot of big model trainers out there. So it goes without saying that if OpenAI can make the GPT suite work on top of Amazon Silicon, that's, that's a big deal for, for AWS and.
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Ed Ludlow
For Amazon because it was such a big deal for Alphabet and we think about the endorsement that it's vertical model seems to be getting from the market. What does it mean for Nvidia? Because as you mentioned, the previous cloud deal between OpenAI and Amazon actually was a ringing endorsement for Nvidia chips.
- [07:48]
Caroline Hyde
It means there's hunger for an alternative to Nvidia. I mean Nvidia stuff works well, but it's expensive, it's in short supply, only one supplier. So you've definitely got increased credibility among the other folks who are putting out AI accelerators on the market. You know, AMD has an Open Air deal for instance. Amazon and Google's TPU's are all making a claim for some of that big Nvidia business.
- [08:11]
Ed Ludlow
All of this is about trying to finance the heaven needing compute coming from the likes of Open Air. Matt Day, brilliant reporting. Thank you very much indeed. Let's get the market reaction, let's get an investor perspective for you. Tony Wang's with us. He is portfolio manager at t Rowe prices $12 billion Science and technology Fund. You are named and own the who's who of the players within AI infrastructure and AI use. Tony, are you worried, let's start with Amazon and OpenAI. Are you worried about the circularity of deals once again at play here?
- [08:42]
Caroline Hyde
Yeah, well, I think that whenever there's some type of creative financing, there's always some scrutiny that's on there. But I kind of view it as, you know, there is a synergistic partnership here and that, you know, Open Air is growing rapidly, they need to compute and it makes sense that they want to look for multisource. And so I think going to Amazon does make sense. In addition, I think they want some of that upside. And so you're seeing like, whenever there's like a new frontier of technology, there's often, you know, companies that need to come together and build the ecosystem. And I think that this is an instance of this. And so, you know, I think it's definitely something to watch. But I think that what matters at the end of the day is that the air continues to progress, the scaling laws hold, the use of, you know, ChatGPT labs continue to, to grow. And I think that when you look at these tools that are coming out of the companies, they are like transformational in terms of how we are rethinking work. So I think what really matters is that the end demand continues to be really strong and that we're seeing progress on AI.
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Ed Ludlow
I'm looking at your holdings and the number one holding that you have at the moment is Alphabet. Interesting news with a new Gemini release this morning. Morning, which we'll get into. But Nvidia is your second biggest now. Are you worried about Nvidia losing any sort of market share to Alphabet, to Amazon, to some of these other chip players?
- [10:08]
Caroline Hyde
Yeah, well, I think the market is growing and so, you know, this is an exponential growth curve. So I don't think that it's a winner take all. And so, you know, multiple companies can, can do well. And in some ways, I think when you step back and think about what's going on, you know, there are, there is kind of a space race for AI, but they're going to multiple areas, multiple moons. And so they're all doing their own kind of domain expertise. I think, like with the tpu, it's very optimized, you know, for a specific stack and for the Google ecosystem. And then I think Nvidia is like, kind of more the merchant, like broader platform can run everything. And I think both can have a place. And you can see that, you know, Google's been doing really well over the last five years. So has Nvidia. So as amd, so is Broadcom. And so to me, I think that, you know, there's not a winner take all year.
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Ed Ludlow
Okay. I love that sort of element of there are many races, maybe many moons. Tony. But talk to us about the moon shot that Oracle is making at the moment and the anxiety that people might not be wanting to lend to their future of leasing and the sheer scale of capacity that they're building with other partners, of course, out there, like related Digital. Have you got any anxiety around Oracle? I know it's in your portfolio last time that it was published.
- [11:29]
Caroline Hyde
Yeah. So I think that, you know, Oracle definitely sees the demand signals that are probably really strong. And so they're looking to meet that demand, you know, in the near term with leases and then over the long term and probably owning their own capacity. And so to me, they see that this as a big opportunity that is once in a generation. And so they're building for it and they're, you know, kind of being creative with it. And so to me, it definitely, you know, the market is super Concerned I think that there's probably somewhat of an overreaction and I think as long as like, you know, the demand is there in years three to five I think that that's what will make kind of the oracle that makes sense.
- [12:12]
Ed Ludlow
So all of this anxiety writ large around sort of whether it's more experimental financing, creative financing, circular financing, is it actually a buying opportunity for you Tony?
- [12:24]
Caroline Hyde
I think we're constantly managing risk and you know, rotating the portfolio to what has the highest roi, what has the best risk adjusted return. You know I still think that is like continue to be really good area to place capital. You know it's a lot of multi year inflection. That being said it's also been, you know, two, three years since ChatGPT has been launched and so we are kind of, you know, further along in AI but I still think we're pretty early and so you know a lot of my views, you know, expressed over the multi year and think that you want to invest in companies that strong competitive advantages that capture the value with their ecosystem. And I think that not everyone's going to be a winner in the space race. Like some rockets might not make it but to me I think it still is like a really great overall theme to, to be invested in.
- [13:16]
Ed Ludlow
The moment you think the rockets to be betting on are in order of importance. Alphabet, Nvidia, Broadcom, Apple, Microsoft. But how will that change as the application of AI comes? Thus far it has all been about the AI infrastructure but there's going to have to be proof of in the pudding the productivity. Are your science and tech fund going to end up looking like health care companies, like financial companies, like actually the users of this tech.
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Caroline Hyde
Yeah, I think that's a great question and you know often I think about where the economic profit pools are, are shifting or where is the second derivative like you know, accelerating to. And you've been right like you know the last few years have been really heavy infrastructure build outs and that's where a lot of the companies have accrued a lot of value. You think about you know, Nvidia, Broadcom, those have been like, you know, examples and then you're also seeing the components that are going in this system like you know, memory, hvm, you know, networking. Those companies are seeing a lot of like traction and economic profit accruing there. Then I think the next phase probably is on the application layer and so you know there are large language models like you know, anthropic, you know, XI that are all working on this and so yeah I think it's going to be exciting and I think you might even see some, you know, previously, you know, viewed as kind of on the wrong side of AI, like perhaps be able to capture value. I think there's software companies that have kind of been written off here in enterprise that, you know, if you're a Fortune 500 companies, often you're going to go to your software vendor once you figured out, you know, what play you want to implement AI. So I think that there could be, you know, new companies that form on the application layer, but there could also be incumbents that are now leveraging seeing the compute costs go down and you know, the capabilities and models be more domain specific. So I think it's an exciting time to be in technology. It's constantly evolving and I think that there will be also great opportunities, you know, that we don't think about right now.
- [15:21]
Ed Ludlow
Well, you're in some of the software play in particular Salesforce, which has been a bit beaten up for perhaps being not at the tip of the spear of things in terms of the monetization. But where's really been monetizing has been the picks and shovels and memory of late. You just mentioned memory. We've got Micron after the bell. Are you feeling positive about how much more we're seeing price strength from these sorts of companies?
- [15:44]
Caroline Hyde
Yeah, we're definitely on an upward trajectory and memory prices. So I think what's going on there is that HPM, the stuff that goes into these GPUs and AI systems, you know, they soak up a lot of wafer capacity and so as a result creating shortages in broader dram. And then also that's creating shortages in broader nand. And so that you're seeing this ripple effect into other areas like sandisk for example. I've seen, you know, the tremendous appreciation their stock price. So, you know, I think that there will be these areas where, you know, the economic profit can be distributed to even more that didn't participate as much over the last few years.
- [16:21]
Ed Ludlow
What's really interesting, and correct me if I'm wrong, but I've gone to the Bloomberg terminal, I've looked at the members that make up your fund, Lambda Inc. A private company, is in there. You of course, T. Rowe Price know the opportunity there is in these crossover financings and the design desire there is for private companies and exposure to it. So are you going to be seeing these companies going public? You looking more for private holdings as well as public?
- [16:45]
Caroline Hyde
Yeah, thanks for asking about that. You know, at Hero, I think one of our biggest competitive advantages that we are both public and we're also one of the biggest financiers in the private markets. And so we partnered up with Lambda. You know, I think that they've got a really interesting cloud stack that is unique and they're on the right side of change of building these data centers really, you know, to, to what you would want a true data center to be like so without a lot of the baggages that you would have to, to hold in traditional compute. And so, you know, I think the future is bright for them. The team's executing extremely well and excited that, you know, they continue to progress, you know, in terms of, you know, timing on public markets. Like, I think that they'll do it when they're ready.
- [17:31]
Ed Ludlow
We'll keep an eye on Lambda and the executive team over there as well. Tony Wang is portfolio manager at T Rowe Price Science and Technology Fund. Public Private. We went everywhere. Meanwhile, coming up, the bidding battle for Warner Brothers is reaching a crossroads. That's up next is the Bloomberg Tech.
- [17:53]
Caroline Hyde
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- [20:31]
Ed Ludlow
Warner Brothers Discovery it is urging its shareholders to reject the Paramount Skydance takeover bid favoring its original agreement with Netflix. Michelle Davis joins us now on the latest. We're seeing the market reaction. Paramount Skydance off by four and a half percent now. So what is the thesis of Warner Brothers Discovery as why the $30 Paramount is not living up to what's been offered elsewhere? So what Warner Brothers is saying is they reviewed the Paramount $30 a share offer. It's the same offer that Paramount had offered them two weeks ago when the board already deliberated and decided to go with Netflix. And in some ways they're saying this offer, the tender offer, is worse than what was initially offered. The logic is they don't view it as certain as the deal they already have signed with Netflix. And part of that has to do with the fact that Paramount has lined up, okay, $54 billion of debt, but they also are going to need $40 billion of equity. And as detailed in this 100 page filing that came out today, Warner Brothers board says that they tried multiple times to get the Ellison's to make basically a personal commitment, personally backstop the equity commitment. But they, so Warner Brothers said refused to do that. They're using a revocable trust to backstop the commitment, which Warner Brothers says is risky. You know, assets could be moved in and out of it. What they want is something that looks a little bit more like what Elon Musk did in the Twitter deal, which if you remember helped Twitter close that deal when Musk tried to back out of it. I mean, fascinating that everywhere in our show it's Questioning of Larry Ellison's financing for various things at the moment, whether it's his son's bid for Warner Brothers Discovery or whether it's his financing for future Oracle datacenter leases. It's interesting though also that others have been pulling back on the potential financing. Talk to us about what's happening with Jared Kushner's affinity. So yesterday we reported that Jared Kushner's affinity was pulling out of the equity commitment or the backing of the Paramount bid. And this kind of underscored some of the concern that the Warner Brothers board has around where all the equity is coming from. Because. Because Paramount has said that it's lined up, you know, sovereign wealth funds across the Middle east as well as Affinity as well as others to back the funding. And if those are falling through, what does that mean? It's also interesting because Kushner's involvement there had been seen as maybe something that would help Paramount clinch this. If, you know, he is the ally to Trump that Paramount needs to get this through regulators. Without him there, I mean, it remains to be seen what that means. Warner Brothers has said that actually they view both the Paramount deal and the Netflix deal as on equal footing from a regulatory perspective. They say both can get through and we don't see any, you know, marginal risk or difference between the two of them. And so it's kind of a moot point. I guess we'll see how the formal rejection of Paramount's offer continues in this unfolding story. Quite the drama. Michelle Davis covering it all for us. We thank you. Now let's turn our attention back to large language models for a minute because Google is rolling out a more efficient, more affordable version of its most powerful AI model across its products. The company announcing today the release of Gemini 3 Flash. And this comes just one month after the release of Gemini 3 Pro, which reasserted its leadership in the air race. Since then, of course, Open Air declared a quote, code red and pushed out a new version of its flagship GPT5 model as well as an updated image generation model to try and keep pace for Google AI's offerings. Tesla it's facing a 30 day ban on car sales in California, the biggest US market. State regulators say the company's ads, well, they've misled consumers about its self driving technology. Tesla's lawyers insisted that the ads were protected speech. Now a judge backed the DMV's complaint. The automaker has not 90 days to appeal or comply before the ban take effect. And Tesla has warned the ban could have major consequences. For the business, its shares have been on a tear before today. They hit your all time high yesterday. Today we just pulled back some almost 3% lower. Now turning to other auto news, Waymo is in talks to raise more than $15 billion at a valuation that could exceed 100 billion sold according to sources. Now the robo taxi maker has discussed raising billions in equity from external backers as well as its parent company Alphabet. Let's get the details simply back. Sarah Fry who helped break this story. And really we're starting to see the race being on 100 billion or in excess of is a lot more than what it was previously valued back in 2024.
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Caroline Hyde
And really those numbers, I mean in.
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Ed Ludlow
The air race they seem, they seem.
- [25:03]
Caroline Hyde
Equivalent to what we're seeing from you know, opening I and there, there is a, a really big hope here for, for these companies in Waymo. The difference is it has a product that is tangible, people are using it, people are, are taking their way mo's around San Francisco, right around. You know, I see them outside by my window all the time as regular transportation options.
- [25:30]
Ed Ludlow
It is real. It is happening in many cities throughout.
- [25:33]
Caroline Hyde
The US right now. And, and I think that that is why they need so much money. This is a very expensive business. This is a business that's going to require a lot of capital to expand into, into other cities and also other types of roads, right, like freeways, more rural areas. I don't know.
- [25:54]
Ed Ludlow
How, how quickly that's.
- [25:55]
Caroline Hyde
Going to roll out, but we are seeing some international expansion in the next few months as well. So a very big moment for, for Waveland for Alphabet.
- [26:05]
Ed Ludlow
Annual revenue run rate you are Reporting is above $350 million. Tell us just very briefly the Alphabet relationship here. They are being able to go to external capital.
- [26:14]
Caroline Hyde
I've gotten a lot of questions about.
- [26:16]
Ed Ludlow
This because people are like wait, isn't.
- [26:18]
Caroline Hyde
It way more part of Alphabet? But, but Alphabet is investing in them. What's going on here? So it's one of Alphabet's so called other bets. That's the division that includes these. We previously thought of them as moonshots. Companies like Verily, the life science company Waymo and Ruth Porat under her leadership.
- [26:38]
Ed Ludlow
Has tried to make this a more financially.
- [26:43]
Caroline Hyde
Financially safe and smart line of the business. She's encouraging spin out, she's encouraging independence and so Waymo is getting a lot of external support as well. And the idea is yes, I have.
- [26:58]
Ed Ludlow
To leave it there. Sarah Fryer on all the news to do with Wayman. Congratulations on the scoop. This is Bloomberg Tech. Welcome back to Bloomberg Tech. We check in on these markets that have some anxiety baked into them at the moment when it comes to the financing of the I spend. Still, the question of bubble lingers. We're off by 1.2% on the NASDAQ 100. We're looking at some of the biggest draws in terms of the overall points perspective. And look, we've got a sea of red and videos up by 3.7% when you were $4 trillion. That matters to an overall benchmark. We perhaps got some competition coming if Open Air does indeed start using training over at Amazon. A key story for us today, Broadcom once again under pressure, this time by almost 5%. Remember, it had been sold off hard since its earnings. We see it now at 324. Micron has its earnings after the bell. We're up by 2 1/2% ahead of that number. But we're expecting 50% growth in revenue for this business as it's managing to really capitalize on memory and the price of. We'll dig into that in a minute. But for now we focus in on what's happening with Oracle. We're down by 5%. Once again there is concerns about how Oracle is financing its big pivot into the the world of cloud computing, the data centers, the leases and indeed whether Blue Owl is able to be able to financing the latest one over in what's happening in Michigan. Let's talk about it with Mandeep Singh, Bloomberg Intelligence Global head of tech research. And we are again questioning Oracle's capacity to get into this data leasing pivot. Are you worried about some of the intricacies? Look, the reporting from Bloomberg is that Oracle is still going ahead with the Michigan project. It's not being delayed from a financing perspective. It's just not blew out behind it.
- [28:42]
Mandeep Singh
Yeah, and look, I think a lot of it is around what kind of open air and rate will we see in 2028, 2029? Because you know, we are talking about build out of data center infrastructure for things that are going to go live, you know, in 2028, 2029. And that's where investors who are funding this do they have the patience to wait for revenues to show up, you know, three years out? I mean in the case of Oracle had the backlog not being skewed to OpenAI, I don't think there would be as much anxiety. But because OpenAI seems to be losing its lead when it comes to, you know, the model provider race and now Gemini Anthropic xi they all seem to have caught up and that's where the anxiety seems to be stemming from is are you better off just, you know, focusing on one LLM provider when you know it's going to be a race where, you know, four or five providers are neck and neck and if they diversify that, you know, exposure in terms of having someone else like X I use Oracle capacity, then I think that may calm down that anxiety. But for now I think think that's one thing. The other thing is training versus inferencing. I mean if Oracle is more exposed to training workloads, then you have to ask yourself how much ROI will OpenAI have training the next version of their model, which is going to cost a lot more, but will it have the kind of returns that everyone expects in terms of the model intelligence and how much they're going to get out of that next training run? So no one wants to underwrite, you know, training workloads, which is why Microsoft refused that to begin with. And all that open air business went to Oracle and now I think market is putting a question mark around why they should be funding Oracle because training is not someone, something that, you know, everyone is keen to invest in right now because I mean training costs will plateau and it's just a question of when, not if and we don't know when it's going to happen.
- [30:48]
Ed Ludlow
There's also the question of what chips you can use for training and we're questioning Nvidia's dominance at the same time. What's so interesting though is the more we peel away the layers of the onion, more we understand what this data center financing looks like and a lot of it. We all talked about capital expenditure from all these big cloud companies, but actually we've got to look off balance sheet and we've got to look to 10Q reports like with Oracle, how much is that being factored in by equity investors as well as debt investors?
- [31:13]
Mandeep Singh
I mean even a matter is looking to finance stuff off balance sheets.
- [31:18]
Ed Ludlow
So that's well too.
- [31:19]
Mandeep Singh
Yeah, exactly. So that's where you know, all these companies don't want to take too much debt. In fact, part of the reason why Oracle's equity seems to be going down is everyone is thinking maybe they should be, you know, raising this money via equity. Why raise everything using debt? And so that's where you know they're going to be creative and sometimes you have to course correct. I mean if, look, the CDS spreads keep expanding and the market is not ready to fund it, maybe Oracle may have to bring down its ambitions in terms of, you know, how much they are will be looking to build because all this is for future capacity. I mean if you have capacity right now, you know the new clouds are doing well. Corby has a nice backlog and your supply constraint. So the question is where will that demand pattern remain for the next three to five years and if it does, then Oracle will be fine. It's just a question of how much training needs these model providers will have and how much are you going to make from the next version of the model training. Is it really worth the ROI in terms of spending 5x on the next training run when things seem to be closing down when it comes to all these frontier models at the end end, it comes down to who has the lead when it comes to models. And for a while it was just open air.
- [32:33]
Ed Ludlow
Mandy Saying of Bloomberg Intelligence, the breakdown there. Let's focus in on some earnings after the Bell. Micron scheduled to report first quarter, fiscal first quarter results and analysts expect the chip maker to benefit from strong pricing trends. Let's get to Kim Forrest, Boca Capital Partners CEO we're off ahead of these numbers, but a lot of optimism baked into Micron and memory remake is right now.
- [32:55]
Mandeep Singh
Absolutely. And the price shows it. And there is a pattern to Micron's earnings right. That oh, maybe a month before people and it's probably in reaction to Micron's customers talking about, you know, what they're buying from Micron, the stock generally. And when things are good, this is a very cyclical stock, but when things are good, things are very, very good for Micron. And I think in the short term things are going to be really, really good for Micron. But often the stock sells off right after just because of that buildup that has happened, you know, in the recent past.
- [33:34]
Ed Ludlow
So I mean Kim, the stock's up 168% so.
- [33:39]
Mandeep Singh
Right.
- [33:40]
Ed Ludlow
We've got a little bit of a dip into the earnings. It's kind of nothing in terms of its performance. But what are you looking for after the Bell in terms of signals that the strength is there and that we don't keep questioning the AI bubble as we know it.
- [33:52]
Mandeep Singh
So there are very few providers of the the big product that I want, which is high bandwidth memory dram. And there's only two other players in the market. Micron has had a nice lead. The other players are coming up. But it looks like for at least, least the foreseeable future, infinite demand is there for this product. And I'm, I'm teasing. Okay. I don't really believe it's infinity, but it's a very high demand. So we would like to know what that's doing. And you can see how Micron is shifting away from its older products and it's more consumer related. NAND Devices, they announced, you know, one of their longtime franchises, they're going to be closing that in favor of putting all its effort behind dram. So that's what I'm looking for is what is the. Why do they have that confidence and why should we as shareholders, you know, go along with the ride?
- [34:50]
Ed Ludlow
Because right now there is shaky confidence around certain names about the infrastructure buildout. Do you have shaky confidence about certain newer players to cloud newer areas and data centers?
- [35:03]
Mandeep Singh
Well, this is going to sound like a Miss America speech. I have a real, I know AI is going to work out. I just don't know how the large language models seem to be consumers of tons of bandwidth which you talked about on your last segment or not. You know, computing power, not bandwidth. But I don't know that that goes on forever because this whole scaling thing where just throw more compute power at it seems like the brute force method and it's not very computer science. We like to think, I'm an ex practitioner we like to think rather than just you know, build. So I'm thinking that breakthroughs in the design of these things are going to help out and may make a lot of the demand that we assume is there for hardware. Not irrelevant but not infinite.
- [35:55]
Ed Ludlow
Well to that point we've seen what China has been forced to do because it can't just throw ever more computer. The situation doesn't have access in terms of supply chain. What about Micron zone ability to the global opportunity here? And they're exposed to China in some ways.
- [36:12]
Caroline Hyde
Sure.
- [36:12]
Mandeep Singh
I mean it is a concern because we don't really want to allow them to sell the really good stuff into China because of military issues and well just you know, leadership but that we're a capitalist society. So some of that kind of has to get, get pushed aside and we let you know, companies work throughout the world. That is a concern. But right now, for the foreseeable future, let's say 18 months to 36 months, there doesn't look to be another break through other than scaling. And it looks like all things being equal, that scaling is the path forward especially for large language models. So it, unless information comes to light tonight, it looks like the, the companies that are offering products to these big data centers are going to continue to have their products very much in demand.
- [37:09]
Ed Ludlow
What's interesting is we're to trying, trying to understand how much in video is still in demand at the same time as an Amazon builds out its training is the same time as TPU's come to the fore Alphabet and indeed Broadcom is used for Asics. What do you make of where if they can all win?
- [37:25]
Mandeep Singh
Well I think they can all win because the, the training, training test and validation are parts of this process and they can better use different hardware setups. So I think that there's a place for everyone. What you're trying to figure out is how much of a place for each one of these items. I think competition always makes it better for the end consumer and I'm not talking about the people using LLMs, I'm talking about the people buildings now. So I am very heartened to see that the leadership of Nvidia isn't overshadowing everybody else who with an idea. I think it's also kind of interesting just from a performance standpoint that companies like Google and Amazon have been able to quickly come out with something that's very usable. And we all had the assumption maybe 18 months ago that that was, you know, the horse was out of the barn and over the hill and you know, so far away. Nvidia was the clear winner. So actually, actually I love it as a capitalist.
- [38:31]
Ed Ludlow
Kim Forest Poker Capital Partners Capital's in the name. We appreciate it. Fintech startup Imprint Payments has reached a valuation of $1.2 billion. The company that helps retailers offer co branded credit cards has brought in $150 million in a new funding round by Khosla Ventures CEO Dara Murphy joins us us now for more what are you using the 150 million for? Dara.
- [38:59]
Caroline Hyde
Hey Caroline, great to see you. Thanks for having me. At Imprint our bet has been the same since we started the company five years ago. We want to be the modern co branded credit card loyalty platform for the world's great brands. And we've raised this capital to allow us to double down on that strategy. Our bet was relatively simple when we started the company that the world's biggest banks weren't building good enough experience for great brands to launch co branded credit cards. Experience. And that's been true. And what you see is we've taken a siloed experience that used to live in the bank's app and put it at the heart of our partners experience. And so when you open our partners app or you open their website, you can engage with the cart, you can pay your bill, you can Check your balance. And that puts you one tap, one click away from buying your next bag of groceries and booking your next flight. And for our partners, that has meant huge increases in lifetime value. It's why brands like booking.com rakuten, crate and barrel are choosing imprint over legacy banks and why we continue to focus on this mission with the money we've raised.
- [39:56]
Ed Ludlow
A mission that was actually incubated in Thrive Capital. They participate in this round, Ribbon, Perkins, Spice Capital and the like. Dara. But I've sort of got a bigger question of just how many of these credit cards am I going to have or even a debit card that you're looking at now? Am I as an individual going to have a booking.com one and a recurrent tin one and I'm going to have a Turkish Airlines? At what point do I become exhausted with all the offerings?
- [40:19]
Caroline Hyde
Well, what you see is we're working with partners that demand a lot of share of wallet from their customers, right? Like if you think about booking.com they're winning against airlines, they're winning against hotel companies, and customers are going there to book the full trip experience. And so by partnering with Booking or by parting with Rakuten that's taking such a large share of online commerce for customers, we end up being a meaningful share, meaningful share of each customer's wallet. And so you're able to give them rewards for a huge portion of their spend. We would agree that very small fractional brands probably don't need credit cards, but more and more we partner with brands that are parallel winners in their categories. They're winning in all of E Comm, they're winning in all of travel. And so we get to give customers way more value for a bigger portion of their wallet. And so more and more customers sign up for that benefit rather than thinking, I'm going to have 50 versions of.
- [41:07]
Ed Ludlow
Of a credit card now and do the inevitable question. But I imagine a lawful lot of this is about personalization, understanding where my next offering or next purchase is coming from, making sure you're meeting me where I am at. So how much are you looking at AI how much are you having to hire in AI Yeah, we think about.
- [41:24]
Caroline Hyde
It as kind of two sides of the coin, right? One is the customer experience that you've mentioned, and one is how we build the company on customer experience automation. And I let us, you know, personalize how much rewards you get, how we talk to the customer, how the experience even shape shifts for the customer and more and more investing in that. So it Feels radically different to anything that a bank has ever provided in the past for these brands or for these customers. The really interesting thing, and maybe it's not as apparent under the surface, is we get to rebuild what looks like a financial company or even a fintech in the time of automation and AI. And so over the last year we've grown the business by almost 300%. We've grown headcount by 20% at every turn. We get to choose are we going to build a new team here? Are we going to invest in technology and automation so we don't have to hire a team of people? We can actually scale the company. We're using technology, which is an amazing opportunity that I don't think anybody has ever had.
- [42:19]
Ed Ludlow
Wow. So I imagine that $150 million doesn't actually go that much on talent, it goes more on the marketing of your product. What does it double down on in particular?
- [42:29]
Caroline Hyde
Yeah, three things. One is we continue to grow, right? So we obviously continue to market to customers but we're not burning all this capital. If you think about the market we're in, big brands can choose hundred year old banks or they can choose imprint. If you choose 100 year old bank you probably sleep really well at night. If you choose a relatively new company, maybe you worry a little more. And so we just want to be very well capitalized to make that choice. Easy bucket too is more financial products. We have the credit card today that serves, you know, many of the brands customers but depending on your financial life you don't want to credit a card. Maybe you want a debit card with more rewards so more of those products. And then the last thing is as we've talked about, how do we build a company using automation and AI and scale without headcount which is an amazing opportunity relative, relative to where we would have been 10 years ago. You see public company fintechs today with thousands and thousands of of employees. We get to make a decision every time do we hire or do we build? And more and more we get to build.
- [43:23]
Ed Ludlow
Darren Murphy imprint CEO Fascinating talking to you. Congratulations on the funding round. Thank you. Now coming up, after burning through more than $1 billion a space startup with turning to a tech veteran more on relativities. Say that again. Relativity Spaces new CEO Schmidt. This is pretty bad tech.
- [43:57]
Caroline Hyde
These days it seems like AI agents are just about everywhere you turn every field and every function. But without identity you can't trust they'll serve your business instead of jeopardizing it. Fortunately, Okta helps you get identity right by securing your AI agent's identity, giving you a single layer of control, a single standard of trust. So whether an AI agent supports a single user or your entire enterprise, with Okta you'll turn risk into opportunity. Secure every agent Secure any agent. Okta secures AI. With volley from iShares. You get access to both monthly income and growth potential in one simple ETF. It's the best of both worlds. Discover Bali iShares Large Cap Premium Income Active ETF iShares the market is yours. Visit www.ishares.com to view perspectives for investment objectives, risks, fees, expenses and other information that you should read and consider carefully before investing. Risks include principal, loss and the use of derivatives, which could increase risks and volatility. Monthly income is not guaranteed. Prepared by BlackRock Investments, LLC. Running a business is hard enough, so why make it harder? With a dozen different apps that don't talk to each other? One for sales, another for inventory, a separate one for accounting. Before you know it, you are drowning in software. Instead of growing your business, this is where Odoo comes in. Odoo is the only business software you'll ever need. It's an all in one, fully integrated platform that handles everything CRM, accounting, inventory, E commerce, HR and more. No more app overload, no more juggling logins. Just one seamless system that makes work easier. And the best part? Odoo replaces multiple expensive platforms for a fraction of the cost. It's built to grow with your business, whether you are just starting out or already scaling up. Plus, it's easy to use, customizable and designed to streamline every process so you can focus on what really matters running your business. Thousands of businesses have made the switch, so why not you try Odoo for free@odoo.com that's o d o o.com hey audiobook lovers. This week on the podcast I'm sitting down with musician, producer and walking encyclopedia Questlove. We're talking about Mark Ronson's memoir Night how to be a DJ in 90s New York City. All right, like we talked about before, Mark Ronson found sanctuary in the DJ booth. What's a tool or piece of equipment in the studio or on stage that gives you the most control? So I have two microphones on stage. We have the microphone that you hear as the audience. Then we have a second microphone in which we communicate with each other. I feel like that second microphone kind of saved all of our friendships. No band likes each other. After 20 years or 25 years, the Beatles broke up in seven and a half years and we're going on 35. Listen to earsay the Audible and iHeart Audiobook Club on the iHeartradio app or wherever you get your podcasts.
- [47:09]
Ed Ludlow
It's time now for talking tech. First up, China's PDD holding its creator of e commerce site Temu. Of course, it's fired dozens of workers following a fistfight between employees, employees and Chinese regulators. And that's according to sources. Two fights occurred during a government visit to investigate claims of fraudulent e commerce deliveries. Plus chip startup Mythic. Well, it's raised $125 million to support its efforts to challenge Nvidia. Take a look at some of the investors. Mythics Tech relies on analog chips with far less power consumption than the traditional brains of a computer. And sticking with chip maker shares, China's Meta x jumped nearly 700% on their first trading day. It's the latest outsized market debut by Chinese chip maker as investors really betting on the domestic firms that could become viable competitors to Nvidia. Now let's talk about another startup, Relativity Space. It set out to revolutionize the rocket industry with 3D printing, but it burnt through more than $1 billion. And its big idea hasn't exactly planned out. Now the company company is turning to former Google boss Eric schmidt and an $800 million fresh funding round from him to turn around the company. Let's get more on this Bloomberg Space reporter Lauren Grosch. So, a new exec, same thesis still 3D printing of rockets? No, unfortunately that seems to have been changed and now the company is much more focused on traditional manufacturing, which as you said, it's a far cry from what they started as, which was supposed to be this SpaceX disruptor that was going to revolutionize manufacturing rockets with 3D printing. But what we found after months and months of reporting is that they were really struggling with the 3D printing technology for a while and over time they started to slowly incorporate more traditional manufacturing into the process. So much to the point that 3D printing is is barely involved in the rocket making process anymore. Well, this sort of speaks therefore more to Eric Schmidt's commitment that we've seen of late of competition versus China and supply chain and defense space tech. But have you heard exactly why he's decided to take the CEO role? The overwhelming theory, and what he has also hinted at on social media, is that he purchased Relativity for a trend that we've actually been hearing about a lot lately, putting data centers in the space. So you might have Heard that from CEO Space X CEO Elon Musk or Blue Origin CEO or Blue Origin founder Jeff Bezos, because they've also talked about putting data centers in space. And so it seems that Eric Schmidt also has that plan as well. There might be some other things that he's cooking up that he'd like to do with a rocket company, but so far that seems to be the prevailing reason he bought the. He bought this and we're now looking at, well, his fortune, $52 billion. He has money to put to work into this. So this is his own bet on space. Yes. So he was actually keeping the company afloat for a little while and then he is so far from what we've learned, has invested a substantial portion of money into this, this company. And then we've also heard that the company is potentially fundraising again. So they're actually potentially going out to high net worth investors to see if they want to be a part of the company. So it looks like they actually do want to grow and maybe have big plans. But yes, for a while now, he has been injecting a lot of cash into this endeavor. Long rush for the latest space startup to keep an eye on. Thank you very much indeed. Now that does it for this edition of Bloomberg Tech. Do not forget to check out our podcast. You can find it on the terminal, online, on Apple, Spotify and Iheart. We'll continue on the theme of Oracle, of financing, of data centers throughout the shows. From New York, this is Bloomberg Tech.
- [51:14]
Caroline Hyde
These days, it seems like AI agents are just about everywhere you turn, every field and every function. But without identity, you can't trust. Trust they'll serve your business instead of jeopardizing it. Fortunately, Okta helps you get identity right by securing your AI agents identities, giving you a single layer of control, a single standard of trust. So whether an AI agent supports a single user or your entire enterprise, with Okta you'll turn risk into opportunity. Secure every agent, secure any agent. Okta secures AI. Only one movie answers the call. Hello, it's me, SpongeBob. For the biggest comedy event of the holiday season. Do you know what the best part is? What is it, Patrick? No, I'm asking. The SpongeBob movie rated DG Friday at Hill's Pet Nutrition, we know that pet parent guilt is real. Leaving too long, playing too little. New homes, new babies. Waking them up when they look so comfy.
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Ed Ludlow
Running out of patience, running out of.
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Caroline Hyde
Treats, running the vacuum. You can only do so much.
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Ed Ludlow
That's why there's hills.
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Caroline Hyde
Science led nutrition to help you give more love than humanly possible because you're only human.
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Ed Ludlow
There's hills. Find the right food@hillspet.com Science does more sometimes you just need to be comfortable, you know? But that doesn't mean you don't want to look good, too. Well, Old Navy the Kings of Cozy have done it again with Bounce Fleece. It's soft, stylish, and comes in elevated.
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Caroline Hyde
Colors that look good anywhere.
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Ed Ludlow
Basically, it's fleece reimagined for real life, made for moments when you want to be cozy but still need to look good.
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Caroline Hyde
Call it airport chic.
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Ed Ludlow
Call it errand elegance. Either way, Bounce Fleece nails it.
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Caroline Hyde
Find Bounce Fleece and other holiday goodies now@oldnavy.com.