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- [00:00]
Adobe Marketing Representative
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IBM AI Business Representative
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Adobe Marketing Representative
Bloomberg Audio Studios Podcasts Radio News.
- [01:29]
Caroline Hyde
Bloomberg Tech is live from coast to coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.
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Bloomberg Tech Host
This is Bloomberg Tech. Coming up, Nvidia CEO Jensen Huang makes a big forecast for the build out
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Caroline Hyde
Right here where I stand I see
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Ryan Vaselica
through 2020
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Caroline Hyde
at least $1 trillion
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Colin Reineke
as
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Bloomberg Tech Co-Host
we discuss the AI&M and a landscape with the CEO of IBM hot off the company's own GTC announcement and Gecko
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Bloomberg Tech Host
Robotics works to deploy its AI powered robots to assess the condition and readiness of the US Navy's warships.
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Bloomberg Tech Co-Host
But first we turn our attention to well once again a market that is focused on geopolitics on more but also on the eve of the Federal Reserve rate decision we're currently seeing some buying of stocks. In fact 89 of these 100 names are in the green for the NASDAQ 100. We're up for a second straight day up 8 10% and we're seeing a little bit more of a risk on attitude ad and you're going to dig into. Well perhaps one of the catalysts as
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Bloomberg Tech Host
I stand here right now Nvidia shares a completely flat in the session but they've been on a roller coaster across two sessions. Late Monday when Jensen Wong had his keynote you can see the big spike almost 5% in the session of what was extended visibility into the demand for Nvidia's products. Here's what he said.
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Caroline Hyde
Right here where I stand. I see through 2027 at least $1 trillion. A trillion dollars is an enormous amount of infrastructure. That infrastructure investment you could make on Nvidia you could make with complete confidence. We have now proven that.
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Bloomberg Tech Host
Let's get with Bloomberg's equities reporter Ryan Vaselica. I mean, you've summarized what the sell side's reaction has been to that $1 trillion number. It's mixed, but on the whole, bullish. What are you saying?
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Ryan Vaselica
Yeah, absolutely. I would say people are in general pretty positive on this target. It really speaks to how much visibility Nvidia has going forward. It really speaks to how they expect all this infrastructure spending to remain pretty durable, which is something that has come under question this year and led to a lot of volatility across the tech. However, I think it also just speaks to just a certain amount of uncertainty and a certain amount of hesitancy when it comes to this company and this stock. Now we wrote about this earlier this week, but Nvidia has been stuck in a pretty tight trading range for months. It's been unable to break out even on the back of strong earnings. Even on the back of yesterday's announcement, we did see a brief spike. But then as people sort of dissected the target, it came back down again. So I think there's still a lot of skepticism out there. Now I would flag that it is hosting an analyst Q and A. I think it starts in about out an hour. That is something I think people are going to be really drilling into this 1 trillion number trying to understand it and maybe that's something that will spur a little bit more gaining. But so far it seems like there's been nothing that has been able to
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Bloomberg Tech Co-Host
lift the stock here because of those analysts who are going to be tuning in.75, say by the stock, only one as ever, says Stell Sell. And look there. See more broadly a price target in the next 12 months of $269, well above where we currently trade. Ryan. So the steel still just waiting on some other catalyst?
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Ryan Vaselica
Yeah, it's hard to know what the catalyst is going to be at this point. They've really talked about their product lineup. They've talked about their growth expectations. The multiple has really come in. It's I think one of the cheapest stocks in the Mag 7. There is still a lot of questions about what is growth going to look like, you know, years out, what kind of deceleration could we see? And people are factoring that in. But certainly when you talk to a lot of people, everybody still likes Nvidia, everybody still thinks it's a very well run stock. They don't really see demand drying up anytime soon. But it does seem like there's a certain amount of hesitancy. You know, it's almost like they built up a tolerance for the kinds of gains that we've seen in quarters past where they would give some kind of big target. We'd see the stock jump 20%. It's a lot harder to imagine anything like that happening today.
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Bloomberg Tech Host
Ryan, what else are you seeing on your desk this morning as it relates to gtc? Like, is there a broader market digestion of the two and a half hour speech that Jensen Huang gave yesterday?
- [05:53]
Ryan Vaselica
Yeah, two and a half. I did see a lot of people saying, you know, this could have been a lot shorter. So that was kind of funny. But beyond that, we are seeing a lot of people just digesting this. We saw some moves yesterday in IBM and optical companies and Intel. So there are a lot of companies like it hasn't quite been the same way that it was in years past where they would mention a company and we'd see that stock rally. Everything is a bit more muted right now. People are really trying to understand this and are trying to understand where this trade goes from here and we're not seeing the sort of excitement that we saw really at the onset of the
- [06:21]
Bloomberg Tech Co-Host
era remix run for Celica with all the technicals on trading this stock. Now let's get you the fundamentals, the market perspective with Daniel Pulling, his senior research analyst and portfolio manager over at Sans Capital. Daniel, I mean, let's talk about the demand for Nvidia's products. You still see them as insatiable. We got gpu, cpu, lpu. What drove your optimism from yesterday's speech?
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Daniel Pulling
Yes, so I think the proof is in the pudding, I might say. So when we look at sort of the, the labs and their revenue new growth this year to date, it's been massively accelerating. Right. So Anthropic's public's numbers went from 14 to 19 billion literally within a few weeks. And I think the crux of what is going on here is that agentic AI is here. It is as viral as Zoom was at the beginning of COVID And what I mean with that is that once somebody starts using it, it starts doing amazing things. Every colleague will follow over time and we just don't have enough compute to really satiate this. And this is likely a multi year process of sort of everybody starting to use agent AI within their own workflows. We have a billion people as knowledge workers and we maybe have a few million agents as of today. So to me, and to us, this feels like sort of the iPhone moment of 2007 and 8 where everybody will want to buy an iPhone and everybody will want to run an agent, which means the numbers will likely continue to be much, much, much bigger over time.
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Bloomberg Tech Co-Host
And Jensen wants to be the infrastructure for that. But also so not just the chips, but the operating system that that goes with. Talk to us about OpenClor and how they're developing sort of their own operating system for that and for agent.
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Daniel Pulling
Ok, yeah, so it's very interesting. So Nvidia created the security framework to wrap these open source agents within an enterprise. Right. And why do they do that? Because an agent will be able to access your calendar, your payment mechanisms, your documents. So it's got to be very, very safe and secure. So this is one of the key bottlenecks that people have to overcome to install agents within the enterprise space. And then as Nvidia always does, they sort of create their own markets. So they created this framework called Nemo Claw, which means that everybody, every enterprise in the world now can implement an agent locally on their devices. Which means that this growth can really start to accelerate within the enterprise because the security is there.
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Bloomberg Tech Host
Daniel, my Bloomberg terminal tells me Sands Capital has about 20 million Nvidia shares, is that right?
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Daniel Pulling
Yes, ballpark.
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Bloomberg Tech Host
Let's go back to the number. 2025 through the end of calendar 2026, five fiscal quarters was $500 billion of demand just for Blackwell and Rubin. I think that Bernstein were able to confirm with Nvidia CFO that the 1 trillion is also Blackwell and Rubin, including associated networking. But there was a bit that Jensen said in passing right after that sentence which was we will be short. In other words, I think they're still massively supply constrained relative to demand. How are you interpreting that?
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Daniel Pulling
Yeah, so I would, I would agree. I think there's two things we need to see here. One, the hyperscaler revenue growth has to accelerate to get the, you know, to basically maybe get the market away from focusing on some sort of peak cycle concern and back to focusing on sort of this growth in tokens that Jensen is talking about. So once we start seeing hyperscalers really re accelerate because they're buying all these chips, I think that concern goes away. And then the second piece is the demand is truly viral. So everybody in the world I think will start seeing these agents as a massive productivity tool. If Your colleagues are five to ten times more productive than you, then you have to implement it as well. And we think the penetration of agents today is within single digits percentages. Right. So as we go from single digits to 100%, it's a billion people, that means you need so much more.
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Bloomberg Tech Host
The associated data point with, with the 1 trillion bar chart was the pie chart that 60% of that demand is still coming from the hyperscalers. It wasn't that long ago that we were very focused on how much Nvidia diversified away from the hyperscalers. It seems like that hyperscaler portion is just going up.
- [10:36]
Daniel Pulling
Yes and no. Right. So hyperscalers are by far the biggest purchases of these things. But there's also the new clouds which are investing heavily and actually also very interesting enough governments will be able to invest more going forward as well. And Nvidia is playing a key role in that. Right. They're one of the leading open source providers, providers of these models, which means as a government you can take the open source Nemo Tron model from Nvidia, implement it locally, you can buy all the chips from Nvidia at the same time and sort of run your own local cloud within your country. So I think those three will be quite important. But hyperscalers will always be very important in all of this.
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Bloomberg Tech Co-Host
Daniel, it's interesting that really where Jensen always tries to lean in is, is differentiation. The fact that he's got the right chip for the right workload at the the right time. And that's why they started to talk a lot more about inference and grop, for example. But I'm interested about. He usually pushes us forward a little bit more. Yes. We've already actually heard a lot about Vera Rubin, we know a lot about Blackwell, but why not even push us into Feynman more? Why not hear about the next iteration? Because it's like every single year we've got a new architecture coming for us.
- [11:40]
Daniel Pulling
Yes, I would actually say what happened yesterday is quite revolutionary. So Nvidia is the first company that will have two different types of chips for inference. So for calling on the AI models to get an answer, there's a new LPU chip which is super fast. Nobody else has that. And that's combined together with sort of the old sort of generalized GPUs that they always had in the past. And, and then he did give an astonishing quote that LPU or the fast chips there will be 35 times more performant on a performance per watt basis than anything that was there before. 35 times. So I do think those jumps are just as good, maybe even better than in the past.
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Bloomberg Tech Host
Daniel, you clearly have a command of the spec right generations generation on, on the, on the chips. I take it back to the stock. You know Cara outlined where the sell side stands on this name the question for you and for Sands Capital, do you buy more based on what you heard on stage in San Jose?
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Daniel Pulling
Yes. So I think this event itself has been very reaffirming of the future. But, but the entire debate about the stock I think will be resolved truly by this. The market is looking at Nvidia as a business that is at peak revenue and peak earnings. We disagree and the reason why we disagree is everything we discussed before agentic air is exploding in terms of demand. Now this all will get resolved once the free cash flow and the revenue growth of the buyers of these chips, that 60% of the hyperscalers for example, will start growing again. And when, whenever you start seeing this, this entire debate will be resolved because then the market will say we're going from peak concerns to actually this is a very structural durable growth trajectory over next five to 10 years. I don't know precisely when this will be solved but my guess is that we're going to see a significant acceleration, hyperscale and revenue growth within the next one or two years because they're buying hundreds of billions of dollars of these chips. And then maybe equally important, the return or the payback periods off these chips has actually improved in the past 12 months because they're completely sold out. So basically you're buying a GPU and you're getting your money back in record time which again then needs to to the point of the hyperscalers we'll start seeing more growth, better free cash for growth which will translate then hopefully to a positive outcome. Fund video.
- [14:02]
Bloomberg Tech Host
Daniel, pulling from Sands Capital, thank you very much.
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Bloomberg Tech Co-Host
Let's check in on the shares of Uber and Lyft right now in the green as you'll see significantly and that's after both companies announced deepening partnerships with Nvidia which is currently down 310 of a percent. Look, Uber says it plans to roll out a global fleet of Nvidia powered self driving vehicles across 28 cities by 2028. Lyft meanwhile will use Nvidia's AI to strengthen machine learning systems across its operations. For more Bloomberg's consumer apps and gig economy reporter Natalie Lang joins us now. What's interesting with Uber is it would had some big bold ambitions articulated back in February was it and 100,000 car cars are going to be on the road in this partnership with Nvidia. But what's the timeline now looking like?
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Natalie Lang
So the updated timeline is that these vehicles will be scaled across 28 cities by 2028, and that will really start in earnest in 2027 in Los Angeles and San Francisco.
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Bloomberg Tech Host
I mean, Uber is about a percentage point of having its, its best day since June of last year. So like at first you're like this is a name check that's driving the stock, but really it's, it's more updates to an existing partnership. What about Lyft then? I mean, this really is by name association because it's more about internal use.
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Natalie Lang
Yeah, it's about internal use, but part of the release also mentions future possible deployments of Nvidia powered vehicles on Lyft platform. But we don't have a lot of details on the manufacturer partner yet. Whereas for Uber they have a couple of partnerships already announced, such as Lucid and Neuro vehicles, Wave vehicles with Nissan that will be, that will be powered by Nvidia chips and technology.
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Bloomberg Tech Co-Host
I think it sort of goes to what RBC analyst Brad Erickson was spelling out, that all of this news vindicates perhaps both Uber and Lyft's role as platforms in the AV era. We'd all been worried about competition, but actually they're the ones that are going to bring it all altogether.
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Caroline Hyde
Right?
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Natalie Lang
Yeah. And this further shows it's not just a demand generation platform, it's not just going to be an app that will allow people to hail a robotaxi. But here we can see that Uber wants to be the fleet partner. It wants to support some remote assistance operations for these fleets that they run themselves with partners as well.
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Bloomberg Tech Host
Blueberries Natalie Lund across all the movers in the gig economy space after gtc, thank you. Another deal announced at Amidia's GTC conference. IBM will collaborate with the chip maker on an open source project aimed to help enterprises use AI at scale. We sat down with IBM CEO Arvind Krishna for more on the deal and on his take about the wider M and A landscape.
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Caroline Hyde
Listen to this.
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Arvind Krishna
I think the regulatory environment is definitely friendlier. Where we got this done in just under four months, but it used to take a lot longer a few years back.
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Bloomberg Tech Co-Host
If regulatory environment is friendlier, should you be doing more of it? Should there be more M and A? Particularly with some beaten up overall valuations of software companies at the moment, I'll
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Arvind Krishna
just say watch the space.
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Bloomberg Tech Co-Host
Oh, watch this space. Okay, but where would you want to add on in this moment. I mean what would make sense to be adding to your portfolio?
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Arvind Krishna
So we are very focused hybrid, cloud and AI and the intersection, the work we're doing together with Nvidia was a five times speed up. So five times, not 5%, not a little amount, but five times. So there we began to leverage the Nvidia GPUs together with some other CUDF or software, combining it with our Watson X data. And the example we used was our client Nestle where together we managed to get that speed up across a massive amounts of data. And that really is important, important in that case combining some of the technologies we work on. Also an open source with the presto presto data engine, Nvidia and the example at Nestle. But then we are very excited. We're going to do more work on that and then take it into the market and take it out to hundreds of clients from there.
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Bloomberg Tech Host
That was IBM, CEO of increasing a car. Many more headlines out there.
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Bloomberg Tech Co-Host
There is it's time to talk talking tech. First up, the UK is ramping up its push into quantum computing, committing more than $1.3 billion over the next four years. It's a major bet on a technology increasingly seen as critical to national security, future economic competitiveness. Plus, don't expect memory chip shortages to ease any time soon. SK Hynix, well, it says that the crunch could last another four to five years. SK Group chairman Anthony Che notes that while chipmakers have already ramped up, capacity may not be enough to satisfy Demand until around 2030. And Samsung, well, is already pulling back on its Galaxy Z trifold. Just three months after the launch, the South Korean company plans to halt sales of the nearly $3,000 device in its home market in the U.S. discontinuation expected to follow it.
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Bloomberg Tech Host
Okay. Coming up, amid the chaos of the Iran conflict, Bitcoin is emerging as an unlikely oasis for some investors. We have more on that next. This is Bloomberg Tech.
- [19:15]
Adobe Marketing Representative
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- [19:46]
IBM AI Business Representative
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- [20:17]
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- [21:18]
Bloomberg Tech Host
One of the world's best known investors in Nvidia, Ark CEO Cathie woods says she's optimistic about the return on investment from frontier tier AI model providers. She spoke with Bloomberg's Anna Edwards in London. Take a listen.
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Cathie Wood
We are seeing revenue generation exploding from the frontier model providers. Anthropic's annualized revenue run rate so air went from 9 billion in December to 19 billion today. So annualizing revenue at 19, that's that's astonishing growth. OpenAI from 20 to 25 billion. The productivity that we are enjoying from these large language models is astonishing even within our own firm. Yeah, I'm even former skeptics that this was going to amount to very much, you know, very New York skepticism there. They're blown away by what they can
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Bloomberg Tech Co-Host
do just to take a detour to geopolitics because it's become such a dominant market driver and I wonder how it influences your your thinking. We are week three of a war that's taking place in the Middle East. Many tech businesses of course probably quite insulated from everything that is happening there. But I wonder does it what what rethinking does it prompt at Ark? What what shift in in focus or shift in strategy if any does does this kind of thing prompt?
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Cathie Wood
Yes well, of course, it depends how long term this is and we are thinking it will be short term. We do have midterm elections this year and other considerations. But of course, energy prices going up. Any supply shock, to the extent it slows unit growth down, it will slow down the learning curves associated with various technologies. If this is, you know, a month or two months, it's not going to have a big impact at all if this is extended. Covid we did not understand that the supply shock would reverberate for three years and that inflation would take off and that monetary policy would accommodate the inflation the way it did. We're not in that situation right now. Monetary policy is not accommodating inflation. We're at 4.3% and to growth on a year over year basis. So nothing like the high 20s, low 30s in Covid.
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Bloomberg Tech Co-Host
Cathie Wood there alongside Bloomberg's Anna Edwards. And let's talk more about the war in Iran because it is fueling volatility across global markets. But cryptocurrencies are actually emerging as an unexpected bright spot of late. Bitcoin and its peers have rallied during these times of geopolitical stress. For more Bloomberg Cross asset reporter Isabel Lee joins us. Look on the day, a little bit of pullback over the last few weeks we've actually finally seen somewhat more buying or less bearishness.
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Isabel Lee
I think it's both. Bitcoin has been resilient. It's now on a six week high. And unlike its other asset classes, gold equities or even other asset classes, it's, it's seen a relative calm. The volatility of bitcoin has been kind of flat and really you can point to it, to many things. Maybe it's institutional buying or maybe it's just a narrative. Although what a lot of my analysts are saying, at least when they talk to me, it's really more institutions, especially corporate treasuries, for every fall they absorb it and they buy more of the supply.
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Bloomberg Tech Host
There is a technical or I guess a better phrase for transactional part of this story which you write about. The rally is driven in part by traders unwinding their options bets. Could you explain that quickly, Isabel?
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Isabel Lee
This is the thing with bitcoin. It's interesting because more than the sentiment, it's really all about this mechanics. So we have traders unwinding their own options bets, those that bet that bitcoin will continue to fall. And so when they unwind that as traders close out their negative positions, bitcoin rallies and we have about $1.5 billion of Bitcoin puts clustered around the 60,000 level and now we're around 75,000 level which is again a six month high, which is really impressive. And there are 1.3 billions of calls at 75,000. So that's why you see bitcoin rally. But again it's more about narrative. We're moving beyond that now. It's about making mechanics. I mean you look at ETF flows, right? One and a half billion dollars have flown month to date. So that's really a sign of confidence.
- [25:23]
Bloomberg Tech Host
And Bloomberg's Isabel Lee. Thank you, Carol. What you looking at?
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Natalie Lang
Well, I just want to look at
- [25:28]
Bloomberg Tech Co-Host
what's happening in the world of stablecoins because a bit of an acquisition has happened with Mastercard and BV NK. Look, this is a company that they're buying for $1.8 billion to really ride into the infrastructure play of stablecoins. Remember Coinbase, we're looking at that asset and they decided to walk away when it cost them 2 billion with the reports at least.
- [25:55]
Bloomberg Tech Host
Welcome back to Bloomberg Tech. One of the other stories out this morning is Qualcomm buying back another $20 billion of shares, also boosting its dividend from $0.89 to $0.92. The story is pretty simple. As Qualcomm tells it, they want to bolster shareholder returns while also continuing to try and diversify this business from smartphone to things like automotive and increasingly more recently data center. That's what the CEO Cristiano Amon is talking about in the statement. Stock up 2% and then another check on Nvidia. We're now modestly lower 410 of 1%. The peak of Monday's session during Jensen Huang's keynote was a gain of 5% which very quickly faded as the market interpreted the 2025-2027 outlook or forecast of $1 trillion of demand for its AI compute. We're now down half a percentage point. Car.
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Natalie Lang
Yeah.
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Bloomberg Tech Co-Host
And two and a half hours of speeching it would feel. Jensen Huang didn't actually only just forecast that trillion dollars of course said he also talked about what the company will need to get there, including more copper and optics capacity. Those comments really rattle shares are companies that make data center optical components. Let's talk about it with blue most common Reineke. Look we're off by one and a half percent on Corning and and some other suppliers at the moment. But what's been interesting is momentum and coherent. They've been running up into this announcement on the anticipation that we're all in on optics and it looks as though there's a double barreled strategy here.
- [27:20]
Colin Reineke
Yeah, totally. And it's so interesting because we see those run ups and then we just have one little comment from Jensen Huang and it just, you know, unraveled right away. So yeah, I mean what he said was basically that, you know, copper is still going to be or is going to remain important in these data center buildouts which just I guess made some of the investors a little bit concerned about all of these, you know, optics components. The thing that's interesting, a lot of analysts did say this morning in some notes following GTC that, you know, both are definitely going to remain important in these buildouts going forward. So there's probably not here huge cause for concern here. And we did see some, some of those stocks recovered today. I think Lumentum did kind of go back up and so is in positive territory now.
- [28:02]
Bloomberg Tech Host
Common what's the experience of a GTC like for the equities team? Every single time on stage there was a name check of any given company. You'd notice a little tick higher in some of those stocks which were the ones of substance and which were just literally name checks.
- [28:19]
Colin Reineke
Yeah, I mean it ends up being such a, like a flurry of excitement as we're all rushing to, you know, send headlines and watch these shares move. I mean, we did see some things, you know, move quite materially. You know, outside of Lumentum Coherent, we saw shares of Uber and Lyft jump on partnerships that were announced. IBM shares also jumped and then there were some other little smaller ones where things quickly faded. I mean, one that was actually kind of interesting is Nvidia itself had a very big spike around that 1 trillion figure and then actually pared most of those gains sort of as the market digested it. But yeah, overall we really are seeing again that, you know, Jensen's comments have the ability to move markets to move these stocks. And it actually is a little bit of a flip from last year. We didn't see a ton of movement around gtc. Investors were really sort of concerned about the macro and you know, had a lot of skeptic skepticism. So seeing a little bit of a trend kind of maybe back towards normal this year where, you know, they have the power to move stocks of other companies.
- [29:19]
Bloomberg Tech Host
Bloomberg's Colin Reineke, thank you very much. Let's stick with what's going on in broader markets today, particularly for tech, and bring in Carol Schlife, chief market strategist at Bimo Wealth Management. And on a very Serious note, like with everything going on, the war in Iran, considerations around trade, a number of headlines relating to trade this morning, even a decline of 4, 10 of a percent for Nvidia. It's the second biggest points drag at the index level for the NASDAQ 100. Carol, you know how closely were you watching GTC over the last 24 hours? For some macro level impact?
- [29:54]
Carol Schlife
I think not necessarily a macro level impact and it's really important to zoom out from what's going on in these day to day basis practices and try to think intermediate longer term. Clearly markets are trying to get beyond that and I think it's one of the reasons why you've seen the aggregate indexes hold in so tightly because realistically given all the news we've had since basically the first weekend before January 4th, we've had several different wars conflicts starting in here, lots of stuff that have hit the markets and yet the aggregate averages are still quite hugging that close to all time highs even though there's been a lot of turbulence underneath. But I think that indicative of the fact that people are really leaning into. You've still got growth stories going on. You had GTC reaffirm that growth story, I mean $1 trillion, if you will, out over the next couple of years. And so you've got a lot of momentum underneath and investors don't want to be out of the market when, when some of that macro clears.
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Bloomberg Tech Host
I find that interesting. You know, as Jensen Wong tells it, the global economy is in the early phase of a transition spanning agentic AI through to robotics in the physical AI space. You know, if you start classic economet economics, how does one prepare for that as an investor to understand where in that transition the global economy is?
- [31:16]
Carol Schlife
Well, I think one of the things you do is understand we are in the middle of a transition. They tend to be really muddy when you're in the very short term or the new phases of a technology. I was rolling it back thinking to when we first got Excel and WordPerfect and some of the other early software and everyone was trying to figure out how do I use it? Do I have to put everything into a spreadsheet or just some things into a spreadsheet? And when you have that sort of reconnect or reconfiguration if you will, it takes some period of time to figure out what the impacts are. But rolling it back and looking at company after company, country after country, reinvesting or investing for the first time in a long time in some of those really important infrastructure and capital investments. And that has a long, long live and long tail to it, if you will. But it's also important to remember from Economics 101 that a lot of the economic stats we have were meant to measure a very different society than we have now or are emerging too. And so that'll be part of the challenge. So as investors, I think part of it is state of versified. Stay long, lean into it and don't get too, don't hyperventilate too much about day to day activity.
- [32:37]
Bloomberg Tech Co-Host
Should you be leaning more into the compute build out the infrastructure build out? That's what's worked for the last few years. And looking at Nebby today, for example, it's selling all convertible debt to be able to continue to build out its own NEO cloud offering. We know it's got to deal with matter. Should you be long that space?
- [32:56]
Carol Schlife
Well, I think a piece of it is, is to understand not only the build out but to, to look far and wide for those companies that are leaning into using the new technology as well. Because there's lots of different applications, different places that, that it has the chance to, to, to supplement if you will. Not necessarily replace everybody, but supplement. And so where are those leaders that are encouraging and their employees, if you will, and prepping their employees to be able to lean in? And those new technologies, I mean, look
- [33:30]
Bloomberg Tech Co-Host
Carol, they've got to lean in because many of them are going to be forced out. Look, there's another headline in your space of banking, Nordea, which is a Nordic bank, saying they're going to be laying off some 5% of staff because of AI productivity. Now you can call it AI washing, but when someone like Jack Dorsey is laying off 40% of staff and he's thinking he can do that because of AI, are we just going to see more and more of that impacting the labor force?
- [33:56]
Carol Schlife
I think the, it's interesting because I do think there's a hint, if you will, of AI washing to some of it. But there's also the issue that these leaders are looking for people in their organizations who, and they're giving them seats at the table. The ones that are rolling up their sleeves, getting messy, trying this stuff out and figuring it out. But also there was a report out recently that talked about the bulk of the spending being done in AI is done on the technology, not on team teaching people how to use it. So there's a piece of it where we have to create an environment where it's okay for people to experiment with it. We're not going to replace overnight some of these macro systems. And especially in highly regulated industries like banking, it's hard to believe that you're necessarily going to totally displace an old software and allow agentic AI to take over all of it. But it is going to supplement what each of us are doing and how we're doing it. And, and you go back and look just in my business in analysis where we started with hand plotted charts and hand calculated moving averages to deploying new technology all the way along makes me a lot more productive day to day and I think that's what companies are looking for. But each of us individually is going to have to figure out how to lean into that too.
- [35:12]
Bloomberg Tech Co-Host
Well, said Karish Life Chief Market Strategist at BMO Wealth Management Management, we appreciate your time. Let's talk about that disruption a little bit more now for labor because China faces a key test as the nation's boom really reshapes industries while putting millions of jobs at risk. Now analysts warn that up to 142 million urban jobs could vanish by 2049 due to rapid AI driven automation. China correspondent Min Lau reports in Beijing.
- [35:39]
Min Lau
High Shen Gung, you know, financial tribute that almost looks like me, but it's not. It's an AI generated video based on a single screenshot. Tools from Alibaba, Tencent, Kuaishou are making AI video generation accessible to millions, sometimes for free.
- [35:57]
Caroline Hyde
Our company I can't imagine without AI,
- [35:59]
Colin Reineke
how can we survive at the beginning?
- [36:02]
Caroline Hyde
Without AI, I don't think our game can actually be done in one year.
- [36:08]
Min Lau
It's brought huge productivity gains for this game developer, but also also raised alarms in the entertainment industry. Disney and paramount have accused ByteDance of IP infringement after its video generator produced near cinematic scenes from just a text prompt. The fear is that AI could replace not just mundane tasks, but jobs across creative industries.
- [36:30]
Caroline Hyde
The painting if we use like labor works it's like 2000 to 4000 for one piece. But with AI we only use like probably 2 RMB for one piece.
- [36:45]
Min Lau
For policymakers, the challenge is balancing growth
- [36:48]
Caroline Hyde
will be a nurture emerging industries and
- [36:50]
Bloomberg Tech Host
industries the future with disruption.
- [36:54]
Natalie Lang
The rapid development of AI is having a profound impact on employment.
- [36:59]
Min Lau
The China Economic Journal projects that more than 30% of urban jobs in China could be lost to AI by 2040. 49, that's 142 million jobs. That's a scenario that could threaten social stability. Beijing is aiming to create another 12 million jobs this year, with just as many graduates set to enter an already slack labor market in Finance and it.
- [37:22]
Caroline Hyde
If there weren't for this kind of regulatory barriers, about 30 to 40% of the job could have been lost right away. If you're thinking about the automation AI replacement placement of a junior roles, it's already happening massively in China.
- [37:35]
Min Lau
That leaves Xi Jinping's government with a dilemma. China can't afford to fall behind in its tech ways with the United States. But the implications of a tech revolution are far from clear.
- [37:46]
Caroline Hyde
If we let AI replace the jobs without taxing the AI appropriately, then then it can really get to the core
- [37:54]
Jake Lucero Arian
of the consumer economy.
- [37:55]
Caroline Hyde
And we got to think about sort of tax policy policy that is targeted specifically at what is driving those job job losses. It will be in the regulatory framework at some point. I just don't see it as a choice yet because we're at the very early stage of promoting the application of AI.
- [38:13]
Natalie Lang
So the gray area must be capped,
- [38:15]
Caroline Hyde
actually by a very wide margin.
- [38:18]
Min Lau
Last December, state media published a landmark arbitration case in Beijing that set some early guardrails. Dismissing an employee because of AI is illegal because it's a business decision for profit, not an uncontrollable event. That means companies must prioritize retraining and reassignment before dismissing an employee. But for now, all signs at the two sessions suggest the government is going all in on tech at the risk of leaving some people behind.
- [38:48]
Bloomberg Tech Host
That was Bloomberg's Mymin Lao. Coming up, Gecko Robotics makes a deal with the US Navy to monitor and maintain its warships. We speak with CEO Jake Loose Sararian. That's next. This is Bloomberg Tech.
- [39:06]
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- [41:11]
Bloomberg Tech Co-Host
The US Government stepping up its use of AI to monitor aging infrastructure and modernize military systems. And a new push, Gecko Robotics has announced a $71 million partnership with the US Navy, deploying its AI powered robots to assess the condition, the readiness of American warships. Joining us now, Jake. This is Arian, his Gecko Robotics CEO and co founder. Jake, can you measure what your robots are able to achieve in terms of real time military readiness?
- [41:40]
Jake Lucero Arian
We're all about measuring the real, the real information and details on the ground. And so we swarm our robots all over these ships, as you see in the videos, and what they're doing is they're gathering ground truth and information that would typically take three or four months to be done and gather 1,1 million of the amount of information data set that is not filtered to any source of truth and software that could be, you know, gathered and then, and then in perpetuity be evaluated to help with planning into the future. What we're providing to the, to the Navy and kudos to the Navy for adopting this technology, you know, in a way that's giving them an advantage over others that deal with the same problem every single day. They're taking very seriously this demand of getting to 80% readiness of their fleet. And the robots collect all this information, data that can help perpetuate goodness both now saving three to four months of cycle time in maintenance cycles, but, but also into the future to plan smarter so that we have less and less days of downtime for the vessels.
- [42:32]
Bloomberg Tech Co-Host
I mean, you're seeing them flying, we're seeing them climbing, we're seeing the hardware. But you're also about the interpretation of the data as well. How Are you developing your own models to ensure that the right information is getting to the end you user?
- [42:45]
Jake Lucero Arian
Yeah, well, it's, it's, it's this example and we say at the company a lot is if it's not ready, it doesn't count. And that's very important as it relates to the readiness of our fleets, as it relates to deterring conflict, what's going on right now in the Middle east and then also on the Pacific side. And you know, we've been doing this for 13 years. I started the company of a college dorm with this idea of what if you could diagnose the health of the built world, you know, what could that enable as it relates to predicting what the future structures, how they should be built and then what, what they're going to, what's going to occur and how to prevent that from occurring. And so we've been improving these models and believing that if you can gather information, data using robots, turn atoms into bits, you can have such an incredible advantage as it relates to how to make infrastructure smarter, make it, make it more efficiently and make even new structures. And so these models are all being fed into a central source of truth, a digital thread for critical infrastructure infrastructure called Cantilever.
- [43:39]
Bloomberg Tech Host
Jake, you, you presented basically at the winning the race summit in D.C. last year, which was very much focused on this administration's policy platforms for AI. I'm curious in the time that since part you've done a deal with the Navy, you got it done. And I wondered what that's like, you know, to see a project through to fruition with some of the military apparatus of this nation.
- [44:02]
Jake Lucero Arian
It is so exciting and so incredible to see the Navy being a leader in the world as relates to giving our warfighters an advantage, an advantage that no other, no other Navy around the world, including China has. And that's the ability to have this incredible advantage with robotics and AI to speed up how quickly we're gathering information and then deploying it. We're not just doing that, you know, for the US Government, we're, we're doing that for the largest companies in the world, companies like adnoc. Adnoc, who's, who's giving this AI and robotics native approach in such an incredibly advanced way. We're bringing that same technology and beyond to the Navy and ensuring as well that it's not just about, talk about five years or 10 years where you're going to see autonomous systems and, and robots and AI affecting the Navy and our, and helping our warfighters. No, this is actually happening today. And that is something that the administration cares deeply about. That's something that Secretary Phelan of the Navy cares deeply about. If you want to have the best Navy in the world, the best assets and programs in the world, most robust, you need impact today. And as you're seeing, today matters. And it matters more than ever.
- [45:06]
Bloomberg Tech Host
Right, Jake, what is your core competence at Gecko Robotics? Are you good at hardware or are you good at software?
- [45:13]
Jake Lucero Arian
We're good at building robotic systems that go out and gather information and data sets that no one one knew how to ever capture before. But then two, interpreting it to allow for decisions to be made, to give you advantages that can speed up times to bring critical infrastructure that's constantly delayed, constantly over budget because of how hard it is to find out where are things broken, how to fix it. The robots are able to gather all the information, not have to destroy the infrastructure and assets to gather it, and then provide the ability to optimize where to make the repairs, the replacement, replacements, and then into the future how to plan for that to potentially never even have a shutdown. We've been able to prevent shutdowns at oil and gas facilities that were going to occur that would have causing big explosions and for the Navy to be able to accelerate and give them advantages in terms of how to get our ships out of dry dock and defending, defending our values. And so we're just so, so incredibly proud to be serving the Navy in this way. And just kudos to the Navy for taking a big bold step as relates to giving us this advantage.
- [46:11]
Bloomberg Tech Host
Jake Lucer, Arian of Gecko Robotics, great to have you back on the show. Thank you very much.
- [46:15]
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