Bloomberg Tech

Episode: Tech Rebounds Amid Tariff Tensions, Tesla Investors on the Sidelines

Date: March 12, 2025
Hosts: Sonali Basak, Jackie Devalos, Caroline Hyde, Lisa Mateo
Featured Guests: Mike Shepard, Amanda Gotti, Mark Gurman, Eden Garcia Perez, Max Chaffkin, Isabel Lee, Clayton Swope, Dave Lazofsky, Peter Ahlstrom, Anurag Rana

Episode Overview

This episode delves into the latest market rebound in technology stocks amidst ongoing tariff tensions instigated by President Trump, examines investor sentiment around major tech names like Tesla, and surveys the evolving landscape in AI and robotics. It also touches on the international space race, the health of US and global consumer demand, and key innovations driving the future of business and technology.

Key Discussion Points & Insights

1. Tech Market Volatility and Tariff Tensions

• Market Rebound: After a turbulent week triggered by new US tariffs and retaliation from the EU and Canada, tech stocks showed signs of recovery following positive inflation readings.
• Tariff Policy Uncertainty: Guests discussed how ongoing tariff threats from President Trump create overhangs in investor optimism, especially for the NASDAQ 100 and chip stocks.
  • Quote (Mike Shepard, 03:55): "Malaise... really seems to be one of the operative words right now when it comes to investors and especially in the tech sector."

2. Intel/TSMC: Geopolitics and Supply Chain

• Intel's US Investment: Ongoing rumors about TSMC absorbing Intel’s foundry business and a significant $100 billion Intel domestic investment reflect the high-stakes, politically influenced reshaping of semiconductor supply chains.
  • Quote (Mike Shepard, 02:17): "Would TSMC be willing to share some of its precious trade secrets with a company that could in other ways also be a rival...?"

3. The Magnificent Seven and Tech's Overhang

• Mag 7 Under Pressure: Only Meta remains up year-to-date among the giants. The sector faces valuation compression—not fundamental breakdown—as investors await clarity on policy and innovation.
  • Quote (Amanda Gotti, 06:57): "We're still very much in a purple haze of fiscal policy uncertainty and it's namely tariff and trade related policy."
• Innovation Lull: Investors crave new catalysts beyond ongoing chip-focused rallies, with calls for broader AI business adoption.
  • Quote (Amanda Gotti, 08:14): "We're in a little bit of a lull in terms of innovation... We need to see broader based use cases, new business models..."

4. Consumer Dynamics and Global Macro Risks

• US Consumer's Role: Consumer sentiment and spending remain crucial amid policy uncertainty, but data and corporate earnings appear steady for now.
• International Headwinds: Particular concern is voiced about Europe (ongoing geopolitical conflicts) and China (tariff risk, yet attractive EM valuations).
  • Quote (Amanda Gotti, 10:55): "I'm most concerned, I think, about developed international exposure. And so Europe in particular..."

5. AI & Robotics: Google's Gemini, Meta, Apple, Tesla

• AI Hits Robotics: Google DeepMind unveils Gemini, advancing robots’ ability to interpret and interact with the physical world. The robotics race among US tech giants intensifies.
  • Quote (Mark Gurman, 15:18): "Really, the ultimate hardware expression of AI is robotics... And so you've seen Tesla play in this space, now you're seeing Meta... and now today, Google..."
• Industry Realignment: Google’s new approach is favored by improved AI infrastructure; competition from Meta (Llama), Apple (in-house humanoid robots), and Tesla means a crowded field.

6. Challenges for Consumer Robotics: iRobot Struggles

• Market Headwinds: Once highly valued, iRobot now warns of substantial operational doubt, citing persistent losses, failed deals (e.g., Amazon), weak consumer demand, and tariff threats.
  • Quote (Eden Garcia Perez, 19:19): "The company mentioned in the going concern warning that consumer spending could be one of the reasons why... and tariffs was another one..."

7. Tesla: Political Crosswinds and Investor Retreat

• Tesla Stock Wobbles: Down over 40% YTD, Tesla sees some “buy the dip” momentum. The brand’s future is muddied by Elon Musk’s support for Trump, which risks alienating its progressive customer base despite potential regulatory advantages.
  • Quote (Max Chaffkin, 20:58): "Tesla's customer base is not especially Trumpy... These are very much the constituency that backed Barack Obama, Joe Biden..."
• Policy Contradictions: The show explores the tension between Musk’s political activity and Tesla’s reliance on government subsidies.

8. Space and the New Race: SpaceX, Boeing, and China

• Crew 10 & Starliner Update: Two astronauts stranded on the ISS since June are awaiting return via SpaceX, highlighting both operational resilience and lingering vulnerabilities (Boeing’s Starliner).
  • Quote (Clayton Swope, 26:23): "Sonny and Butch... their endurance and their patience and their grace. And... we've learned... that space really can still throw us curve balls..."
• US vs. China: China’s growing routine in space—with its Tiangong station and ambitions to reach the moon—suggests a rekindled space race.
  • Quote (Clayton Swope, 28:51): "It's hard to avoid the notion that this is a space race, maybe a Moon Race 2.0. The US is still the undeniable lead space power, but China is definitely nipping at our heels."

9. Startup Spotlight: Celestial AI’s $250M Round

• Photonic Fabric: Celestial AI’s optical connectivity is being adopted for next-gen AI hardware, promising bandwidth and energy efficiency improvements. Major investors include Fidelity, Tiger, BlackRock, with strategic ties to big hyperscalers and AMD.
  • Quote (Dave Lazofsky, 34:11): "We're developing and optimizing our cap table for having the right investors... through an IPO... The decision... was based on the fact that we are the only company... that has the ability to provide optical interconnectivity..."

10. China’s AI Surge: Alibaba and “Emotional Intelligence”

• AI Arms Race: Alibaba’s R1 omni model claims superior emotion-detecting abilities at no cost, rivaling OpenAI’s paid features and rapidly advancing despite chip shortages. China’s AI innovation accelerates, especially due to homegrown workarounds for restricted chip access.
  • Quote (Peter Ahlstrom, 40:06): "What's been surprising to a lot of observers is how quickly some of these Chinese companies have been able to evolve their AI models, especially because they're cut off from the most advanced chips..."

11. Adobe Earnings Preview

• Investor Watchpoint: Adobe’s digital media ARR growth is under scrutiny as the company faces threats from open source AI art tools.
  • Quote (Anurag Rana, 43:08): "They have a huge segment... their Photoshop Creative business, which is under threat... by a lot of open source models out there now."

Memorable Quotes

• Mike Shepard, on Tech Malaise:
  "Malaise... really seems to be one of the operative words right now when it comes to investors and especially in the tech sector." (03:55)

• Amanda Gotti, on Policy Uncertainty:
  "We're still very much in a purple haze of fiscal policy uncertainty... The Mag 7 have been priced to near perfection. So we're not seeing fundamentals deteriorate, we're just seeing multiples come down materially..." (06:57)

• Mark Gurman, on Robotics as AI’s Next Big Leap:
  "The ultimate hardware expression of AI is robotics... All of these companies want to play in this space." (15:18)

• Max Chaffkin, on Tesla’s Political Bind:
  "Tesla's customer base is not especially Trumpy... These are very much the constituency that backed Barack Obama, Joe Biden... and those people... are very mad at Elon Musk right now." (20:58)

• Clayton Swope, on the New Space Race:
  "It's hard to avoid the notion that this is a space race, maybe a Moon Race 2.0. The United States is still the undeniable space power... but China is definitely nipping at our heels." (28:51)

• Dave Lazofsky, on Photonic Fabric:
  "We're interconnecting AI processors with light... and there's no more efficient way to move information than photonically." (31:58)

• Peter Ahlstrom, on China’s AI Progress:
  "What's been surprising... is how quickly some of these Chinese companies have been able to evolve their AI models, especially because they're cut off from the most advanced chips." (40:06)

Segment Timestamps

• Tariff Tensions & Tech CEOs: 02:17–06:01
• Tesla and the Mag 7: 06:01–09:10
• Global Consumer & Emerging Markets: 09:10–12:19
• AI & Robotics (Google Gemini, Meta, Tesla, Apple): 15:18–18:07
• iRobot Troubles: 18:07–20:18
• Tesla’s Political Tide: 20:18–23:12
• Market Moves & Tech Indices: 24:05–25:42
• SpaceX, Starliner & Space Race: 25:42–31:10
• Celestial AI Startup Spotlight: 31:29–37:40
• Alibaba AI Innovation: 37:50–40:46
• Adobe Earnings Preview: 42:31–43:41

Conclusion

This episode captures a complex moment of reflection, vulnerability, and innovation across the tech landscape. Tariffs, political crosscurrents, and consumer sentiment are creating turbulence, but industry insiders retain faith in the long-term runway for transformative technologies like AI, robotics, and space. All eyes remain on US and Chinese innovation, as emerging threats and opportunities redraw the competitive map in real time.