Tech Stocks Under Pressure As Iran War Drags On

Summary

Bloomberg Tech (March 12, 2026)

Episode: "Tech Stocks Under Pressure As Iran War Drags On"

Hosts: Caroline Hyde (NYC), Ed Ludlow (San Francisco)
Main Theme:
A rapidly escalating war in Iran is fueling global market volatility, with significant impacts on energy prices, tech stocks, and broader technology sectors – from cybersecurity and defense to AI and robotics. The episode brings together breaking news reporting, expert insight, and key industry voices to dissect the tech and business implications of geopolitical uncertainty.

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Key Segments & Insights

1. Market Volatility: Tech and Oil in Focus

• [01:33] Caroline Hyde: Tech stocks are hit hard as oil prices spike due to deepening conflict in Iran, raising fears about energy supply shocks fueling global inflation.
• Iran's Supreme Leader threatens prolonged closure of the Strait of Hormuz and further escalation, directly affecting global energy trade.

Notable Quote:
"As long as the straits remain closed, what you're going to continue to see is this upward push on the price of oil."
— Jomana Versace ([03:51])

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2. Ground Report: Dubai Amidst Conflict

• [02:24] Jomana Versace (live from Dubai):
  • Day 13 of Iran war – Most institutions in Dubai shifting to remote work as precaution.
  • The UAE has intercepted many Iranian projectiles, but falling debris is causing residential damage.
  • Around two-thirds of Iranian missiles have targeted the UAE.
  • Iran’s new Supreme Leader (the former leader’s son) is defiant: Hormuz stays closed, more fronts may open, and US assets remain targets.
  • Regional economies, particularly oil and finance hubs, face mounting pressure; decades-planned diversification into innovation/AI is at risk.

Notable Quote:
"These projects are being severely tested by and undermined by the geopolitical developments with really no end in sight."
— Jomana Versace ([05:52])

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3. Cyberattack Case Study: Stryker Breach

• [06:17] Ed Ludlow: Pro-Iranian activist group HANDELA claims credit for a cyberattack on Stryker (medical tech), crippling global ops.
• [06:59] Patrick Howell O'Neill:
  • Attack began just after midnight, shutting Stryker computers worldwide, wiping data even from personal employee devices.
  • HANDELA posted the attack was revenge for a suspected US strike in Iran.

Cyber Warfare Insight:

• Iran pursues “asymmetric” strategies, leveraging cyber tools to impose costs, score propaganda wins, and disrupt western businesses.
• Opportunistic targeting of companies for maximum headline impact is expected to continue.

Quote:
"There's a big propaganda value for doing things like this... It's a major propaganda win for Iran and you can expect continued opportunistic attacks like this."
— Patrick Howell O'Neill ([08:18])

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4. Defense Tech & Cybersecurity: Investor Perspectives

• [08:44] Lauren Webster (Piper Sandler):
  • Investors gravitating to defense tech and cybersecurity:
    1. Western governments seek to reindustrialize defense, keep supply chains local.
    2. Shift from software/AI into “industrial” plays like defense.
    3. Ongoing conflict intensifies interest and capital inflow.
  • Private defense and supply chain startups are seeing new momentum, not just legacy giants like Lockheed.
• Cybersecurity: Despite recent software sell-offs, cyber remains a “winner”, especially as AI is integrated.

Quote:
"Efficacy is super important and a lot of the AI solutions are just starting to get there... Cybersecurity is actually going to continue to be a place that wins."
— Lauren Webster ([11:37])

• On leading cyber names: CrowdStrike cited as an example of a cyber/AI platform thriving in the high-threat environment. ([12:28])

Outlook on Conflict:

• Webster forecasts near-term disruption and volatility, especially in oil, but long-term opportunity for private-to-public defense tech and a cybersecurity rebound.
  “We expect to see a bounce back [in cybersecurity] as well.” ([13:31])

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5. AI Startup Boom: Cursor & Replit

• Cursor:

  • [15:16] Caroline Hyde: Cursor, a breakout AI-coding tools company, is reportedly raising funds at a $50B valuation (doubling since last fall).
  • [15:38] Natasha Mascarenas: Cursor’s annualized revenue exploded from $100M to $2B in a year; raising rapidly to fuel more in-house model R&D.
  • The market for AI coding tools is still hot and crowded (“not winner-takes-all…yet”), with other names like Replit and Claude Code competing aggressively ([16:35]).
  • Expect consolidation ahead; many players can't survive as differentiation narrows.

• Competitive Dynamics:
  “At some point, it does tip over into [winner-takes-all]… despite immense growth, there are just so many players.”
  — Natasha Mascarenas ([16:35])

• Replit:

  • [30:49] Ed Ludlow: Replit raises $400M at a $9B valuation (lead: Georgian Partners).
  • [31:10] Amjad Massad (CEO): Swift team expansion, broadened use cases (“code is the universal interface for knowledge work”), global partnerships, and democratization beyond just core engineering teams.
  • Boasts 100x revenue growth in a year: $2.5M → $250M ARR, on track for $1B in 2026 ([34:25]).
  • Not in direct competition with Cursor/Claude Code for core engineering—Replit's focus is code for all, not just specialized devs.

Quote:
"We're telling enterprises now you need to decentralize innovation... anyone can code in that enterprise."
— Amjad Massad ([34:49])

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6. AI Reshaping the Workforce: Job Cuts & "AI-washing"

• [18:19] Atlassian cuts 1,600 jobs, citing AI transformation.
• [18:42] Brody Ford: Notes the trend: AI is now the go-to rationale for cost cuts, sometimes just a fig leaf for deeper strategy shifts.
• Other software giants (Oracle rumored; Adobe eyed) may follow as AI prompts investor skepticism about adaptation.

Quote:
"If you want to cut costs, you say it's due to AI... There is some truth, but it's probably not quite as direct as some of these management memos make it out."
— Brody Ford ([18:42])

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7. Netflix Bets on AI with Ben Affleck’s Startup

• [19:59] Ed Ludlow: Netflix poised to pay up to $600M (with performance triggers) for Interpositive—Ben Affleck’s stealth AI film editing startup.
• [21:14] Brody Ford: Interpositive stands out because it trains on user-submitted footage (not external corpuses), designed “for filmmakers by filmmakers.”
• Copyright safety/lack of training on public work is a big appeal for Hollywood creatives and Netflix.
• Staff is small, company only a few years old.
• Netflix pivots to AI-infused tools as megamergers (like Warner Bros. Discovery) falter.

Quote:
"It's exactly what Hollywood should want in an AI product... Most people in Hollywood are going to be very mistrustful of companies like Netflix and Amazon when it comes to AI."
— Brody Ford ([21:36])

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8. Apple’s Foldable Phone – Finally?

• [23:40] Ed Ludlow: Apple set to enter the foldable category; new device opens to iPad mini size (~8-inch screen) but folds to be pocketable.
• [23:59] Mark Gurman:
  • Runs updated iOS 27, with iPad-style layouts.
  • Big leap in durability, minimal crease. Premium price (>$2K), meant for a niche market (initially ~5-10% of iPhone sales).
  • Apple will continue to push high-end "slab" phones and aims for a more edge-to-edge design in 2027.

Quote:
"So basically, basically an iPad mini you can fit in your pocket... It'll have a market leading crease, so to speak."
— Mark Gurman ([23:59])

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9. Dell & US Government: Building AI Infrastructure

• [26:02] Ed Ludlow: Dell CEO Michael Dell and Dario Gill (DOE Undersecretary) discuss public-private partnership to build national AI/supercomputing infrastructure.
• US policy shift: move from pilot to production on national AI systems; emphasis on open, scalable platforms.
• Expectation to double R&D productivity via the Genesis Mission (signed by President Trump pre-Thanksgiving 2025).
• Accelerated timelines – major new supercomputers now deployed in two years (not a decade).

Quotes:
"We're in the midst of a computer revolution and AI is at the heart... It is going to transform how science and engineering are practiced."
— Dario Gill ([28:16])

"We used to have supercomputing projects that would take a decade to build. Now we're building these things in two years... that's a big, big change."
— Dario Gill ([29:17])

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10. Robotics at Home: Sunday’s Ambition

• [35:14] Caroline Hyde: Sunday, the AI robotics company, raises $165M at a $1.2B valuation.
  • [36:01] Tony Zhao (CEO):
    • Funds to ramp up real-world beta program—laundry- and dishwashing robots in real homes for the first time.
    • AI learns dexterity tasks via glove-based data collection (“memory gloves”), not just from robot trials.
    • Over 3,000 households on the waitlist.
    • Launch cost for the Memo robot: ~$10,000, with prices expected to fall.
    • Design choices focus on trust (hat disguises camera for natural 'eye contact').
    • Speed isn’t the priority—robot works unattended.

Quotes:
"The beta program is a really great way for us to both kind of exercise our muscle of deploying these robots into real people's homes which is the first time these general purpose robots are deployed to like real homes."
— Tony Zhao ([36:01])

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11. SPV Mania in Private Markets & Risks for Investors

• [39:27] Ed Ludlow:
  • SPVs (special purpose vehicles) let investors access shares of private tech titans like SpaceX pre-IPO—but layers of fees and the possibility of non-existent shares haunt the market.
• [40:20] Bailey Lipschultz:
  • Some SPVs are “clean,” cap-table verified; others are multi-layered, opaque, risk-laden.
  • Allegations and actual cases of fraud (investors wiring money for non-existent shares).
  • Problems often surface only during forced events (IPOs, acquisitions).

Quote:
"If you're being pitched...an SPV that's investing in another SPV...that's investing in another SPV...congratulations, even if those shares do exist...what you end up getting distributed is much, much smaller because of those carry fees."
— Ben Walter ([41:25])

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Memorable Moments & Quotes

• “Oil prices spike again, stoking fears the war in Iran will further crimp energy supplies and fuel inflation.”
  — Caroline Hyde ([01:33])

• “It’s not just ships, subs, ballistics, but it is the supply chain around that entirely.”
  — Lauren Webster ([10:36])

• "AI is now the cool thing to ‘blame’ for layoffs—even if the reality is more complicated."
  — Brody Ford ([18:42])

• “You can expect continued opportunistic attacks like this from Iran.”
  — Patrick Howell O’Neill ([08:39])

• “You go to work and come back after eight hours and all the work is done. That's the dream.”
  — Tony Zhao on Sunday robots ([37:55])

• “Much like ogres, SPVs have layers—layers in which are buried a web of extra fees.”
  — Caroline Hyde ([41:13], adapted from a Shrek joke)

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Episode Flow / Timestamps for Key Sections

• 00:00–01:12: Ads, show intro (skipped)
• 01:21–06:17: On-the-ground Iran war update, oil market impact
• 06:17–08:44: Cyberattack on Stryker, Iran’s asymmetric cyber warfare
• 08:44–13:46: Defense tech/cybersecurity market trends, Lauren Webster (Piper Sandler)
• 15:16–18:12: Cursor’s valuation, AI coding tools market, Natasha Mascarenas
• 18:19–19:59: Atlassian and tech layoffs, AI as rationale
• 19:59–23:29: Netflix’s $600M deal for AI film startup (Interpositive), IP ownership
• 23:40–26:02: Apple’s foldable phone, future iPhones (Mark Gurman)
• 26:02–30:26: Dell & US DOE — government AI infrastructure partnership (Michael Dell, Dario Gill)
• 30:49–35:14: Replit funding, international growth, customer base (Amjad Massad)
• 35:14–39:27: Sunday’s laundry robot, AI/data collection, home robotics market (Tony Zhao)
• 39:27–42:54: The risks of investing in private tech SPVs (Bailey Lipschultz)

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In Summary

This episode delivers a comprehensive tour of how techno-geopolitics, market anxieties, and AI’s rise are reshaping the global tech landscape. The hosts and expert guests break down complex events—cyber-warfare, defense sector investment, job market churn, robotics and the latest AI valuation battlefield—with a blend of analytical rigor and compelling, real-world stories. Those tuned into Bloomberg Tech get not just the news, but crucial context and foresight on where innovation and risk intersect in a world on edge.

Transcript

[Ben Walter]

Every small business owner has that one moment that could have broken them. But remarkably, it didn't. Hi, I'm Ben Walter, CEO of Chase for Business and on season three of the Unshakeables, my co host Kathleen Griffith and I are bringing you more incredible stories of overcoming the impossible. We're really proud to share that the Unshakeables is nominated for Best Branded podcast at the 2026 iHeart Podcast Awards. Listen to the Unshakeables wherever you get your podcasts and lear. Learn [e-mail] podcast JP Morgan Chase bank and a member FDIC Copyright 20 and 26 JP Morgan Chase Co. At Charmin

[Ed Ludlow]

we heard you shouldn't talk about going

[Jomana Versace]

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[Tony Zhao]

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[Jomana Versace]

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[Lauren Webster]

Bloomberg Audio Studios Podcasts Radio News.

[Natasha Mascarenas]

Bloomberg Tech is live from coast to

[Ed Ludlow]

coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.

[Caroline Hyde]

This is Bloomberg Tech. Coming up, tech stocks forwards. Oil prices spike again, stoking fears the war in Iran will further crimp energy supplies and fuel inflation.

[Ed Ludlow]

Plus, we hear from Michael Dell and the U.S. energy Department Undersecretary for Science about Dell's work with the federal government on AI.

[Caroline Hyde]

And new details emerge on Apple's entry into the foldable phone category. We'll break it down. Key headlines Iran's Supreme Leader has called for the Strait of Hormuz to remain closed and warned that new fronts may be opened if the war persists. Here with the latest in the Middle east is Bloomberg's Jomana Versace live from Dubai. And you know those are the two red headlines on the terminal, right? The latest in public address from Iran's supreme leader that start there but conscious of course, that in real time drone attacks continue across the region, including where you are.

[Jomana Versace]

Exactly that, Ed. And it is day 13 now of the Iran war with no signs really that things are letting up. And you know, as you can see, we have actually started working from home today. Many institutions around around Dubai have actually advised their employees to be working from home out of precaution. There hasn't been a formal evacuation notice issued, but I think what has happened in the last 24 hours is the intensity of the strikes has really taken on a different dimension. And what you're seeing here is, you know, the UAE has been extremely successful at intercepting many of the projectiles that have been headed towards them. Out of all of the projectiles that Iran have fired, about two thirds have been directed towards the UAE alone. Just to give you an idea here of context. But that is not to say that some of the fallen debris isn't causing damage on, on residential buildings, which is exactly the situation that we're in. So out of an abundance of precaution, we are of course broadcasting for home. But I will tell you that the tone still coming out of Iran is one of defiance. We had the first statement a couple of hours ago coming through from the new Supreme Leader, the son of the prior Supreme Leader, and he was saying that they will maintain the closure of rates of Hormuz. They are very aware of the cost that this has inflicted on the global economy and global energy infrastructure. And they've also warned that new fronts could open up and that they will continue to strike on US assets. This coming after a very intense 24 hours of more vessels being targeted around the Persian Gulf, more fuel depots also being hit, set aflame. We've had disruption in oil supply and analysts estimates vary. But you know, any way you look at it, as long as the straits remain closed, what you're going to continue to see is this upward push on the price of oil.

[Ed Ludlow]

Jomana, I can only imagine the stress that's putting you on and all of your colleagues, your family at the moment. Talk to us though a little bit about what you think the impact is writ large on your part of the world. The uae, not an oil force, it is a financial force. But how do you think that this focus on oil prices as well is changing the tone in the Middle East?

[Jomana Versace]

But UAE obviously very notable OPEC producer. And so you know, there are two dimensions to this. Of course, the focus from a, an economic perspective is maintaining the flow of oil and ensuring that production doesn't get permanently halted or disrupted. What has happened is with some of the key OPEC producers from the region, the likes of Saudi Arabia, Kuwait, Iraq, UAE have had to manage their production levels simply because their they don't have any capacity left in their storage. They're looking for other ways to get that oil out. You've probably heard about this east west pipeline in Saudi Arabia that Saudi Arabia are leaning on as well. In the uae, there's also Fujairah pipeline that bypasses the straits as options to get the oil out. But beyond the oil dimension, as you say, look, these are, this is a part of the world that has spent decades painting this image of a place where financial, the financial ecosystem construction, they've created a whole ecosystem around it to bring in capital and to bring in investment from abroad. And you even saw it when President Trump made a visit almost a year ago to this part of the world talking about the investments and the opportunities in terms of artificial intelligence and the diversification strategies that these economies are pursuing. At risk here is that these projects are being severely tested by and undermined by the geopolitical developments with really no end in sight. And of course, this is the reason why these GCC states have been one, for ages trying to avoid the scenario and two, actively trying to work the diplomatic channels to make it stop.

[Ed Ludlow]

Bloomberg's Jomana Versace, we so appreciate you coming live for us from Dubai. Stay safe. Thank you. Now look, a pro Iranian digital activist group HANDELA has claimed credit for a cyber attack against medical technology maker Stryker. Now the attack crippled the company's global operations with many Stryker employees around the world unable to to work due to the breach. So according to a source and a memo seen by Bloomberg News, Strike is still investigating the breach and doesn't know when its systems will be back online. Joining us now with the details is Bloomberg's Patrick Howell o' Neill from our cybersecurity team. And it's actually not the company Stryker that's telling us it's an Iranian impact cyber hack. It's Iran itself. How do we know that Stryker is dealing with this?

[Patrick Howell O'Neill]

So yesterday, a little bit after midnight Eastern time, computers began to turn off in Striker offices around the world. It was a bit of a frantic scene. Employees were trying to, once they realized what was going on, unplug the computers

[Caroline Hyde]

to save the data.

[Patrick Howell O'Neill]

And it interrupted operations around the world for the company. Employees were sent home.

[Caroline Hyde]

I mean, it was a full stop.

[Patrick Howell O'Neill]

Data was wiped on the computers and even on phones and devices, even personal devices for employees that had, you know, corporate software on their computers, on their phones rather. And then Hondala posted, taking credit for the attack and saying it was in response to a suspected US strike of an Iranian school and has said that they have a ton of data. But Stryker is, it appears, really recovering and getting back on its feet.

[Caroline Hyde]

Patrick, this is a case study, right? Handela is a pro Iranian digital activist group. What can you tell us about Iran's broader strategy? Cyber strategy in response to what the United States has thus far enacted in the region.

[Patrick Howell O'Neill]

When you think about Iran's cyber strategy, you can easily put it into the context of Iran's strategy overall in this war, which is that it's defined by asymmetry. I mean you can think about drones, missiles, the kinetic space for sure. And the cyberspace is just like that. They are looking ways, looking for ways to impose cost on Israel, on the US and on partners of those countries. And so they're opportunistically looking for companies with connections, companies that will make a splash. There's a big proposal propaganda value for doing things like this. What the actual impact is economically, the long term impact of this company is to be determined. But it's a major propaganda win for Iran and you can expect continued opportunistic attacks like this from the country.

[Caroline Hyde]

Bloomberg's Patrick Howe o', Neill, thank you very much. The conflict in Iran and across the Middle east continues to bring investor attention back to defense technology. Joining us to discuss is Lauren Webster Piper Sandler, Managing director of Investment Banking and that's your expertise. It's just, it's not just cyber, but I look at the Bloomberg terminal every morning for the last couple of weeks and the stories that are up there in the realm of tech, all to do with defense technology. You must have the same conversation with clients on a daily basis.

[Lauren Webster]

Absolutely. And I think there's a, there's a couple of thematics that are really driving investor interest in the category and it certainly started before for the current conflict. One was this push across the west, us, Canada, Europe for sort of sovereign reindustrialization of their defense base. A lot of investment pouring into. We want to buy what we build in our, in our borders to more recently the rotation out of the software sector, the sell down on AI concerns that money hasn't just sat on the sidelines, it's been plowing into industrial spaces like defense technology. And then third, third, the current conflict is certainly bringing kind of a microscope to the space and really getting investor interest there.

[Caroline Hyde]

In a, in a war scenario it's hard to determine what actually has changed. Right. One of the data sets we track is non classified or declassified dollars that go to the legacy primes for ballistics. Right. And they go to the same players, the vast majority still to Lockheed etc. Are you seeing actually this new group of largely private companies get real tangible traction in this environment?

[Lauren Webster]

Yeah, yeah, certainly. And there's a couple pockets that really plug into the ballistics space. And you're right, like we have A huge resupply requirement there after expending so many in the current conflict.

[Jomana Versace]

But.

[Lauren Webster]

But one is in sort of the launch capability and there's a launch lot of investor interest going into particularly private companies to be able to fuel the launch capability for those ballistics and munitions. So that's one pocket. The other one is actually kind of picks and shovels around the industry. We have a whole manufacturing base we need to reconstitute here in Europe saying the same thing. We need to have our supply chain within our borders. And so it's not just ship subs, ballistics, but it is the supply chain around that entirely.

[Ed Ludlow]

Go a little bit Lauren, not just in defense tech but we think about cybersecurity at this moment as well. We were just hearing about what's happened with Stryker. How much is that a point of interest? How much are people willing to take on what has been some software anxiety around that area?

[Lauren Webster]

Yeah, yeah, absolutely. So. So I think you're right around sort of the interest and where it was because particularly in the SAS sell off I mentioned previously cybersecurity was not immune to the sell down but. But we see it, I see it as somewhat overblown for a few reasons. One is companies like Stryker. Others they know the threat is still very real in there and they need effective cybersecurity tooling. So ethic efficacy is super important and a lot of the AI solutions are just starting to get there too. Is cybersecurity is actually going to continue to be a place that wins. It's a beneficiary from plugging AI capabilities into IT. And so I think you're going to see cybersecurity companies continue to do quite well. They've done better than the broader software market given both the threat and the opportunity from some of the new AI technology.

[Ed Ludlow]

Lauren, are there any that set themselves apart that have managed to sell themselves as a platform, not some sort of single point of service but more broadly have intertwined generative AI ahead of the curve.

[Lauren Webster]

Yeah you certainly saw last week CrowdStrike's earnings come out and just really strong performance from the business around this platform story. Look, it has endpoints, millions of endpoints, billions of endpoints that it is monitoring and that is a data moat in the AI in the AI era. Second, they are using AI to really drive security outcomes for, for their customers.

[Ed Ludlow]

So.

[Lauren Webster]

So you saw that bright spot in their earnings for sure.

[Caroline Hyde]

What are you modeling for to happen in the duration of this conflict? What you are as a team discussing through the lens of different asset prices and how long you think particularly the volatility in oil. Right. That's the underpinning of what's going on. But the simple question is how long you think it's going to last.

[Lauren Webster]

Yeah, I wish I had a crystal ball for that. But certainly, you know there's going to be near term disruption. We have seen multiple points of that this year. First the sell off in the market, now the conflict. But I think long term we see a few opportunities with a significant growth outlook and those continue to be defense technology going from largely private to public over time. And we're really excited about that and we will see. Yeah, certainly. But, but in cybersecurity security we expect to see a bounce back to as well.

[Ed Ludlow]

Webster, it's been great having you on today of Piper Sandler. Thank you for your time. Coming up, another eye popping valuation in the AI boom. We're going to that private market we just discussed. Cursor could nearly double its worth to $50 billion. That conversation next. This is Bloomberg Tech.

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[Caroline Hyde]

Cursor is reportedly in talks on a new funding round that would value the company at around $50 billion, nearly double its valuation from just last fall. All according to sources for the latest. Bloomberg's Natasha Mascarenas broke the story with the team. Team, there's a lot of interest in Cursor. There has been for quite some time. They've moved quickly, growing the product, but this is a big jump in valuation. What are the details on the round? Who are the players?

[Natasha Mascarenas]

Yeah, absolutely. So earlier this month we reported that Cursor has topped 2 billion in annualized revenue. That's up from around 100 million in annualized revenue at this time last year. So the revenue growth has just been insane, which is basically investor caught nip in the this industry. We've also been watching Cursor focus on more in house model efforts which I would expect is a big part of why they need to raise new capital so soon after their last round closed just a few months ago. You know, we don't know the lead investors just yet but we do know, I mean just looking at the market, so many companies are hitting revenue milestones or even new funding milestones with yesterday Replit announcing that they had raised at

[Ed Ludlow]

9 billion and it's actually got the Repert CEO joining us a little later in the show. And it just feels that all of these companies are able to thrive simultaneously. The fact that all we talk about is Anthropic and its cowork and its coding capabilities open AI as well. But still there's space for Cursor.

[Natasha Mascarenas]

Yeah, absolutely. I mean it's, it's a little bit of a cliche that it's not a winner takes all market because at some point it does tip over into it. I mean when Cursor launched its product in 2023 in developers eyes all the big names of AI were missing. OpenAI didn't have a product, Anthropic didn't have a product. They were the model layer helping these companies. But once they saw Cursor's growth, you know, and other growth, we absolutely saw them put more efforts into their own products. My expectation is this year, similar to last year, we will see consolidation in this space. Last year we saw Windsurf, a small smaller company get acquired by Cognition. I am watching the same thing this year because to your point, despite the immense growth there are just so many players.

[Caroline Hyde]

You see a lot of headlines on the Bloomberg right? Lovable is one out of Sweden. I think that's raised money. By the way, Kosa didn't reply to comment on our story but I did put on X that basically as far as I can tell, Replic, Cursor and Claude Coded just all do the same thing in a slightly different way. It is a competitive field, the AI coding agent space.

[Natasha Mascarenas]

It's immensely competitive. I mean think about also this whole idea of people being worried that their jobs are going to be automated away. You see engineers trying all the products but they are going to pick one at some point. And so right now it feels like there's this ARM rates to figure out which is going to be the preferred coding assistant or software development assistant. And you know, day by day we, we see these companies go head to head on it.

[Ed Ludlow]

Natasha, it's great you're on. So much of the breaking news in the private area. Thank you very much indeed. Natasha Mascara.

[Ben Walter]

And is that.

[Caroline Hyde]

Software firm Atlassian is joining rivals blaming AI for massive staff reductions. The Sydney based company plans to cut 1600 jobs, about a tenth of its global work workforce. Bloomberg's Brady Ford has the software space details. It is the latest one. Right. The scale is not perhaps the same as what we heard from Block a little while back, but you have the details. Why is Atlassian doing this and what's it doing?

[Brody Ford]

Well, this is the cool thing to do now if you're a software company, right, if you want to cut costs, you say it's due to AI. A couple of years ago it was that you were flattening management layers and today it's that AI is changing the market and there is some truth to that, right? I mean, Atlassian Stock is down 50% some this year and a lot of that is because investors are scared they're not adapting to AI correctly. So there is certainly some truth that fuels these cuts, but it's probably not quite as direct as some of these management memos make it out to be.

[Ed Ludlow]

Oh, the old AI washing debate continues, Brody. And you'd just been breaking the news last week. The Oracle was likely to be laying off many thousands of people, it might be understood. And after their earnings, it feels as though they filed some formal paperwork. All of this seems to be building. Are we going to hear it from other software names? We've got more earnings coming after the bell, for example.

[Brody Ford]

I think it's likely that we're going to keep hearing. I mean this whole AI job displacement question has been going for years and it seems like it's only ramping up. Yeah, I mean tonight we have Adobe, notably, they haven't done a big scale layoff and they're firmly in this bucket of a company that is kind of really facing a lot of skepticism from the market about their ability to compete in this era.

[Ed Ludlow]

Bloomberg's Brody Ford, thank you very much indeed on all things AI and unfortunately worker displacement. But let's talk about Netflix now maybe shelling out up to $600 million to acquire Ben Affleck's AI startup Interposition Positive. That's according to sources familiar with the deal. Now the move would mark one of the biggest purchases ever for the streaming giant. Here with more Bloomberg's Lucas Shaw, who covers all things media and entertainment and well, they couldn't get Warner Brothers discovery. So they're going in on AI and actually its cash portion is less, but there's some quotas they should hit.

[Brody Ford]

Yeah, I mean, the, the price was initially described to me as $600 million. I spoke to a nut from People where there is an earn out that would get to 600 and perhaps even more. The initial upfront money is less than that, but still a big payday for a company that nobody even knew existed, really, until Netflix announced this deal. You know, Ben Affleck had been out there giving some really interesting public statements on AI, but it seemed just as sort of a curious filmmaker, not as someone who'd started his own company.

[Caroline Hyde]

The performance triggers are interesting when you, when you just stop and look at what Interpositive does. Right. The tools that it makes allows filmmakers to alter existing footage. Will you just talk a little bit about that, Lucas, Why it's useful to Netflix?

[Brody Ford]

Yeah, well, it's useful on a couple of fronts. One is this is an AI company that is founded by a filmmaker. It's for filmmakers. And if you listen to Ben Affleck talk, you know, they don't, they don't train on a bunch of existing work that's already out there. You're not going to run into copyright issues in the way that Google, Facebook, OpenAI, etc.

[Ben Walter]

Are.

[Brody Ford]

You are supposed to upload your movie as you're making it or your TV show. And the model will train on what you have put into it and can then help you change your shots, adapt your shots, take things out, adjust certain backgrounds. And so it's exactly what Hollywood should want in an AI product, which I think is helpful to Netflix because most people in Hollywood are going to be very mistrustful of companies like Netflix and Amazon when it comes to AI. They're going to assume that they are out to do sort of what you were just talking about with, with Brody. Right? Job, displacement.

[Ed Ludlow]

This is a lot of money. How large is the scale of the engineering talent, the scale of the company? How long has Ben Affleck been building this basically in stealth?

[Brody Ford]

The company is only a couple of years old. The staff is still quite sparse. I think the number caught a lot of people, including myself, off guard, which is one of the reasons why we ended up reporting it.

[Tony Zhao]

Right.

[Brody Ford]

The news that Netflix was buying this company had already been announced. What I was most interested in was when I heard how much they had paid for it. But my understanding is that, you know, the company had been out looking to raise money in the private markets and was getting a valuation north of $1 billion. And so when they had the opportunity to sell, they didn't get a price quite that high. But it had to be pretty significant for them to consider doing it and essentially become a proprietary technology for Netflix.

[Caroline Hyde]

It is interesting we started the segment by saying like for Netflix, biggest acquisitional deal ever and sort of completely have forgotten about and look past what happened with the Warner Brothers discovery bid. Fold that in where we're at with it.

[Brody Ford]

Waiting on what's going to happen with Warner Brothers and Paramount. Right. Netflix is pretty much out. Paramount CEO David Ellison was on the Warner Brothers lot this week talking to some senior staff. They're trying to get that deal approved by the fall so that they don't have to start paying that the ticking fee they have that would make their acquisition of Warner Brothers even more expensive.

[Caroline Hyde]

Bloomberg's Lucas Shaw, who is the managing editor that leads our screen time team with the reporting, thank you very much.

[Ed Ludlow]

Apple on its entry into the foldable phone category. The long awaited device is set to have an iPad like feature when it's fully opened according to sources. Let's get more Bloomberg's Mark Gurman who of course broke the story. So what, there's going to be a screen on the front but also the internal screen is going to feel more like an iPad mini.

[Patrick Howell O'Neill]

Yeah, this is pretty exciting. So if you've used an iPad mini, it has about an 8 inch screen and now this foldable phone will be kind of small when it's closed, but when you open it up it'll be the size of an iPad mini. So basically, basically an iPad mini you can fit in your pocket. And so with that you're going to see an updated version of iOS 27 later this year. And some of the key features will be iPad like layouts for apps that'll run standard iOS. The other cool things here is that it'll be a little different from past foldables in that it'll have better durability and then it'll also have a reduced crease. So it'll have a market leading crease, so to speak. Right now, most foldable foldable phones, you see that line in the middle on the Apple version, it'll be much less visible. So that's going to be pretty nifty. And obviously this is going to be probably north of $2,000. So it's obviously a good thing that they have the technology a little superior to what's on the market today.

[Caroline Hyde]

Mark, take us inside Apple not not just in the story you put out yesterday or overnight but all the reporting on this product over, over the last few months, months. Does management feel like this? This is big for the direction that Apple wants to go, that it's going to be one of the most high volume products, things like that.

[Patrick Howell O'Neill]

I actually think it's going to be pretty niche. You know they'll sell some, maybe 5 to 10% of overall iPhone units in a year, will be the foldable phone. But it is going to be niche from the get go obviously because that price point which puts it at about double what you're paying for sort of the baseline pro phones. And obviously some people like the current candy bar style so the slab of glass style, you know they're also working on new versions of the regular Pro phone. So you'll see an 18 Pro and 18 Pro Max in the fall. Big focus there is on processor and camera. The phones will look basically the same as the current versions. And then a year later, as early as 2027, you'll see a more of an edge to edge phone with, with more curved glass. In honor of the product's 20 year

[Ed Ludlow]

anniversary, Bloomberg's Mark Gurman always with all things Apple. We thank you. Now in Washington, tech giant Dell has been holding an event with its biggest customer, the U.S. government. Earlier Ed spoke with Dell CEO Michael Dell and undersecretary of science at the U.S. department of Energy. That's Dario Gill who spoke about using AI to advance scientific discovery. Take a listen.

[Caroline Hyde]

A lot of the themes that you're trying to get across and I don't know what conclusions you've reached in the last hour with your colleagues that next to you is that either government is getting it right in the United States or they're not in where they're allocating resource, where they're deploying policy to build critical national AI infrastructure. What are the conclusions you've reached today?

[Patrick Howell O'Neill]

You know we're seeing in government a number of the projects advance from the pilot phase to production phase and certainly Dario can speak to the ambitious initiatives but you know we are, you know we have built a platform for open scalable systems to enable all the great science that's occurring in the national labs and beyond. Certainly we have a fabulous example in the Doudna cluster that we're beginning to, to deploy. And all of this is about accelerating science, you know, scientific discovery and progress. And certainly, you know that's, that's a huge priority. So great to be here with our largest customer customer and you know we're very mission focused and making sure. Our solutions are enabling the mission wherever it occurs, whether that's in, in space, out in the field and everywhere else does go.

[Caroline Hyde]

There are case studies. Right. We could talk, for example, about the progress you've made with any rsc. But zooming out for a moment, if you will, from the DOE's perspective, why is AI infrastructure now such a core part of, of national security and energy security implications?

[Ben Walter]

Well, because we're in the midst of a computer revolution and AI is at the heart of that revolution and it is going to transform how science and engineering are practiced in our nation. The Monday before for Thanksgiving, President Trump signed an executive order to launch the Genesis mission. And within that mission, we seek to harness this computing revolution to double the productivity and impact of America's trillion dollar a year R and D ecosystem. And science and engineering are at the heart of our progress and capabilities in national security, in discovery science, in energy, in health. And the example of the partnership that we have with the doubt in the system in Nersk in One of our 17 national laboratories exemplifies the power of using AI to accelerate science.

[Caroline Hyde]

Is, is Dell and Mr. Dell sat next to you delivering supercomputers to the timeline you'd expect?

[Ben Walter]

Yes, one of the so, so for example, in that system that we're standing up, we already have an early access program where we stood up. The first generation of nodes of the Nvidia GPUs system is going to be operational for the science community mid-2027. So I think one of the characteristics we're seeing right now is that we used to have supercomputing projects that would take a decade to build. Now we're building these things in two years and, and that's a big, big change in terms of the velocity with which it's moving.

[Patrick Howell O'Neill]

One of my government is doing is, is. Sorry to interrupt there. No, please let, please the leveraging the integrated, you know, rack scalable systems that we're building for commercial and enterprise and obviously there are enormous build outs in, in AI data centers as, as you're well aware, Ed. And, and so they'll kind of again, leveraging that open scalable architecture that we built will accelerate the government's progress in all of its AI infrastructure requirements.

[Caroline Hyde]

That was Dell CEO Michael Dell and Dario Gill, Undersecretary for Science at the U.S. department of Energy. Now coming up, Startup Sunday raised 165 million as it works toward bringing dishwashing and laundry folding robots into your home. Speak to the CEO next. This is Bloomberg Tech.

[Ed Ludlow]

AI coding startup Replit has raised $400 million in a Series D round led by B2B investor Georgian, finding the company at $9 billion. Joining us to discuss the latest funding is Replit CEO Amjad Massad. Wonderful to have you with us, Amjad. What's the money going to be used for? Because you're building it up in a swift formation.

[Tony Zhao]

Yeah. So there's a lot of product innovation to be done. So we're hiring more people in R and D. You know, Replit is kind of expanding beyond just code. We think that code has become the universal interface for knowledge work. So we're seeing customers of ours, they're not just building apps, although that's a big use case. They're building automations, they're building slide decks, they're building marketing materials, they're doing all sorts of things with, with Replit. So we're, we're expanding that, but we're also expanding internationally. We're seeing a lot of excitement around Replit and places like in Japan, South Korea, obviously the Middle East. We have this big partnership with Saudi Arabia and that's growing across the Middle east, but also Asia. We were just in India for the summit there and there's tremendous excitement there. We partnered with Razorpay who's also a customer and we're bringing kind of the replace superpowers to developers in India. So there's a lot to do.

[Ed Ludlow]

I have to do the follow up of. If you are with significant exposure and growing in Saudi Arabia, how have things been in the last couple of weeks? Is that still growing as quickly as you anticipate it is?

[Tony Zhao]

It is. We haven't seen any, any disruption to growth or day to day operations. Obviously we wish the best to the people there and hope, hope things, hope we get to peace as soon as possible.

[Caroline Hyde]

You may, you may see this as not fair but if you put rep plate alongside cursor, right alongside core code, there are different functions, there are different strengths, but the base functions are similar. Right. You actually also have a lot of investors in common with Cursor. How do you manage that and just basically say no, like no. This is what replicate does. This is how we're different. This is our motor or what we're doing best. Yeah.

[Tony Zhao]

So if you look at our customers, our customers buy Cursor by cloud code, but they buy them for their core engineering teams. What are the rest of the company using? Code is democratized now. Anyone can build applications, can build software and the most innovative companies in the world are opening their eyes to that and saying we don't want to be left behind. We want our product managers to be able to ship software. We want our designers to prototype and get in front of customers as early as possible. And that's, you know, not just startups. This is like we're talking about, you know, 85% of the Fortune 500 companies are using replit and in the primary departments it's primarily outside of engineering so so we don't really compete with them head to head on on deals.

[Caroline Hyde]

The, the benchmark right now in Silicon Valley. Again you can tell me if I'm wrong but is Ars, you know how real these businesses are coming in, how quickly. Take us inside replit. How's things going financially?

[Tony Zhao]

Yeah, I mean last year we grew 100x. We went from 2.5 million to $250 million. I said last year that it looks like we're going to be headed to a billion air are in 2026 and we're on track. So I think that's, that's really exciting. But we, we also spent a lot of time just making sure enterprise adoption is, is going as planned because you know, you mentioned cursor and cloud code. They're going after established markets. We're telling enterprises that now you need to, to decentralize innovation. This is, we're creating a new category of you know, anyone can code in that enterprise. So the thing we're most proud of recently is as the adoption in the and the enterprise.

[Caroline Hyde]

I'm Jen Massad, CEO. It's great to have you back on Bloomberg Tech. Thank you very much. We have more funding news. Robotics firm Sunday has reached a nearly $1.2 billion valuation following $165 million a funding round. The startup is using AI to develop a robot that can do housework and plans to launch a testing program later this year. Sunday's co founder and CEO Tony Zhao joins us now in studio. We just showed some, some video of Memo. You weren't able to bring Memo with you. It's quite, quite big and quite heavy. But it's an interesting use case. What are you going to use to fund funding for? I guess in the first instance to kind of accelerate this testing program so that I can have one in my home or anyone watching global tech right now can say all right, I'll get one of those.

[Tony Zhao]

Yeah, 100%. I think the beta program is a really great way for us to both kind of exercise our muscle of deploying these robots into real people's homes which is the first time these general purpose robots are Deployed to like real homes. As well as deepening the research focus that we have internally.

[Caroline Hyde]

I share my family in town and they're here to watch the show today and they know full well that, you know, in the living room is the laundry and it's not folded because of the difficulty in training me to do it. What is the technical challenge on the hardware side but also software side? Dexterity to get the robot to fold laundry?

[Tony Zhao]

Yeah, yeah. I think the breakthrough is really about the AI that is behind it. You think about Jenny as AI that generates images and text, but we use it to generate actions. I think the one of the most important part is how we gather the data to train this really powerful AI. And what we do is we develop this glove, club, memory gloves and essentially we give it to people so that they can do the laundry in their own homes and we capture that data to train our robots to do the

[Ed Ludlow]

same thing, skill capture gloves, months. So basically that's giving the data, the underlying data so that the robot can learn. This was sort of a breakthrough that you made in academia, Tony, but I'm interested as to how the beta is going and how many people actually want them in their homes.

[Tony Zhao]

Yeah, we have a huge wait list. We have more than 3,000 people who spend like 30 minutes like filling up this whole sign up form. And we're actually in the process of selecting people who will be participating in it this year.

[Ed Ludlow]

It's all about getting robots in the wild. Now I'm interested, Tony, as to. We were watching a lot of these videos basically on fast forward. They're going at four times the speed than they actually do. What do you think your biggest learning will be in the wild? Where do you think there will be issues? Where do you think they'll really overcome a lot of the concerns people have?

[Tony Zhao]

Yeah, I think the, for us, we're actually not super worried about speed because essentially if your laundry, if all your houseworks can be done by the robots, it's essentially like you go to work and you come back to work after eight hours and all the work is done. So the part that we are really distinct is we do not actually need to train on data that is collected from a robot because we have this whole fleet of memory developers. So our interest and our users interests are almost perfectly aligned. We want feedback attacks. We don't necessarily need the data from your homes.

[Caroline Hyde]

Bloomberg Tech executive producer Jackie Lopez has come in with probably the most important question of the day, which is will it come with the hat and why does Memo have a Hat for me, probably a more important question, particularly because it's not bipedal.

[Tony Zhao]

Right.

[Caroline Hyde]

Is what are you going to charge for it and how are you going to charge? What's the model?

[Tony Zhao]

Yeah, I think the way we think about the robot we built is almost a perfect example of mvp, which is a minimum viable product that we try to simplify, we try to lower the cost. So in the beginning when we sell it, we're going to sell it for around 10 US dollar. But just like personal computers, just like phones, it will get cheaper over time.

[Caroline Hyde]

It comes with the hat.

[Tony Zhao]

Yes, the hat is really interesting because we essentially imagine a world that the robots are everywhere, the ubiquitous. Right. And we really want to make eye contact with the robot. And instead of putting the cameras inside the eyes of the robot, we essentially hide it underneath the hat so it looks a lot more natural. You can make eye contact with it.

[Ed Ludlow]

It's cute. Tony Zhao, thank you. CEO Sunday. Come back, tell us how that testing in the wild continues. Investors have been clamoring for early access to share shares of private companies like Space x before their IPOs. But they're turning to the wild world of special purpose vehicles or SPV's. They act kind of as a middleman structure whose main asset is shares of other private companies. But there are some questions around who really owns the stock or if it even exists. Bloomberg's Bailey Lipschultz joins us some more. And you really do this wonderful deep dive. Not every SPV is born equal. Some are more questionable, more comfortable than others. But what's amazing is that sort of co founders of Anduril or the hottest IPO candidates are getting sent, well, SPV terms that they know they haven't issued shares to.

[Ben Walter]

They know they haven't issued shares to. They're very, they're a company that is very outspoken about pushing back against these and just kind of the potential fees and they're if you go on X, Palmer and Matt are very vocal about not wanting this to be a thing. And the big question is if there's a market, why aren't people investing in it? And it goes to the whole debate about capitalism, Right. If you are willing to take on these fees and willing to take on the risk to buy and are at two and a half times its latest funding round and pay a fee to a manager, from the management perspective, why not? They're offering the deal. And from the investor perspective, hopefully you did your due diligence.

[Caroline Hyde]

Bailey, to quote the great Shrek, can much like ogres, SPV can Have layers. That was good layers, Donkey. And that within it buries a very complicated web of extra fees. And what Carol is talking about understanding within those layers, if the stock's even there at all in the end, if there is actually ownership of real cap table position in a private company.

[Tony Zhao]

Yeah.

[Ben Walter]

And I think that goes back to, to the question of if you're invested in a co, invest on the cap table in an spv, a so called clean spv. Congratulations. That makes all the sense in the world. If you're being pitched an email that's saying, hey, pay me 2 in 10 for access to this SPV. But that's on top. That SPV is investing in another SPV that's charging another 2 in 10 and that's investing in another SPV that's charging 2 and 20. Well, congratulations valuations. Even if those shares do exist, which there are questions around that, if there is a liquidity event like an IPO or a sale, you may be thinking that you're only paying the initial fees, but in reality what you end up getting distributed is much, much smaller because of those carry fees in that management fee.

[Ed Ludlow]

Look, FOMO inspires a lot of bad behavior. And already you started to see bad behavior in this. There is fraud or at least allegations of fraud.

[Brody Ford]

Yeah.

[Ben Walter]

In one person settle those charges. Allegations of fraud that the shares never actually existed. So cold outreach, wire me your money. And even though I'm promising you not providing those documents, that I actually own the shares of said private company or said fund, I'm putting it in my bank account. And we have seen settlements already. And the more people I talk to, the more this is potentially the tip of the iceberg because you don't have these issues come to light until there is a forced event. So when there is an ipo, when people say, hey, looking for those Space X shares I owned? Well, maybe they don't end up getting transferred to your account. And that's where the issues show up.

[Caroline Hyde]

Schultz with the big take. Thank you very much. That does it carry for this edition of Bloomberg Tech, Your father in law

[Ed Ludlow]

should come in all the time. On fire at Ludlow today. On fire. Don't forget to check out our podcast. You can find it on the terminal. So it's online on Apple, Spotify and I heart this is Bloomberg Tech.