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This podcast is brought to you by Wise the smarter way to manage your money internationally if you're getting a headache from juggling different currencies and different bank accounts in different countries, there's a better way to receive money in the currency you need without the slow transfer times or hidden fees. Meet Wise, the savvy way to handle your money internationally. Hold balances in up to 40 currencies with the mid market exchange rate on every conversion. Whether you're receiving payments from tenants abroad, earning as a digital nomad, or converting dividends from your international investments, the Wise Multi Currency account is for you. Be Smart, Get Wise, Download the Wise app today or visit wise.com Terms and Conditions apply. Bloomberg Audio Studios Podcasts Radio News.
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Bloomberg Tech is live from coast to.
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Coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.
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This is Bloomberg Tech. Coming up, President Trump seeks, quote, immediate negotiations on acquiring Greenland for national security reasons. We'll recap his speech in Davos.
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Plus Netflix shares they drop on spending to by Warner Brothers Discovery and Zipline.
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CEO Kelly Clifton joins us to discuss the robotics startup's new $7.6 billion valuation and expansion.
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First, we return to these public markets that actually bounce back somewhat on the walking back from the edge of President Trump. The idea that Greenland will not be something that is taken by force. European stocks rally from their lows. We see in fact the NASDAQ 100 now up 1.4% as the mood music changes. But there are real details in which industries benefit which are pulling back from this significant speech over at Davos. We're looking at The S&P 500 now up a percentage point. But really Ed, we have to get to the details of that speech we just heard.
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D
Yeah. And here to recap it always Bloomberg Surveillance co host Annmarie Horden, who is out in Davos. The central feature of the President's speech was Greenland. Not just ruling out the use of force AMH in acquiring Greenland, but the commitment to continuing on that path. What do we need to know?
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C
The President made it very clear he doesn't want to use force. He won't use force. And he talked about how he is coming here to have intense negotiations for the United States to acquire Greenland once again. So coming into this, you had the Europeans really feeling like this was an existential threat. This has really taken up all the oxygen in every single meeting room you'll attend or dinner on the sidelines of Davos, Switzerland. A lot of criticism pointed towards Washington because of the President's rhetoric regarding Greenland. But he came here with some thinking, maybe was just to negotiate. And that's exactly what we did. And we've seen the President used this tactic before in the past. In the first term, there was so many leaks about maybe the United States would leave the Naito Alliance. At the end of the day, Naito came to the position the President always wanted it to, which is to spend more on collective defense. Another time this happened, of course, was more recently, last year during Liberation Day. This is what the Treasury Secretary spoke about earlier in the week here at Davos. He said the hysteria around this is like Liberation Day. Everyone needs to take a step back, take a deep breath. That was what it feels like now. The President anchored this debate, negotiation, dialogue, what you may want to call it, to the extreme, and is now here for some sort of potential negotiation. Of course, we need to see how this goes. The President did say he will be having bilateral meetings with European leaders, so we'll see what comes of this. But it does seem to be like this has taken the tone of the rhetoric down a notch.
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A
And yet he chastised European leaders, particularly around energy. And we think here on the technology show about the nuclear commitment. That was something he talked of. Nuclear stocks react. We also hear a lot about the Golden Dome. What took your attention, Amari?
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C
Yeah, the Golden Dome has been linked with this administration to Greenland. They also spoke about the fact that Canada wants to be a part of this Golden Dome. This would be able to shield ballistic or cruise missiles into the United States before launch or during launch and be able to defend the United States, Canada. And they think Greenland is important for this. And that has been one of the issues they have been pushing. The President also talked about the fact that Greenland is just important in general for national security when it comes to Russia and China. On that front, the president did say he also will be sitting down with President Zelensky. I spoke earlier with his special envoy, Steve Wyckoff, who said he was going to Moscow tomorrow to meet with President Putin and alongside Jared Kushner. And then also he'll be having another meeting with Ukrainians this evening. So potentially also are getting closer to some sort of peace agreement when it comes to Ukraine. And that is critically important for the Europeans. And I bring this up because the Europeans felt like Greenland has just been sides an existential threat to them, a distraction for some of those really important negotiations taking place regarding the future of Ukraine.
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Bloomberg's AnnMarie Holden, long days in Davos. We so appreciate it. Thank you. Now let's return to tech and the earnings release of Netflix. You'll see that shares, they're sliding. They're down by the most in the month at the moment. The company delivering disappointing profit forecast for the current quarter. And that's the spending is mounting. Let's get more Bloomberg's entertainment editor, Felix Gillette. And look, the 76 cents a share for the fiscal quarter we're currently in, that forecast is below expectations. But it's Warner Brothers Discovery and its programming they spend on.
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B
Yeah, I mean, I think investors have every reason to be concerned about spending at this point. I mean, it's not just that Netflix is pursuing the biggest acquisition in the company's history, but they're also said yesterday that they're going to be spending more in 2026 than they did in 2025 on programming, whether it's TV series or movies. They spent about $18 billion last year. They're going to be up to about $20 billion this year. And yeah, they have a lot going on, whether it's live sports that they're continuing to expand in. They've got this whole podcasting thing they want to do. They've been talking for a long time about trying to ra video game efforts. So, yes, spending is a concern moving forward.
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D
Felix, you'd think that the Warner Brothers Discovery deal would be the be all and end all of that earnings call. But what executives are talking about with these attractive investment opportunities which seem to suggest buying properties, you know, catalog. They've looked at Sony, for example, for movie rights. Did we learn any more about how aggressive Netflix is going to be in acquiring more ip?
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B
I mean, what we learned is they see the competition as being incredibly fierce out there. You know, talking about, you YouTube talking about competition from, you know, other places like Instagram, TikTok. And I think from that Netflix's perspective, they can't have enough library franchises content. They really become this all service for all different people in the family. And to do that, you know, you kind of work on sports, you got to work on topical programming. You have to have dramas, comedies, boxing. So they're really advanced in all fronts. And yeah, I think they, you know, are kicking the tires on every library as it comes up. I think what they said is that, you know, with Warner Brothers Discovery, once they looked under the hood a little bit, they really liked what they saw and that's when they decided to move forward aggressively.
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A
And it rather serves Netflix to be talking about competition in those fields, particularly if they want to get regulatory approval for the deal with Warner Brothers Discovery. Remind us where we are on that deal, Felix, because September, because the 21st of January was going to be a key date.
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B
Yeah, I mean, so Netflix came back yesterday. They had, they amended their offer slightly. It's now an all cash offer before it was cash and stock. And so, yeah, they're moving forward. They'll put it in front of Warner Brothers Discovery investors sometime in the spring before the annual meeting. At the same time, Paramount hasn't completely gone away. You have David Ellison still breathing down the neck with the tender offer, you know, still trying to keep them in play. I think Paramount, everyone's waiting to see if they'll raise their offer. In the meantime, Paramount seems to be saying, oh, well, you know, Netflix is going to have all these regulatory issues to your point. That's why, you know, Netflix has had this talking point about, oh, we don't just compete with other streamers, we compete with all these tech companies and social media, all these other broader competition field. So that's been one of their big talking points. And also of course, that, you know, they believe suddenly in theatrical releases of movies and that they'll plan to continue to put Warner Brothers Discovery movies in theaters for the 45 day window as they are now.
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D
Bloomberg's Felix Gillette with the Netflix breakdown. Thank you very much. Let's stick with Netflix earnings. Helena Wang, research analyst at Philips securities, says the company is, quote, in an ideal position and has an accumulate call on the stock. She joins us now. Helena, why then is Netflix in an ideal position? What are the data points that you point us to from that earnings call and earnings print?
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Hello.
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E
Thank you for having me. I guess to start off just diving straight into their financials. They have very strong financials so they do have a beat on both the top and bottom line. And that is not just for the fourth quarter, it is also for the entire year. So overall numbers look very solid and that is the actual organic volume coming. So people are actually engaging and paying for the services.
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D
Helena, like all analysts, you're trying to model for what happens next and you put things in the pro column and the con column. Where does this situation with Warner Brothers Discovery fit into which column?
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E
Well, I guess it really depends because for Netflix right now, they're clearly in the leader position in the streaming business. So even compared to their closest robbery, Disney, they have a much bigger membership base and they stop reporting the numbers. But they did disclose in this earning that their membership is 325 million. So that and their monetize its business almost twice as better. And with less than 10% of the total TV viewing, there's still a huge Runway for growth. So this Warner Brother deal, it really comes in. So the question for 2026 is no longer whether they're going to be able to continue their growth profitably, which they have been doing. So that's almost 100%. So the question really coming in whether they're going to be able to to integrate such a big company without sacrificing in their margins. So that is the question that's coming in.
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A
Yeah. And for this fiscal quarter, it looks like margins come under pressure. So do stock buybacks. But they said look in the longer term they're committed to margin increase. Helena, I'm looking though at the stock that's the lowest since January of last year. How confident are you and the investor base that they can not get distracted during this M and A process and indeed interweave it? Well, if they manage to clinch it.
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E
While the operating margin guide is seems to be a little bit light for the next quarter, they've guided 31% while the consensus was 32 to 33%. So there is a question of whether we will be expecting its operating expense to expand further. But I guess what my view is they might want to guide more conservatively at the start of the year. Given all the uncertainty of the war the deal, they're leaving more scope to outperform expectation as the year progresses. So I do believe there is a little bit of wiggle room in terms of margin.
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A
For years, I mean, investors just haven't liked the idea of them making this purchase. Really since the minute they put their hand in the ring, shares are off by about 30%. Should they be buying this asset? How Integral is it that they buy this storied Hollywood asset?
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E
Well, okay, I would like to point out that financially they're very strong. So they don't necessarily need a merger to survive. So it's not necessarily a lifeline for them. So from the Netflix point of view, it's more of a power move for them to aiming at total dominance. So all power move sort of needs to come with a sacrifice. So the fact that they are making the decision to expose themselves with such risk means they are confident enough with their growth, with their financials to make such progress decisions.
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D
Helena, for the last few years, several years, Caroline and I have been told constantly that in this streaming race, content is king. So why Netflix not getting more support, particularly in the stock, for just going out there and being aggressive to keep the library growing, having more content?
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E
Well, I guess right now because they already don't have a competitor in terms of the streaming business business, they already have a very strong content slate. The 2025, we got all the squid game, Stranger Things one Wednesday. So all these are very, very popular. And 2026 lineup is also very strong. So they have this incredible ability to have the amazing content with more to come and still have very impressive traditional financial metrics. And if you realize their bottom line growth is much higher than the top line growth, this is because your business itself is a very mature efficiency machine. Because if you think about it, their cost of making the content available is somewhat fixed. We get 2 billion people P2 million people watching or 200 million people watching it. So the more engagement they get, every new dollar that comes in flow almost straight to the bottom line. So this is why they already have very outstanding profitability, so they can afford to expand more aggressively into a bigger total dominance.
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D
Helena, which piece of this Warner Brothers Discovery proposed transaction interest interests you more? The studios or taking HBO Max and doing something with it?
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E
Well, I think it will still be the HBO Max, because HBO Max right now is still considered the fourth biggest streaming company. So with HBO Max together adding up together, they will essentially have more than 450 billion subscribers. So that is more than almost more than half of the streaming industry. So that would definitely give the entire monopoly in that field.
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A
But Helena, I look at Mr. Beast, who has more than 450 million subscribers on his YouTube platform alone, let alone the dominant force of YouTube. So how do you see the market and who their competitors are?
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E
Well, I guess that is exactly why they wanted to explain more to the field because they've already reached almost a monopoly leader position in the streaming business. So they're looking to expand into something else because the entertainment industry is always forever changing. So they're always trying to make sure that they have a foot in the ring before the environment changes.
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A
Helena Wang of Philips securities staying up late for us in Asia. We so appreciate you having time for us on the show. Thank you. Now let's turn our attention to Nvidia's Jensen Huang. He plans to travel to China as he works to reopen a crucial market for his company's AI chips. For that next, this is Bloomberg Tech. Every day millions of customers engage with.
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A
We're going to be listening now a little bit more to what's been being said across in Davos. In particular, we've been hearing from the CEO of Nvidia, Jensen Huang, who is being interviewed by Larry Fink himself, talking about the trillion dollar opportunity that continues and indeed where we might indeed see job losses or not. Let's get out to Bloomberg's IN King who covers all things semiconductors right now. And in let's talk a little bit about what's been happening, happening in terms of Jensen and where he sees the opportunity and scale needed for AI. You've been saying more broadly that, well, this is a no brainer and that he's been saying this time and time again.
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F
Yeah, I mean, he's traveling around the world preaching basically to whichever audience he can get in front of and trying to convey the message, I mean, kind of Last night for US time as message was look, hey, AI is going to change the economy. But, but listen Europeans, you don't need to worry about regulating AI too much because it's actually going to help create certain jobs and make certain jobs stronger. And again he's delivering a very nuanced message but everything is designed to ease the passage of AI.
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D
I think it's really important to point out despite the news headlines and articles written, none of this is new, particularly the point that the investment in infrastructure will generate skilled labor jobs, jobs plumbing electricians for example. Also there were no questions put to him in an extended on stage conversation about China. But Bloomberg's reporting citing sources that he will go to China. That is in and of itself quite a normal thing for him to do. But what do we need to know about that?
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F
Yeah, I mean always at this time of year, as you know, we have the, you know, the, the Chinese New Year and he'd like to go to Taiwan, he likes to go to Beijing and to sort of look after his, his employees. They have parties and things like that. Previously when he's visited China, he has managed to have meetings with senior officials. We don't know whether he's going to do that this time but obviously if he could then it's really important to get Beijing to sign off on just.
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D
One quick introduction team which I apologize for. Remember that he only told me two weeks ago we don't speak directly to the Chinese government. Our communication is through the company companies. But sorry, carry on in.
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F
Yeah, whether he does directly or whether he does it through intermediaries getting sign off on those H200 chips which the US government has said, hey, it's okay to an extent to send them to China. Getting China to accept them is going to be key and that will be something that you know, our audience will focus on heavily.
- [20:10]
A
And of course all of this access to China is something he's been talking about as a total, total addressable market of at least 50 billion in this fiscal year alone. I just want to go back to what he said at Davos yesterday when being in discussion whether we call it an interview with Larry Fink. China wasn't on the agenda, but certainly the size of the market was. Just take a listen.
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This is the largest infrastructure buildout in human history.
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F
That's going to, that's going to create.
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B
A lot of jobs and it's wonderful that, that the jobs are related to tradecraft and we're going to have plumbers and electricians and construction and steel workers and Network technicians and people who install and fit out the equipment. And all of these jobs we're going to in the United States, we're seeing quite a significant boom in this area. Salaries have gone up, up nearly double. And so we're talking about six figure salaries for, for people who are building.
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F
Chip factories or computer factories.
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A
Now we've heard Palantir CEO Alex Karp talking about the death of humanities, but the study of vocations and how long do those sorts of jobs last? You're a man who knows significantly what the data said to build out looks like many would say electricians. Well, they're going to in the short term. Any.
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F
Yeah, I mean it really depends. This is all about focus. If you're Jensen Wang, you want the focus on the economic benefits of AI. You want everybody thinking about how this is going to propel the economy forward and help everybody. You don't want people thinking about questions like the one you just gave me and also about the amount of jobs that maybe go away because of AI. So this is a, this is like a hey, look over here type of directional kind of assertion that he wants to make. And for the foreseeable future we are going to continue to see these massive.
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A
Build outs inking across all things in video. As always for us, we appreciate it. Matter. Well, it says it's looking to boost its online safety features as Europe weighs tougher rules and the possibility restrictions on social media platforms for young adults. ReMax Francine Lacqua sat down with Nicola Mendelsohn, who leads Matters Global Business Group, to talk about new teen accounts designed to give parents more control. Take a listen.
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B
Keeping young people on, safe on our platform is incredibly important to us. It's an absolute priority and we've been investing in this area for a number of years. It's why we launched teen accounts back in 2024, to keep young people safe, to give parents supervisionary controls so that they can also work with their children, their young people in terms of keeping them safe. So what does that mean? It means restricting the amount of time that they spend on the platform. It means that they can restrict who comes on and we place them all in that, in that category automatically. So this is very important. But of course we're going to work with regulators wherever they are. Do you think the ban will come through? I'm not going to speculate, I'm not going to speculate with you on that. So first off, we use AI when it comes to people on our platform to see more of the things that they want to see. So we have growth across all of our different platforms, which is fantastic to see. Then we have the Advantage Suite, which is very simple. I mean, some of the practices that you used to do took 150 different steps. Now you can do it in one step. We also see more and more the increase in our generative AI tools, how they can use it for text, for translations, for even the creation of video. Now we have over 2 million advertisers doing that. So all these things are combining alongside both reels as well to really give growth for our advertisers.
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C
What do you think is still untapped in your mind?
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B
Oh, so many things. I mean, that's. I've got a whole smorgasbord of things. So definitely messaging. We're seeing a continuous uptake in more personalized communication between businesses and people. There's now over a billion messages sent every day between people and business. Businesses. We see 8% of people around the world, globally, that are speaking with a business every single week. So this is an area both on the marketing side, but increasingly more on the utility and the authentication side. A good example is Air France. So Air France, when they switched this on, within a few days, it became their primary source of communicating with their customers and they're doing it to deliver boarding passes. Tell you about what, your baggage is also remarketing as well. So that's a very good example of some of the changes that we're seeing.
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D
That was Messi's head of global business, Nicola Mendelsohn, speaking with Bloomberg's Francine Lacroix. Let's get back to Bloomberg Surveillance co host Annmarie Horden, who's standing by in Davos. Emery, thanks so much.
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C
And I'm now joined by the Dutch Prime Minister, Dick Schoof, an individual who's really at the center of what's going on with Greenland, as well as someone who's really important to the United States when it comes to national security. Regarding China, I want to start with the President's speech, though you were one of those countries listed potentially more tariffs. The President said he's here for earnest negotiations. What did you make of his speech? Are you feeling more relaxed?
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F
Well, I think it's good that he used the word negotiations. And I think we share the common interest of security of the Arctic, and I think we should work it out in NATO and then make sure that the security of national security of the United States, Canada and Europe or will benefit from it.
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C
The President also used the words, I don't want to use force. I won't use force. So when you say you're looking forward to the security of the Arctic kind of agreement, do you think Washington can come to with the continental Europe?
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F
Well, that's difficult to say, but I think American presence on we already have a base and I think we could intensify that also with European troops and then fairly close together for the security of the Arctic and try to prevent influence from Russia and China in the Arctic.
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C
Do you think this means the trade threat is over the higher tariff levels?
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F
Well, not yet. And I think we have a European Council tomorrow evening and I think we should step up and make sure make very clear that this is it's unjustified. It makes no sense to use trade tariffs to achieve security goals and we have to push back. But in the meantime and ready to act on it as a European Union. But at the same time, use the time in between for diplomatic efforts because I think we should solve this diplomatically.
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C
How has Netherlands been involved in that diplomatic outreach to the Trump administration?
- [26:44]
F
Well, we are involved in the EU and we are involved in a lot of ways. And of course the Secretary General of the NATO is also a Dutchman.
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C
We saw the leaked tax.
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F
Yeah, yeah.
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C
Are you aware of that? I mean, do you feel like if you tax X now a US Official that it might become, you know, public knowledge?
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F
Yeah, no, I don't think anybody expected that. But anyway, it happened. But I think we are involved because we are always have a very strong transatlantic bond. We have a big trade relationship with the United States. We consider the United States is a big friend of ours. But at the same time, I mean that's not the way we have to to create a friendship with import tariffs that's fairly dependent difficult.
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C
You are sounding optimistic though that there is an off ramp. Do you think the European Union should use the anti coercion rule?
- [27:30]
F
Well, we should look into every measure we can take if the input tariffs are being implemented the 1st of February. But at the same time we should try to prevent it from happening and find a solution for the Arctic security.
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C
Right now you're joining me. It's the evening in Davos, but it's very early on the West Coast. The Bloomberg Technology show in and one company they do track is asml. It's a huge chip maker. It's really a crown jewel of Europe. You recently met with the chief executive officer. What is your sense of what is going on in terms of chips to China and the national security framework? Because we saw the United States has had A lot of almost ups and downs in terms of what they will allow go to China and what they won't.
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F
I think we should more align and I think that ASML is delivering a lot of machinery for China in the lower end chips and I think that's good business for ASML and in that way they can really produce the top notch technology that we need in the west. And I think that's also important for, for the U.S. so I think ASML is a crown rule of the Netherlands and the whole ecosystem around ASML is very important and we should cherish.
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C
What was the assessment you recently met with the CEO I believe this week. What was his assessment on how it how having to really walk this tightrope between Washington and Beijing and then you.
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F
Have to walk also the tightrope with the Netherlands. Right.
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C
So but I'm guessing that one might be a little bit easier. But maybe not all politics is.
- [28:54]
F
But, but yeah, but we have our own arrangement when it comes to national security. But I think he knows very well that, that it's not about top notch technology that's going to be shifted to, to Beijing or to China. So we have to discuss all kind of issues related that we make it possible for ASML to earn money in China as well and make sure that they create a top notch technology for us, for Europe, for United States.
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C
Last year when you joined Bloomberg, you talked about how under the Biden administration there was concerns about national security comes to chips to China and you expected that to happen under the Trump administration. But with all this hot rhetoric from the Trump administration regarding Greenland, do you think that has made it more difficult to align yourself with Washington on national security for a key adversary like China?
- [29:44]
F
Well, I think on China is maybe more easy because we are more aligned and of course we have all our trade interests and also the US has a strait interest. So it's different than for other issues. And I really hope that we can make arrangement around Greenland. I really hope that the US will back us up in the peace process in Ukraine because it's still going on and at the same time we have to take care of national security issues related to economy. I mean it's just what it is in the world of today.
- [30:15]
C
The Prime Minister of Canada, Mark Carney had a pretty spicy speech yesterday, provocative for some individuals. The President made a nod to it today. He didn't mention Trump by name, but many individuals took it as he was signaling to what is going on in the United States. And he said if you are a country in the Middle, if you're not at the table, you're going to get eaten. And he said the world order we live at now is dead. Do you agree with that assessment?
- [30:36]
F
Well, the world order certainly has changed and I think it's an illusion to think it will come back to the days that I grew up. So we have to adapt to the new way in which countries, I mean, it's got China, we've got the United States, we still got Russia as a military power, we've got upcoming countries. So we have to adapt as Europe. And I think Europe has to get itself stronger economically, but also on the defence side within NATO. But we have to work much more together and make sure that the European Union is a real economic union and that Europe is really a defence force to reckon with.
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C
And Prime Minister, your life is changing. You're going to be leaving government. How is the formation now of the new government?
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F
Well, it's on track and they expect to be to be inaugurated at the end of February, but the negotiations are still going on.
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C
And what are your plans?
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F
Yeah, well, I'm officially already retired. Congratulations to you. Yeah, yeah. In a few days I will be 96. Do I say it correctly? Yeah. Oh, 69. What is it?
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A
69.
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F
Anyway. Yes.
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C
You're definitely very much younger.
- [31:45]
F
69. Yes. But of course, I hope to. I worked for a very long time as a civil servant on all kind of key positions in security. So I hope to get my experience and my knowledge and to, to, to make it valuable for people and you.
- [32:02]
C
Can come share that with us on Bloomberg tv.
- [32:04]
F
Oh, that's great.
- [32:05]
C
We thank you so much for your time.
- [32:06]
F
Thank you.
- [32:07]
C
That was the Dutch Prime Minister Dick Schoof there. An individual who is really. His country's at the epicenter when it comes to Greenland. They're one of those countries labeled by the Trump administration potentially more tariffs and they don't get access to Greenland. The president really tempered that rhetoric though, today, had his speech, which is giving a little bit of life, breathing some life into this story for European leaders to have a sigh of relief. But also when it comes to export controls and chips going to Beijing, ASML.
- [32:34]
A
Key for our audience. Great to have you and that interview. Thank you, Anne Marie. Let's stick with Davos coverage. Salesforce CEO Mark Benioff is striking a more cautionary note on AI technology, saying reports of teen suicides linked to AI should be a wake up call on unregulated AI. He spoke with Bloomberg's Emily Chang. Take a listen.
- [32:55]
B
We are dealing with a New kind of very unwieldy technology which by left by itself, these large language models, they can do all kinds of terrible things. I mean, they can do a lot of great things too. You've used them, you know, they can summarize things and you can ask them queries and you can get information. But unfortunately, we saw this year this horrible example or this company, character AI specifically started to find that their product was turning into a suicide coach for their customers. And one of the most horrific things I've ever seen in technology is these children, you know, died and it was completely unnecessary. And I think it needs to be a wake up call that, you know, we're letting all of this AI technology out fully unregulated. And by the way, you remember that's true what we did with social media as well, and you probably remember what I said in 2018 here, you know, which was social media was becoming the same kind of very dangerous technology. And look, a lot of governments have made changes around social media now. So you go to a lot of countries, if you're not 17, 18 years old, you're not going to use social media. There are controls, there are protections, decisions. We need to get there with AI now. There doesn't need to be any more deaths. You know, we need to be like taking this seriously. And AI is great, it's incredible. But these models, you know, they're inaccurate, they hallucinate, they're kind of hard to control.
- [34:20]
A
What should we do? I mean, should CEOs be held personally liable? Should? I was talking to Dennis Hassle, this CEO of Google DeepMind, and he asked, look, if we knew every company in every country would pause, should we pause AI so society and regulation can catch up? And he said yes, he would be in favor of that.
- [34:39]
C
Would you be in favor, Emily?
- [34:40]
B
Number one, tech hates regulation. You know that they hate it, right? They get people on, oh, it slows down innovation. They hate regulation. They hate it, they hate it, they hate it. Except one regulation. They love section 230, which basically says they're not held responsible or accountable for these deaths or for anything that their social media or their AI does. And that needs to change.
- [35:02]
D
There was Salesforce CEO Marc Benioff speaking with Bloomberg's Emily Chang.
- [35:08]
B
Did my card go through?
- [35:10]
E
Oh, no.
- [35:11]
B
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- [37:17]
A
A crucial speech from the President of the United States in Davos eases some of the tensions in the market. We're now up 8.10percent on the NASDAQ 100 having had on the broader markets in the S and P the worst day since April yesterday. Now we bounce back a little bit. We've seen a halt and slides on bonds on crypto as well as the President says he would not be wanting to use use force when it comes to his attention on Greenland Nasdaq if you look under the hood and video is your biggest points contributor to the upside. To the downside, it's Microsoft and this name Netflix currently down by some 4 percentage points. We had been lower earlier in trading and that's after we saw well profit forecasts disappoint the market after we got its earnings. We look at what Bloomberg Intelligence has been writing and it's calling quote the M and A noise also driving investor sentiment. I'm Pleased to say Bloomberg Intelligence is. GitHub Raginathan is here with us. So either the M and A noise is also M and A spending and that seems to be where the margin is getting a knock.
- [38:15]
C
Yeah, that's exactly what it is, Caroline.
- [38:17]
E
And so we saw for the first.
- [38:18]
C
Time that, you know, content cost is actually going to be higher than expected. 10% content cost growth is what they're forecasting for 2026. You comp that to about high single digits in prior years. And really, I mean, this is just a microcosm of what we're seeing on a much bigger level with the whole $83 billion acquisition of Warner. They're basically paying for content. They're basically paying to keep that engagement level up. And I think what was a little bit disconcerting from, you know, there was obviously a lot of nuance in the earnings report, but what we saw was, you know, engagement growth. Yes, you know, it did grow, but, but by very modest amount, only about 2% the whole year. And remember, this was a year where they really had blockbuster content. I mean, whether it was Stranger Things or Squid Game or K Pop Demon Hunters, I mean, this was the year when we should have seen a much bigger uptick in engagement growth, which kind of really then leads us to the fact that, you know, this is why they need to buy Warner and this is why, you know, you have that acquisition.
- [39:16]
D
Geetha, in the time that we've come on air here on Bloomberg Tech, Bloomberg's reported that the EU is going to probe both the Netflix and Paramount bids for Warner Brothers discovery in parallel, which is a somewhat unprecedented approach for two companies to go head to head in the context of a regulatory probe. What is the regulatory risk on this to you? You know, I know that you're trying to model for what happens next. And I always ask you, hearing an Ethan, what happens next?
- [39:43]
C
Yeah, regulatory risk definitely is a big one there and definitely much higher for Netflix compared to Paramount. Especially as you look at the streaming concentration in some of the European markets, you just look at the basic size of Netflix subscriber base, it's about 325 million. Combine that with about 125 million with.
- [40:02]
B
You know, Warner Brothers again, you have.
- [40:04]
C
450 million and some of those European markets, that risk is really, really high. It's high even in the United states at about 35, 40%, but definitely higher there. So antitrust is definitely going to be a huge part. Apart from that, you also have the financial risk. I mean, is this going to turn into a really ugly bidding war. So that's also something that we're kind.
- [40:24]
E
Of on the lookout for.
- [40:26]
D
Keith Oranganathan from Bloomberg Intelligence, great to have you back. Thank you so much. Let's turn to the private markets. Drone delivery startup Zipline has closed a more than $600 million funding round down, putting the company's valuation at $7.6 billion. Kelly Clifton, Sipline CEO co founder, joins us now. It's a big jump in valuation, although I don't think you actually ever disclosed the 2024 round that put you a pretty significant valuation of 5 billion. Anyway, there is a lot of interest in this color. And why did you raise the funds? What are you going to use them for?
- [40:57]
B
Well, I mean, you know, we spent most of last year expanding the service aggressively in Dallas. This, it's been an amazing place to, you know, for, for almost a decade, Zipline operated mainly outside the US and last year there was basically regulatory progression in the US that allowed this technology to start serving US Citizens. And what we've seen is just like explosive growth and basically infinite demand on behalf of customers. I mean, it turns out when you design delivery where anybody can pull out their phone, order anything they need, have it delivered to their home in less than 10 minutes, people use that service a lot, like 10 times as much as we've seen usage for traditional delivery services. And so yeah, this funding round is going to allow us to start announcing new metros. Today we're announcing that we launching Houston and Phoenix over the coming months and then we'll launch every quarter that comes now we'll add new metros to the overall network.
- [41:49]
D
And what's the scale of those launches at first? Right. That you know, know when I shared some of the data that you put out there on X, there was a lot of interest on the rate of expansion. You know, the headline is, is 2 million deliveries. But if you think about what we're talking about, last mile delivery, that's just a tiny fraction of what a delivery van will do. How real is this?
- [42:09]
B
I mean the, the data that we're seeing again just in a single Metro in the U.S. but the data is mind blowing. I mean, we have municipalities in Dallas where just on Sunday, 10% of homes placed an order with Zipline in municipalities. So it's like, you know, we have certain cities where more than 50% of homes are engaged zipline customers. So this has definitely gone from like science fiction to completely normal and something people depend on day in and day out in just a few months. Yeah, the service has been growing about 15% week over week over the last year.
- [42:43]
A
Kind of what's the unit economics of, of it? How much are you having to spend on each of these deliveries?
- [42:50]
B
The, the advantage shouldn't be that surprising, but actually I think people may not realize when you're talking about instant, normal, instant delivery. We're using a 4,000 pound gas combustion vehicle driven by a human to deliver something to your house that weighs five pounds. It's actually a super expensive solution. This is the reason that there are so many fees. And then you know, tip on top of up, autonomous systems are going to be less expensive 10 times as fast, plus their zero emissions. So these kinds of systems are already cost comparable today. They'll be significantly less expensive in the future.
- [43:22]
D
There is a lot of interest in this particular funding round because some of the names involved are the hallmarks of a pre IPO round. Some anchor or tenant investors. Is that a fair assumption to make?
- [43:36]
B
I mean Zipline has been really lucky. I think that there's a lot, you know, we've been building this company for 12 years, but I think it's finally kind of obvious that robotics is going to remake the planet over the last. I mean I think it's going to transform a lot of economies and logistics is one of the most obvious places where automation and robotics can have a huge impact. It can improve service, improve reliability and it's something that people are going to depend on day in and day out. By the way, it can also create a lot of high paying jobs, jobs in the United States, both on the manufacturing front as well as like maintenance. We're building out complicated new kinds of infrastructure in each of these cities. It's the reason that every city has been so excited to have Zipline come. It's creating high paying jobs we're investing in, in the, in each of those cities that we're launching.
- [44:20]
A
Not sure that was an answer as to whether you're going to be ipoing or not, but I go really more to color the fact that this is a global company. We're looking at your drones delivering food. But it's really about medicine and health and in particular over in Africa. Can you talk to us about how much of the scale of the business is that?
- [44:38]
B
Well, yeah, Zipline, you know, when we started the company, what we do, what we do today was illegal in the United States. So not, not an ideal pitch for investors. But this was the reason that we initially partnered with the government of Rwanda. You know, Today Zipline serves 5,000 hospitals and health facilities across the world outside the US or a huge, huge health care logistics network. We've now done 135 million commercial autonomous miles with zero safety incidents. And the system is saving about 17,000 lives a year, predominantly moms and kids. One cool thing, just this week we announced a new national scale partnership with the government of Rwanda. We're going to be dramatically expanding the number of use cases, building a new distribution center, and for the first time ever, Zipline is bringing its next generation technology, which we call platform, to, to the continent of Africa.
- [45:26]
D
Kind of those regulatory changes you were talking about were the President's EO in June and then later in the summer, the line of sight rules. Right? This is all in the context of. This is all in the context of the President's focus on this as a national security priority. I hope this question doesn't shock you, but how is it blind thinking about literally weaponizing the technology, its use in defense use cases, conversations with the President.
- [45:54]
B
Well, the great news is actually that, you know, the government is trying to accomplish a lot of things. They're really focused on AI and exports and commercial diplomacy. This is the reason, you know, just five weeks ago, Zipline announced a $550 million total partnership with the State Department as well as all of our African country partners to basically make sure that the developing world is built on top of you US AI and robotics infrastructure. That's really good because it can make sure that these countries enables these countries to save money and save lives. But it is also a key way of making sure that the US can maintain its manufacturing and technology leadership for the decade to come. So Zipline is already working really closely on those initiatives. This announcement with Rwanda would not have happened without that partnership from the U.S. state Department.
- [46:36]
A
It's a big funding round, It's a big valuation. Zipline CEO Kelly Clifton, thanks for joining us.
- [46:42]
B
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- [47:46]
D
Oh, no.
- [47:47]
B
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