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- [00:00]
Narrator/Advertiser
At CES. Michael McDermott, EVP of Samsung, spoke with Bloomberg Media Studios about what the company.
- [00:06]
Bloomberg Host
Calls its next AI chapter, your companion to AI Living.
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Bloomberg Reporter Caroline Hyde
It's a shift from AI as a feature to AI as a trusted partner in everyday life. Support for the show comes from Public Lately it feels like there are two types of investing platforms. Some are traditional brokerages that haven't changed much in decades, and others feel less like investing and more like a game. Public is positioned differently. It's an investing platform for people who are serious about building their wealth on public you can build a portfolio of stocks, options, bonds, crypto without all the bugs or the confetti. Retirement accounts? Yep. High Yield cash? Yes again. They even have direct indexing. Public has modern design, powerful tools and customer support that actually helps go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market ad paid for by Public Holdings Brokerage Services by Public Investing member FINRA SIPC Advisory Services by Public Advisors SEC Registered Advisor crypto services by ZeroHash all investing involves risk of loss. See complete disclosures@public.com disclosures small businesses are.
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Bloomberg Reporter Natalie Lung
The pulse of every community.
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Bloomberg Reporter Sarah Kent
They bring people together, create opportunities and drive growth. Chase for Business helps business owners like.
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Bloomberg Reporter Caroline Hyde
You with personalized guidance and convenient digital.
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Bloomberg Reporter Sarah Kent
Tools all in one place.
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Bloomberg Reporter Natalie Lung
With that guidance and your determination, you.
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Bloomberg Reporter Sarah Kent
Can take your business farther and help build a brighter future for your community. Learn more@chase.com business chase for business make more of what's yours the Chase Mobile app is available for select mobile devices. Message and data rates may apply JPMorgan Chase Bank NA Member FDIC Copyright 2026.
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Bloomberg Reporter Natalie Lung
JPMorgan Chase Co.
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Bloomberg Host Ed Ludlow
Bloomberg Audio Studios Podcasts Radio News.
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Bloomberg Reporter Caroline Hyde
Bloomberg Tech is live from coast to.
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Bloomberg Host Ed Ludlow
Coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.
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Bloomberg Host Caroline Hyde
This is Bloomberg Tech. Coming up, the US Defense Department adds Alibaba, Baidu and others to a list of firms it says are connected to the Chinese military, but then pulls the list.
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Bloomberg Host Ed Ludlow
Plus we keep beating the earnings from Rivian, Coinbase, Instacart, Airbnb all out with their results.
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Bloomberg Host Caroline Hyde
We'll break it all down and Anthropic completes a deal to raise $30 billion in funding, doubling the valuation of the company to $380 billion.
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Bloomberg Host Ed Ludlow
Private markets and public markets. We do it all on the show and we think about the macro data as well. When that CPI print comes in much cooler than expected and it gives life to the bond market but not so much the equity market. I'M looking the NASDAQ 100. It's actually down on week. Look, we're just inching into the green on the day. We're off of our lows. But on the weekend has been turbulent and then some. We're going to dig into the pressures that we see on software that's continuing roughly 1.3% on the week. On the week we're off by 2.3% on Bitcoin. We actually steady on the day. Ed, there's a lot to be digesting about some of the market signals we're getting. What are you looking at?
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Bloomberg Host Caroline Hyde
Later in the show, we're going to go deep on revision. You and I are going to talk about what's going on with this name. Up 20% in the session at one point, up 28% and on track for its best day since its IPO in November, November 2021. Honestly, it doesn't even matter what it posted in the quarter gone or what it said its financials would be for this year. The stock is only trading on the idea it's on track for its next generation EV, the R2, and that will go on sale next quarter. We'll have a lot more in the earnings story. This is the big breaking news of the morning. The Pentagon added names Alibaba, Baidu and BYD to a list of Chinese technology companies that it says are aiding the Chinese military, only to then take down or pull that list without any explanation. The moment that the headlines hit from the list going up, you saw the US Listed shares of those names drop. Tencent was already on the list that had been published earlier in January. This is difficult to understand. Let's get to Bloomberg senior tech editor Mike Shepherd. Shep, I hope that I explain the chronology of events correctly there, give us the fuller details. And my understanding is that Bloomberg News has also heard from the Pentagon, but they didn't have much to say.
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Bloomberg Reporter Caroline Hyde
They didn't have much to say at all in the way of an explanation about why this move, this list, this updated list, which now has 130 Chinese entities on it, was posted at 845this morning and then shortly after withdrawn. They said they had nothing to announce at the at the moment. Now, this is something that become increasingly closely watched by investors and by others who are wondering whether Chinese companies may be suffering some sort of repercussions from elsewhere in the government as well. The 1260 H list, as it's known, is seen as a precursor perhaps or bellwether to further measures that the government has taken against Chinese entities. And it's also closely watched in particular because we see the addition in this latest iteration that has since been withdrawn of Alibaba and Baidu. And those companies are making inroads in artificial intelligence. And this is a central point of contention and competition between the US And China. Right now.
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Bloomberg Host Ed Ludlow
It's a central point of contention when it comes to Open AI, we understand through a document that's been seen that was sent by OpenAI to Capitol Hill all regarding their worries what Deep Sea has been doing with their technology.
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Bloomberg Reporter Caroline Hyde
Well, that's right, Karen. This comes amid so much scrutiny on China and its advances in artificial intelligence. And OpenAI has warned U.S. lawmakers that it believes Deep Seq has been using improper methods to advance its models, especially the R1 breakthrough that we saw last year and heard so much about. What they are saying, in essence, is that Deep Seek has been using frontier models from the US and elsewhere and copying and taking those results and then improperly through a method called distillation, using it to advance its own models and train its models. And OpenAI went further to say that it has been raising these concerns. And we even scooped last year that Microsoft and OpenAI, who are partners in the OpenAI venture, had looked into the extent of distillation by Deep Seq and other Chinese ventures. OpenAI, since in this memo to Congress, is saying that it has tried countermeasures against Deep Sea, but Deep Seek is seeking to thwart those. It also noted what it called a national security risk, and that is that with Deep Seek searches under topics that are sensitive to the Chinese government, and that includes Tiananmen Square and Taiwan independence, for example, those are screened out. And you do not get the answers that you might through OpenAI and other platforms.
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Bloomberg Host Ed Ludlow
Mike shepherd on all the national security news, we so appreciate it. Thank you. Look, let's talk about OpenAI and its rival, Anthropic, because Anthropics just finalized a deal to raise $30 billion, doubling the valuation of the company to 380 billion. For more, Bloomberg Fari joins us now. What's interesting is some of the same VCs that back OpenAI are backing anthropic. But talk to us about the gargantuan valuation here.
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Bloomberg Reporter Sarah Kent
That's right. So this was even more money than Anthropic. And we were initially expecting the round went from 10 billion in initial talks to a 30 billion total. So we have a big bottom. You know, we are seeing what we have have kind of colloquially referred to as double dipping, or we're seeing Investors that maybe used to only focus on one big player in the race actually start to hedge their bets and also invest in competitors such as Anthropic OpenAI or Xi OpenAI.
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Bloomberg Reporter Natalie Lung
And that's, that's a newer phenomenon in.
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Bloomberg Reporter Sarah Kent
The Valley, I would say.
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Bloomberg Host Caroline Hyde
We also now have some confirmation of how Anthropic's business has been going.
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Bloomberg Host
Right.
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Bloomberg Host Caroline Hyde
You and I have talked a lot about how Anthropic's focus initially was on the enterprise. Tell me what the annual revenue run rate numbers are that we now have. And I guess you know the reason we care so much about this round is will this company go public or not?
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Bloomberg Reporter Sarah Kent
That's right. We're seeing run rate go up just very quickly from the last report of 9 billion to 13. We're also seeing the cloud code run rate in particular go up. And now Claude Code is their coding agent. That's been very successful. So I think that this is showing that Anthropic, even though it doesn't have the kind of consumer reach that OpenAI does, which sort of has the Kleenex phenomenon of chat GPT being the brand everyone knows in the consumer space. But that doesn't mean that Anthropic should be counted out in terms of being able to achieve some very high revenue projections and very strong growth, which of course investors like to see.
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Bloomberg Host Caroline Hyde
Bloomberg. Shereen Ghafari, brilliant reporting. Thank you very much. We have other funding news. Shield AI, which makes AI powered software to help run autonomous vehicles and other hardware like drones, is in talks to raise as much as $1 billion. Sources say the new round would double its valuation in less than a year at up to $12 billion which include the capital raised car Coming up Ed.
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Bloomberg Host Ed Ludlow
We'Ll discuss the wider impact of what's been termed the AI scare trade. The second of Clio Capital is Bloomberg. Logistics Stocks became the latest victims of the so called AI scare trade after a karaoke turned a company. Yes, I said that right. It's a semi cab platform and enables customers to scale freight volumes by 300% to 400%. Shares of C.H. robinson tumbled 15% adding to a growing list of companies where I fears business are reshaping investor sentiment across sectors. Bloomberg equities reporter Carmen Reinecke has been across the latest and I had to double, triple check that this particular company Karaoke turned autonomous vehicle business, it's actually just $6 million in valuation but it rocked market caps across the entire industry.
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Bloomberg Reporter Sarah Kent
Yeah, it's teeny tiny and actually the CEO told me yesterday that he had never Imagined sort of in his wildest dreams that they would have a day like they did yesterday. I mean their stock was up more than 20%. So we've really just seen sort of the fear of software disruption from AI trickle across the broader market into these little sectors that you wouldn't think were initially tied to the AI trade. And some of the fear in software disruption, you know, may be founded, but it seems like there are a lot of these knee jerk reactions and investors are sort of turning in saying, you know, what's next? How can I even protect from downside like this? Because you know, just the smallest little headline or thing coming out can send, you know, all of these stocks off a cliff.
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Bloomberg Host Caroline Hyde
Caroline was on this so quickly yesterday. But I think there's some value in giving the Bloomberg Tech audience an understanding a bit what it's like right, so that headlines are going on the terminal because there's certain stock moves, there's volatility. You have like industrials, transport logistics teams, teams, equities teams. Like what is happening? You know, like all of these stocks are falling. Just summarize that. That session we just showed a great chart, but it was severe. Right. And then we still continue to see ongoing pressure in software generally from the broader story.
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Bloomberg Reporter Sarah Kent
Yeah, finding that the tripwire can be really difficult actually. I mean we've seen so many things fall on pretty small things or even you know, like in the instance of real estate stocks last week there wasn't a super immediately clear catalyst that drove selling in that sector. So it is definitely, you know, a team effort. You know, I'm speaking to investors as much as possible to see what they're thinking, how they're reacting to these sort of like sparked sell offs. And yeah, it's been a full collaboration. Right. Because we just don't know what's next. There are so many different parts of the market that could see potential disruption here and where, you know, these fears could spark another decline in shares.
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Bloomberg Host Ed Ludlow
While you were sort of calling out the CEO of Algorithm that was affecting logistics, we understand we were speaking to the CEO of Altruistic Altruist, which is the wealth management startup that discombobulated wealth management stock market more broadly. And he too had this sort of David Goliath moment. Common. But what's so interesting is Ed and I speak a lot to the VC backed companies, companies that are developing the latest autonomous vehicles and trucking and, and bringing up these new platforms. How discerning are investors starting to become to a headline risk or actually what is going to upend the industries they put money into. Because is really a $7 million algorithm company going to do that?
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Bloomberg Reporter Sarah Kent
You know, I think we've seen actually really a lack of discernment. Right. Everything is a very knee jerk reaction now, I think keep hearing people say over and over something along the lines of, you know, sell first, ask questions later. And I think actually what I'm hearing from, you know, fund managers and people on the street is they're looking or trying to impress sort of maybe more discernment on investors. So they're not sort of making these very like, snap decisions. We'll have to keep see, seeing what happens. It's definitely been, you know, a wild few days.
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Bloomberg Host Caroline Hyde
Bloomberg's Carmen Reineke, you've been brilliant for a number of weeks in a row trying to explain what's going on. The scare it sent market caps across, stocks in multiple industries tumbling. We've just explained that. But all that disruption hasn't hit top lines. That's notable not just for public company shareholders, but for private market investors who are trying to find their next win. Sarah Kent's managing director of Clear Capital, a generalist VC firm. Morgan multiple software companies in its portfolio. Sarah, that's your job, right? Like, like, you know, in the case study of a software name with a $6 million valuation that spooked an entire logistics sector yesterday, you want to be finding those names through that lens. What's your interpretation of what we've seen this week across multiple sectors where software is coming for it?
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Bloomberg Reporter Sarah Kent
Yeah, I want to find companies that are going to disrupt markets because they have a great product, not because they have great Twitter fingers. And so I think part of that, what we're seeing right now, that makes investors nervous on the startup side, private investors, is that we want to make sure that these companies, these CEOs who are going viral with these sort of, hey, guess what, everything's falling apart. That they actually have an interesting solution because otherwise they're just sort of a megaphone, not necessarily a unicorn.
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Bloomberg Host Caroline Hyde
I said software coming for it, I meant AI coming for it, even coming for existing software platforms. Is there real risk to established industries here imminently?
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Bloomberg Reporter Sarah Kent
Yeah, I think that there's risk long term, but the reality is that a lot of that risk is going to be sort of taken up by, by companies in those industries. So it's not like logistics is ignoring what's happening. Right. When you look at some of the bigger logistics players, you have companies like the Nordics who have been consistently sort of ahead on software investing on their pension arm so they're obviously, I'm sure, having those kinds of conversations. And so I think it's a little bit flippant to think that you're going to end up in a situation where logistics didn't see this coming. Of course they know and they're often placing bets into startups or building and buying technology in house that can help them sort of be a part of that change. Kind of the same way in oil and gas, we've seen them often also get some upside as it transitions to, to a cleaner energy.
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Bloomberg Host Ed Ludlow
Ed makes a great point in our chat that, you know, you would have thought Flexport would be the company that would be upending the future of transportation and logistics. AI from your perspective, how are you at this moment seeing the valuations in startups reflecting this FOMO or this fear factor we see in the public markets?
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Bloomberg Reporter Sarah Kent
There's, there's a huge barbell right now in valuations for startups. And what you tend to see is there a handful of companies mostly in AI, like anthropic giant round, like some of what Elon's doing with his various country companies like OpenAI, where those private names are going up and up and up and we all have no idea how they're going to make that money back in an IPO or ever be profitable, profitable. And then on the other hand, you have startups that aren't promising the world and we're seeing a lot less velocity in those startup fundraising rounds, not because there's anything wrong with those companies, but just because people are worried about, hey, if all of the capital intensity is going over there, do I really want to be in these sort of solid, interesting, slower growing companies that might actually end up being profitable, but don't feel like they're going to be multitrillion dollar IPOs?
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Bloomberg Host Ed Ludlow
Are there any solid SaaS companies out there right now?
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Bloomberg Reporter Sarah Kent
I think there are a lot of solid SaaS companies. I mean, even in the public markets, you look at names like Salesforce and you have to kind of ask why do people, even though the valuation is a bit high, why do people think that this is going to go away overnight when, when they look inside of their own companies, they're not in a rush to cancel all their contracts and just yolo everything into chat gp. But for some reason there's the thought that that is going to happen overnight in the larger market and all of these companies are going to be valueless.
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Bloomberg Host Ed Ludlow
Sarah Kern's looking at portfolio right now. We appreciate it. Managing director of Clio Capital coming up we're going to speak with a software company. Twilio CEO Kuzma Chandler is joining us. The latest earnings they were good As a Bloomberg Tech.
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Bloomberg Reporter Caroline Hyde
How do you shift AI from being a flashy feature to a trusted partner.
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Narrator/Advertiser
In consumers everyday lives on the ground at CES Bloomberg Media Studios?
- [18:23]
Bloomberg Reporter Caroline Hyde
Asked Michael McDermott, EVP of Samsung. Our 2026 vision is built around an AI companion. It understands you and responds intuitively.
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Advertiser Voice
This intelligence works quietly in the background across TVs, home appliances and mobile devices.
- [18:38]
Bloomberg Reporter Caroline Hyde
By putting AI at the time same center of everything we do, we're simply.
- [18:42]
Advertiser Voice
Improving everyday life for everyone everywhere.
- [18:46]
Bloomberg Reporter Caroline Hyde
Support for the show comes from Public Lately it feels like there are two types of investing platforms. Some are traditional brokerages that haven't changed much in decades, and others feel less like investing and more like a game. Public is positioned differently. It's an investing platform for people who are serious about building their wealth on public you can build a portfolio of stocks, options, bonds, crypto without all the bugs or the confetti. Retirement accounts? Yep. High yield cash? Yes again. They even have direct indexing. Public has modern design, powerful tools and customer support that actually helps go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market and paid for by Public Holdings Brokerage Services by Public Investing Member FINRA SIPC Advisory Services by Public Advisors SEC Registered Advisor Crypto Services by 0/ all investing involves risk of loss. See complete disclosures@public.com disclosures here's a paradox.
- [19:46]
Narrator/Advertiser
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- [20:52]
Bloomberg Host Ed Ludlow
Shares of Twilio holding on to gains were up 2.4%. The company posting solid fourth quarter earnings results and guidance driven in many ways by gains in voice and messaging. Company also issued its revenue forecast of about 14% that topped analysts estimates. Twilio CEO Kazama Chip Chandler is with us and Kusama, what's driving the adoption? You talk about becoming sort of a foundational infrastructure layer. What does that look like?
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Twilio CEO Kazama Chip Chandler
Yeah, I mean I think for us what it means is, is that companies increasingly are. They've always been using us for communications and for data, but increasingly they're pointing their workloads towards us. And I'm talking about AI companies as well as enterprises as infrastructure that allows them to connect the lams, the data warehouses, the agents that they're now starting to build with and, and telcos. Put all of those different capabilities together under one platform. And that's I think what uniquely positions.
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Bloomberg Host Ed Ludlow
Twilio, uniquely positions you against this so called SAS apocalypse.
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Bloomberg Reporter Sarah Kent
How much?
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Bloomberg Host Ed Ludlow
Because imagine did you get questions on an ongoing basis bases from investors saying how resilient is the way in which you charge customers?
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Twilio CEO Kazama Chip Chandler
Yeah, we don't get as many questions about that, that topic actually. I mean, I think the reality is, is that, you know, we've always been sort of an infrastructure provider and so there's some level of insulation in that way. Like what we do is like very unique. I think the other dynamic that is at play here is that our pricing model has always been usage based. And so, you know, if you're worried about what the terminal value is associated with, seat licenses and stuff like that, like that's not something that we think about day to day. Instead we think about how do we combine all of these different elements that are coming to the fore to create a great customer experience on the other side.
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Bloomberg Host Caroline Hyde
It's great to have you back, back on the show. Going back to basics with Twilio I think really helps the audience understand, right. Twilio does customer engagement improvement. And on the show every week Caroline and I get told that the area that is most imminently ripe for improvement is call center, essentially that kind of domain. The analysts are looking at the results and the outlook and saying that you might be being a bit conservative and a bit muted. They want to see more evidence that voice AI as an example is really taking off. What do you see on the ground, so to speak? Kazama?
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Twilio CEO Kazama Chip Chandler
I mean, you know, look, we want to see more too. I mean, I think we feel pretty good about the outlook, we feel great about the way that 2026 is shaping up so far and we're pretty positive on it all, I think as it relates to voice specifically, since that's kind of where you started, I mean, I think you're seeing tremendous velocity for from a number of different companies. You know, we called out a number of them in our most recent earnings. You know, just take an example like some Sierra, like they've really captured the imagination right now in this moment. We're lucky to have them utilizing our infrastructure to be able to grow with a customer like that and add different kinds of voice capabilities to the speech to text and text to speech capabilities that they offer. So I think that's really been exciting and interesting for us. And then I think looking forward, there's a number of other growth factors that we're looking at. This idea of having persistence, performance, memory, context, being able to combine all of that also with agent building capabilities. I think that's what creates durable tailwind for our company.
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Bloomberg Host Caroline Hyde
The usage based model as you just described it, it's a great advantage for you, right? And I think again just going on the reaction to earnings, some of the concern is that if the outlook for the rest of the year is conservative, how much is that? Because you don't have visibility that far afield on a usage based model from your customers?
- [24:43]
Twilio CEO Kazama Chip Chandler
Yeah, I think it's less about that. I mean I just think the dynamics of a usage based business maybe cause us to be a little bit more conservative about the way that we forecast and the way that we kind of call it. I wouldn't take that as signal that there's any dampening of optimism in terms of our business. Quite the contrary. I mean the signals we're hearing from customers are that they want to go all in with Folio again, not just communications and data, but to build their entire stack around a lot of our infrastructure, including a number of other companies obviously as well who will end up partnering with. But I think this usage based pricing model like ideally positions us because it matches a customer's revenue events with our revenue events. And so our incentives are very, very tightly aligned.
- [25:30]
Bloomberg Reporter Natalie Lung
Because I mean there's a lot of.
- [25:32]
Bloomberg Host Ed Ludlow
Fear, there's a lot of anxiety not just in investors, but in people writ large around AI at the moment. How are you thinking about that around your own labor force and about how you make your business as efficient as possible by adopting the tools with which you're currently building upon?
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Twilio CEO Kazama Chip Chandler
Yeah, look, my personal view is, is that I don't think AI is per se coming for the workforce. I mean, I think frankly, it's going to be tremendously additive to the workforce. Like, you know, I've got a kid in college, I've got one that's about to go. I actually think what's about to happen here is, is that over the next five to seven years, you're going to have a whole slew of college graduates who are AI natives who are going to add so much more interesting and intellectual capacity to the workforce that I actually think workforces could potentially grow in many ways. I think what is, you know, probably a certainty is, is that those who don't retrain or reskill with different kinds of AI capabilities, they're probably more at risk. And, you know, we're working hard to make sure that our workforce is retrained, reskilled. We're adding a number of different capabilities to our own internal tech stack. There's a number of things that we're doing to use AI inside the company. You know, and you pointed to customer service a moment ago. We're certainly using it there. Inbound sales. We're certainly using it there. And I think there'll be a lot more other things that we do going forward.
- [26:50]
Bloomberg Reporter Caroline Hyde
Forward.
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Bloomberg Reporter Natalie Lung
Customership.
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Bloomberg Host Ed Ludlow
Chandler, embracing it. We thank you so much. Twilio CEO there. Coming up, we'll take a look at Airbnb and Instacart's earnings. Still coming thick and fast, folks. This is Bloomberg Tech.
- [27:24]
Bloomberg Host Caroline Hyde
Welcome back to Bloomberg Tech. At the top of the show, our top story was U.S. listed shares of Chinese technology companies. The Pentagon briefly listed Alibaba, Baidu and BYD as being names that it considers as aiding the Chinese military. Then that list was pulled from the, from the Internet essentially. Nvidia also down 2 billion percent. I'm not drawing a causal link, but remember that in Alibaba's case and Baidu as well, they are big potential buyers of Nvidia GPUs if that is a transaction that's allowed to go through by the US Government. Also taking a look at shares of Amazon Caro, we are teetering on the edge. They are flat as a pancake right now in the session, but had been headed for their ninth straight day of declines following that monster Capex Outlook, outlook for the year. Ninth straight day of decline should be the worst losing streak since 2006, which I guess if you look at the right hand side of that chart and the slide gives you a sense of anxiety right now with capital expenditures also looking at revision. So Rivian really on a tear. Remember it was down 30% almost year to date. It's now up 24% in the session. Doesn't really matter what they posted in the quarter gone. But they're basically on track for their next product, VR2, and that's all the market cares about.
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Bloomberg Host Ed Ludlow
I mean, talk us about the R2 because it's got to be able to inspire purchasing at a time where we've taken away some of the support from the government and we are seeing just EVs on a downhill trajectory.
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Bloomberg Host Caroline Hyde
Yeah. You know, rivian today had two premium consumer products that are an SUV R1T pickup, and it didn't have a mass market product. The R2 is supposed to be that it's still at a premium price point and Revision. And its CEO, RJ Scaringer, basically argued there isn't much out there below 70,000 USD for the everyday family. You know, in the SUV form factor, it's like the Toyota RAV4 of EVs. And all they're saying is that, you know, things are going as they said they would. And that, that chart that tells the story, that spike that you see around December, that's when they announced that their plans.
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Bloomberg Host
Right.
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Bloomberg Host Caroline Hyde
Which we went deep on, and then it faded because there was a lot of anxiety that they'd fall behind on the actual product delivery.
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Bloomberg Host Ed Ludlow
I mean, they have been cutting costs, right. Per vehicle, more than $7,000, like in lockstep with the amount that you're now not getting in terms of subsidization. But it's interesting, the delivery numbers, are they, are they optimistic? Is it positive? To be between 62 and 67,000 is.
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Bloomberg Host Caroline Hyde
More than last year, but it still is low volume.
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Bloomberg Host
Right.
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Bloomberg Host Caroline Hyde
And they're still going to lose $2 billion this year. And there's still one to watch, though, because of, you know, all the people that back them and the hype around their tech elsewhere in earnings. Strong demand for travel help boost shares of Airbnb. Bloomberg's Natalie Lung joins us now. Airbnb, what's the story here? You know, what are they doing that's new, that's different, and that's giving them a boost.
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Bloomberg Reporter Natalie Lung
Last year they rolled out a reserve now pay later option in the US and that's really helped boost bookings, letting people book in advance without worrying about their budgets so much. And they're expecting to roll this out to more markets globally. So that could continue to help help the results. And this year, CEO Brian Chesky really put a big focus on launching new businesses. Yesterday he talked about possibly testing airport pickup services. And we also know they're testing grocery delivery for guests.
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Bloomberg Host Caroline Hyde
We're up for 4% at one point. We'd have been up almost 10% in the session. I know we're here to talk about tech, Natalie, but does Airbnb tell us anything about the kind of health of the travel industry right now and the consumer around the world to spend money on travel and experiences?
- [30:59]
Bloomberg Reporter Natalie Lung
Yes. So U.S. travel has been pretty strong and especially strong in their international markets as well, which are growing at almost like twice as fast than their core markets. They called out Brazil, Japan and India, has also seen a lot of first time bookers for them.
- [31:18]
Bloomberg Host Ed Ludlow
Let's talk about the strength of groceries. Instacart really impressing investors, Natalie.
- [31:24]
Bloomberg Reporter Natalie Lung
Yes. Yesterday they provided first quarter guidance that could be their strongest quarterly growth as, as a public company. So that that was really positive news for investors. You know, Instacart has seen this sort of moderating growth in the last few years and this has really seen them accelerating. As you know, they're lowered the minimum basket size needed for free delivery. That's really helped. And their partnership with Uber allowing people to auto takeout has also helped with demand.
- [31:55]
Bloomberg Host Ed Ludlow
What about the underlying technology and how much air is becoming a flywheel for them or not?
- [32:01]
Bloomberg Reporter Natalie Lung
Yes, they're continuing to push out new technology solutions for grocers such as their white label website building and AS also as well as other recommendation engines for groceries. And that has powered a third of their revenue and they continue to expect it to grow this year including pushing internationally with Costco in Europe.
- [32:26]
Bloomberg Host Ed Ludlow
Emmett, nothing long. We thank you so much on the earnings roundup. We've got more of them. Coinbase. Well, it showed how quickly a cooling crypto market can pressure even one of the industry's most diversified exchanges. Revenue in the fourth quarter tumbling 20% to 1.8 billion. That says falling token prices drain trading activity across digital assets. This is the company stock is already down only 37% year to date. It's got a bounce today. Katie Greifeld, I'm pleased to say, joins us, host of the Crypto show and what everyone is trying to get to grips with is, is have we found a bottom here? Is this bad and as ugly as it gets?
- [33:00]
Bloomberg Reporter Natalie Lung
That seems to be the explanation for why you're seeing shares bounce and then some. Coinbase currently up about 16% at the moment. That is its best day since June, which looks unintuitive when you consider some of the actual numbers that we got last night, which weren't great. Transaction revenue coming in soft. You also had trading Volumes. Volumes coming in lower than expectations. But as you mentioned, I mean shares were down 37% through yesterday's close. We also had Robinhood report a few days earlier their crypto business drove a net revenue miss for that company. So it wasn't necessarily surprising to see these figures. And the idea here is now basically that. Exactly. That we're looking for a bottom that maybe the worst is already priced into this stock.
- [33:44]
Bloomberg Host Caroline Hyde
Katie, I'm a little ignorant here. You know, like crypto from a sort of asset perspective is not something that I spend a huge amount of time on. What I was trying to ask earlier in the week is I get when volumes are down, that's not great.
- [33:56]
Bloomberg Host
Right.
- [33:57]
Bloomberg Host Caroline Hyde
That's kind of logical. But there's been so much volatility. So I thought that in an environment where there's volatility a name like this would do really well. Right. Because you're on one side of the trade or you're on the other.
- [34:09]
Bloomberg Reporter Natalie Lung
Well, you're not wrong for thinking that. I mean volatility, that's typically good news for exchanges across any asset class. But consider the movements that you've been seeing in the price of bitcoin. It hasn't necessarily been two sided volatility. It's really been dropping like a stone over the past several weeks which isn't a great environment when it's a one sided trade here. But I mean as Caroline mentioned, this is a fairly diversified business. It's. They've been trying to move away, away from just that reliance on spot trading. They have an interesting revenue sharing agreement with Circle. So they're exposed to stablecoins which is seen as much steadier. And another reason why you are seeing the shares prop today is there's some optimism that maybe we are going to see that market structure bill that's currently working its way through Congress actually get some action in the next few months. Maybe actually make its way over the finish line. So that's what you're seeing maybe. Maybe also the price of bitcoin itself pop a little bit today.
- [35:04]
Bloomberg Host Ed Ludlow
Clarity on the Clarity act. Who thought it. Katie Greifeld, thank you so much for joining us today. Meanwhile, let's stick with more earnings. I want to just take you to Applied Materials because this is the equipment maker of the US for the chip makers. We are up 9%. Stella set of numbers managing to prove to the market that even though China is pulling away in terms of orders, we're actually seeing just the drumbeat of more and more investment in data centers. Of course that means equipment manufacturing that is needed for chips to go into those data centers. Applied Materials benefiting off the back of it. We're up 8.9%. The CEO sounded pretty bullish at etching and deposition gear.
- [35:42]
Bloomberg Host Caroline Hyde
Absolutely essential. Let's go to Space SpaceX Dragon and.
- [35:47]
Twilio CEO Kazama Chip Chandler
Godspeed Crew 12 and lift off.
- [35:50]
Bloomberg Reporter Sarah Kent
Freedom flies bound for the International Space Station.
- [35:55]
Bloomberg Reporter Natalie Lung
1.7 million pounds of thrust now propelling.
- [35:58]
Bloomberg Host Caroline Hyde
Falcon 9 got ahead of myself there. Space X capsule carrying four crew members from the US Europe and Russia launched overnight to the International Space Station. The start of a planned eight month stay in orbit that will include research on meditation in space. They'll be joining three other astronauts aboard the ISS which has been operating with a skeleton and crew since the first ever space medical evacuation. You remember in January.
- [36:26]
Bloomberg Host Ed Ludlow
Meditation. We need to do more of it on Earth, let alone in space. Brilliant. Thank you, Ed. Meanwhile, coming up, Ben sun from Primary joins us to talk about the venture firms. The latest megafund is Bloomberg Tech.
- [36:44]
Bloomberg Reporter Caroline Hyde
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- [37:43]
Narrator/Advertiser
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- [38:46]
Bloomberg Reporter Sarah Kent
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- [39:19]
Bloomberg Host Ed Ludlow
Early Stage Venture Firm Primary it's just closed a $625 million fund that brings total assets under management to 1.65 billion. This at a time when investors are still really eager to back startups at the seed level. I speak to Benson Primaries Co Founder General Partner Ben the size and scale of the of the funds are getting bigger. Is that because we're seeing more opportunity to fund more companies or because each individual seed company needs more money?
- [39:45]
Advertiser Voice
I think it's a combination of both. Caroline and if you look over the last decade the seed market has grown from $5 billion 10 years ago and this is just what was invested seed in the US in that 10 years ago, in that year to last year being about 20 billion. So we've seen 4x the amount of capital in terms of round sizes. On top of that round sizes have gone up from 1 billion to 4 billion as well. So again a climb of about 4x.
- [40:17]
Bloomberg Host Ed Ludlow
Are you seeing returns though that vindicate such bigger bets at the seed level? Where are you deciding to double down on companies? Do you just stay at seed? How do you think your own DNA changes in this moment?
- [40:31]
Advertiser Voice
Oh I think if you look at historically on the the exits and the size of outcomes in both the median and the decile, you seen that each kind of generation of startups just gets a step function higher and higher. And now with what's happening in AI we think the outcomes are going to be that much greater and so so the amount of capital going in it matches the quality of the talent but also the quality opportunity. And with transformations like I we think and the market thinks those opportunities are going to become and those outcomes are Going to become bigger than we've ever seen before.
- [41:09]
Bloomberg Host Caroline Hyde
Ben, some of the data you just referencing, I wrote my column about this in January 26th. There's no point calling it a seed round anymore. Mango seed, coconut, coconut seed, avocado seed. But you know, the scale is not just different. You're basically making a bet sometimes on just two or three people in the lab context, for example. Is that more disconcerting in the moment when you do a seed round based on, you know, maybe an alumni of a, of a bigger tech company or someone that's going alone in this environment?
- [41:44]
Advertiser Voice
Yeah. People look at historical data and they say, well, the round size has gotten bigger, so it hasn't become irrational. The reason why we have become bigger because it's become more rational. Think about the founding talent I know alone. You know, I started my career as a founder 30 years ago. You know, what we knew about the Internet and how to scale a technology company back then. I mean it's, it's night and day to where you see the market and the type of talent you have. Now a lot of the talent are coming from best in class tech companies that have gone from zero to $1 billion type outcomes, if not more. And those that talent is coming out and starting new companies. And then on top of that, the scale and the quality of ideas are just getting better and better. So I think the capital going in, the valuations are climbing. These are just markets being efficient and saying, well the talent and these potential outcomes look like they have much more upside and therefore kind of demand those type of premiums.
- [42:49]
Bloomberg Host Caroline Hyde
The seed market is very broad. What are the corners of the technology industry or opportunities where, where like the technology just doesn't exist yet.
- [43:00]
Advertiser Voice
I mean the big unlock talk as you know, is around kind of AI and this is at the infrastructure level, all the way to the application level. And the opportunities that we're kind of seeing across all different types of sectors is becoming evident that really AI is being unlock what is a much larger TAM than historically you've seen before. Before we used to talk about TAM as like software budgets. AI is replacing meaning or augmenting human labor. And when you think about that type of replacement augmentation, we're talking about a market that's trillions of dollars, not, you know, hundreds of billions of dollars. And that's really kind of the opportunity that we see. And, and it's happening in all different sectors, whether it be fintech, health care, industrials throughout the enterprise, all the way to SMBs and consumers. So across the board. We think there's going to be be huge transformations, especially with a Ben some.
- [43:57]
Bloomberg Host Caroline Hyde
General partner at Primary. Great to have you on Bloomberg Tech. Thank you very much, Carrie. So many more news headlines to get to.
- [44:03]
Bloomberg Host Ed Ludlow
There are it's time now for talking tech and first up, bytedance is in talks to sell its Moonton video game business to Saudi Arabia based Savvy Games for more than $6 billion. It's all according to reports from Reuters which says the parties could finalize a deal as soon as this quarter. Bloomberg has reported that the company's revived sales talks late last year plus day one data centers when it selected banks for a U.S. iPO that could raise $5 billion, according to sources. They say the company, which is backed by Chinese datacenter operator GDS, is targeting a valuation as high as $20 billion listing that may take place as soon as this year. And also looking to go public in the United States is SoftBank's digital payments provider PayPal. The company could list as early as March, according to Filing. Now Pepe is seeking a valuation of more than 10 billion. The SoftBank founder, Masayoshi Son is pushing for as much as $20 billion according to sources.
- [44:53]
Bloomberg Host Caroline Hyde
Okay, coming up, social media is having a rough start to the year, but is the bad press slowing the industry's growth? More on that next. This is Bloomberg Tech.
- [45:11]
Bloomberg Host Ed Ludlow
Social media's impact on teens. Well, it's never been more scrutinized than it is right now with lawsuits in the US over addiction allegations, Australia's ban on under 16 that could actually spread to Europe. But are these moves actually crimping the industry's growth? Bloomberg's Kurt Wagner, who covers social media joins us on this. You wrote a piece, your Tech in Depth piece that kind of shows that no, it doesn't actually affect the business model thus far it feels like yeah.
- [45:37]
Bloomberg Host
And I think there's two elements here. The first is the volume of accounts, accounts that have been removed. And again, these bands right now to be clear, this is only happening in Australia, Caroline. Right. So there is potential that this could become a real global problem. But the number of accounts that are being removed are drops in the bucket for these companies. It's maybe even a rounding error in terms of who they are losing. And then on top of that, I think if you talk to people who study this industry from a business standpoint, a 15 year old on SNAP, a 15 year old on Instagram, that is not a super valuable user for these companies in terms of revenue. They don't usually have a lot of disposable income. They're not making household purchasing decisions yet. And so the point of this story here was mostly to say right now, this is not a real threat to the business of these companies. It could be down the line, but I think that's something that, you know, might be years away if it ever comes.
- [46:29]
Bloomberg Host Caroline Hyde
The extension of that. That last part is that many of these names still rely heavily on advertising as source of revenue. There's obviously subscription in some cases, which is a different model that would suggest generally ad healthy right now. What do you say?
- [46:46]
Bloomberg Host
Yeah, I mean, all of these businesses continue to grow their ads, their ads business quite considerably. I think it was Metta was, was more than 20% year over year. I mean, this is a company that's been around more than 20 years. That is, you know, and they still figure out, you know, how to, to grow that ads business. And so I think there is a lot of money still pouring into these companies. And again, it's just, where is that money being targeted? It doesn't feel that teens, while they're important again to, to create a vibe around a platform, to create buzz around a platform, they're not necessarily who advertisers are looking to get right now. And so I think that's where, again, there might be some delay in how these types of bans impact the business.
- [47:30]
Bloomberg Host Ed Ludlow
Push us forward, though, because we are going to see some key executives have to come up against arguments in court. Look, we all remember the pictures of Mark Zuckerberg being confronted by parents holding up signs. That moment resonates with the user base and of potential customer.
- [47:48]
Bloomberg Host
It does. We're expected to hear Mark Zuckerberg testify next week in Los Angeles in a. In a big trial that's all about whether these platforms are purposefully addicting teens to, you know, Instagram, Snap, TikTok, etc. And so, you know, there is a reputational element to this. And I think while I say that the business might not be impacted now if you get a whole generation of teenagers who stop using these products, that is. That is not good. Right? That is not good for meta that these people are now going to go spend time elsewhere the most.
- [48:21]
Bloomberg Host Caroline Hyde
Kurt Wagner, thank you very much. Some of the biggest players behind the AI boom are taking a page from the Crypto Industries 2024 playbook, working to back congressional candidates who favor a lighter regulatory touch on AI. For more, Bloomberg's corporate lobbying reporter Emily Birnbaum joins us now. And these are names that are familiar right across the top tier of venture capital and the Frontier Labs Labs explain this playbook they're trying to replicate.
- [48:50]
Bloomberg Reporter Sarah Kent
So the memory of Fair Shake, crypto's big pack, looms large over Democrats and Republicans in Washington. They spent huge sums, hundreds of millions of dollars, and were very successful. And so now the AI companies, including both Andreessen and Horowitz, who also gave to Fairshake, are pouring millions of dollars into congressional races across the country. Last time, the crypto industry won by not talking about crypto, instead boosting candidates based on issues that are popular in their district. And that's exactly what the industry is going to do this time with their pack. It's called Leading the Future.
- [49:34]
Bloomberg Host Ed Ludlow
What can they do to dial in to where the electorate is at, at the moment? Because when it comes to AI, there's a lot of anxiety, a lot of labor anxiety. For example, where are they going to post the opportunity to them?
- [49:48]
Bloomberg Reporter Sarah Kent
Yes. So I think first, there is increasingly a lot of anxiety among constituents about AI, particularly about employment, particularly about data centers being built in their backyards. So I think for the industry, they're both, both. They're going to be making the argument that this is good for American dominance over China, that they are the innovators of the future. We'll see how that plays. But more than anything, I think they're working with strategists in each of these states. And you can see in their advertisements, they're focusing on ICE in New York, they're focusing on Trump ally, his MAGA accolades in Texas. We're going to see that play out over and over. And people in those states don't necessarily know that it's the industry behind these advertisements. Mailers, texts coming to their phones.
- [50:37]
Bloomberg Host Ed Ludlow
Fascinating. Bloomberg's Emily Bambam must get you back on that story and do go read it. Meanwhile, that does it for this edition of Bloomberg Tech. What an extraordinary week.
- [50:46]
Bloomberg Host Caroline Hyde
And yeah, and in the United States, at least a holiday weekend for many. Recap the show and the week on the podcast. You know where to find it, all those places online and all of the Bloomiverse. Have a great weekend. This is Bloomberg Tech.
- [51:00]
Narrator/Advertiser
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