Bloomberg Technology 04/26/2024

>> FROM THE HEART OF WHEREINNOVATION, MONEY, AND POWER COLLIDE IN SILICON VALLEY ANDBEYOND, THIS IS BLOOMBERG TECHNOLOGY WITH CAROLINE HYDE AND ED LUDLOW. . >> I'M CAROLINE HYDE. >> I'M ED LUDLOW IN SANFRANCISCO. THIS IS BLOOMBERG TECHNOLOGY.CAROLINE: INTEL SLIDES AMID TEPIDFORECASTS. WE WILL DISCUSS ALL OF THATWITH THE CEO. ED:.

MICROSOFT AND GOOGLE POSTSTRONG RESULTS. CAROLINE: JEFF BEZOS AND ANDY JASSYDELETING CHAPS AMID AN ANTITRUST PROBE.LET'S CHECK IN ON THESE MARKETS. THIS IS A MACRO PICTURE ON THEDAY AND SOME EARNINGS GALVANIZING A DRIVE HIGHER.NASDAQ UP MORE THAN 2% THEN. WE SEE THE CORE PCE THAT THEFED SO LOVES COMING IN LINE. WE ARE NOT CALLING, BUT WE ARENOT EXCEEDING EXPECTATIONS. THE MARKET IS RELIEVED AND WEARE SEEING ABOUT OF GOOD, HEALTHY INCREASE IN CERTAINSTOCKS.

A 10 YEAR YIELD DIVES DOWN ONTOTHE BACK OF THAT PCE NUMBER. EVEN THOUGH WE SEE BONDS INDEEDRALLYING COMING YIELDS FALLING LOWER, THE DOLLAR STILLRESILIENT AGAINST THE JAPANESE YEN.WILL WE SEE INTERVENTION FROM THE BOJ?MOVING ON, HAVE A LOOK AT WHAT IT IS DOING AGAINST BITCOIN.DOLLAR STRENGTH AGAINST BITCOIN. CRYPTO ON THE DOWNSIDE. ED: IT IS ALL ABOUT EARNINGS.INTEL IS OFF SESSION LOWS. AND JUST A MOMENT, IAN KINGWILL GIVE US THE NUMBERS AND.

THEN WE WILL SPEAK TO THE INTELCEO. MICROSOFT AND ALPHABET ARE ALLABOUT CLOUD GROWTH DRIVEN BY AI PRODUCTS.MICROSOFT, 31% TOPLINE GROWTH ON AZURE.WE WILL GO DEEPER ON THAT LATER IN THE SHOW.CLEARLY, ALPHABET IS OUTPERFORMING.IF A JUMP IN THAT STOCK. A DIVIDEND FOR THE FIRST TIME. IT JOINS THE $2 TRILLION MARKETCAP CLUB IF IT CLOSES AT THAT LEVEL.JOINING NAMES LIKE MICROSOFT,.

APPLE, NVIDIA.THAT IS IMPORTANT. WE ARE STARTING TO BELIEVE THATTHERE WAS GROWTH AT ALPHABET AND GOOGLE DRIVEN BY ALL THEINVESTMENT AROUND AI. THAT IS LATER IN THE PROGRAM,BUT WE START WITH SEMI CONDUCTORS. CAROLINE:LET'S DIG IN ON ALL THINGS INTEL.IAN KING WAS DISCUSSING WITH THE BUSINESS.THIS SEEMS TO BE A WORRY ABOUT FORECASTS.Q1 WAS PRETTY RESILIENT, THE FORECAST, TEPID.

>> YOU ARE ABSOLUTELY RIGHT. THE ISSUE THAT INVESTORS HADWAS WITH THE FORECAST THAT PAT AND HIS TEAM PUT OUT AND THATWAS CONSIDERABLY LIGHTER THAN THE CONSENSUS.THAT WAS EXPLAINED BY PAT AND HIS MANAGEMENT TEAM AS BEINGRELATED TO A STRUCTURAL ISSUE THAT SOME OF THE EXCESS DEMANDCAN'T BE MET BECAUSE OF AN ISSUE WITH A SHORTAGE OF ACERTAIN TYPE OF MANUFACTURING. ED:IT IS IMPORTANT TO TALK ABOUT THE SERVER MARKET.WHAT DID WE LEARN ABOUT INTEL'S.

PLACE? IAN: AS I FORWARDED IT ALONG TO YOU,THE SERVER MARKET, THE BASIC SERVER MARKET AT INTEL HASOWNED FOR MANY YEARS ISN'T GROWING AT A RATE THAT IT HASIN THE PAST BECAUSE SPENDING IS GOING ELSEWHERE, INTO AIACCELERATORS. AND THAT ISN'T A BIG MARKET FORINTEL YET. ED: WE SHOULD TALK ABOUT FOUNDRY.INTEL IS PURSUING TWO BUSINESS MODELS. IAN:THAT IS THE BIG STORY, ISN'T IT? PAT IS PURSUING SOME LONG-TERMFUNDAMENTAL CHANGES TO THE CHIP.

INDUSTRY. IF IT PLAYS OUT HOW HEPROJECTS, WE WILL SEE A WHOLE DIFFERENT INTEL AND A WHOLEDIFFERENT INDUSTRY, BUT IN THE MEANTIME HE HAS TO REPORTQUARTERLY EARNINGS BASED ON WHAT IS HAPPENING RIGHT NOW. ED:IAN KING, THANK YOU SO MUCH. CARO, IT IS THE EARNINGSCONTEXT. BUT LIKE EVERY EARNINGS, IT ISABOUT OUTLOOK AND THE LONG TERM. THE STORY WITH INTEL THAT THEMARKET IS SEIZING ON RIGHT NOW. CAROLINE:WE WANT TO DIG IN TO THE LONG-TERM WITH THE CEO.BUT WE HAVE TO ACKNOWLEDGE THE.

SHORT TERM.THE WORST SELLOFF SINCE JULY 2020. WE ARE AT THE WORST SINCEJANUARY 2024. THIS IS A COMPANY THAT HAS LOSTA THIRD OF ITS MARKET CAPITALIZATION THIS YEAR ALONE.ED: WE KNOW THAT AI IS A COMPLICATED STORY.THE SERVER MARKET NEEDS CPU'S AND IT ALSO NEEDS MEMORY, WHICHWE DISCUSSED WITH MICRON THE OTHER DAY.A LOT OF THIS IS HAPPENING IN PARALLEL.SOME OF THE CLOUD GROWTH IS NOT NECESSARILY AI RELATED.DATA CENTER INFRASTRUCTURE IS.

NEEDED FOR NON-AI REASONS ASWELL. LET'S TRY TO UNPICK WHAT ISHAPPENING IN A NAME THAT YOU SAY IS DOWN. WE WELCOME NOW TO BLOOMBERG TVAND RADIO WORLDWIDE AND JOINING US IS THE INTEL CEO PAT GELSINEGER. THE STOCK IS DOWN MORE THAN 10%AND WE ARE KIND OF HERE AGAIN WHERE THERE IS THE SHORT-TERMAND THE LONG-TERM WHERE YOU ARE TRYING TO CONVINCE INVESTORS OFA RETURN TO TECHNOLOGY LEADERSHIP AND ALSO GROW AFOUNDRY BUSINESS.

HAVE YOU AN UPDATED TIMELINE OFWHEN YOU THINK YOU WILL ACHIEVE THAT TARGET? PAT: YES, THANKS.WE DELIVERED SOLID Q1. WE MET ON REVENUE, WE BEAT ONEARNINGS. A BIT TEPID IN THE FIRST HALF,BUT WE SEE A LOT OF IMPROVEMENT AS WE GO THROUGH THE YEAR.WITH THAT, THE FOUNDRY BUSINESS AS I WOULD SAY WE WILL SEEPROGRESS EVERY QUARTER FROM NOW UNTIL THE END OF THE DECADE.IT JUST GETS BETTER AND BETTER AS WE MOVE INTO OUR NEWTECHNOLOGIES. GETTING BACK TO PROCESSLEADERSHIP, WHICH HAD BETTER.

ASP'S AND WE CAN BUILD BETTERPRODUCTS WITH THEM. WE WIN MORE EXTERNAL FOUNDRYCUSTOMERS AS SCALE GROWS AND WE GET PAST THIS PERIOD WHERE WEHAD TO INVEST AND CATCH UP AND CREATE.EVERYTHING BECOMES A TAILWIND GOING FORWARD AND WE HIT KEYMILESTONES. ONE OF THOSE I WAS VERY PROUDOF HIS WE WENT TO PRODUCTION THIS WEEK WITH OUR FIRST SERVERPART FOR INTEL 3. THE U.S. IS BACK TO LEADERSHIP PROCESSTECHNOLOGY BEING MANUFACTURED ON OUR SHORES FOR THE FIRSTTIME IN A DECADE.

EVERYTHING'S COMING TOGETHER ASWE WOULD SAY AND WE ARE VERY OPTIMISTIC THAT WE WILL DELIVER.THE FOUNDRY BUSINESS AND THE MANUFACTURING CAPABILITIES ASWE HAVE LAID OUT IN THE COMPANY, THE INDUSTRY, AND THEWORLD. CAROLINE: 2024 THE BOTTOM IN MANY ASPECTS.THEY WANT TO UNDERSTAND THE PACE OF THE CLIMB NECESSARY.HOW CAN YOU TELL US ABOUT HOW QUICKLY YOU WILL BE ABLE TOSCALE BACK THAT MARKET SHARE YOU HAVE SO FAR LOST? PAT:WE LOOK AT INTEL NOW IN THESE TWO DIFFERENT PERSPECTIVES.INTEL PRODUCT AND WE EXPOSE.

THROUGH OUR RECAST FINANCIALSTHAT WE HAVE A VERY SOLID BUSINESS WITH HEALTHYFINANCIALS AND WE EXPECT THOSE TO IMPROVE OVER TIME.BUT THE BIG STORY HAS BEEN ABOUT EXPOSING THE FINANCIALSFOR FOUNDRY AND THE LOSSES ASSOCIATED WITH THEM. WE WILL CROSS THROUGHPROFITABILITY THROUGH THE MIDDLE OF THAT PERIOD AS WESTART TO MODERATE THE LEVEL OF INVESTMENT REQUIRED TO GOREBUILD THAT DECADE OF UNDERINVESTMENT.

AS WE DO THAT, IF WE HAD THATTODAY, WE WOULD BE MORE THAN DOUBLE THE EARNINGS WE AREFORECASTING. IT BECOMES A HUGE POSITIVELEVER FOR US. AND AS I LIKE TO SAY, ALL OFTHAT IS IN OUR CONTROL. ALL OF THESE THINGS ARE IN OURCONTROL AND IT GETS BETTER AS WE WIN ADDITIONAL EXTERNALFOUNDRY CUSTOMERS. ED: THE LINK IS ABOUT GROWINGMARKET SHARE SERVER TO SUPPORT THE COSTS NECESSARY FOR THEFOUNDRY BUSINESS. YOU WERE ASKED AN INTERESTINGQUESTION ON THE CALL IN THE.

CONTEXT OF SERVERS BUILT ON X86 VERSUS ARM-BASED ALTERNATIVES AND YOU GAVE APRETTY THOROUGH EXPLANATION ABOUT THE DATA CENTER CPU'S,BUT I DIDN'T HEAR WHAT WAS HAPPENING IN THE REAL WORLD.WHERE ARE DATA CENTERS BEING BUILT AND WHAT ARE THEY BEINGBUILT ON RIGHT NOW? PAT: WE HAVE BEEN IN A PERIOD NOWFOR A NUMBER OF QUARTERS WERE DATA CENTER CPUS HAVE BEENFAIRLY TEPID AND WE DO SEE THAT IMPROVING.WE HAD A GOOD IMPROVEMENT IN THE FIRST QUARTER OF THE YEARAND WE EXPECT THAT TO CONTINUE.

AND THERE IS TIME FOR AREFRESH, BUT WE ARE ALSO SEEING THAT THE CPU'S AS HEAD NODESFOR TEST CASES. WE CAN NOW RUN 70 BILLIONPERIMETER MATERS NATIVELY ON THE CPU. I DON'T NEED A SPECIALACCELERATOR. I CAN DO EVERYTHING IN OF THESOFTWARE STACK I ALREADY USE INSIDE DATA CENTERS AND WE ARESEEING THAT THESE POWER EFFICIENT PRODUCTS WE AREBRINGING TO THE MARKETPLACE ARE GOING TO ENABLE US TO STABILIZEAND REGAIN MARKET SHARE WITH MUCH HIGHER CORE COUNTS.THE ASP'S ARE GOING UP VERY.

NICELY ON THAT THROUGH THE YEAR.WE SAW GROWTH IN Q1 AND WE EXPECT THAT TO CONTINUE THROUGHTHE YEAR. AND IN THE BACK HALF OF THEYEAR, OUR ACCELERATOR PRODUCT LINE WE BELIEVE BECOMES A VERYCOMPELLING SOLUTION FOR ENTERPRISE CUSTOMERS AND WEHAVE QUITE A NUMBER OF ANNOUNCEMENTS OF THOSE THISQUARTER. CUSTOMERS SUCH AS BOSCH ANDDELL AND SUPERMICRO ALL BRINGING THOSE INTO THE MICRO– MARKETPLACE. HE CLOUD PARTNERS LIKE THEFASTEST GLOWING CLOUD PROVIDER.

IN ASIA.ALL OF THOSE COMING ALONGSIDE THE INTEL STRATEGY, SO WE SEETHE MOMENTUM BUILDING AREA CAROLINE:MOMENTUM AND WE ARE WITH TV, RADIO AUDIENCES, THE CEO OFINTEL, PAT GELSINGER. ON MOMENTUM, EVERYONE WANTS TOTALK ABOUT AI AND ALL OF ITS WAYS AND MEANS.I'M REALLY INTERESTED IN ULTIMATELY YOU WERE GOING TO BESHIPPING IN EXCESS OF 40 MILLION AI PCU'S, BUT WHAT ISTHE DEMAND LIKE AT THE MOMENT AND WHAT IS THE COST LIKE? PAT:WHEN WE ANNOUNCE TO THE.

CATEGORY AT THE END OF LASTYEAR , EVERYBODY SAID, WOW, WHAT IS GOING ON?YOU ARE SEEING A FLURRY OF INTEREST OF OTHER PEOPLE COMINGINTO THE MARKET. BUT INTEL IS UNQUESTIONABLY THELEADER. FIRST TO DECLARE THE MARKET ANDFIRST TO DESCRIBE THE USE CASES, AND OUR FIRST PRODUCT ISHAVING A VERY ROBUST RAMP INTO THE MARKETPLACE.TO SOME DEGREE, I'M RACING TO CATCH UP TO THE DEMAND.WE ARE REACHING SUPPLY COMMITMENTS, BUT NOT ALL OF THEUPSIDE REQUESTS.

THIS IS VERY ROBUST AND WEEXPECT TO EXCEED THE 40 MILLION UNITS.WE WILL INTRODUCE OUR NEXT GENERATION PRODUCT IN THEMIDDLE OF THIS YEAR, SO ALL OF THESE PIECES WE ARE VERYOPTIMISTIC AND WE SEE USE CASES AND COMMUNICATIONS WHERE ALL OFA SUDDEN I GET SUMMARIZATION, CONTEXTUALIZATION, TRANSLATIONIN REAL TIME ALL RUNNING ON MY PC. ALL OF THESE USE CASES ARE BECOMING AI ENABLED AND INTELLEADING THE AI PC PARADE IS A VERY EXCITING TIME AND WHATWILL BE THE BIGGEST PC REFRESH.

IN DECADES. CAROLINE:THIS IS A CONVERSATION ABOUT YOUR TECHNOLOGY AND YOURFUNDAMENTALS OF THE BUSINESS. I'M GOING TO TAKE A TURN FORTHE MOMENT AND IT IS A SENSITIVE QUESTION.GIVEN YOUR RELATIONSHIP WITH ISRAEL AND THE FACT THAT YOUARE ONE OF THE LARGEST EMPLOYERS OVER THERE, HOW AREYOU CURRENTLY FEELING ABOUT STUDENTS IN THE UNITED STATESPROTESTING AGAINST ENDOWMENTS BEING INVESTED IN COMPANIESASSOCIATED WITH ISRAEL AT THIS MOMENT? PAT:WELL, WE HAVE BEEN IN ISRAEL.

FOR 40 YEARS NOW AND IT HASBEEN AN INCREDIBLE COUNTRY FOR US, AN INCREDIBLE INNOVATORSAND EXTRAORDINARY RESILIENCE BY THE ISRAELI PEOPLE.AND THEY CONTINUE DESPITE THE CHALLENGES OF THE WAR THAT ISGOING ON THERE TO DELIVER AGAINST THEIR OBJECTIVES.WE ARE VERY COMMITTED TO SUPPORT OUR TEAMS WHEREVER THEYARE IN THE WORLD. THAT SAID, WE SEEK PEACE AND WEHAVE BEEN CLEARLY EMPHASIZING THAT WE NEED TO FIND ROUTES OFSUSTAINABLE PEACE IN THE REGION. WE HAVE BEEN SUPPORTINGPERSPECTIVES THAT REINFORCE.

THAT ACROSS THE REGION.AS WE LOOK ACROSS THE WORLD, THERE CONTINUES TO BE THETURBULENCE AND FUNDAMENTALLY OUR STRATEGY IS ABOUT BUILDINGFUNDAMENTALLY RESILIENT SUPPLY CHAINS AROUND THE WORLD.THERE WILL BE THESE CHALLENGES ACROSS THE WORLD, WHETHER THATIS IN ISRAEL, UKRAINE, OR ASIA, AND WE ARE COMMITTED TO MAKINGSURE THAT WE CAN SUPPORT THE GLOBAL MARKETS THAT WE SERVEWITH A STRATEGY THAT WE REALLY WAS BILLED A TURBULENT WORLD.ED: LET'S END ON AI ACCELERATORS.GAUDI IS ON TRACK FOR 500.

MILLION THIS YEAR.A WE'LL PROBABLY DOMD 3.5 BILLION.NVIDIA WILL DO 34 BILLION. YOU HAVE SAID THAT CHOICE ISIMPORTANT AND ALSO THE CPU WAS IMPORTANT AND I ACCEPT THATMANY SHARE IT. DO YOU SEE A CLEAR PATH WHERETHE NUMBERS I OUTLINED REBALANCE IN YOUR FAVOR IN THEAI ACCELERATOR MARKET GOING FORWARD? PAT:GIVEN THE STRENGTH THAT WE SAW AT OUR VISION EVENT, WE HAD 20PLUS CUSTOMERS COMING OUT PUBLICLY IN SUPPORT OF OURACCELERATOR STRATEGY, WE ARE.

STARTING TO SEE THAT PIPELINEOF ACTIVITY CONVERT. AND ULTIMATELY MUCH OF THEACTIVITY THAT YOU HAVE SEEN SO FAR ON GENERATIVE AI HAS BEENIN CLOUD TRAINING. NOW I THINK THE ULTIMATEMONETIZATION OF AI HAPPENS AS BUSINESS DEPLOYMENTS START TOOCCUR AND THOSE ARE THE AREAS WE SEE STRIKE.WE LAUNCHED THE OPEN PLATFORM FOR ENTERPRISE AI.HOW DO WE ENABLE THESE USE CASES INSIDE OF THE ENTERPRISEBUT IN AN OPEN ARCHITECTURE THAT MANY GET TO PARTICIPATE IN?WE ANNOUNCED OPENAI NETWORKING.

TO STANDARD ETHERNET-BASEDSCALE UP AND SCALE OUT NETWORKING.AND OBVIOUSLY THE MOMENTUM WE ARE SEEING WITH GAUDI, ALL OFTHAT IS IN THE SECOND HALF OF THE YEAR.YOU CAN SEE A VERY ACCELERATED CYCLE.A LOT OF ENTHUSIASM FOR GAUDI. THE UNQUESTIONED LEADER INTOTAL COST OF OWNERSHIP FOR ENTERPRISES.BUILDING ON THE XEON FRANCHISE AND THE POSITION WE HAD. AND LITERALLY ISV'S AND CLOUDPROVIDERS, BUT MOST IMPORTANTLY.

ENTERPRISE CUSTOMERS SEEING THEVALUE PROPOSITION. WE FEEL LIKE WE ARE GETTING ALOT OF MOMENTUM IN THE CATEGORY AND FEEL GOOD ABOUT THEPOTENTIAL FOR AI EVERYWHERE. HEY IPC, EDGE, AND CLOUD.CAROLINE: ENDING ON AN OPTIMISTIC NOTE,WE THANK YOU SO MUCH, PAT GELSINGER ON ALL THINGS AI ANDALL THINGS INTEL NUMBERS. LET'S KEEP THE FOCUS ONEARNINGS FOR A MOMENT. THE FORECAST FOR SNAP IS A GOODONE. SHARES POPPING. UP 25% LET'S CALL IT.POSITIVE SIGNS IN THEIR REVAMP.

THE NEW DIGITAL ADVERTISINGBUSINESS THEY HAVE BEEN OFFERING, MARKETERS LIKE IT.18% FORECAST FOR INCREASE IN SALES.THIS IS BLOOMBERG TECHNOLOGY. CAROLINE:GOT TO GET BACK TO THOSE EARNINGS.GOT TO GET BACK TO THE NEW $2 TRILLION ENTRANT.SHARES POPPING HIGHER AFTER THE SURGE IN CLOUD REVENUE AT THOSEBUSINESSES FUELED IN PART BY BOOMING USE OF ARTIFICIALINTELLIGENCE SERVICES HELPING DELIVER STRONG EARNINGS RESULTS.I WANT TO GET TO IT WITH.

HILLARY.LET'S COMMENT ON THE ONE MOVING THE MOST TODAY.ALPHABET, PARENT OF GOOGLED. CLOUD ALWAYS BEEN SEEN AS THELAGGER THERE. BUT IT IS HELPING BRING ABOUTMARKET SHARE WITH STARTUPS. >> INDEED IT IS.THANK YOU FOR HAVING ME. GOOGLE IS WELL KNOWN FOR HAVINGA STRONG PRESENCE AMONG STARTUPS, TECH COMPANIES.THEY HAVE AMONG THE BEST AI ASSETS AROUND HISTORICALLY.THEY ARE GOING TO BENEFIT FROM THIS ALONG WITH EVERYBODY ELSE.CAROLINE:.

I THINK MANY WERE WAITING FORTHESE OFFERINGS, HOW ARE PEOPLE ADOPTING THEM AND BOOSTINGTHEIR OWN PRODUCTIVITY? MICROSOFT HAS SHOWN A LIGHT ONTHE FORTUNE 100 USING THE AZURE CLOUD AT THE MOMENT.CLOUD IS STILL GOOD FOR GOOGLED. HILARY: THE CYLINDERS ARE REALLYSTARTING TO GET GOING. IT IS INTERESTING BECAUSEMICROSOFT IS ABSOLUTELY BENEFITING FROM A SHAREPERSPECTIVE DUE TO THEIR LEADING POSITION IN AI ACROSSTHEIR BUSINESSES AND ACROSS CLOUD.

I VIEW AI AS ULTIMATELY ACONTRIBUTOR, BUT IT IS DEFINITELY AN ACCELERANT TOCLOUD MIGRATIONS. ED: GOOD MORNING.THE SHARE REACTIONS OF EACH ARE INTERESTING.ALPHABET MORE PRONOUNCED. WHEN I TALKED LAST NIGHT ABOUTCLOUD, AI SOLUTIONS DID MAKE A MEANINGFUL CONTRIBUTION TO THE28% CLOUD GROWTH YEAR ON YEAR, BUT SHE DIDN'T PUT A NUMBER ONIT. MICROSOFT DID PUT A NUMBER ONIT. THEY SAID 31% AZURE, 7% FROM AI. REALLY INTERESTING SHAREREACTION.

I PUT IT TO YOU THAT ALPHABETISN'T PROBABLY JUMPING AS MUCH ON THAT CLOUD NARRATIVE AS ITIS THE SWEETENER OF A DIVIDEND. HILARY:I THINK YOU ARE RIGHT ABOUT THAT.INVESTORS WERE PLEASED TO SEE THE RESULTS ACROSS THE BOARD.I THINK THEY BREATHED A SIGH OF RELIEF THAT CLOUD ACCELERATEDAND BUSINESSES ACCELERATED QUARTER OVER QUARTER, BUT THEBIG PIECE OF NEW INFORMATION HERE WAS OPERATING MARGINIMPROVEMENT AND COMMITMENT TO THAT THROUGH THE YEAR AS WELLAS THE DIVIDEND.

IMPORTANTLY, IT SIGNALS ASHAREHOLDER FRIENDLY HER STANCE THAN WE HAVE SEEN FROM GOOGLEHISTORICALLY. ED: HILARY, DO YOU BELIEVE NOWTHROUGH THE LENS OF ALPHABET AND MICROSOFT'S EARNINGS THATCORPORATE AMERICA IS SPENDING ON USING GENERATIVE AI? HILARY:I BELIEVE THEY ARE. I BELIEVE MOST OF CORPORATEAMERICA IS EXPERIMENTING WITH AI AND TESTING GENERATIVE AI INMICROSOFT AZURE'S CLOUD AND ELSEWHERE.THERE ARE SOME EARLY ADOPTERS WHO ARE STARTING TO GET TO SOMELEVEL OF SCALE.

MICROSOFT'S SEVEN POINTS OF AICONTRIBUTION WERE GOOD. I WOULD SAY THEY WERE GENERALLYIN LINE. MICROSOFT DID SIGNAL THAT THEYWERE CAPACITY CONSTRAINED. I STILL BELIEVE IT WILL BE INTHE SECOND HALF THAT WE SEE MICROSOFT DOING INFERENCING ONTHE CLOUD REALLY BROUGHT NOW AND START TO DRIVE THAT NUMBER. CAROLINE:WE ARE TALKING ABOUT TWO NAMES THAT HAVE ALREADY DONEPHENOMENALLY WELL IN THE HEIGHT AROUND AI.

WE ALSO THINK ABOUT WHAT DATADOG IT IS UP TO. HOW ARE THESE COMPANIES GOINGTO BENEFIT? HILARY:THE WHOLE CLOUD CONSUMPTION CONFERENCE, THEY WILL BENEFITWITH A LAG. WE ARE NOT SEEING IT ON ABROAD-BASED BASIS YET. THERE ARE A SELECT FEW WHO WILLBENEFIT. THEY WILL BENEFIT FROM THEABSENCE OF COST OPTIMIZATION WE SAW LAST YEAR.THEY WILL SEE THE FLOW THROUGH OF WHAT IS EFFECTIVELY ACYCLICAL CLOUD CONSUMPTION.

WE HEARD THAT FROM MICROSOFTLAST NIGHT. COMPANIES ARE STARTING TO DOTHINGS, THEY ARE TAKING ON MULTIPLE PROJECTS AND BRINGINGTHOSE BACK. THAT IS A POSITIVE. ED: WE ARE DOWN WEEK ONE OF MEGACAP TECH AND I'M BRACING FOR WEEK TWO.WHAT DO YOU THINK IS THE BLANKET TAKEAWAY OF THISSEVEN-DAY PERIOD SO FAR? HILARY: I WOULD SAY OVERALL CAUTIOUSLYOPTIMISTIC. AGAIN, I STICK TO THE NAMESWHERE EXPECTATIONS ARE LOW, VALUATIONS ARE REASONABLE, ANDCOMPANIES HAVE IDIOSYNCRATIC.

DRIVERS. THE CLOUD CONSUMPTION COMPLEXAMAZON SHOULD SHOW SOME PRETTY GOOD RESULTS BASED ON THE FACTTHAT THEY HAVE A LOT OF TECH COMPANIES AND STARTUPS WHO AREEXPERIMENTING WITH AI, BUT IT IS COMPANY BY COMPANY ANDENTERPRISE BUDGETS REMAIN SOMEWHAT CONSTRAINED IN THEFIRST HALF. MORE OF THAT OPENING UP IN THESECOND HALF. CAROLINE: ALWAYS SO GOOD TO GET YOUREXPERTISE IN THE TIME THAT WE HAVE EARNINGS AND ALL THE TIME.WE THINK YOU FOR BEING HERE. ED:.

LET'S GET SOME NEWS IN TALKINGTACK. A FOOD DELIVERY SERVICE LAUNCHING ITS INTERNATIONALPLATFORM IN RIYADH, ITS FIRST LOCATION OUTSIDE CHINA.ACCORDING TO SOURCES, THE COMPANY LOOKED INTO EXPANDINGIN THE MIDDLE EAST FOR MONTHS AND COULD LAUNCH AS EARLY AS AFEW MONTHS FROM NOW. THE MOVE COMES AS CHINESECOMPANIES SEEK GROWTH ABROAD TO COMBAT A DOMESTIC SLOWDOWN READU.S. SECRETARY OF STATE ANTONY BLINKEN AND CHINESE PRESIDENTXI MET. A WARNING WAS ISSUED SAYINGCHINA AND THE UNITED STATES.

SHOULD BE PARTNERS RATHER THANRIVALS. THE MEETING COMPOSED ON TRADE,TENSIONS, AND AI TALKS. HUAWEI'S LATEST SMARTPHONES ARESAID TO BE UTILIZING AN UPDATED VERSION OF ITS MADE IN CHINACHIPS. THE PHONES SPORT A PROCESSORWHICH IS A NEW VERSION OF THE 9000 CHIPS THAT ALARMEDWASHINGTON OFFICIALS DUE TO THEIR SEVEN NANOMETER TECH LONGTHOUGHT TO BE BEYOND CHINESE CAPABILITIES.IT SOLD OUT WITHIN TWO DAYS OF BEING LAUNCHED. CAROLINE:FASCINATING.

COMING UP, WE WILL TALK FTCALLOCATIONS — ALLEGATIONS AGAINST JEFF BEZOS AND ANDYJASSY. THEY HAVE BEEN DESTROYING MESSAGES AMID AN ANTITRUSTPROBE. MEANWHILE, U.K.LISTED COMPANY UP 16%. THE U.K. CYBER COMPANY HAS AGREED TOSELL ITSELF TO A PRIVATE EQUITY FIRM FOR $5.3 BILLION,BASICALLY A 20% PREMIUM. CAUTION IN THE MARKET THIS DEALWILL GET DONE. THEY WALKED AWAY BACK IN 2022FROM TALKS TO BUY DARK TRACE. THIS IS A COMPANY IN SOMEWHATOF AN INTERESTING RELATIONSHIP.

WITH THE EMBATTLED ENTREPRENEURMIKE LYNCH ON TRIAL FOR FRAUD IN THE U.S. ED: WELCOME BACK TO BLOOMBERGTECHNOLOGY. ED LUDLOW IN SAN FRANCISCO.CAROLINE: CAROLINE HYDE BACK IN NEW YORK.WE ARE HAVING THE BEST WEEK SINCE NOVEMBER FOR THE NASDAQ100 AND THE NASDAQ MORE BROADLY AT THE MOMENT.THIS IS BEING DRIVEN ON MACRO DATA.INFLATIONARY PRESSURES ARE IN LINE WITH WHAT THE MARKETEXPECTED.

THE BOND MARKET CATCHES A BID. RESILIENT DOLLAR STRENGTH. THIS IS THE LOWEST BEGIN HASBEEN IN 34 YEARS. LOOKING AT BITCOIN ALSO DOWN.LET'S LOOK AT WHAT IS HAPPENING IN THE MICRO LEVEL.NASDAQ HAS A FEEL-GOOD FEELING. IT FIRST — ITS FIRST QUARTERCAME IN LINE. ONE OF THE OTHER KEYUNDERPERFORMERS, THIS IS AN AUSTRALIAN SOFTWARE COMPANY.THE CO-CEO HAS LEFT AND IS STEPPING DOWN TO SPEND MORETIME WITH FAMILY AND ON.

PHILANTHROPY.THAT HAS UPSET SOME STOCKHOLDERS. BIG MOVE — GROWTH LOOKS GOOD,CLOUD LOOKS GOOD. FOR THE FIRST TIME EVER, THEYARE DOING MORE BUYBACKS. WHAT ARE YOU LOOKING AT, AND?ED: LET'S GET TO ONE OF THE TOP STORIES. TOP ANIMAS IN — AMAZONEXECUTIVES AND ANDY JASSY DESTROYED TEXT MESSAGESDISCUSSING BUSINESS ACCORDING TO ALLEGATIONS BY THE FTC,ERASING EVIDENCE THE AGENCY COULD HAVE USED IN AN ANTITRUSTCASE AGAINST THE RETAIL GIANT.

I WANT TO BRING IN MIKESHEPPARD WHO LEADS OUR COVERAGE OF THE INTERSECTION OF TECH ANDPOLITICS. AMAZON IS PUSHING BACK AGAINSTTHIS FTC ALLEGATION WITH SOME FORCE.WE WILL GET TO THAT, BUT WE ARE TALKING ABOUT COMMUNICATIONSMADE BY EXECUTIVES ON THE SIGNAL APP. EXPLAIN IT TO US.MIKE: IT IS IMPORTANT TO TURN THECLOCK BACK A COUPLE OF MONTHS TO SEPTEMBER AND THIS IS WHENTHE FTC FILED ITS INITIAL ANTITRUST CASE AGAINST AMAZON.THEY HAVE BEEN GRADUALLY.

INCREASING THE PRESSURE ON THISCOMPANY. IN NOVEMBER, THEY HAD A LESSREDACTED VERSION OF THE CASE RELEASED TO THE PUBLIC AND THATINDICATED THEY HAD CONCERNS. THEY DIDN'T NAME NAMES.TODAY, WE LEARNED AND WE ARE DISCUSSING TODAY THE LATEST ANDTHAT IS THAT THEY ARE NAMING NAMES INCLUDING CEO ANDY JASSYAND FOUNDER JEFF BEZOS. THAT INDICATES THE KIND OFPRESSURE THE AGENCY IS PUTTING ON THE COMPANY.IT ECHOES WHAT THIS BROADER EFFORT AGAINST BIG TECH IN D.C.CAROLINE:.

TURN THE CLOCK BACK EVENFURTHER AND YOU GO BACK TO 2019 WHEN JEFF BEZOS MADE CLEAR THATHIS PHONE HAD BEEN HACKED. THAT IS THE ARGUMENT AS TO WHYEXECUTIVES MOVED TO SIGNAL AND THESE DISCUSSIONS THAT CANDELETE THEMSELVES. AMAZON HAS SAID THE FTC HAS ACOMPLETE PICTURE OF DECISION-MAKING INCLUDING 1.7MILLION DOCUMENTS, OVER 100 TERABYTES OF DATA.WHAT MORE NEEDED THEY DO TO PROVE THAT THEY WEREN'T USINGSIGNAL FOR CONVERSATIONS THEY DIDN'T WANT SEEN BY THE FTC?MIKE:.

THE FTC IS ACTUALLY ALLEGINGTHAT MAYBE THERE WAS MORE THAT THEY NEEDED TO KNOW ABOUT.MAYBE THERE WAS MORE IN THOSE CONVERSATIONS THAT DISAPPEAREDTHAT THEY DON'T HAVE ACCESS TO AND ARE NOT PRIVY TO IN THECASE YET AND THAT THEY SHOULD THEREFORE BE ABLE TO SEE TOHAVE A CLEAR AND COMPLETE PICTURE, BUT AMAZON IS SAYINGTHAT YOU ALREADY HAVE ENOUGH. YOU HAVE MORE THAN ENOUGH THENYOU NEED TO BE ABLE TO CARRY ON YOUR WORK HERE.I'M GLAD YOU BROUGHT UP THE POINT ABOUT 2019 BECAUSE OFCOURSE THAT IS WHEN JEFF BEZOS'.

TEXTS WERE PURPORTEDLY HACKEDAND HIS DESIRE TO MAINTAIN SOME DEGREE OF PRIVACY IS ANOTHERDRIVER HERE. SO THE COMPANY IS SAYING WEHAVE DONE ENOUGH AND WE HAD CAUSE TO TRY TO PROTECT SOME OFTHESE COMMUNICATIONS AGAINST PEOPLE ON THE OUTSIDE. CAROLINE:MIKE, YOU ALWAYS SUM IT UP SO BEAUTIFULLY.MEANWHILE, LET'S SHIFT GEARS A LITTLE BIT.NEARING A DEAL TO RAISE $6 BILLION IN FUNDING.THAT IS ACCORDING TO A PERSON FAMILIAR WITH THE MATTER.MAX CHAFKIN JOINS US NOW.

I'M INTERESTED BY THE FACT OFTHE SHEER AMOUNT THEY ARE RAISING VERSUS THECAPITALIZATION, BUT THEY DID GO FOR FUNDING TO BEEF UP XA I.MAX: ELON MUSK SAID THIS COMPANYMAKES LARGE LANGUAGE MODEL SIMILAR TO OPENAI.HE DID THIS QUICKLY AND WITH A SMALL STAFF, BUT TO KEEP THESEMODELS TRAINING, YOU NEED AN INSANE NUMBER OF VERY EXPENSIVEGPU'S, THE GRAPHICS CHIPS THAT ARTIFICIAL INTELLIGENCECOMPANIES USE. ON AN INTERVIEW LAST MONTH, HESAID THEY WERE USING 20,000.

ALREADY OF THESE NVIDIA H 100'SAND THAT THEY NEED 100,000. THAT IS AN EXPENSE THAT IS INTHE HUNDREDS OF MILLIONS OF DOLLARS, IF NOT THE BILLIONS OFDOLLARS. THAT IS WHY HE IS RAISING THISMONEY AND THEY NEED IT. ED: THERE IS A LITTLE BACK STORY OFALL OF THIS THAT A BLOOMBERG NEWS JANUARY 19 THAT XAI WAS INTALKS TO RAISE FUNDS AT A VALUATION BETWEEN $15 BILLIONAND $20 BILLION. $18 BILLION IS PRETTY MUCHBETWEEN THOSE. ELON MUSK DENIED IT AND HE SAIDFAKE.

AND THEN THE INFORMATION CAMEOUT YESTERDAY WHICH BLOOMBERG REPORTED AND HE HASN'T SAIDANYTHING YET. THE MAIN THING IS IRRESPECTIVEOF WHAT ELON MUSK SAYS, HE HAS AN ABILITY TO RAISE MONEY FORPRETTY MUCH ANY PROJECT HE IS DOING. MAX:IT IS NOT THAT HE ONLY HAS AN ABILITY, BUT HE HAS TO RAISEMONEY HERE. ELON MUSK IS VERY WEALTHY ASMANY PEOPLE KNOW, BUT HE IS NOT VERY LIQUID.MOST OF HIS LIQUID — WEALTH IS TIED UP IN TESLA STOCK, SPACEXSTOCK.

HE DOES NOT HAVE BILLIONS OFDOLLARS. HE SPENT A LOT OF MONEY TO BUYTWITTER AND TURN IT INTO X. HE DOES NOT HAVE BILLIONS OFDOLLARS RATTLING AROUND IN HIS POCKET WITHOUT RAISING MONEY.HE NEEDS THIS IF HE HAS ANY PRAYER TO CATCH UP TO OPENAI.INVESTORS ARE HAPPY TO GIVE IT TO HIM BECAUSE OPENAI, THESECOMPANIES, THERE ARE SOME REAL QUESTIONS ABOUT THE BUSINESSMODELS, BUT THEY HAVE BEEN ABLE TO ACHIEVE HUGE VALUATIONS, ALOT OF ADOPTIONS. TAKING A FLYER ON ELON MUSK INTHE HOTTEST CATEGORY OF.

BUSINESS MAKES A LOT OF SENSEFOR THE VENTURE CAPITALISTS CONSIDERING THESE DEALS. ED:AND TO HIS CREDIT, A LOT OF THESE PROJECTS DO TURN OUT TOBE PROFITABLE. HAPPY FRIDAY TO YOU, MAX.SHARES OF IBM A LITTLE LOWER, BUT THEY ARE BACKING A PROJECTIN CANADA. $730 MILLION U.S. DOLLARS, ONE BILLION U.S.CANADIAN DOLLARS, THIS IS FOR SEMI CONDUCTORS.IT'S AN INTERESTING BET. WE HAVEN'T REALLY TALKED ASMUCH ABOUT CANADA IN THE CONTEXT OF ARE THEY GOING TO BEIN SHORING AND MAKING SOME KIND.

OF DOMESTIC EFFORT WHEN ITCOMES TO SEMI CONDUCTORS? IBM IS DOING SOMETHING.WE WILL BE RIGHT BACK. THIS IS BLOOMBERG TECHNOLOGY. THIS IS BLOOMBERG. ♪ CAROLINE:CYBERSECURITY FIRM RUBRIC JUMPED YESTERDAY ON ITS IPO DAYAND IT IS FALLING ONTO ITS GAINS.IT RAISED ABOUT $732 MILLION ON THE BACK OF THAT IPO.ONE OF THE KEY BACKERS IS GREYLOCK.WE HAVE GREYLOCK'S PARTNER WITH.

US.YOU ARE AT THE STOCK EXCHANGE RINGING THE BELL ANDCELEBRATING. HOW DOES IT FEEL ULTIMATELY TOSEE AN EARLY PAYOFF LIKE THAT? >> THANKS SO MUCH FOR HAVING ME.THE HONEST ANSWER WHEN YOU BACK A COMPANY VERY EARLY, YOU DON'TREALLY FULLY KNOW WHAT LIES AHEAD.I WOULD SAY THIS COMPANY IS A STORY OF AN EXCEPTIONALLEADERSHIP TEAM, AN EXCEPTIONAL LEADER TARGETING A VERY LARGEMARKET. EARLY ON IN THE COMPANY'SHISTORY, IT WAS VERY CLEAR THE.

SIZE OF THE MARKETS THEY WERETARGETING. AND THEN THE QUALITY OF THEPEOPLE. CAROLINE: AND I THINK WHAT'S INTERESTINGMORE BROADLY ABOUT THE DIRECTION OF TRAVEL WITH RUBRIKIS THEY HAVE POPPED AND INCREASED AND THERE ARE OTHERCYBERSECURITY COMPANIES IN YOUR PORTFOLIO EYING THE MARKET, BUTIT IS ALSO THE JUGGERNAUT THAT IS MICROSOFT.MICROSOFT SAID IT IS STILL MAKING STRIDES IN CYBERSECURITYINTERLACED WITH GENERATIVE AI. HOW MUCH ROOM IS THERE FOR THEELEMENT OF COMPETITION?.

>> CYBERSECURITY IS A SECULARGROWING MARKET. THESE MARKETS HAVE BECOME VERYLARGE. IT IS ONE OF THE MOST IMPORTANTPARTS OF TECHNOLOGY. THERE IS A LOT OF ROOM FORMULTIPLE PROVIDERS AND MULTIPLE PIECES OF THE STACK.AND THEN RUBRIC IS AN IMPORTANT PARTNER.RUBRIC AND MICROSOFT HAVE A STRONG PARTNERSHIP. ED: I'M REALLY INTERESTED INRUBRIC'S CLOSE RELATIONSHIP WITH MICROSOFT.THERE IS A FINANCIAL ELEMENT TO.

IT.GIVEN HOW AI IS PLAYING OUT, I WONDERED IF YOU HAD APARTICULAR THESIS ON HOW THAT RELATIONSHIP CONTINUES? ASHEEM:IT IS A MULTIFACETED RELATIONSHIP, BUT FUNDAMENTALLYWHAT MICROSOFT AND RUBRIK ARE TRYING TO DO IS PROVIDECUSTOMERS WITH CYBER RESILIENCE AND BRING DIFFERENT PIECESTOGETHER. ED: SO, WHAT IS NEXT WITH GREYLOCK?YOU HAVE A LOT GOING ON, YOU WOULD CLAIM, I THINK, AND MANYOF YOUR COLLEAGUES HAVE SAID ON THIS SHOW THAT YOU GUYS EARLYON GENERATIVE AI AND ORGANIZED.

ON GENERATIVE AI — I WONDEREDIF YOU HAVE SHARPENED YOUR FOCUSED ON ANY OTHER AREAS INTO KILLER? — IN PARTICULAR? ASHEEM:I HAVE BEEN AT GREYLOCK NOW A LITTLE OVER TWO DECADES ANDTHERE HAS NEVER BEEN A MORE EXCITING TIME FOR CAPITAL.IT HAS REALLY BECOME AN AI JOB. THERE IS THE FOUNDATION LAYER,ENABLING INFRASTRUCTURE IN THE MIDDLE, AND THEN APPLICATIONSAT THE TOP. FOR VC BACKED STARTUPS, THEREIS A LOT OF ENABLING INFRASTRUCTURE AND ALSO INAPPLICATIONS.

IT IS A SAFE STATEMENT TO SAYTHAT OVER THE COMING 5-10 YEARS, YOU WILL SEE LOTS OFAPPLICATIONS COMPLETELY REINVENTED WITH NEW WORKFLOWS.CAROLINE: AND YOU HAVE GOT COMPANIES INTHE PORTFOLIO ALREADY DOING THAT AND YOU CAN NAME SOME OFTHE OTHER KEY AI COMPANIES THAT YOU MIGHT WANT TO ANTICIPATECOMING TO THE MARKET I'M SURE, BUT WHAT ABOUT THE COMPANIESTHAT AREN'T INHERENTLY AI FOCUSED AND ARE TRYING TOBECOME SO? HOW DO YOU ADVISE THOSE? ASHEEM:I THINK ANY COMPANY THAT.

STARTED THREE OR FOUR YEARSAGO, THEY ARE AT RISK OF BEING COMPLETELY DISRUPTED BY A NEWSTART UP. A COMPANY THAT HAS A PRODUCTLINE OR A NEWER START UP, THEY HAVE TO GO AND LOOK AT THEAPPLICATION OF AI TO THEIR PRODUCT LINE AND KIND OFREIMAGINE OTHER WAYS. EITHER IN A COPILOT MODE OR THEMORE IMPORTANT IF YOU TAKE A ONE-YEAR VIEW FROM HERE, IT ISALL ABOUT AGENT FRAMEWORKS. SO MOST COMPANIES REALLY SHOULDBE LOOKING AT HOW THESE TECHNOLOGIES REALLY APPLY. ED:IF THERE IS ONE THING CAROLINE.

AND I HAVE LEARNED IN THE LAST12 MONTHS OR SO IT IS THAT NOT JUST A COMPANY IS BEING FOUNDEDINCREDIBLY QUICKLY, BUT A PLATFORM OR PRODUCT IS BEINGBUILT VERY QUICKLY. YOU GUYS HAVE THIS EDGE PROGRAMWHERE THAT IS WHAT YOU FACILITATE.AN IDEA FROM AN INDIVIDUAL THROUGH TO A BUSINESS QUICKLY.JUST EXPLAIN THE PROCESS AND HOW THAT IS PLAYING OUT. ASHEEM:THANKS FOR ASKING ABOUT THAT. WE HAVE A BESPOKE COMPANYBUILDING PROGRAM AT GREYLOCK CALLED EDGE.WE ARE VERY SELECTIVE ABOUT WHO.

WE PICK IN THE PROGRAM. ONCE AN ENTREPRENEUR ANDGREYLOCK SELECT EACH OTHER, WE WORK CLOSELY WITH ENGINEERS ANDFOUNDING TEAMS ALL THE WAY FROM MARKET SEGMENTATION TO PRODUCTSTRATEGY TO INSERTION FOR INITIAL PRODUCT, WORKING WITHINITIAL CUSTOMERS, BUILDING CUSTOMER ADVISORY BOARDS, THENOVER TIME HELPING GO TO MARKET. IT IS A VERY BESPOKE PROGRAM.MANY YEARS AGO, PALO ALTO NETWORKS STARTED IN OUR OFFICETHROUGH THAT APPROACH. ANOTHER ONE THAT WENT PUBLIC ISSUMO LOGIC AS WELL.

AND MORE RECENTLY, A COMPANYCALLED ABNORMAL SECURITY STARTED IN THAT PROCESS AS WELL.THEY HAVE RAPIDLY GROWN TO BECOME A LATE STAGE COMPANY.WE HAVE ANOTHER ONE IN THAT PROGRAM. ED: ASHEEM CHANDNA, GREYLOCKPARTNERS, GREAT TO HAVE YOU ON THE PROGRAM. COMING UP ON THE SHOW, UBERBACKED LIME IS GOING TO GROW ITS FLEET OF SCOOTERS, ELECTRICBIKES, IN CITIES NOT JUST HERE IN THE U.S., BUT AROUND THEWORLD.

DO THOSE CITIES WANT THEM?THAT IS THE BIG QUESTION. THAT CONVERSATION IS NEXT.THIS IS BLOOMBERG TECHNOLOGY. ED:THE OPERATOR OF SHARED ELECTRIC BIKES AND SCOOTERS LIME, WHICHIS BACKED BY THE LIKES OF UBER, IS PLANNING TO INVEST 55MILLION DOLLARS TO EXPAND ITS FLEET GLOBALLY.JOINING US NOW IS THE LIME CEO. I FIND THIS INTERESTING BECAUSEIT IS NOT JUST SAN FRANCISCO. THE STORY AND RELATIONSHIP ISWELL TOLD, BUT YOU ARE LOOKING AT OTHER REGIONS AROUND THEWORLD.

WHICH REGION'S MOST RECEPTIVERIGHT NOW TO ADDING MORE TO THE OFFERING? >> THANK YOU FOR HAVING ME.WE ACTUALLY SEE DEMAND FROM ALL OVER THE WORLD. LIME IS IN 30 COUNTRIES, THREEHUNDRED PLUS CITIES. THE REASON WHY CITIES ARE SOINTERESTED IS BECAUSE THE BIGGEST CHALLENGE OF OUR TIMEIS THE CLIMATE CRISIS AND THE NUMBER ONE SOURCE OF CARBONPOLLUTION IN EUROPE AND THE UNITED STATES IS FROMTRANSPORTATION.

THE VAST MAJORITY OF THAT ISFROM PERSONAL CARS AND TRUCKS. IF WE ARE GOING TO MEET THECHALLENGE OF CLIMATE CHANGE, WE MUST TRANSITION AWAY FROM CARSAND ADOPT TRANSPORTATION ALTERNATIVES LIKE BIKES ANDSCOOTERS. WHICH IS WHY YOU ARE SEEINGCITIES ALL AROUND THE WORLD EMBRACE MICRO ABILITY. ED: I PUT A POLE OUT TO ASK, DOCITIES NEED MORE ELECTRIC SCOOTERS AND BIKES?THE MAJORITY OF RESPONDENTS SAID NO. ALMOST THE MAJORITY.IN SOME CASES, THEY VOTED FOR.

FEWER.THERE IS STILL FRUSTRATION AND SKEPTICISM AND DISINTEREST OUTTHERE. HOW DO YOU OVERCOME IT? WAYNE:I THINK THE BEST WAY, WE NEED TO EARN THE TRUST OF RESIDENTSAND CITY GOVERNMENTS IN ORDER TO OPERATE.I THINK THE BEST WAY TO ENSURE THAT IS TO MAKE SURE THAT OURSCOOTERS AND BIKES ARE PARKED RESPONSIBLY, THAT WE HAVE AGREAT SAFETY RECORD, WHICH WE DO, THAT WE CONTINUE TO INVESTIN TECHNOLOGY, AND LIME BUILDS AND UPDATES EVERY SCOOTER ANDBIKE WE PUT ON THE STREET TO.

ENSURE THAT THEY ARE THESAFEST, BEST RIDE OUT THERE. WHEN WE CONTINUE TO DELIVER ANEXCELLENT SERVICE, WE WILL BUILD TRUST WITH CITIES TOEXPAND. CAROLINE: YOU WERE TALKING TO A BIKEADDICT HERE. I PREFER THE NONELECTRIC ONES.I DO IT A LOT IN NEW YORK CITY, I DO IT IN LONDON.BUT THEY ARE A MASS AND THEY ARE EVERYWHERE AND THAT IS AKEY CONCERN. DO YOU HAVE TO SPEND MORE ONINFRASTRUCTURE TO ENSURE PLACES DO HAVE A PLACE TO PARK THEM?WHAT IS THE RESPONSIBILITY OF.

YOU? WAYNE:I THINK IT IS A JOINT EFFORT. LONDON HAS 2.5 MILLION CARS. THERE ARE 100 TIMES MORE CARSIN LONDON THEN ELECTRIC E BIKES. EACH PARKING SPOT CAN FIT 6-80BIKES. IF YOU SAY THERE IS AN OVERABUNDANCE OF CARS INLONDON, IF ANYTHING, IF WE CAN EVEN TAKE A 10TH OF THE PARKINGSPOTS IN LONDON AND TARTED INTO BIKE PARKING CORRALS, WE CANEASILY SOLVE PARKING ISSUES IN LONDON.WE HAVE TO CONTINUE TO WORK WITH CITIES AND CITYGOVERNMENTS TO MAKE AN.

INFRASTRUCTURE TRANSITION TOBUILD MORE PROTECTED BIKE LANES AND MORE PLACES YOU CAN SAFELY,RESPECTFULLY PARK YOUR E BIKES. CAROLINE:YOU ARE SOMEONE BUILDING OUT AND SPENDING MONEY WHILETHINKING ABOUT PROFITABILITY. YOU PROBABLY TOOK A LEAF OUT OFTHE BOOK OF UBER. I'M INTERESTED AS TO WHATULTIMATELY THE GOAL IS AT THE MOMENT. DO YOU HAVE TO REMAINPROFITABLE AT THE CURRENT MOMENT? WAYNE:2023, LINE GREW BY 33% AND HIT.

OVER $600 MILLION IN GROSSBOOKINGS. MORE IMPRESSIVELY, OURPROFITABILITY GREW TO NEARLY $100 MILLION.THAT IS ACTUALLY WHAT HAS ENABLED US TO INVEST $50MILLION INTO SCALING E BIKES. I ABSOLUTELY THINK THAT TODAY'SPUBLIC MARKET IS DEMAND PROFITABLE.LIME IS SHOWING THAT WE CAN DO IT AS WE EXPAND PROFITABILITYAND PROFIT MARGINS. CAROLINE: ARE YOU GOING PUBLIC SOON?WAYNE: I THINK THAT DEPENDS ON THEMACRO MARKETS AND OUR BUSINESS.

RESULTS.WHAT WE CAN FOCUS ON IS MAKING SURE THAT LIME CONTINUES TOGROW RAPIDLY AND EXPANDS PROFITABILITY.THE MACRO MARKET IS STILL A LITTLE BIT IFFY.YOU WERE CHATTING ABOUT RUBRIK. READ IT HAD A GOOD IPO.BUT IT IS STILL ONE STEP FORWARD AND THREE STEPS BACK.I WOULD SAY THE MARKET FOR IPO'S IS STILL A LITTLE BITFROSTY. WE ARE MAKING SURE WE HAVE THEBUSINESS, PROFITABILITY, AND GENERAL CONTROLS TO LIVE AS APUBLICLY TRADED COMPANY.

THE RIGHT TIME WILL DEPEND ONTHE MACRO MARKETS WHICH IS OUT OF OUR CONTROL. CAROLINE: WAYNE TING, LIME'S CEO.LET'S GET BACK TO THE PUBLIC MARKETS. ED:ASTONISHING WEEK IN EARNINGS AND NEXT WEEK IT IS ANOTHERASTONISHING WEEK IN EARNINGS. [LAUGHTER] CAROLINE:WE HAVE HAD SO MUCH FOCUS ON AI SPEND.$40 BILLION APIECE ON AI SPEND. WHAT CAN YOU GET FROM THAT?GOOGLE OUTPERFORMS. MICROSOFT OUTPERFORMS. THAT IS IT FORBLOOMBERG TECHNOLOGY.

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