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This is Bloomberg day Break Weekend, our global look at the top stories in the coming week from our Daybreak anchors all around the world. Straight ahead on the program, some big entertainment earnings are coming out this week. We'll break down what to expect from Disney and Paramount Sky Dance. I'm Nathan Hager in Washington.
I'm krolyin Hepkea in London, where we're looking ahead to Portugal's Web Summit as the country pivots to tech and AI.
I'm dek Krisner looking ahead to Singles Day in China.
That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg eleven three y oh New York, Bloomberg ninety nine one, Washington, DC, Bloomberg ninety two nine, Boston, DAB Digital Radio, London, Sirius XM one twenty one, and around the world on Bloomberg Radio, dot Com and the Bloomberg Business app.
Good day to you. I'm Nathan Hager. We begin today's program with a look at some upcoming earnings reports in the entertainment sector. We get results this week from both Walt Disney and Paramount sky Dance. For more on what to expect from both these entertainment giants, we are joined by Bloomberg Intelligence analyst Geita Ranganathan and Bloomberg Surveillance co host Paul Sweeney, who spent a better part of his career covering the media. Great to have both of you
with us on the weekend program. And let's start with Disney. Obviously the biggest entertainment company in the world. Gita, what are some of the key things we need to watch from the House of Mouse this time around.
Yeah, so, I think, as usual, the big thing that we're watching for is the Parks segment. This is the biggest segment for Disney, brings in about sixty percent of their profits. So obviously, you know, any trends, any consumer trends, are very very important. One of the key things that you know, people have been concerned about for Disney for this year is the competition from the opening of Epic Universe in Florida, which happened in May. When they reported
last they actually showed a really good results. They were able to hold their ground despite all of that competition, So I think we're expecting to see more of that, you know, resilient demand going into the quarter. And then the other big thing that we're watching for is really the streaming business. So in August, ESPN launched its streaming
platform for the very first time. We're going to look to see if Disney management team provides any numbers in terms of early adoption and just to see how that launch has been going.
Paul, you of course follow this company very closely as well. I mean, I gotta admit when it comes to Disney streaming, I sometimes forget about my Disney Plus subscription. I mean, am I part of the problem here? I mean, how do you see Disney navigating the very competitive streaming universe.
Yeah, I think, Nathan, it all comes down, as it usually does in the media business, to content, and Disney has some of the absolute best content in the world, including live sports. So when you put that all together, it's just a question of how you deliver that content to people. And when I came up into business, it was through the cable bundle, it was through satellites like DirecTV.
Now it's streaming, and so you just got to figure out how do you most efficiently get that content to your client when they want your customer, when they want it where they want it, and charge a price that is profitable for you, and Disney's has a great track record of doing that. Netflix paved the way and streaming and really showed kind of the world how this new
media models can be. And now what we've seen from the legacy media companies over the last ten years or so, as Githa writes about with her research, is these legacy media companies are trying to catch up. They're trying to transition from a model where the cable TV bundle was really a way to go to now streaming and Disney is really doing a good good job, and I think the street believes that they can certainly be a really big player in the streaming business.
Yeah, Githor, we've talked before about how Netflix has expanded its own streaming strategy with live events, getting into sports as well, and now with Disney introducing its own streaming sports platform with ESPN Plus, is it kind of like legacy media playing catch up again?
Yes, a little bit of that, but you know the way that they're kind of positioning ESPN, So Disney has to be really careful. They're kind of walking a tightrope here because remember they have the leading brand when it comes to linear TV with ESPN. ESPN generates about fifteen billion dollars from the linear TV model ear in and ear out. You know, we're talking about affiliate fees. They
are the highest affiliate fee generator across the industry. They charge something like ten dollars per month per subscriber, so absolutely way way above competitors who charge maybe you know or other channels that are at like one dollar or one and a half dollars per month. So obviously they have to be very careful to protect that legacy TV model, but at the same time, they want to be able to appeal to consumers who are outside the PATV ecosystem. And there are a lot of consumers, by the way,
outside the PATV ecosystem. We're talking about sixty five to seventy million households that do not take a PATV or that do not subscribe to a PATV bundle, and so it's really important to be able to, you know, provide access to sports content and that's exactly what ESPN is going after and we think that so far, you know, they've done a really good job with that in terms of putting their content out there. You talk about catchup
and are they a little bit late to the game. Yes, maybe in terms of Disney Plus, but again with ESPN, they had to be really measured, really deliberate, make sure that they don't cannibalize, you know, their linear TV business, which is really their cash go.
And Paul, you mentioned the content slate that Disney has as well. We haven't even talked about what, you know, their traditional business, what's coming in the box office? What are we expecting there?
You know, it's interesting, as Githa writes in her research, Disney is just in a phenomenal place from a content creation perspective. They've got obviously all the Disney product that has propelled the company for decades, but then they also have the Star Wars stuff and the Marvel stuff, and they just seem if they see something good out there over the past ten or fifteen years, they went out
and bought it. So they have the best content in the business and they usually lead box office by a wide margin, although Warner Brothers is having a very good year this year, so again Disney's at a spot you know. You know, they bought the media assets, including the studio, from Fox, so they have all of that content as well.
So from a content perspective, nobody really can compete against them, and so they're in a great spot there, and they monetize it better than anybody else, whether it's through the cable bundle, through the streaming service, you know, making bringing some of the content to the theme parks. That's kind of been the magic of Disney as a company and as a stock over the years, their ability to really monetize their content as well or better than anybody else out there.
You know, we haven't even talked about the linear networks yet. They've got ABC as well, and I think this is going to be the quarter since the controversy surrounding Jimmy Kimmel, isn't it. Is this going to be a hindrance potentially the traditional broadcast and cable networks.
Kitha, Yeah, So, I mean, you know, one thing that all media companies, this is not just Disney, have to contend with is cord cutting. Is a lot of pressure with the linear TV networks. Of course, you had the Jimmy Kimmel, you know, controversy. One thing that we're going to be looking for when they report is whether that Jimmy Kimmel's suspension actually hurt their streaming numbers because we did get reports that users were kind of canceling, you know,
their subscriptions. Again, I don't think it's going to be material, but this is something that all media companies have to contend with. What is the plan that they have for their networks? For Disney, ABC is a very important property because it shares a lot of the sports rights with ESPN. You know, they do show a lot of Monday night football games. You know, they have NBA games, There's a lot of college football. So you know, ABC is still
a very very important property to them. Yes, they have a whole bunch of other cable TV networks, you know, think about the whole Disney suite, you know, National Geographic, all of those channels that are definitely insecular decline. But so far there are no plans, at least publicly that that Disney has said that they want to you know, necessarily separate that business or sell that business. So again we're kind of contending here with the melting ice cube.
And Nathan you know, interesting on the subject. Laura Martin Research Channels that need them in company came out with a really provocative note about a month ago, saying that Disney should just shut down the ABC network, make it go dark, don't sell it, just shut it down. It's a declining business, and it's really the only business business
that is under federal regulation. And if you want to get out of the way President Trump and maybe some heavy handed regulation, just sell it and or just shut it down. Which I thought was an interesting topic.
Yeah, I'm really interesting. Indeed, we're speaking with Paul Sweeney, host of Bloomberg Surveillance and get the wronganathen of Bloomberg Intelligence. Let's shift over to Paramount sky Dance. The first quarter that they're going to be reporting as Paramount sky Dance under the new ownership with David Ellison at the helm, a lot of job cuts, a lot of changes. Getha, How could that play into the results?
Yeah, we really expect the upcoming results to be a big reset in the whole Paramount sky Dance outlook. I mean, this will be the new management team's first big reveal off its operational of its financial plans. As you just mentioned, there's to be a mix of major cost cuts to improve efficiency and there'll probably be some major investments that they announced to support you know, long term growth, especially on both on the content side as well as on
the tech side. We have to remember that this was a company that was undermanaged, underinvested in for years, so you know, really looking forward to see what they have to say. But of course, the big looming question other than results is are they going to make or are they going to increase their bid for Warner Brothers Discovery.
That is really the big.
Big question.
Absolutely I wanted to get into that with you, Paul. Is Paramount Skydance is going to have to become Paramounts Skiddance, Warner Brothers Discovery or whatever other names they're going to have to put at the end of their title.
Yeah, you know, it's interesting they have an enterprise value of thirty billion dollars in at one point in time that was a big media company. In today's world, it really is not, and I think, you know, it's kind of a lot of folks will call it, you know, substandard in size, but you take a look at Warner Brothers Discovery, it is three times the size of Paramount at ninety billion dollars of enterprise value.
So it's it's.
Really a big something, a big pill to swallow there. So they're going to need some help.
Now.
It's nice when Larry Elson is the CEO's father that lends some support there, But they're going to need some partners probably if they want to pursue this. Here so be aching to see how it plays. And as Githa well knows, this is a company that is now officially in play. I mean the CEO said it, the board has said it, and so it's just a question of who and when, I think at what price.
Yeah, it would be fascinating to see. I given the merger between Disney and Fox just a few years ago, if we see yet another major media entertainment merger like this, where could that position Paramount against Disney with competing giant content slates.
KEITHA.
Yeah, I think it puts them really within striking distance of Disney. It puts them within striking distance of even I would say in Netflix, because they're going to have a fantastic content. They're going to have some best best in class, I would say IP so really really puts them on the map because right now, if you kind of look at Paramount, they have about eighty million streaming subscribers. You put that together though with HBO, Max which has
about one hundred and thirty million. You already get to two hundred million, which is above what Disney has in terms of streaming subscriptions, So definitely makes them a major player, you know, somebody that you have to take note of, and gives them a lot of firepower in terms of growing both the studio business as well as the streaming platforms.
Yeah, really busy entertainment earnings week on tap Forest. Thanks to both of you for this. That's Paul Sweeney, co host of Bloomberg Surveillance and geta ronganath and media analyst from Bloomberg Intelligence, and coming up on Bloomberg Daybreak Weekend will preview Portugal's Web Summit, one of the largest of its kind in Europe. I'm Nathan Hager, and this is Bloomberg. This is Bloomberg day Break Weekend, our global look ahead at the top stories for investors in the coming week.
I'm Nathan Hager in Washington. Up later in our program, Singles Day in China is coming up. We'll get a preview. But first Portugal. It's looking to accelerate the growth of its AI, technology and startup industries. For more than a decade, the country's been louring top international business talent through its Golden Visa program, but now it's also playing host of billion dollar investments from the likes of Microsoft and Nvidia
in new AI data centers. With the Web Summit in Lisbon taking place in the next few days, we want to get more from Bloomberg Daybreak Europe Banker Caroline Hepger in London.
Nathan Portugal's Web Summit, which Bloomberg once dubbed the Davos for Geeks, is one of the largest tech summits in Europe. In the next few days, the forum in Lisbon will hold discussions on topics ranging from AI to cybersecurity to fintech, whilst playing host to speakers from Meta all the way to tennis legend Maria Sharapova. It comes as the country looks to consolidate its status as a tech haven and to court investment in its burgeoning AI and startup industries.
Now in the last few weeks, investors have grown increasingly concerned though, about the prospect of stretchtech, dot valuations and maybe even an AI bubble. In Vidias, Jensen Wong spoke to Blueberg's Ed Ludlow and tried to calm the market's nerves.
I don't believe we're in an AI bubble, and the reason for that is we're going through a natural transition from an old computing model based on general purpose computing to accelerated computing. We also know that AI has now become good enough because of reasoning capability, research capabilities, its ability to think. It's now generating tokens and now generating intelligence that's worth paying for to the point where I'm paying lots of it.
That was Nvidia's Jensen Won speaking to Bloomberg's Ed Ludlow, well as tech CEOs, then seek to reassure investors that AI spending shows no signs of abating. Portugal is positioning itself as one of the beneficiaries of Europe's AI build out. How far, though, can the country's growing tech scene thrust its economy into the twenty first century? Joining us now is Bloomberg's Portugal bureau chief, Sofia Auto Ecosta. Sofia, good
to speak to you. So shall we start with the Web Summit, which is one of the largest of its kind in Europe? What do the main themes this year that they'll be talking about actually kind of tell us about Portugal's priorities.
It's kind of the greatest hit of the biggest talking points across AI and tech at the moment. So we do have AI and ethics really exploring how to govern this increasingly important industry in Europe and how really to kind of align it with human values. We also have the future of work climate, tech growth and startups, you name it. And we do have the Finance Minister from
Portugal attending and expected to speak. So that really shows you where the priorities life for this new government that followed the elections earlier in May this year.
That's really kind of.
Throwing investment and subsidies at this industry, trying to position Portugal as one of the forefront economies to invest in in the European Union.
Sophia, you've been writing about the town of Scenes, which is on Portugal's dramatic Atlantic coast. Then actually this could be a data center, a tech hub, not just for Portugal but maybe for Europe. Tell us about what's been happening there in terms of deals and breaking ground.
So this is really interesting because this is a very small town, about fifteen thousand residents. I went down there. It's about an hour and a half's drive from our Lisbon office. And what's happening there is investment from Chinese, US European investors and.
Quite a lot of it.
So my interest was, you know, why are billions of dollars pouring into this really small Portuguese town And one of them is what's set to be one of the biggest data center projects in the European Union. And it's one point two gigawatts. Now, Karlyn, I have no idea what what one point two gigawatts is, So just to put it in context, that's about as much as the entire metropolis of Lisbon consumes, so it's quite a lot of energy. Now why does this matter? I mean, this
is a big investment. It's a ten billion dollar data center. This is huge for Portugal, and Portugal is really trying to say, hey, we're not just tourism, even though it accounts for about a quarter of GDP and a lot of jobs. So incredibly important of this still for the economy, but that was important to bring the economy out of the crisis, out of the not just the financial crisis, but the sovereign deck crisis. But now, okay, let's invest
in the future. This is where it's at. The government is making it easier for these companies to come here. I spoke to the Stark Campus Data Center CEO and he said, you know, we were welcomed with open arms. And the Chinese battery maker calb is the fourth largest battery maker in the world, so this is quite significant as well. That's a two billion euro investment. They just broke ground on their first battery factory outside of China.
They picked seeing this tiny, tiny town as the gateway into the European Union and this was really heralded by both sides of the political spectrum as a big step forward for Portugal in terms of the green energy transition.
Yeah, lots of visit is bit of population in Portugal only just about ten million people. But the focus on data centers, you know, raises the same question for Portugal as across Europe, which is that the AI boom is power hungry. There will be growing power demands. There's a worry about whether it's going to strain Portugal's energy system.
I mean, we did see blackouts in Portugal earlier this year and that was blamed on a number of factors, but one of them was you know the green and clean energy system, there is the infrastructure going to be able to cope.
So that's the big question, and there's been a lot of discussion at the government level but also at the company level over who really should take the lead on investing in the grid infrastructure here.
We actually had EDP that's.
Portugal's biggest utility today, saying that it plans to allocate a significant amount of money into investing in the grid here in Portugal, but.
Also in Spain where they have a market.
And I'll just tell you that number three point six billion euros in electricity, grids and infrastructure through twenty twenty eight.
That's a big number, Caroline. So the problem here, or I mean, I.
Guess the issue I wouldn't call it a problem, is that Portugal uses renewable energy for about seventy percent of its energy consumption, so that's a pretty big proportion, and it still also imports a bit of energy, a lot of that from Spain. So whether to kind of reduce
the reliance on the Spanish grid, that's one question. Whether to improve the infrastructure here and whether it makes sense for private companies to do that and share the load with the government these are all still questions and there's still a lot of looking into what happened around that blackout. The Portugal does like to blame its neighbors in Spain for that.
Indeed, in terms of startups, Portugal's also got an interesting scene there Sword Health, this startup that uses AI for medical rehabilitation, for example, that has raised quite a lot of money and is now more valuable than everything other than about five listed companies in Lisbon. Is that part of a kind of growing scene as well? If you're seeing data centers, you're seeing all of this interest. Is there also a bit of a growing startup scene in Portugal?
Yeah, there is, and you know, there has been an attempt for the past decade or so to really nurture startups in Portugal. But I think this one really grabbed my attention, Caroline, because it was valued at three billion dollars in a financing round last year, and this year in June it was valued at four billion dollars, and as you said, this is this is pretty significant for Portugal.
It's one of the most valuable private companies for sure, and one of the most valuable companies you know, full stop in Portugal and It's also backed by Founders fund, so very high profile investors looking at this company and.
What it does is obviously quite interesting.
It's looking at pain management solutions and physical rehabilitation using AI,
obviously a buzzword for investors at the moment. But you know, the fact that you can found these companies in Portugal, you can also stay here not necessarily have to go all the way to Silicon Valley to scale suggests that the country is taking these things more seriously, is understanding that these companies need more of an infrastructure around them, and the government actually just recently said it would cut taxes for companies, which would be a big help as well.
Okay, that's interesting in terms of what the government is hoping for and what the public in Portugal make of all of this. Portugal still got a GDP per capita that is amongst the lowest in Western Europe, so there must surely be a desire for the economy to do you well, But what is the government's political ambition, what's the response from the public.
So there's always a tension between the foreign money that's coming into Portugal, which has obviously been hugely important for the economy, not just these kind of investments into tech, but also from overseas residents coming to live here. Portugal has seen a big rise in American, Chinese, Russian citizens coming to live here. There's a tension between that and what it can do for the country and the country's economy.
But actually, you know what that means for the locals who have always been here and are seeing the price of real estate go up beyond affordable levels. The housing affordability in Portugal has actually seen the worst decline in the European Union in the past decades. So it's a
huge tension point for the Portuguese public here. When I went down to Size and spoke to locals there, you know, they said, it's all good and we respect what the government's trying to do in bringing Chinese and American investment here. But our buildings are, you know, crumbling. We only have one healthcare center, the hospitals far away, the roads are cracking.
You know, where is the investment actually in locals and in what we care about, and in creating jobs for people who really still struggle to pay the rent and their rising energy bills and send their children to school. So there's always that tension between local interests and what the government is doing at the macro level, which is attrapped as much foreign investment as it can.
Very interesting. Sophia, thank you so much for spending some time with us. That is blimpag's Portugal bureau chief, Sofia auto Ecosta. Of course, this comes ahead of the Web Summit, which takes place in Portugal in the next few days, and we'll continue our full coverage and analysis of Europe's AI build out here on Bloomberg Radio. I'm Caroline Hepga in London. You can catch us every weekday morning for Bloomberg Daybreak. You at beginning at six am in London. That's one am on Wall Street.
Nathan, Thanks Caroline. Man coming up on Bloomberg day Break. Weekend. Singles Day in China is approaching. We'll check in on what's become the largest shopping day in the world. I'm Nathan Hagar and this is Bloomberg. I'm Nathan Hager in Washington with your global look ahead at the top stories for investors in the coming week. Now we want to head to China, where Singles Day will be celebrated in
the coming week. It's the unofficial holiday that's become the largest shopping day in the world, and it's spreading across Southeast Asia. Let's get to the host of the Daybreak Asia podcast, Doug List for a preview.
Nathan, retailers in China are not taking any chances this year. Many have stretched their sales to as long as five weeks. Now, we know the Chinese economy has been struggling. Weak domestic demand has become call it a characteristic and so e commerce giants like Ali, Babajd dot Com are working to entice shoppers. The question is whether they'll succeed. For a closer look, I'm joined by Bloomberg analyst Katherine Limb. She covers the retail and e commerce industries in Asia from
our bureau in Singapore. Catherine, thank you so much for making time to chat with me. Can we talk about the big picture? First? Talk to me about expectations and the extent to which these big retail names are concerned, perhaps about underperforming.
We had a very week third quarter in China and that's really pushing retailers to bang the book and try to get more out of singles Day and in fourth quarter. And the reality is, as I speak to retailers over the last two weeks itself, Singles Days off to a fairly weak start. You know, we're halfway through the shopping festival right now. I do see more promotions coming up and keeping the fingers crossed that that's enough to really try and push thing ahead.
So, Catherine, I'm wondering about the role of the government in trying to make Singles Day a success. What steps, if any, has Beijing taken.
Well, we've seen the offer of you know, vouchers perks. They are also supporting e commerce platforms and retailers to try and come up with better service levels. But at the end of the day, it's really the confidence of the consumers right now, particularly if property prices as at value still says very low incomes outlooks still stay uncertain, it's going to be hard for consumers to want to spend more in you know, an environment of uncertainties.
About US brands like Apple and Nike, what are the expectations for these brands?
Now?
What isn't just thing is that you know, for these two brands, you know, they were off to a very week start since the beginning of the year, and we'll actually start to see things coming up better for them different fundamental reasons. Off a lower base, but they are creeping up. And I'll take Nike for instance. On the first day of Ali Baba sale, they were off to a very weak start. They did not lead the sportswear sales ranking as they did before in the last two years.
And you know, two weeks down the road, they've actually creep up to being the third, nowhere near the first, but you know, still a good you know, improvement, and again I'm hoping to actually see more over the next two years.
So do you think it's more likely that Chinese consumers will favor the local brands this year, perhaps more so than they have in the past.
I don't think it's going to be that this thing this year. It's moll about, you know, the value proposition that on the table for the consumers. We are at a somewhat balance point between nationalism, being very nationalistic about local brands itself and foreign brands. At the end of the day, it is what is on the table at a good price, you know, for the consumers, and they will be willing to take that if it comes to Not.
A day goes by when we're not discussing artificial intelligence, and I'm curious about the way in which companies like JD and Baba are using AI to drive sales this year.
Well, there's lots of you know AI shopping assistanms, lots of marketing push, you know, just based on what you are browsing. It's a lot more back end rather than you know, what we see as consumers itself. But clearly, you know, they know what we are looking at and they are pushing these items, you know, repeatedly to the face of the consumers to try and get the conversion
rates to actually go up. So you know, this is definitely a good period during Singles Day to test start some of these algorithms as well as these programs, because that's where they're going to actually try and improvise on that for twenty twenty six.
So as long as we're talking about technology, how has the smartphone business been performing on the mainland.
Well, you know, definitely we are still seeing some form of subsidies coming through from the government, so that's actually helping iphoned seventeen model. So far, the platforms, whether it's JD dot Com, Ali Baba's team, or they've been actually pushing for more sales of it, and I'll actually like to throw in that mate one which has actually ventured
into speedy delivery or quick commerce for that matter. They are also now being able to actually deliver new iPhones to you, like, you know, within an hour.
So we know, Singles Days started in China and since then it's spread to many parts of Southeast Asia. So I'm curious away from the mainland when you look at other jurisdictions. I know you're in Singapore, I'm also thinking about Hong Kong, even Taiwan. Are there other jurisdictions that are expected to perform, let's say, better than the mainland.
I think if we actually look firstly at Singles Day, Singles Days no longer about China, and I think you're right on that that we're also seeing Ali Express, you know, Talubau, Globo, JD dot Com Global also launching promotions and campaigns for this Singles Day outside of China. So are they doing better?
I think yes for certain jurisdiction like Singapore for Southeast Asia, And it's really because we're off from a very low base and we're starting to actually see more of those value propositions coming through from Maidi and China products, and you know they are actually very decent for the price that you're actually paying for them.
So Catherine, what about experiences, whether it's entertainment or even visiting a restaurant? Are these industries expected to do well?
That has actually taken off during d long National Day holiday. And you know, when you talk about restaurants the consumption itself, let's not forget that. You know, there is now the counter coming in from takeaways, food deliveries. And again, you know, I'll go back to what I've just mentioned about the convenience, you know, the east of it. You know, we've actually seemed the latest catering or restaurant services sales continue to actually slowe down. That may be a bit of uptick
in October. The overall scheme of things, I think more people are actually you know, doing food deliveries rather than going to the restaurants.
Catherine, we'll leave it there, Thank you so very much. Bloomberg's Katherine Lim our senior analyst covering both retail and e commerce across the APAC. From our bureau in Singapore, we go to Hong Kong next, where the Global Financial Leaders Investment Summer took place over the last week. That's where we caught up with Goldman Sachs CEO David Solomon. He spoke with Bloomberg TV host Yvonne Mann and David Nglace. The conversation started with a question about the US China trade truths.
I think at the moment, you know, a de escalation is a good thing, but there's obviously a lot of work to do to really arrive at a real stable.
Deal that can endure, you know, over a period of time.
I'm encouraged by the prospect of a potential visit from the US President that was telegraphed in the fall. But for the moment, you know, I did not think the escalation on either side was constructive, and so you know, I much prefer a de escalation.
I think both both sides.
Really had a purpose in that meeting to talk constructively, to have a more de escalated environment, and that allows now for constructive conversations as.
They move forward.
One year truce though between the two is that a good or bad thing? I mean, what did to do in terms of business sentiment when there was a twelve month time frame?
Now it's better then, it's better than an escalation at on reasonable levels, which is kind of where we were, you know, over the most recent time. Trade negotiations are complicated and there are a lot of issues on the table.
They need thoughtful responses and responses that can be durable. Yes, there's some uncertainty because it's a one year delay at all of this, but it's also a realistic period of time to try to get the right kind of deal done so both economies can move forward in a constructive way. And look, these are the two most important economies in
the world. I think it's very important that you know, we arrive in a better place where we can both participate constructively with each other in the global growth of the world.
I mean, speaking of let me borrow your phrase, participate. There's been a resurgence in equity capital market raising here.
In Hong Kong.
A lot of the Chinese companies, tech or otherwise are raising capital for the future. I want to get your sense as someone who sits in New York, you travel, of course all around the world. Is there a lot of appetite now from US based investors to participate by giving that capital to Chinese companies right now? In order to do there's you know, I realize there.
An sure, there's.
More appetite for it than there was twelve months ago.
I remember actually last November sitting in a dinner in the United States with a group of US investors and this topic came up, and there were a couple of investors that basically said, we all should be looking to China.
And the reason, the reason that had evolved that way is if you look.
Last fall, the prices had gotten so cheap, the capital flows had moved so in the other direction that you just knew that things would come more into balance and there'd be a recycling.
And we've seen that recycling.
You've seen a big move and prices year over year, you've seen more foreign capital come in.
And start to participate.
That's a fundamentally different question about the big capital allocators really fundamentally shifting their allocations up to be higher again.
So far, direct.
Investment in China has come down, and I think one of the big questions is until we understand kind of the trade and the geopolitical landscape, it's harder see significant shifts back to higher levels of foreign direct investment and.
More capital allocation.
But for the moment, those flows are making for a better IPO market here and more opportunities here.
How do you look at that?
I mean, the whole competition has kind of changed into the dynamics, right. You have so many of these Chinese banks now that are doing some of these deals with Chinese companies. When it comes to going public, how does Goldman Sachs compete.
Well, you know, goldmin Sex competes just fine, thank you very much. When it comes to taking public companies public on a global stage, Golden Sex is a leading position.
We've had a leading position for fifty years.
And there's always competition in the business, and you know, we'll continue to compete, so we welcome competition. But we have a pretty active footprint out here, as you well know. They have a pretty active footprint around the world. And look, one of the big advantages. I just had breakfast with.
A company here that.
It's actually a Chinese company, but the you know, the CEO, the founder was here and why does he value Golden Sex. He values Golden Sex because we have a sess to people, information, capital markets all over the world, you know, not just in a narrow portion of the world.
And so it's a competitive business. It always will be. But I'm comfortable that we have the resources in the position to compete.
Effectively, right and you know, you know I've been greeting up, of course, and I understand your history. You guys have been doing business in China very long time. You guys took the big banks public back twenty plus years ago. So I mean you're headed there in my understanding, after here, you're going to China. Of course you speak with regulators, what have you? What's your long term vision for difranchise in Greater China? What do you want what do you want your franchise to become longer?
I think you have to look at Goldman Sachs and just think strategically that as a global firm, that when you think about our businesses, what are our two big businesses global banking and markets, the investment banking and trading
business and asset and wealth management. And so if you think about how we think strategically about the firm, what advantages does the firm have besides the fact that we have at scale businesses, we're very good at the those activities, we're leaders of those activities, and we have a right to compete and win, you know with those activities.
That was David Solomon, CEO of Goldman Sachs, speaking with Bloomberg TV host Vonn Men and David Nglace at the Global Financial Leader's Investment Summit in Hong Kong. I'm Doug Krisner. You can catch us weekdays for the Daybreak Asia podcast. It's available wherever you get your podcast.
Nathan, Thanks Doug, and that does it for this edition of Bloomberg Daybreak Weekend. Join us again Monday morning at five am Wall Street Time for the latest on markets overseas and the news you need to start your day. I'm Nathan Hager. Stay with us. Top stories and global business headlines are coming up right now.