AI Funding Frenzy Continues with Cursor, Thinking Machines

Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is live from coast to coast with Caroline Hyde in New York and Eva low in sentrancs go.

This is Bloomberg Tech, Coming up Tech socks, whip saws, Skepticism grows about the FED being able to cut interest rates.

In December plus Thinking Machines, the AI startup founded by former Open Ai exec Mir Marati, is in talks to raise funding at fifty billion dollar valuation.

And we sit down with the CEO of Cursor after it raised two point three billion dollars in a funding valuing the company twenty nine point three billion dollars.

Carter massive private sector funding valuations. But let's get to the public sector, because we are being whip sored on the day.

That we are flat if you're going your five day stretch.

The NASNAC is currently flat as a pancake, as we might say over in the UK. But at the moment, we are still seeing this questioning, question of valuations, questioning of sustainability of CAPEC spend from the big AI players, question of what the Federal Reserve does next. So we dig into key assets that see volatility this week but I'm looking at Crypto has been in the eye of the form. We're off by seven percent, let's call it.

On Bitcoin.

More broadly, we're seeing a lot of pullback in terms of the ETF buying. We see another more than eight hundred million dollars washed out in terms of outflows from those ETF products.

D The mood music of the market has changed this Friday in the context of technology best laid plans. I was going to tell you that Tesla and n Video was two of the biggest decliners. Actually both now positive territory, but over the course of the week, probably in Video more than any other, has had volatility, starting the week with a really big jump, then declining on news flow actually an aggregate over the course of the week, it's basically flat. But then there's the Super Bowl next week

Probably both at this point.

Character Yeah, and let's get to both of those key elements we want to dissect. Blueing b TV Markets correspondent Norah Melinda is here to really break down what felt like the start of the day of a risk of rally. The risk off is still there in crypto, but we're really getting whip sored in the stock market.

We're seeing a lot of whip song in the market and a lot of conversation here about a potential AI bubble. But when you think about valuations from the S and P five hundred more broadly, we haven't even seen a five percent decline in the S and P five hundred

Norah'm going to let you and the audience in on a secret. I was going to take a vacation next week. Okay, check my calendar. Super Bowl Wednesday. In video earnings. We've got to talk about it and one of the reasons it's great to having the program. Let's talk about it through the lens of the options market and what that's telling us about how they've looked at their calendars and how they're preparing for that print.

Well, a lot of activity happening here in the options market, as you mentioned in Vidia of course being the super Bowl event for the market next Wednesday post market, but we are seeing call options here on the vis what strikes around sixty here and set to expire right before the Nvidia earnings come out. So it really is showing you a bit of a glimpse into the options market and what that means is we think about volatility more broadly and what that means for the broader market.

Someone's taking a bit of a holiday at least until November the twenty fifth.

That's Michael Barry.

We understand a course, he's been winding down his sec at least for Sion Asset Management, but he really sparked off this whole narrative about how we assess assets and ultimately the deterioration of them when it comes to GPS and.

Chips right, and he is talking about the fact that potentially a lot of these tech companies are using it to pad artificially their earnings here. So when we think about tech companies and the fact that we do see them flying high, we're seeing evaluations super intense here, We're seeing them very high. It just really begs the question more brobvious to whether or not these tech companies are running further beyond what fundamentals will actually allow.

Invokes Nora Melinda with the tech market. Look, thank you so much. Let's keep the discussion going and break down the signals and the economy how they trickle into business. Natalie Gallagher is principal economist and director at Board, an AI powered enterprise planning platform providing macro analysis and strategic guidance to global companies on business, investment and economic policy.

It's been a difficult week.

We planned this morning show with the narrative in the market right now that this is about the FED and what they will or won't do in December, but actually, over the course of the week, it wasn't about that at all. It was about valuations in an AI bubble or not an AI bubble? What's the real driving force right now? That's top of mind for the people you speak to.

Yeah, you know, the debate has absolutely intensified when we talk about are we in an AI bubble? And there's really there's two sides to the story. On one side, it doesn't appear to be as cut and dry as maybe a repeat of the dot com bubble, and that's

Now, there's absolutely risk right as we as.

We approach the potential for an AI bubble, but it's not as cut and dry.

Let's try and link it to the Fed.

You know, why does it matter if the Fed does or does not cut interest rates again in December?

Yeah, it matters extensively, especially for a sector like tech because it's so rate sensitive. When we look at discounted cash flows, we look at M and A activity. You know, the Federal Reserve was already flying partially blind back in October. Very likely data is going to continue to be delayed or offset as we get into December, and.

So that elevates the risk of a flower Reserve.

Misstep that's going to have an outsized impact on tech.

What's having an outsized impact on the economy is AI investment. In many ways, it's underlying why we see GDP growth. But I've been speaking to CEOs of late and underneath the hood, they're saying this economy is weak, and actually we're seeing companies Verizon this week, Amazon earlier, they are laying off tens of thousands of people in many ways to try and right side their cost base. Natalie, what are you actually hearing from the companies that leave right now?

Oh?

What I'm actually hearing is that there's really two sides to the economy right now. Right it's regularly called a K shaped economy.

So you're absolutely right.

We have AI valuations that are really driving business investment and overall economic growth. R and D spending. For example, it was up fifteen percent in Q two. That is the highest it's been since the dot com era. Now, when we talk about what's also sort of channeling economic growth, those AI valuations, they're allowing higher income consumers to continue to drive growth in the economy.

And that's why it's so important as.

We get into twenty twenty six, we really have to talk about what does the tech sector look like and what does AI look like in the next twelve months.

Now, Natalie, I'm going to ask more of a complex one now, and I want your take just more broadly on women's thinking about the AI bubble.

Michael Barry.

Many in the media have been talking about this depreciation of certain assets. In particular, we're trying to work out just how long an NVIDIAGPU lasts.

You has hit three.

Years, four years, five years, and the company is sort of doing accounting wouldn't say tricks, but accounting changes to try and understand how long these assets really last. From your perspective, what is the asset that we should be analyzing, What is the underlying accounting we should be keeping an eye on, you.

Know, I would say even broader picture.

What we really need to track is the investment that's been taking place right There's been a significant investment way really across assets, and.

This is just part of the broader story.

What we're really going to need to see from an eggnomic perspective, is this translate into meaningful productivity growth. If we don't see that, then we risk a capital misallocation story.

Just a couple of minutes time, we're going to go talk about applied materials the chip equipment maker, but that story illustrates that Right now, there is still an issue with tariffs and with China and with trade policy. How is that impacting the global economy right now?

Right now?

You know, we saw an immediate de escalation when we had the US China trade talks back in October, and so that removed an immediate headwind, but it also introduced a structural issue. Right we have an annual renegotiation.

Period for example.

Now, what that does in in broader sense, what tariffs do is they create a situation where companies don't have quite the forward guidance that they would like. Because we're talking about investment cycles that are seven to ten years. Realistically, we're getting about one year visibility and two overall prices.

We're about to get a bit of visibility next week with our so called super when it comes to videas fundamentals.

But when you're.

Giving analysis, when you're thinking about strategic advice, do you think the commitment to continue spending by big aipays is there and is there globally at the moment, Natalie.

I absolutely think it continues to be have a lot of weight behind it. Now, what I also see when I look at the numbers is that there's been sort of a clear shift in investment strategy towards evidence based investment rather than just spending on faith alone.

You know, we.

Absolutely saw this with how investors responded to share prices following the earnings release back in October.

It's been great having you come back to Natalie gallagha As she's principal economist at Board.

We appreciate it. Look, it just teased us Apply Materials. Let's go there.

I'm just going to flip on from Tesla and a video and show you what's happening in Apply Materials Stop right now, because we're off now only.

By three tenths of a percent.

This company was sinking as much as six percent at the opening of trade. We will worried about the current quarter sales that are suffering largely because of a decline in Chinese business in particular that is a significant about thirty percent, let's called it. Twenty nine percent of total fourth quarter sales were from mainland China and they declined some eight percent year on year. What are we thinking about this fiscal year? Look, we've just been talking about

Coming up.

Former opai executive Mirror Marti's startup Thinking Machines Lab could soon rank among the world's most valuable private companies. Give you the latest in the funding talks. Next Sploomberg Tech.

Thinking machines Lab the AI startup founded by former open ai executive Mirror Maurati. It could become one of the most valuable private companies less than a year after I launched. According to sources, the startup is in talks to raise funding and a fifty billion dollar valuation, quadrupling its value from July. Let's get more from Rachel Metz who worked on this story. Well, their very own ed Ludlow and

I mean, it's a very young company and they have released a product, so it is possible that they're seeing a lot of traction that they haven't spoken about publicly yet. For their product, it's called Tinker and it helps people and companies fine tune AI systems. But it's not clear how much growth they could actually have right if they've been around for less than a year, so it's pretty tremendous so that they'd be in tox with this kind of money and valuation.

When we broke the story, people on social media kind of blew up and they were saying, oh, that would be twenty five billion dollars per blog post because the company has only ever done.

Two blog posts.

But what we did get the sense that this is Mira Marati right, that she is out there talking to investors about this.

It's her.

She's the face of that explained to our audience who she is, why she's important, and I guess the intellectual capital that she gives that place.

Sure.

So Murti has been in the tech industry for a long time. She has been an Open AI or had been an Open AI for a number of years and was an executive there. So she was at the company through before things sort of like exploded with the brief ousting and rehiring of Sam Altman. In fact, she was

Thinking, yeah, dig into that talent, Rachel, because she actually drew over with her an awful lot of ex Open AI, well, actual co founders going with her.

Absolutely, yes, quite a number of early employees. She has co founded. One of the co founding employees over there, John Shulman, with her. And also there are people advising the company that used to work at OPENINGI. So it's a very deep bench of experience from that company, but also from other companies as well. But open Ai in particular, there was a quite an exodus of talent from that company to her company.

And again, the reason this is extraordinary it was only February that they kind of came into existence publicly. July raised at a twelve billion dollar valuation. Now November talks for fifty billion dollar valuation, maybe more. Bloomberg's Rachel match, thank you very much. Turning to media paramount, Netflix and Comcast are eyeing potential bids for Warner Brothers Discovery. Meanwhile, the company has amended CEO David Zaslav's contract to secure his pay in the event of a sale. For more,

Yeah.

I mean, now we know that the deadline for the first bids is a week from yesterday, November twentieth, So that's coming up fast. And I think this is another signal that, you know, big transaction potentially could be coming

It's interesting. Now that's a reverse spin off. Initially it was going to be Warner Brothers. It was spun off.

The actual bit of.

Movies and the magic and the streaming and cables were going to be left with Discovery Global, and now it's the other way around. But whatever the case, Detasazlov's saying I'm committed until twenty thirty. Unless he's been he you know, has to leave because the company is bought.

From your perspective, you're hearing more that.

The insiders would like it as a whole sold, or would they like it sold for parts into different players.

Depends on who the bidder is.

I mean, Paramount Skydance clearly wants the whole thing. They're happy to take the cable networks that would fit in with their portfolio and give them additional scale. But if you're talking about Netflix, they have no interest in the cable networks. They just want, you know, the studio's business, the library, the HBO Max side of things. Comcast you could see maybe going either way, but really they want the studio, the library in terms of scale, getting their

Fish, you've already answered this, but let's leave our audience with the what we know, So explain just very quickly again the deadline and where we think these bids stand.

Yeah, the deadline for the first bids is a week from yesterday, Thursday, November twentieth. We think these three companies are going to submit bids, and you know, the Warner Brothers Discovery is saying that they're hoping to get this decided one way or the other by the end of the year. So we at least now have a very concrete timeline for how they're going to deal.

With these bids.

They've been out there meeting with the bidders, you know, presenting their financials, going through the library and plans.

So this has happened quick.

Now seemingly a fifty eight billion dollar offer from Paramount's guidance is not enough. Bloomberg's Felix Jellette. We appreciate you breaking it down Chinese e commerce platforms. They saw strong sales during the country's month long shoppings event Singles Day now an AI integration emerged as a major growth driver

But all the numbers actually good.

When you take into well the idea that it is longer than on previous times.

Yeah, we did a like for light comparison.

We think it's about fourteen point eight percent up over last year, which is actually much better than expected. We think this is the strongest one since twenty twenty one, and that's they ran a week earlier and a couple of days later. But even taking that into account, we're pretty optimistic at the Chinese consumer right now.

Okay, where is the Chinese consumer right now?

Well, middle class growth was pretty good.

You know, Ali Bob is now reporting numbers, especially with their eighty eight VIP program that's also really strong and that's focused on a more upscale consumer. They're reporting thirty percent up in that particular category, so.

That's pretty good.

Middle class consumers are what people have been worried about over the last couple of years. He has been pressure and employment, so that really didn't play any consequences here For this eleven eleven it was great. You know, we're seeing close to fifteen percent growth year over year, which is already the largest shopping festival.

So these numbers are pretty optimistic.

But we're in a position where we can look at all of the Chinese technology companies that participate in this and say this specific company one they are ahead. Ali Baba is the one I'm thinking about most because in early October the shares hit I think, the highest level since twenty twenty one. But there's no sort of tangible evidence that any one company, at least from what I can see on the Bloomberg terminal, did any better or AI made any more impact than any other in this period.

Yeah, it's interesting.

I think for sure the destination platforms as opposed to the social commerce platforms did better here.

So let's JD that's Ali.

Baba there definitely we think much stronger growth than the Doyan or red node platforms.

But AAR really did.

I mean, the business advisor that Ali Baba released is quite effective. You know, it made things a lot more efficient. Despite that growth of fourteen point eight percent that we think they came in at, you know, ad spend growth was much lower than that, which means that acquisition costs have come down. And Ali Baba is really making it

Jacob, what did you learn about the health of the Chinese economy?

You know, this came in better than expected for us too as well. You know, so we see really solid growth and we've seen this what we looked at. We saw labor pressure also picking up in terms of salaries and the amount of household income recently. So this wasn't

I mean, the government's been there to prop it up. There's been subsidies so many ways. People would say that they should be able to buy this moment, what is it that they buy in terms of domestic brands versus well the companies that you advise who are trying to access Asia.

At this moment.

Yeah, I think it's all over the place. I mean when we look at again.

When I was talking about the Ada Vip and we look at that middle and upper class consumer, we would see a lot more of the important products consumed by that demographic. So that's what's driving a lot of that growth right now. But you know, I think that a lot of the local brands, especially you know, mainly TikTok and Dillion focused a little bit more price conscious. But I think what happened again, you know Ali Baba's business advisor. You know, we expected, you know, in terms of the

Steven Engel, our reporter over in Asia, did a beautiful wrap up of like the ways in which they are targeting using e commerce, social media and.

The influence of influencers.

But how are you seeing AI and some of the ways in which technology are helping some of the brands that you represent, well, I.

Think just from being on the ground, this year was very efficient. I mean, you know, it did run for a month, Sales were spread out different categories, which made it really great to operate. I mean, if we go back to ten years ago, is kind of bring your toothbush and pillow to work because you were there twenty four hours around the clock.

This year.

The preparations, the AI, just the assistance in general and efficiencies really kind of made it great for operators and it kind of reduced the stress level on people's operations. So that was great and we'd expect that to continue on into next year.

Jacob Cook, C of WPIC Marketing Technologies. You always on the ground and then somewhere stunning like Vancouver.

How do you do that?

It's great to have you back on the show.

Welcome back to Bloomberg Tech.

Let's tech a check on these markets because we're all over the place today. Look, we started much in the red. We had anxiety building once again, tech valuations, what the Federal Reserve might be able to do in December, what economic data is going to tell us?

And then the rebound kicked off.

We're up four tenths of percent is Video and some of the key other players, particularly Micron, Microsoft Broadcom, all turn into the green. We're now up four tenths of a percent, but on the week we're still under some pressure. Bitcoins still hunt some pressure, well by six point six percent over the course of the week, So we really are seeing that that asset class is in the line of fire. Even as the NASDAK bounces on this day and helps draw it draw it to a weekly gain,

There's a lot going on in private markets this week. The name Cursor has been on the tip of the tongue of big names across tech, including Sachi, Nadella and Jensen Wang, and it's vibe coding software has been on the tips of the fingers of employees at the likes of Nvidia, Salesforce and PwC. Now the company has roughly tripled its valuation in just a few months, raising two point three billion dollars at a twenty nine point three billion dollar valuation. Michael Tryll, Cursor CEO, joins us now

Why and what does it mean to you?

Well, first, thank you for having me. We raise this money to invest deeply in research. And we are this company that's something in between a product company and then also an AI and models company, and in parts it's an important product lover for us to do our own investment in product specific models and that's something we've been doing for many years.

This lets us do that in a bigger way.

It's AI coding, and you know I was in Washington, DC for GTCDC. Jensen one goes on stage and he made a very pointed remark that software generally speaking, is now worth paying for, and he used Cursor as the case study. Would you actually talk us through the case study? Nvidia is a big company, It has many of its own engineers. How are they using Cursor, what are they using it for, and how are you charging them for it?

Well, we've been really happy to see not just the accelerating demand in our market, but also the success in our deployments with customers. There was actually a study that came out recently that showed that customers after they switched to our agent get forty percent more done and in.

The productivity reference for the engineered themselves, the workload that they're trying to get through.

Yes, okay, it's looking at plor requests, merged and metrics like that, but folks are seeing lots of success out in the field. And so to Jensen's comment, the ROI of buying the tool is just has been so high for many of our customers, which makes us really happy.

What's interesting is vibe coding was all the lexicon in the past few months, and many people felt that it was individual.

So paying the twenty dollars for a Cursor.

And really doing it and really feeling the power of understanding and being able to prompt. How about now what you call AI coding? Is this more of an enterprise play? Is it more of a sit at home and play at being a developer play?

We serve professional development teams and in particular professional engineers or are ICP, and so when we use the term A coding, it's to underline that we care. You know, there are some folks that experiment with the tool for prototypes, but the core use case, the reason the vast majority of customers are using Cursor is to get real work done in their real jobs, and that means shipping carefully in professional codebases at the highest degree of quality.

We were just talking about all the CEOs of the Magnificent seven and others who have.

Been using Cursor been talking about Cursor.

They must have been calling Cursor, Michael.

How many imbounds you're getting on companies wanting.

To buy you at this moment.

We've been really excited to see demand both across the Mac seven out of seven of the mag seven actually our customers, and we're really happy about that. But then also staples of the real economy like Starbucks and PwC and Hilton and Budweiser, and then many digital natives like Stripe, Adobe, Uber, Nvidia, Shopify and.

Others like that.

I'm going to jump in there and just quickly because so go for it.

Please. Yeah, you're not.

Answering exactly my question. Has anyone been trying to buy you?

I can't talk about things like that here.

You can talk about them here. Bloomberg Tech is the right place for it. What you've been doing is shopping yourself. Find that very interesting. You used M and A to address your own talent requirements growth by Design. What was behind that move and what was the problem you were trying to solve for in doing that?

Growth by Design was a talent agency that we had worked with for a long time, and the folks that were running that business. We got to know over many months working with them on building the team, respected recruiting leaders in the industry, and we started talking with them a few months ago about whether they would come in house and join us to lead talent for us. And this is a strategy that we've taken kind of across the board, whether it be an R and D, go

What's so interesting is how fierce the talent fight has been in many ways Michael taught to us about where you are getting your talent from, how you're going to see that growth by design is going to bring on even more of the best people to work and build your business.

Still, largely folks that join us we reach out to, and that's through knowing past colleagues of theirs, and we invite them to interview.

But more and more we're.

Scaling that and trying to diversify how we find folks, and then we have a deep interview process where, for instance, on the engineering side of things, we invite folks and for two whole days to spend two days with us going and turned on a project, and that's both giving them lots of information on us as a company that also gives us really great signal about whether they're going to be affect when they join.

You've grown incredibly quickly, and you've joined us on this program to explain how Cursor is being used in the real world and generating real revenues. But if you had to reflect honestly on what's still difficult for you and curs and what some of the I guess barriers or headwinds are to your industry or you specifically, what are they? You know, what is it that you need to see change right now? But we have a long product journey left.

We're addressed at the very start of how we think building software and coding is going to change over the course of the next few years. And I think it can be really really easy for folks who are removed from writing code all day to stay in touch with just how far away we are from all of software changing. And despite all of the change over the past few years,

Those that we regard as leaders of industry have talked about the AI displacement of jobs or not displacement of jobs, and actually, as it relates to Cursor, you know, many take the view that it's not AI that's going to take your job, it's somebody that uses AI that's likely to take your job, just through the lens of what Cursor sees through his customers and internally, where do you sit on that debate?

Michael, Definitely, in the data that we have, we don't see that. We see the fold of who's participating in the software development life cycle expanding, and that's more engineers getting within the fold and growing seats within engineering accounts and growing engineering teams. But that's also folks in support or in design helping to do small changes within a production code base too.

Michael Trueau, Cursor CEO, thank you very much for coming back here on luvent Tech and SF what you.

Got fascinating conversation, But now it's time for talking tech head and first up, Jeff Fezios's Blue Origin nails a major milestone it's next to Glen New Glen rocket booster safely landed on a platform in the Atlantic after launching a pair of small satellites on its way to study Mars. Now that makes Blue Origin only the second company after Elon Musk's SpaceX to successfully recover a booster, fittingly named never tell Me the Odds.

Plus.

Emirates is reportedly partnering with SpaceX is Starlink to bring faster in flight Wi Fi to its fleet.

Now that's according to sources.

The deal could be announced at the Dubai Air Show on Monday, so the service will still need government.

Approval before it can be deployed.

And in a rare split between a chip maker and its biggest customers, Amazon is joined in Microsoft in backing legislation that could restrict Invidio's chip exports to China.

According to The Wall Street Journal, the.

Proposal would require chip makers to meet US demand before shipping to come trees under arms embargos ed Okay.

Coming Up founder's fund is backing startup Netek, aiming to supply AI to small businesses and we mean small businesses. We're going to speak with the CEO, Melissa talking about next this is Bloomberg Tech.

In a show of continued confidence, founder's fund is backing Netik for the third time in a row.

It's the kind of support and.

Sustained support that the firm has previously on is shown to the likes of Cognition AI or andill Now. Netik has raised twenty three million dollars in a Series B funding round aiming to talk quick businesses and contractors with advanced AI tools. Melssa top max here Netics CEO Melissa this is about main street, this is about h fax, this is about contractors coming in repairing. Why target that part of the market.

Well, thank you for having me, Caroline. I think for us it's very important there. We're bringing frontier AI to the industries that are the backbone of American economy.

I think a lot of startups.

Are existing in Silicon Valley that backs maybe developers, but for us, we want to back these industries and large companies in these industries in HVAC, plumbing, electric, solar, consumer health and bring the frontier AI for them and help them make more revenue.

Why doesn't some of the enterprise offerings thus far be fit for purpose for these small and medium sized enterprises.

Yeah, I think these workflows are really deep. So I think Ed was telling me actually just yesterday about adding heat pump to his own home.

Yeah, he did add a heat pumps my home. Yeah, hopefully it's working really well.

It works, but it was very difficult process. It was delayed. There you answer the question, but.

Yes, yeah, it's exactly like Ed's experience, right, trying to reach out to a company that might help you and help you immediately because you have that need. Now, so what we help with these industries with They all actually face seasonality and volatility and have to have deep workflows with their customers like AD.

So the other.

Solutions that might give you point solutions or easy workflows will not work with these essential services that are serving millions of consumers out there in America.

My small house in northern California is one end of the scale. The other is data center build out and Jensen one was speaking about this at GtC and DC. I'm going to read you some of his quote. But in order for us to win that the market, we need mechanical engineers, electric engineers, plumbers, construction, skilled craft labor. We need mountains of them. We need mountains of them, and that's going to create lots of jobs and it's going to be fantastic for the United States. But we

Is that your experience, there's.

Definitely labor shortage in these markets. We need more people to go in and get trained in these industries for our country. And it's not just for data centers. It's actually as we have access to more tools, the energy need is increasing from consumers and businesses, data centers across the board, and we're going to need this labor to be able to power it all.

Talk to us about total addressable market here, Melissa, because it is such an obvious play to sort of make sure that Main Street is equipped here.

But why haven't more tackled it. What are you seeing in terms of the need?

I think when you're building a business in this area, the mission is the most important thing. All of us at Netek truly care about bringing AI to the backbone of American economy and to the physical world.

I think this is maybe not.

The sexiest area that the Silicon Valley companies are building in one, it's very difficult. You have to get integrated with companies very closely. We partner with large private equity firm and large enterprises in these industries and to really learn their workplace.

So I think that's the root of Caroline's question though, right if I said small businesses earlier, actually you work with some bigger businesses as well. But you know, the basic question is can a contractor or a small firm of engineers, plumbers, whatever, afford to pay for your software? That's what it comes down to.

Yeah, I think the question is about does that contractor a solo contractor or maybe a few people do they need AI today?

Right?

I think in there in that type of small business level, if anything, capacity and labor being able to go take on more jobs is the more problem. Then maybe investing the small capital you have to AI tools. This is why we actually started with more mid market and large enterprises, because they're at a point that they can invest for more growth with AI tools versus.

Not just real quick.

If you and Jensen wangare so much on the same page, have you actually met with him and.

Talked about this.

I did not, but I got to listen to him in DC when he was talking for the AI Executive Order and I was front row and loved that he talked about this type of jobs because I think we need to encourage the young people to go into skilled labor a lot more as AI does displace job in more computer backed maybe small menial task areas. These are the jobs that are not replaced for the next one hundred years.

Melissa to magnetic see are great to have you on Bloombotech.

Thank you.

AI is reshaping holiday retail. Google is testing new AI tools through its Gemini platform aimed at making search and check out more seamless. It's part of a broader push to bring agenticai into everyday shopping. Here with more is Lenian Rincom, Google VP of Consumer Shopping product This is interesting because we're going from the domain of AGENTICAI and we're trying to take it to how consumers already you search, marry them in the context of retail.

How does it work and why is it important?

Yeah, So agentic tech is, you know, relatively new, and we're really focusing on bringing agentic ai for consumer problems that really matter to consumers. And so for example, taking the tedious parts of shopping and having AGENTICAI, which is AI that does things on behalf of the user.

So, for example, with price.

Tracking, you know, we have the scenario of you see a product, maybe the price is too high. You can track the price and we will auto buy the product for you. On the other hand, for example, let's say you have a particular product. Let's say La Buboo is one of the products of the season, and you want to find it near you. It will actually make all the calling for you for nearby businesses and tell you whether it's in stock.

Do you have any evidence or data that this technology change results in an actual purchase or more that increases the likelihood that the consumer goes through with it.

I mean, anecdotally, we do see that consumers are really loving this in the sense that both consumers and merchants actually especially for the agentic calling, because it's allowing consumers to have more confidence let's say that the product is actually in store.

There are some that perhaps don't want others agents coming and making purchases.

They want that direct relationship.

We've seen reports of Amazon doing a season desist on perplexity because of creiment's being made.

How do you think you'll navigate the ecosystem in that way.

Lilian, Yeah, it's a great question.

You know, I think all of this agentic technology is very nascent, and again at Google, we're really starting with what are those real problems that consumers have and always giving consumers control of the experience. So in that agentic checkout, for example, as I mentioned, you know, we're starting with a real user need, right, which is a lot of times people will see a product maybe it's too expensive.

On the backhend, Lilian, we've got a beautifully geeky audience. What is it that you've managed to do in the last few months years that is just allowed for this, that is now seeing the agents able to run run free and make purchases on one's behalf safely.

Yeah, I think again. So a lot of this is new.

I will say that, you know, on the agentic calling piece, we have been doing things like duplex, which you may or may not be familiar with, which is where we're using AI to essentially call a business on your behalf for some years actually, you know, since twenty seven, twenty eighteen.

I think the restaurants have been doing it for me for a long time.

Yeah, exactly.

On the calling piece, I think we've been doing this for a long time, and we're really finding real user needs, you know, for tedious parts of shopping where we think it can help. On the agentic calling piece, also tracking the price is something that we've done over some time. This year, we've actually gotten down to the variant level.

And then the buying.

Really what we're doing there is we are instantiating a browser and really adding a product to the card on the merchant side and letting you buy it.

The question is always what happens next and how is this going to go? At the enterprise scale. The issue with agentic AI is that you need many agents to be able to communicate with one another. In fact, in the consued think about an airline app, for example, and they maybe use a different software platform to book the flight originally. Are you encountering those problems? You know, Gemini and what's outside of Google's control?

You know, I would say that it's still nascent. So today, for example, a lot of our merchants and the way that they show up is actually through relationships that we've developed over the years. So we have something called the shopping graph, which is, you know, fifty billion product listings

Yeah, Lillian and Rincon of Google.

Fascinating as we head towards holidays, taking a little bit of the to.

Do list off our plate. Thank you for stopping by.

And meanwhile, that does it for this edition of Bloomberg Tech.

And what a week it's been. What a week We've got coming.

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