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Live from New York.
I'm Caroline Hyde and I'm Jackie Devalas in San Francisco. This is Bloomberg Technology coming up.
Ali Baba sches saw after AI demand and e commerce rebound, they drive revenues for the Chinese giant. Plus US Treasury Secretary Scott Bessant weighs in on AI productivity and his relationship with Elon Musk and the CEO of Carlvana joins as the stock sinks on lower gross profit per vehicle and it's the Chinese names that do you want Once again today Ali Baba absolutely soaring at one point up
more than thirteen percent. Were up nine percent at the moment on the ADRs, the American Depository receipts really AI demand cloud seeing growth of thirteen percent, seeing e commerce come back as they charge more fees. Overall, we want to dig into it with Yuchunsen who joins us for more and look, this seems to be Ali Baba coming out of the doldrums of the past years and the regulatory pushback.
Yes, right, exactly.
So today is the big earning day for Ali Baba, and I would say it delivered very strong and solid earnings. I'll come if you look like it feeds on the revenues right from the top line. Reported a revenue growth which is the fastest it was in a year, and it's we're above the world's free analyst estimates. And it also comes from the improvements from two of its most important segments. One is e commerce and the second is
the cloud business. So to drill down a bit that the e commerce apparently is the bread and butter and helped by the overall recovery of the Chinese consumption trend, but also the AI.
The cloud business is.
Really the highlight here because apparently lots of the market sentiment or interests have been going into how Alibab are going to deliver right on its AI strategy, and the cloud is where it's see where it houses the EAI features Q one and different initiatives it has, so there you know, Ali Baba's cloud service also up was up like thirteen percent on a.
Year over year basis.
Again, it's really impressive ernest print, and the investors was sharing all across the board on the financial print.
What do we know about how much the company expects to invest in cloud and in artificial intelligence to really keep this boost going.
Yeah, that's a really good question and it's a question that all analysts was asking right on Ernie's call. So the CEO ed e Wu stated that he's going to putting more money in AI infrastructure in the next three years and will be more than it did over the past decades.
So that's a really big commitment.
The company keeps saying that a AGI, which is artificial general intelligence, is going to be the primary objective for the company going forward.
So that's a.
Strong boost, you know, to the sentiment because if we take a look back only about stock today of ten percent, but year today is of more than sixty percent, and it's mostly driven by the AI hope that the market is giving the company. Right following on the right of Deep Sea. So now this is a moment that is shown that the fundamentals is back in it. And then on the earnest outlooker social that sentiment.
Chi and Chen and all things Talibaba and the Chinese stock rally let's talk about how the flip side is affected. It calls the Deep Seek impact on AI investments here in the US as well. Auca Kolf's with us, but Photio manager at Alga. And what's really interesting is you video is a key name, Microsoft is a key name. All of these refocuses and recalibrations of AI investment whether it's worthwhile, has anything changed for you?
Absolutely not.
If anything, the amount of investment that's going to go into the ground is going to accelerate, and in part because what deep Seek showed us is that, you know, you can start building these models and it doesn't cost that much as long as you have a foundational model to build upon, and therefore adoption rate should skyrocket. You know, you saw just yesterday, you know, or just this morning Nebuus reported that there the usage of their data centers actually he's skyrocketed post Deep Seek.
So clearly there is.
More demand for something that is cheaper when it's increasing productivity.
Anker.
We're also seeing signaling from Washington that lawmakers JD. Van's President Trump really trying to support AI infrastructure, and as it relates to tariffs, because chips are now kind of within that discussion.
You know, it's.
Intended to encourage domestic production, but that manufacturing is incredibly complex, and you, as a portfolio manager, I'm curious if you find that assumption risky. Could that backfire in a way that does lead to higher prices ultimately for the companies and for consumers.
Yeah, So the thing is on if you look at the cost of a chip relative to the cost of the product, it's in fact a very small percentage of the product. So if you look at Nvidia's gross margins, you know, the cogs or what is going to TSMC is only you know, ten percent of the revenue. If that so, if you take a twenty five percent tariff on the chips, you're only increasing the price by you know, two and a half percent because the the fundamental like cogs are a lot lower than people think. So is
it very risky to tariff chips. I don't think it is in terms of the inflationary effect. I do think that, you know, the impact is we really do need to bring more manufacturing on shore. That is non negotiable, and just for our national security, that's what we need to do.
I love that you bring us that breakdown of really what it means from a price perspective with Chip Harris, but bring us there for your expertise, And what do you think TSMC is going to start manufacturing more here in the US? Like there's been ongoing reporting around whether they do a deal with Intel, many saying that's not going to happen if you've got to push back against foreign ownership of companies alone foreign relationships here in the US.
So a little known fact, perhaps is that Morris Chang, who is the founder of TSMC, is in fact an American citizen. Right, So TSMC is a Taiwanese company that was born of an American citizen who moved to Taiwan after studying in the US and working here for a long time. So I would argue, in fact that it might be kind of an American slash Taiwanese company.
So the little known fact I wanted to bring up.
But you know, I do think that the Intel Taiwan semi tie up is a necessity, and in part because where Intel is today is not a function of this management team or the previous management team. It is a function of some strategic kind of errors that were made fifteen years ago that have carried on to the life cycle of Intel and catching up to where TSMC is is. Would I would call a low probability event, And so you know, for our national security, I do think we have a footprint of fabs in the US.
Those are Intel fabs.
Should they not be somehow handed to TSM that actually knows how to manufacture it.
It solves a lot of problems.
It solves the capital intensity that TSM has to put into the ground in the US, which is a big hurdle for them. It solves a national security problem of bringing more capacity to the US. It solves Intel's problem of not quite knowing what to do because they're struggling to catch up. So to me, it feels like a really win win situation for TSM to actually take ownership of the of the Intel fabs.
I mean, these all reports, but would you be buying in on these reports or these potential win win scenarios.
Look, I think there can be many flavors that it has to suit all parties.
Do I think there's some version of this.
I think it's logical for it to happen, and therefore, yes, it is really the only solution that we have.
How do you feel about the ecosystem of chip makers. TSMC is a great example of perhaps these plans to bring more plans to the US solves one problem bringing domestic production here in the US, but at the same time it also increases that concentration in one player.
How do you feel about that?
So I would be focused more so on the fact that if you bring it to the US, the ecosystem in the US actually gets stronger. One of the biggest problems right now is we don't have the engineers, We don't necessarily have the supply chain. Therefore it costs too much as people bring manufacturing into the US. And the first step in this is that we can allow TSM to build a sizeable footprint. Intel is about twelve percent
of the world's manufacturing capacity. Why not utilize that footprint to build the US engineering ecosystem which has slowly deteriorated over the last three decades.
Speaking about talent, that's kind of one of the biggest questions. Do we have a pipeline of researchers both kind of on the manufacturing side as for the software. Are you concerned at all about where we are in that landscape compared to China?
Yeah, Look, I think that China is very innovative, but so are we. And over the last I would say, you know, two decades we have seen a dearth of talent graduating in the more tech fields that are not software, and we have to we have to write that ship. You know, I graduated in material science and engineering, you know, two decades ago, and you know we need to kind of start that engine again because really we.
Do need to build that in the US. So do I worry about it.
I think it's an effort that needs to be pushed on.
That's Anchor Crawford, portfolio manager at Alder.
Thanks so much.
Can you just describe what it's like to work with someone like Elon Musk, someone as successful in American business? Just what's that like day to day?
Yeah, Look, Elon Musk, like Stan Druckenmoer, like I always compare the great.
Businesspeople to great athletes.
They keep their eye on the prize, whether that whether he's the Messy or Michael the Messy or Michael Jordan. He is focused and his energy level is unbelievable and he's gotten to where he has because everything's on the table. There's always this examination of why are we doing it? This way, why are we doing what we're doing? And most of all, if something's not working, let's fix it.
You know, Sam Oltman was on Bloomberg TV just two weeks ago and called Elon Musk insecure.
Do you view him as much?
I'm not going to get into the technic magnet the.
Kind of slap best secondly best, and I would say that's wise. He is drawing criticism, though, when you and the administration come out and pick out the various things where money is being wasted on, I think we can all agree that that's a waste of money. Well, there might be some concern is the way that some people are being laid off in Washington that lacks some dignity? Could you comment on that today?
Look, I think that there are many fine public servants, but I think that you know, I've been in Washington three or four weeks now, and there's a real bias towards the status quo. And if you don't move quickly, then then the lobbyists get involved, the entrenched interest, and
it's impossible to get anything done. So, you know, anyone who has experienced in financial hardship, any kind of the mental duress, you know, I'm sorry for them, but that's also what the average American experiences every day most of us. You know, you all come to work, you want good ratings, you know you get a performance readout. You really push forward.
And I can tell you that in Treasury, I have been so impressed with the quality of the permanent staff and I want to get everybody back to the office and a lot of people are on board with that.
US Treasury Secretary Scott Besson Bloomgs avelience earlier today. I speak it all down in Bloomgs Mike Shepard in Washington. Now, one are the key takeaways. It was a wide ranging conversation, well it.
Really was, but the most segment of that conversation, in a way, was quite illuminating. We really saw once again, as in our first interview with the Treasury Secretary about two weeks ago, no day life between Scott Besson and Elon Musk. Musk, of course, has been tasked with this government efficiency push. Donald Trump asked him to lead this. It has caused some controversy for the way they have powered through agency by agency, moving to even shut down
some entities like USAID altogether. And it is generating. As we saw this morning, some negative poll numbers in the Washington Post and IPSO survey a majority of Americans were uncomfortable with how this was working in terms of agencies
being shut down like that. At the same time, we saw Scott Besson really lavishing praise on Elon Musk, likening him to a great athlete for the focus and energy that he brings and the urgency of this moment that if they want to make change, they have to move quickly. And Carol, it's important for us to remember that Scott Besson's own agenda of reducing the deficit depends in large measure on the success of Elon Musk with Doge in trying to find those kinds of savings and cost rod
reductions across government. And he also wants Elon Musk to help in other ways too, and that includes pairing back some of the regulations that he sees as an impediment to the economy.
Mike, what did Besson say about where these Doze savings will actually go.
Well, you know, he and the President have talked about trying to get them somehow returned to the taxpayers, but so far the math really isn't holding up. We had great reporting from our colleague Andre Tartar yesterday showing that while Doze has claimed fifty five billion dollars in savings so far, the numbers on the group's website itself show something closer to sixteen billion. And you have to have that yet again because one of the contracts was mistakenly
listed as eight billion rather than eight million. So when you break that down, it's about eleven dollars per taxpayer as opposed to the five thousand per head that Donald Trump and Elon Musk have possibly been floating.
So we have to see.
They're only a month in, as the Treasury Chief was keen to point out, but we have a long way to go before we're actually going to start seeing some of this money go back to the taxpayers.
Both the Treasury Chief and.
Must have said Mike, many have wondered when the math is going to start mathing on AAI investment and productivity gains. In fact, Scott Bessen didn't weigh in on that.
Just take a listen the US productivity. I think that I've been meeting with a lot of the tech leaders lately, and I think we are very close to the cusp of this AI finally coming into the productivity numbers.
Thirty seconds left.
What did you make of the view on AI helping productivity in the US?
Caro, He is trying to answer one of the big questions out there for investors and even companies themselves, when are we going to see this breakthrough in terms of a profit generating real game changing use case for it. He is signaling though, that there could be some productivity gains. We have seen evidence of this already at Meta, for instance, the way they've incorporated into their own business structure of
finding efficiency, finding gains helping profitability there. But he did not elaborate, and it would be interesting to hear him lay out more of a case down the road.
That's Bloomberg's Mike Shephard, thanks for joining us. It's not just Scott Wesson talking about Musk. The CEO of Boeing came out this morning saying Elon Musk and his Dosee team are helping the Planemaker work through bottlenecks that have caused the next fleet of Air Force one jets to fall years behind schedule. This comes as President Donald Trump has repeatedly criticized the company for failing to deliver the jets on time, Caroline coming.
Up, Jackie.
Apple launches and you know end smallphone. We'll dig in next. This is Britmbag Technology.
Apple introduce a new low and smartphone yesterday, the iPhone sixteen E, which will go on sale next week February twenty eighth. This in an effort to revive the company's growth after a slow holiday season. Let's bring in Nabila Pope All, senior research director at the International Data Corporation also known as the IDC. Nabila, this is a great upgrade, but it's also far pricier and lower price models from the past. How well are you expecting this to sell?
You know?
I think that that's a really great reason why Apple rebranded it from the SE to the sixteen E, right because they don't want it. They don't want consumers to think this is a more expensive SE device because the previous sees have were at four twenty nine and prior to that at three ninety nine, and this is at you know, significantly more expensive, but they wanted to think of it consumers to think of it as a much
less expensive sixteen device. So we think that given all the bells and whistles this is coming with makes us a significant upgrade from all the different you know specs. This is coming with which much much greater their latest chip set, bigger screen size and all the different you know, the uh and more. They're you know, the biggest, they're you know, the most innovative modem. Like I think that's the biggest news right now. So I think that's what
they want the consumers to focus on. So we really expect you know, traditionally or rather they're in their previous se devices right of their budget phones, they have been doing about anywhere from five to eight percent in their launcher, and we expect this device to do. Actually, this is going to be the bigger news, you know than the in fact even the launch of the sixteen device. And it comes with Apple Intelligence to top it off. So for a budget device, we expected to do really well.
Nebula talk about that C one chipset and the fact that they're moving away from Qualcom. How important a road test is this for the seventeens.
And I think that this is you know, I think this is what the biggest news is.
Right.
They didn't want to, I guess test drive it with their their sixteen models, right, And I think they finally launched.
It is they've been trying to get into this space with word integration and launching their own modem, and and this will also play really well into the so the investors write more profitability, but also give them more room to play with the design, play with whether it's you know, they use it as a as a test play to see how much more they can make the device more efficient, how they can play with the design and what they can do is essentially whether they you know, how they
what lessons do they learn right to bring it into play, whether it's in terms of efficiency and design or really bring the motem into the seventeen. So I think that's it's a really good test ground for them. And at the same time, right, the sixteen users who are or rather the sixteen uh not e right, but the the pro and the the users are paying double the price for the rest of the family won't feel kind of cheated because they're paying double the price. But at the
same time, you know, they're getting the Qualcom chip. So I think it's a really genius marketing move. At the same time, the se users will get a phenomenal upgrade and they won't feel that we're paying two hundred dollars more for you know, they're getting all of these fascinating upgrades, not just the modem but the latest chip and you know, bigger screen size and rival list of upgrades.
And Apple intelligence.
Nabila popole I see senior research director joining us and interestingly reports that Apples Tim Cook is actually going to be meeting with Trump and the Oval Office.
Plenty of for him to discuss.
When it comes to China where they probably want that sixteen E to be selling. Well, welcome back to lu Meg Technology and Caline Hide in New York.
And I'm Jackie Devalas in San Francisco.
Got more than five percent after that twenty day rally, that record rally that saw shares go into record territory. Come and Ranicky is with us to talk us through what that twenty day rally means. Yes, we pull back a bit, but ultimately this has driven the stock to numbers that we've never seen since it's well first listing and we're questioning whether they need to get a little cheaper.
Yeah, exactly. So we've been watching Meta for a while. Obviously it's had an incredible run over the last few years, and this twenty day rally was just amazing to watch. Metas never split its stock before, so since twenty thirteen, it's just you know, been going up and so it really the level that it's hit now it's more than seven hundred dollars per share, kind of puts it in the sweet spot for a stock split, and actually the pullback that we're seeing today makes me think that it
could make even more sense. Companies often enact stock splits when their price per share gets very high, lowering it. So splitting the stock doesn't change anything about the fundamentals it's purning is then exactly, but that lower price per share can be really enticing for investors, especially the retail crowd, and you know that is a major part of the market force that we've seen lift a lot of these technology stocks. So it would be very interesting to see
if Meta does it. It's the only mag seven stock that hasn't split its shares, so we'll be keeping an eye on that.
Carmen.
On that note about retail investors, on the one hand, it's great to bring them into the fold, but does that inject more volatility into the stock as well?
How's it?
How has it worked out?
For other tech stocks that have done similar splits in the past, you.
Know, I think the biggest one that comes to mind is in Vidia, and Vidia obviously enacted as split last year, and it has had an incredibly volatile you know about you know, year years, few years. The stock at one point was you know, more volatile than bitcoin. So certainly, yes, there could be volatility that comes in to play. But I also think that you know, these stocks are very volatile.
They are m big parts of the market. So when we see them swing, we can you know, see the entire SMP swing, we can see the Nasdaq one hundred swing, and I would think that most people would say, like, it's it's worth some volatility that helps you know, get better, better price action and opportunities for investors.
It is all psychological, the idea that you could own a whole share, even though of course you can trade parts of shares as a retail investor. Well, they're not the only name that's eclipsed the one thousand old evolve for example, Netflix that there you must be questioning a still split there as well.
Yeah, exactly, so Netflix is over one thousand dollars per share. It has split before I think it was in twenty fifteen and did a seven for one split. So that's another one where retail names could really be enticed back in and keep a rally going.
That's Bloomberg's Carmen Ryanicky, thanks so much for joining us. Sticking with Meta and turning to politics. CEO Mark Zuckerberg went to the US Capitol yesterday to lobby senators on artificial intelligence. He's seeking to muster his influence and is standing with Donald Trump at his inauguration. Bloomberg's Emily Bernbaum joins us for more. Emily, is this working? Is this closer relationship to Trump actually increasing?
You want?
Sorry, Zuckerberg's relationships to Republicans on Capitol Hill.
I think there's evidence that it is working. So we've heard four years Zuckerberg is enemy number one to Republicans. You know, he was an ally to the Democrats, That's what they said. And now it's a totally different tune on Capitol Hill after Zuckerberg has made extensive overtures to Trump and to Republicans. So Ted Cruz, the head of the seven Senate Commerce Committee, says trust.
But verify about Zuckerberg.
Jim Jordan is sounding a different tune over in the House. So these were once, you know, the people who attacked him. So I think there's still skepticism. There's still a desire to hit big tech from Republicans because they have seen that this is something that their base really reacts to. But in terms of Zuckerberg himself, I think that his reputation is changing really fast among conservatives in Washington.
So what can he get done? What is policy priorities?
Policy priority number one is AI trying to stave off any regulation that could hamper the company, trying to get any policy that could boost open source, which is a big lobbying campaign they've launched over the last year. You know, AI development is top of mind for Meta. They are going to invest sixty five billion dollars in it this year. And then there is also this ongoing fight with the
EU where they've found allies in the Trump administration. EU passed a regulation that would crack down on the tech companies for hosting misinformation, for hosting certain kinds of harmful speech.
This is a big threat to Meta and to.
The other social media platforms, and it's one that jd Vance this past week has taken up Trump himself has taken up, you know, criticizing the EU for hurting American companies.
So those are you know, top of mind.
There's also antitrust issues, you know, ongoing case against Meta by the government.
What will the FTC do with it?
All of that is.
Still pending, but there are existential issues facing Meta that the government can help with, and Zuckerberg is doing everything he can to try to protect his company.
Let's talk about that overall lobbying strategy. How else is it changing during this congressional session.
Yeah, So, over the last four years, during the Biden administration, Meta's policy team was led by Nick Clegg. He was seen as being slightly closer to Democrats. They cultivated relationships with Democrats. But there was a recent announcement that Joel Kaplan, the big Republican at Meta. Now they layered him on top of Nick Klegg. And so he is the head of global policy for Meta, and he has taken the
reins a lot within the company. He's made decisions about ending DEI, He's made decisions about ending fact checking, you know, two really big asks for Republicans. So Joel Kaplan and his influence can definitely be felt in Meta's lobbying strategy and how they are approaching Republicans.
Always great to catch up with them. Many van bound the latest in Washington. We appreciate it.
Time now for talking tech.
First up, KKR has secured enough shares of fuji Soft in a tender offer to take the company private, and the deal value fuji Soft at four point four billion dollars and ends a month long bidding war against Bain Capital. Now KKR aims to acquire the remaining shares of the software maker through a squeeze out process in late April, giving it a near fifty eight percent steak. Plus Lenovo revenues get an AI boost. The company posted a faster
than anticipated twenty percent jumping quarterly revenue. It's all due
to demand for its AI computing infrastructure. The world's largest PC maker posted sales and nearly eighteen point eight billion dollars, then also beat estimates and shares of Grab now they are falling today after the company predicted full year revenue that actually trailed estimates, citing caution in Southeast Asian ride sharing and food delivery market in particular, whom works both with Grab CFO Peter Ui, who had this to say, about their userbase.
It's a big year for digital banks, and it's really very ecosystem driven play when it comes to our products. Of one of our digital banks, how of those uses on the digital bank platform today are from GRAB and we see a lot of benefits that we're seeing in making sure that the on demand pieces and the digital banks are actually cohesive, putting together because it really drives that retention and also just the LTV of a user base.
Sticking with earnings, Carvana out with its report overnight and while the company had a strong fourth quarter and a rosy outlook, shares our down significantly.
Today.
Let's get some answers from CEO Ernie Garcia. Ernie, clearly, shares are reflecting some skepticism, and in particular, your gross profit per vehicle declined. What was behind that fall and do you expect it to rebound this year?
Sure?
Well, first of all, thanks for having us and to try to you briefly answer that question specifically. I think there's seasonality in retail GPU and we saw that a little bit this year, but I think there's a way bigger story going on that we're extremely proud of, and that's that we just had the most profitable year in automotive retail history, and we did it while growing at thirty three percent for the year, at fifty percent in the quarter, and we did it with just one percent
market share. So I think the big story here is we've still got a huge opportunity. We still have a ton of work to do. The team's done a great job. We're extremely excited.
Day to day.
The market is going to do what the market does, and our job is to just keep marching.
We're seeing some pullback in the retail sector and I'm curious if this bodes kind of any kind of weakness for Carvana. Where do you see used car prices going this year? Is there any vulnerability to you know, your consumers being more touchy around inflation?
Yeah, I think I think the way that we try to think about things is a little bigger picture than that.
You know.
Again, I think the history of companies that are the most profitable in their industry and are growing the fastest is a pretty thin history, and when you look back on those companies, generally, the next you know, ten plus years, ten twenty years are our pretty great years. I think we're focused on that timeline. I think, you know, month
to month, quarter to quarter, year to year. There's going to be inflation stories, there will be tariff stories, there will be ev stories, but we don't talk about those specific storylines about great companies when we look back in time and I think our goals would be a great company. And so we're going to say, focus on our customers and just keep moving down the path, and we think that's going to take us to a great spot, as it has over the last couple of years on average.
I mean, I completely hear you on the market's going to do what the mark is going to do. It's off by sixteen percent though today, and that is a big fall. I know that you've run up more than three hundred percent in the previous year.
So credit where credit's due.
But we need to.
Get into some of those issues that the investor base is seeing. And I really want to ask about perhaps some of the gains that you saw in the sales of loans. Perhaps people saying, look that padded your abit dar. Is that something that will continue to pad abit dar? Is it something that's a one off?
I think it's something that's been a consistent contributor for the last couple of years. So I don't think we expect major changes there. I think since you brought up ibadad my to make sure I frame all this as positive as possible, we increase aribadad by four times a year over year, So I think that's pretty great. Another is another line that points in a very good direction. So, like I said, I think we got to focus on
our customers. Give them a great experience that they love, give them a ton of selection, give them a great value.
If we do that, the rest to take care of itself.
I think your job is to give things not just a positive ring, but a truthful ring. And I'm sure that that's what's you're trying to do. But let's talk about it. Happened to over effect. You're a positive guy on and.
We love it.
But talk to us about some of the positive impacts or indeed negative impacts of taris. What does that mean for the secondhand market, What does it mean for autos more broadly, if it's gonna be tougher to get foreign cars.
In So, I think that's incredibly complicated, and I think there's probably a lot of people that are better position to answer those questions than we are. So I unfortunately I'm going to give you a very unsatisfying answer that we will pay attention, we'll react to whatever happens. But again, I think what's going on inside of Carvana is you know,
we grew it thirty three percent last year. That's so large compared to anything that can happen macro, and so we think it's smarter for us to say, focus on our customers and on what we do because it's just a bigger range than anything that's going to happen from a macro perspective.
Ernie, you said your guidance is based on the environment remaining stable, but there's a lot of external factors that also come into play. Which ones are you paying attention to? Specifically? Given to Caroline's point, tariffs do play a role, inflation does play a role. What will you be focused on to make sure that guidance stays on track?
Yeah, I think everything you just mentioned, I think that you know, we'll see.
I think there's a lot of uncertainty about what happens with Harris, there's a lot of uncertainy about what happens with inflation. I think if you asked two people, you get three answers. I think there's a lot of uncertain about what's going to happen with rates. We're going to pay attention, we're going to adapt to our environment, and we're going to keep moving forward.
So I think we watch all of that.
Of course, investors watch that very closely as well, But we think that our job is mostly to look at our business, to put together a bunch of projects that we're very confident we'll create value for our customers over a long period of time, and to march through those projects one at a time, because, on average, the macro environment is the average, and if you spend a ton of energy chasing your tail on that, it's energy that could be put somewhere else that creates long term value.
So we try to stay long term focused.
Another parts of the car market, autonomous vehicles is kind.
Of the next big thing.
How are you thinking about how that might affect your business model? Are you looking to buy more of those types of cars wholes sale or how do you bring in that kind of business into the fold?
Sure, well, so I think related concept ZVS.
You know, we put out a report today that said that you have five point seven percent of our sales last year. We're evs that compares to one point three percent for the used market in total, so we're you know, four times more likely to sell and ev to our customers.
We're believers in evs.
We generally set up our system where it's a pull system, so we're buying the cars that our customers want. As autonomous vehicles start to become more available, we will certainly buy more of those and provide those to our customers. And in general, I think, you know, we're fans of
any technology that pushes things forward. We think that as a one percent market shareholder, we will likely be beneficiaries of any change in the market, any shakeup we're very well positioned to take advantage of because our customers love our offering and it makes things a little easier for us. So we'll be rooting for evs, we'll be rooting for autonomy, and we'll be doing our best to.
Get our customers a great experience along the way.
It's great to have some time with you today. Thanks for coming on all the positivity to appreciate it. Hanney Garcia now coming up, the founder and CEO of together Ai joins us to discuss the startups latest funding round and the demand for open source models. There's a Lumote technology.
Startup.
Together Ai announced a three hundred and five million dollars Series B funding round. Together AI's platform gives developers access to multiple open source AI models and compute power, which the company says makes building AI applications faster and cheaper. It's CEO Hipple, they percash joins is now will help us understand why you think open source AI technology is the future.
Thank you for having me here today. You know, we are seeing our customers are choosing open source models for a variety of reasons. In many cases, they are you know, really encoding their business logic into these models. Now they are part of their technology strategy, and companies want to control these models and controlled the intellectual property they are
creating in the process. They also wanted to make it more cost efficient when they are deploying these models, you know, at scale to run serve you know, sometimes hundreds of millions.
Of their customers.
They really want cost efficiency. We have to create customers like Zoom and Salesforce and escape holecom that are really deploying these things that lack scale and are choosing to use open source models.
We well, why are these customers that you mentioned going to you rather than Amazon, Bedrock or as your AI.
Yeah.
So Together does you know, we are AI systems research lab. Some of our co founders are luminaties in this field. And what we've been able to do is really, you know, do fundamental research on how to make these models work more efficiently in run time. This is really a new
kind of computation. So we do a lot of work on, for example, how the linear algebraand these models executes inside GPU cores, or how to quantize models into you know, smaller models that run more efficiently at the same quality. So we do a lot of work here which really reflects in the economics and the scalability of our platform. And so it's faster and it's cheaper relatively using hyperscalers,
and we are on the forefront of technology. So when new models come out in open source, they are on Together's platform on day one.
Deep Seak is also available on the Together ai platform, but it's also raised some national security concerns, concerns about its overall security. How are you thinking about that and navigating having deep Seak on the platform.
What we do is we own all our infrastructure, which is mostly based in North America and Europe, and all the models that we serve on our platform, they run on our you know, they run on a cloud platform, so there is no sort of data leakage to the maker of the model. And we're seeing, you know, a lot of demand for deep seek and other models for the reason of security and having sort of control that we provide through through our cloud.
David Sachs, the ais ARE in Washington, is a big fan of open source models.
Do you think that this could open.
The door for perhaps a regulatory environment that favors open source more than closed You know.
I think that would be welcome. You know, we do believe that this technology should be developed in the open transparently. You know, this is really a fundamental tool for humanity. So we we and you're seeing this that really happen all around the world. Now we have you know, Meta who is investing significantly in building open source models, their
companies in China, their companies in Europe. So you know, we really think regulatory environment that promotes open source, that promotes open safety and open research is going to be great for the industry.
Let's talk about the fundraise.
The valuation is a lot more three point three billion dollars three hundred and five million is what you raised.
Where do you put that to work?
Right now?
Hyopule?
Yeah, you know what I would say, AI has really moved across, you know, from from the experimental phase into production phase. We have over four hundred thousand AI developers, air native companies, enterprises building applications on our platform. We will invest in as I mentioned, we are a researcher one company, so we will invest in our research programs. We also have a very wide product from you know, we serve models of all modalities language, images, videos, audio,
and you know. Of course, we are also scaling up our infrastructure to meet the growing demand for the platform.
Well, it's great to have time with you. Good book.
Plcash, CEO of Together AI on the latest funding round. Now that does it for this edition of Bloomberg Technology. Do not forget to check out a podcast. Can find it on the terminal as well as online on Apple Spotify. An i heeart from New York from San Francisco, Miss Blomberg Technology