Apple and Amazon Coming in Hot

constraints hitting the Mac and the iPad. I spoke to Apple CEO Tim Cook and will tell you what he had to say. Plus Amazon surging in late trading after providing a strong outlook for the third quarter, a much different forecast than other retailers, net sales jumping in the second quarter, in part thanks to I'm day shoppers will dig into the data, and the largest chipmaker from mobile

devices is warning of a slowdown and spending. We will ask Qualcomps CEO Christiano Alman about the company's weaker than expected forecast, the chips act and China. He's my guest later this hour. All of that in a moment, but first I want to get a look at Apple now. For that We've got Julias with US principle analyst at Forrester or Research, and Julie I did just get off the phone with Tim Cook and we walked through the results. I mean, clearly, we're seeing a record June quarter in

terms of revenue. iPhone particularly strong. He said, iPad demand also very strong, but that the iPad and mac were held back by supply constraints. It also sounds like the macroeconomic environment is impacting wearables, which would make sense given its you know, more discretionary items. And when it comes to services, he talked about digital ad spend and we're seeing the macro environment. They're seeing the macro economic environment

have an impact there. What are your headline takeaways? Yeah, so I think the first one is is you know the good news. So, like many other companies, Apple faces the same headwinds that you already mentioned the recession. It's inflation, it's uncertainty, is the supply chain and so forth. I think Apple benefits though in a few ways. The first

one is about two thirds of its sales come from smartphones. Uh, Folks consider that to be a necessary device, and they upgrade that far more frequently than they do a PC or a tablet or the other devices that they own. And the second thing that you already mentioned, or you and Emily, Emily, you and Ed mentioned that I think is really important is Apple does have a more fluent customer base. We need to look in the United States. Uh, the iPhone owner has a household income that on average

is eighteen thousand dollars higher than an Android owner. Thirty of their households have an income of more than a hundred grands, and there are three times it's likely to have an income of more than three thousand dollars a year. So Apple does benefit from having a more fluent customer base in the United States and abroad. Now, this was interesting from Tim Cook. He said they expect revenue to accelerate in the September corner dis bite, seeing some softness

in some areas. He said they do believe there were some macroeconomic headwins that affected the business in the June quarter that I already discussed, but sounded optimistic despite some of the softness that we've seen. You know, I was trying to get him to give me a real take on whether or not we're going into a recession, and you know, always has a tint to to try to sound like an economist. But what's your takeaway from that? So if I were Tim Cook, I would also be optimistic.

I think if we look specifically at the US market, which also has a lot of parallels globally, almost sixty of US consumers own an Apple device, so they're likely to buy a second, They're likely to buy into some of the streaming services, use Apple Pay, and use some of the in the category that's growing the fastest for Apple. Uh. The second thing that we know that is about eighteen or nineteen percent of consumers only own Apple devices and

are very locked into that ecosystem. So while generally all companies are facing some headwinds, Apples looking and has a customer base that's uh, you know, it should help them, you know, sail through here a little bit easier than some of their competitors. Now. Supply was in another point of optimism in this discussion. When you look at the numbers. Of course, we remember last quarter Apple said that they

would expect four to eight billion dollars. You could potentially, you know, just shave that off the top due to supply constraints. He said, it actually ended up being lower than the lower end of that range, and he also said they saw quote significant improvement in the month of June in China on the supply side and the demand side. He specifically talked about strong demand around the June eighteenth holiday,

the big shopping holiday UH in China. Said they're seeing strong results there um and they're about to start a big promotion in China of fairly rare sales promotion where a series of Apple devices will be discounted for a few days, and he said that had nothing to do UH with clearing inventory. What does that signal to you about the state of play in China, Well, it's he said, not a specialist on the Chinese market, but it does, you know, indicate I think it's also it looks like

they're willing to invest a bit. You know, China is a ton is a gigantic market, and Apple has always been like compared to the Chinese incumbents, it's been a relatively small player players. So I think it's worthwhile for Apple to invest there and try to grow that base because one of the things that we know about people with Apple products, if you can get them to buy one, their more likely to buy two or three, and then

they're more likely to buy into the services. So I think I do think it's an important market for Apple to invest in and try to gain some ground, especially starting with smartphones in that market. Now, a key question has been how are they going to invest if indeed we are looking at a recession ahead. Our Markerment has reported that Apple plans to slow hiring, slow spending in some areas across some teams next year, which is a little less drastic than we've seen, you know, certainly lapps,

we've seen hiring freezes at other big tech companies. Cooke says, we believe in investing through downturns. We've always done that and found that's made us stronger. On the other side, obviously, we're being deliberate in our decisions of where to invest. What do you make of that word deliberate? So if I were to try to guess what Tim Cook is thinking, and if I were to say deliberate, I would either be focused on things that consumers notice, which is the hardware,

right consumer. There's a lot of upgrades and a lot of things that every company is doing involving artificial intelligence, anticipating what I need, getting better at like loyalty and security and things like that. I think some of those things consumers are less likely to notice. UM. So if I were him, I be investing in the hardware side,

because that's what really pops for consumers. Uh. And then there's some other things that simply have a long lead time, you know, whether it's things like augmented reality or the metaverse, or like payments. There's a lot of things that if you know, if you pause now, it has a longer you know, it has a bigger impact further down the road. So I would be focused on, you know, continuing to work on those things where there's still like a lot of you know, a lot of ways to go. UM.

Take for example, payments. Um, they've almost albo the number of people using Apple Pay in the United States and UK in the past two years during the pandemic. Nothing to expect but upside in some of those categories like that. So I wouldn't want to slow down, you know, the

number of places Apple Pay is accepted, for example. He did actually also emphasize the number of people you know, new rising numbers of people using Apple services, rising numbers of of people switching to the Apple platform, The iOS platform and singled out the fact that a lot of these people are totally new to the Apple platform, totally new to iOS. So we're listening into the Apple earnings call.

We'll let you know if Tim Cook has any additional things of interest to say, Julia, ask Force or research principal analysts. Always great to have your instant reaction here on the show. Thank you. Let's now get a deeper look at Amazon results also in strong and beating analyst estimates. I want to bring in Tom Forte, managing director at DA Davidson, who is a by rating on both Apple and Amazon. So Tom, I think let's look at the top line here in that you know, the sales and

sales forecast better than expected. This after we've seen pretty dismal results from Walmart, for example. Why is Amazon somehow bucking the trend? I think for Amazon, it greatly benefit in the second quarter from strong cloud computing sales and strong advertising sales. Then when you think about the outlook for the third quarter. Having Prime Day this year in the third quarter versus the second quarter last year was

clearly a needle mover. They had talked when they reported the prior quarter that Prime had about a four d basis point impact on their sales growth. So I think it's a combination of June quarter, cloud computing, and advertising, a September reporter Prime Day, which is booing the sales for Amazon. So when you take out Prime Day, how well well positioned is Amazon really? And I know we've

got another one coming up later this year. But if we think solely about the health of consumers in an inflationary environment where they're paying more for gas and groceries, how does Amazon fair? So Amazon is actually not not

well suited for inflation. So when you think about Amazon of the unit sale or third party, so generally speaking, that means those products are being sold by someone other than Amazon, and then they're less likely to raise price given that they're not going to want to lose the

buybox to another competitor trying to sell on Amazon. And yes, they have whole foods, and yes they sell some food or less discretionary products on Amazon, But generally speaking, inflation has been tough for Amazon to a tough challenge for Amazon. Is Amazon in a better position though, obviously because they've got aws and the cloud computing units, something that Walmart

and Target don't have. The answer is absolutely so. If you look at Amazon and again going back to their third party unit sales, I think that they're relative profitability is clearly the highest on cloud computing and very strong and advertising, and then much higher on the third party retail sales than when Amazon is the seller of record.

So when you compare them versus Walmart and target, cloud computing helps, but it also helps to have a large percentage of their sales from the third parties rather than from Amazon. Let's talk about, though, some of the challenges that Amazon's has had coming out of you know, a couple of years of pandemic spending where even they have said they grew too fast, they built out warehouse capacity too quickly, and they haven't been able to fill that space.

How much of a headwind is that going to continue to be? It is a headwind. I think the data suggested they had about a hundred thousand less employees between the March quarter and the June quarter. So Amazon has been a little more nimble and adjusting either head counts or future square footage than I expected when it came to there for filment centers and their employees at the

fulfillment center level. But I do think if you look at Amazon through the lens of Shopify, a Shopify also felt like it was overstaffed for current e commerce demand and had a ten percent reduction of force. So I think of Amazon, I think of Shopify as two examples of e commerce companies that are acknowledging that right now they've got too much capacity and their headcounts probably too high. Yeah,

certainly big news about shopifyes layoffs. I want to talk to you a little bit about my call with Apple CEO Tim Cooke. You cover Apple as well. The highlights. He said they continue to expect revenue to accelerate in the September quarter, despite seeing some softness in some areas. He also said they saw significant improvement in the month of June in supply and demand UH in China, and

this I thought was particularly interesting. When it came to spending and and hiring plans, which Bloomberg has reported on, they planned to slow hiring and spending in some areas next year. He said they believe in investing through downturns, but will continue to be quote deliberate about their decisions of where to invest. What's your takeaway from all of that?

So I think for Apple, the question has been for a while how serious are they about getting into electronic vehicles and what do they want to do in the metaverse. So when I interpret your comments from Tim Cook on deliberate investment spend, I'm thinking about the future product roadmap. To what extent do they intend to get into electronic vehicles,

aut meted reality, virtual reality. We know their natural investment cycle for the next generation iPhone and other devices, but to what extent do they want to expand into new categories and how will that dictate their investment spend. What do you think the answer to that question is, I mean, do they lean into cars and the metaverse or not right now given the economics circumstances. My expectation for both

over the long term is certainly yes. So if you look at Apple's history, they're not the first entrant often into a new category, smartphones being the best example, But there are often the second entrant in a later significant entrant. So if you compare Tesla versus Apple, I'm of the belief that longer term they will have a car, it will be more than just Apple play within the car for metaverse. I clearly think they're going to have some

sort of headset or other device. Otherwise they're leaving it wide open for Facebook slash Meta to disrupt them, which I think would be a big mistake. Alright, Tom Forte d A. Davidson. Always good to have you on the show. Tom, thanks for weighing, and alright, coming up a closer look at the investment climate in China right now. So many factors that play in a big call between President Biden and President si Jing Ping will dig in next, Mrs Bloomberg.

President Biden and Chinese President Shi Jingping held a two hour call Thursday, talking about a range of issues from Taiwan to the war in Ukraine. Biden reiterated support for the One China policy and both agreed to more talks about energy and food. President Biden is trying to find new ways to work with China, as well as strategies to contain the country's global influence. AIDS were directed to

plan and in person meeting between the two leaders. Amy Seliko is a principle at albright Stone Bridge Group and joins us now to discuss So, Amy, what are your takeaways from the headlines out of this call? It sounds like tensions were calmed rather than inflamed. I think that's right, Emily. The important thing was having the call U. The US

channel relationship is so contentious. Tensions are running so high that there are few memor burs of the two governments who can talk and put um have frank conversation, raise

issues in a constructive way. The two presidents can. They have a longstanding relationship, and unfortunately the state of the relationship in some ways rests on them continuing as they did today for the fifth time since President Biden has been in office, just to level set the relationship frankly exchange views on areas where they fundamentally disagree, and are continuing to work at cross purposes, but always raising the very important point that confrontation should not veer into the

military zone. Competition is fine, Disagreements are fine and can be managed as long as they don't actually explode over a crisis like on Taiwan. Well, now you have how Speaker Nancy Pelosi seemingly determined to visit taiw On, and obviously the Chinese government has strongly expressed their disapproval of this visit. I mean, is this a good idea? What are the consequences going to be if she indeed goes through with this trip. Well, it's not unprecedented that the

Speaker of the House visits Taiwan. That happened twenty five years ago, mintoln Grit did so. But of course the U. S. China relationship was in a very different place twenty five years ago, and so that's right. The timing of the visit is particularly challenging because here in Washington, we continue

to to ramp up areas of competition with China. We continue to complain about bad Chinese behavior, including more and more aggressive and assertive actions visa VI Taiwan, and so in Beijing there's a view that this visit is a provocation to demonstrate more official support for the government. And of course it's three months before China is having a major leadership meeting, and so what continues to be stressed is that, exactly as you said, Emily, the timing is

bad for Speaker Pelosi to be going. Right now, that doesn't mean she won't go, It doesn't mean it's going to lead to a disaster. But indeed, the Chinese government has been vociferous in saying there could be consequences for her taking that action. At the same time, you've got this two billion dollar manufacturing bill that would bring chip production to the United States and a broader d globalization

trend that I'm sure China can't be happy with. How does that play into this Well, in fact, the Omnibus China Bill was stopped in Congress, and so the bill that you just mentioned, the Chips plus Science Bill, is only one small part of that larger China bill, and so UM that the ELM and sept the bill of course, reinforcing and invigorating the ability of the United States and manufactured semi conductor chips conduct R and D here in the United States through funding from the government, are all

meant to enhance competitiveness with China, but they're not. And what's not in the bill are some of those provisions that we're going to seek to earlier. UM have the delisting of Chinese companies from American stock exchanges if China didn't comply with these audit rules that they've been dragging their feet on, and a potential outbound investment screening process.

So this bill is actually very targeted just on American competition with China and not on constraining American engagement with China. I think the Chinese government, although they wouldn't want to say it this way, is probably a little relieved. This is what was passed by the House today after the Senate vote. Interesting last quite question. Obviously we're seeing now

ali about a move to this Hong Kong listing. SEC chair Gary Gensler says a U S China deal needs to happen, so more of these deal listings don't happen. Is a deal and a possibility, It's absolutely a possibility. The two sides continue to work very much at it. I think there's certainly posturing by both the SEC and and the Chinese c s r C on what they want. The Chinese wants some exceptions from across the board requirements that all Chinese listed companies face audit inspections by the US.

The US is holding firms saying you've had that exception for much too long. We want you to comply. I think the talk about it not happening is a little bit too quick. There's still hope there, all right, Amy selco albright Stone Bridge. Always good to have you here, Amy, thank you for joining us. Welcome back to Bloomer Technology and Emily Chang in San Francisco on Capitol Hill. The House just passed a bill that includes fifty two billion

dollars for US chip manufacturers. It's already past the Senate and now the bill goes to the White House from President Biden to sign into law. This is a major legislative victory for President Biden after the US chip industry has steadily lost ground to overseas rivals and of course China in recent years. I want to bring in callcom CEO Christiano Alman for more on this and the company's earnings results. Christiano, great to have you back with us.

We're gonna talk about earnings, but I have to ask you about the Chips Act and just how transformational you think this could potentially be to the industry. Look, this is great news for the United States of my conductor industry as well as the globals of my conductor industry. We need more chip manufacturing. We understand the chips are important, actually an essential technology now for our addition to economy, and a company like Welcome, which is the largest fabulous

semiconductor company, we need more manufacturing of chips. So exactly, we're very happy about that and UH. We are the number one customers a company like Samsung, UH foundry in Korea, one of the top two customers off t SMC. They aren't one to be an Apple in Taiwan, and they have more manufacturing capacity in different geographies with even more suppliers such as Intel. That's great news for the industry.

So we're very excited about that, even though we're not a recompend officiary off the funds, but it creates more capacity UH and supply for chips with this head off supply disruptions like those we've seen with COVID. I think the way to think about this because this is not gonna This is not going to have any short term impact. This is about building a more resilient and geographically diverse

supply chain for semiconductors. So over time, I think we're going to build the infrastructure in place that will allow us to continue to grow as an industry and have a more resilient supply chain. So let's talk about your results. Be on earnings, but the guidance came in a little light. You talked about a challenging macro environment. You said the smartphone market will be smaller than forecast. UM let's talk about that word challenging. Just how challenging do you do

you expect the macro environment to continue to be. I'll talk about that, but I'm also going to talk about what's good. Um. We you know, we have micro economic headwinds, so if you look at what we did in the quarter, it was really a beat top in bottom. But we more cautious about what is the future outlook and when we guide Q four in line with everybody else because of the micro economic headwinds, we know that they can have an impact consumer spending. So we're calling that the

mobile market. It's going to be, you know, smaller. It's a market that is mature, a grow single digits. It's going to be smaller as we look at the consumer spending uh softness. But the good thing about the results is we saw the record out too an IoT, which is the diversification strategy of qualcom working. We guided for the next quarterer sequence of growth in outo an IoT,

which we expect to be new records. And we're somewhat insulated from what happened in the market that we're because we're concentrated more in premiument high tears and that proven to be resilient, and I think that's probably outline in Apple results as well. Well. That's my next question because you know, you you talked about how the smartphone market is going to be smaller than forecast, but that the

high end is holding up. Does that mean iPhone that you know, it is the iPhone that is carrying a lot of the growth right now. Uh, it's across all premium devices from iPhone to also Galaxy series from Samsung. The premium device says from Vivo, Opo, Shell, Me one Plus, etcetera. What is really happening is we have a mature smartphone user base in people when they think about buying their

next device, they want a better device. So what we have seen towards several quarters in the year is the mix continue to improve and our strategy to really focus on share of wallet and permanent high tears really working out as as we see you know, the improvement and the resilience of the premutier and that leads to the great I think announcement we have in the quarter, which is our Samson agreement and happy to talk about that.

Actually for me, that was the key highlights of the Cualco. Course, let's let's talk about that you extended this big licensing agreement with Samsung, and you know there has been concerned that Samsung is making more of its own ships. What does this mean for Qualcomm's market share and why why are they betting on you for so many more years? I mean, this is quite a long agreement. This disagreement actually put a lot of things to rest and let

me unpack that for you. The first one, it is an extension, very simple extension or existing uh pattern license agreement with Sandsung for our licensing business. Uh is extends all the way to two thousand thirty on the same royalty terms and actually include six G So I cannot think of anything else that will give that much indication of stability in our licensing business, and it is a great benchmark for renewals. The second part of the announcement

of exactly the most exciting one. We talks about the growth opportunities and really is a multi ear agreement that we are going to be powering the Galaxy product lines of Sands and globally. Let me walk you to this. Galaxys twenty one our share versus their in house solution was in the order Galaxys twenty two. We climb up to about the upcoming products which will be impacted by this agreement. Uh, you see that share of qualk and going uh increasing more than sevent where we're going to

be powering their solutions globally, and that's very exciting. So if you have any questions about concern about the Qualcom partnership with Samsung as related that they're using the internal solution, I think disagreement put that to the rest. Is a multi ear agreement. Very excited about that, and we'll continue to validate our strategy to be focused on premium and high tier. Okay, let's talk a little bit about supply.

I just got off the phone with Apple CEO Tim Cook, who said they've seen quote significant improvement on the supply and the demand side in China. What are you seeing in the supply chain? Is it going to get better, is it going to get worse? And how much longer our supply issues going to be with us? Look, I we were one of the few companies to call the supply shortage early on, and we took action early on. We also said that we expect to supply them and

to normalize in the second half of twenty two. If you go back several quarters and look some of my comments and exactly what's happening, we're seeing exactly the same thing as we had indicated. We see now much more

balance demanded supply equation. Uh. There are still pockets of short dishes in some areas, but they are small and the bigger thing and uh, we are uh seen as we guide with Costa the next quarter on the mobile market, the impact of microconomics into China lockdown, but we all know, I think those lockdowns they come and they go, and we expect the China market to bounce back. So very consistent. Uh, and uh, it's you know, we're being prudent, but it is.

It is very likely a situation that we continue to see growth and with that we actually guided twenty four percent year over year growth in Q four. Now we've heard from a number of different CEOs fairly dire predictions about the future of the economy. You know, Elon Musk has said he has a super bad feeling about the economy. Jamie Diamond says he's preparing for an act, not a hurricane. You've got the World Bank slashing their global growth forecasts

what's your take on the economy? How concerned are you are? Are you are? Is Qualcom preparing for a recession? Look, it's very difficult to predict, and I have been very focused on the things that we can't control. But what you actually see us doing is really focus on what's important for Qualco in the long term. And I can actually unpack that in justice quarter alone and how we

guided you for the Sensung agreement. It's about bringing long term stability to our position the prim inteer in the market. The market is going to go up and down, uh as we have a mature phone market, but Qualcom is growing structurally. That's why we're gonna end up the year with almost fifty year of the year growth in in

the phone market. But the most important thing is how we've been very active diversifying the company without an IoT, And what we said in the quarter is we have record auto an IoT growth with sequential growth projections for the next quarter. And we're seeing that the enterprise and industrial segment has been very resilient. So why you have economic headweights that provide softened in consumer spending, the industrial

and enterprise is strong. You've seen that for other companies that are being focused also on the enterprise, like Microsoft, and the reality is digital transformation off the edge. It's somewhat recession proof, but we will see. So here's the question. I mean, you're pushing into cars, you're pushing into networks, you're pushing into computers. But will you be able to grow those businesses fast enough to whether what could be

a serious near term economic downturn. We we we kind of size from what we saw in uh In in the coming quarter. We did size. We call about twenty cents of EPs could be the size of the macro economic headwinds on consumer. But even with that, we're projecting growth of and I think that's because Broken has a number of drivers of growth, which is driven by secular transformation.

As device has become connected, they become more intelligent, and it's happening, you know, in a number of different verticals of the industry. And we continue, we expect that to continue, even though as we navigates to those challenging times. All right, call come seeing you Christian lemen. Always good to have you here. Thanks for sharing your view of the future with us, Appreciate it. All right, Coming up, Al Salvador's big bet on bitcoin as the crypto world is going

through a winter. What's that that bet worth? Now we'll discuss assist blue Mark and it's time now for our crypto report, and I want to turn to El Salvador. The country's finance minister defended its strategy to adopt bitcoin as legal's tender and even doubled down on its plans to build a bitcoin city, as critics are urging the country to ditch this whole experiment. With the main cryptocurrency

suffering badly through a bear market. Let's break it all down now with Bloomberg's Michael McDonald, who has been following El Salvador's bitcoin bat very closely, and our own crypto contributor, UM, Michael, how's it going in El Salvador. Obviously there's a crypto winter going on, but don't think winter is ever too bad in El Salvador. Is there bitcoin bet paying off? Yeah? So, I think the crypto winter has sort of cooled enthusiasm a little bit on the ground in El Salvador, at

least among your average Salvadorian. UM. You know, the price when they adopted Bitcoin is Legal tender last year was near record highs around sixty thousand, it's now trading in around twenty thousands. Think that's discouraged a lot of people from from using it and from investing in it, and it's also hurt the government's finances. The government has bought about a hundred million dollars worth of bitcoin over the

past eight ten months. At today's prices, those are worth about fifty million dollars, so you see a decline of about on their on their bitcoin holdings. Um. There are some signs that some businesses are accepting it as a currency, although the vast majority of them seem not to be at this point. Um. And among those that do accept it as a currency, it's a very small percentage of their sales that are actually in bitcoin. CHINALI, what about here in the United States. I know that there are

some bitcoin a t M s here and there. You might find them in a bodega in New York City, for example, But are people actually using them? It's a great question, Emily, because, for example, the other day I had a conversation with Mariel Rubini, who was of course known as macro economists and who works a lot on emerging markets as well as the US economy, and the question here was why do you need bitcoin? Remember the bitcoin scrypto skeptic, sorry, And why do you need bitcoin

when you just have fintech? I think it's a great question, especially when you have the US government really cracking down on bitcoin on whether it's a secure in other tokens, whether it's a security, or whether it's a currency or a commodity. And you look at what happened in Al Salvador and the idea of using it as legal tender really starts to define it as a currency in some ways. So the question then becomes are other networks like the Lightning network taking off in a bigger way as companies

start to use it. More to Michael's point, whether you're in Al Salvador or you're in the United States, that price fluctuation has been really scary. Now there's another aspect here. This all comes as other currencies like the dollar are rallying, putting other emerging markets in you know what my sources call severe stress people who bank a lot of countries in the world. And so if that is already an issue, not Bitcoin under pressure, but other currencies, then you have

a dual issue here for a country like El Salvador. Interesting, Michael, what is El Salvador's government? Why are they doubling down even though the price is under so much pressure? UM, you know, why are they touting this success? Yeah? I think you know, from our interview yesterday with the finance minister, I think he really sees it as a new technology

that has potential in the future. UM. And I also think, you know, one of the things that he told us what it was that it has brought in some levels of tourism, some levels of foreign investment. Some of that has come in via cryptocurrency exchanges, UH, cryptocurrency, digital wallets, different companies that provide different types of cryptocurrency UH, infrastructure. UM. And you know, El Salvador is also a country that relies extremely heavily on remittances sent home from migrants that

lived mostly in the United States. UM. Those migrants send home money, usually via money Gram or Western Union or some of these traditional sources of of money transfer services U. And so I think the government is is trying to save Salvadorians fees on these transfers through bitcoin and through things like Lightning Network, which tends to be a little

bit cheaper than using the actual block chain on chain transactions. UM. But we're starting to see some of these more traditional companies actually come up with ways to try and compete with that. Money Gram announced for a a project with usd stable Coin to try and transfer money faster via Moneygram's network from the US to El Salvador. Um. So it is true. I mean if you use something like landing and network, you can't you probably can save money

on this. The thing is now these more traditional networks are are starting to come up with ways to compete with that and and make it cheap and fast as well. And you think about so many the people might go who want this to work in All Salvador because it shows you that bitcoin has another use case and payments, and it can become more uh seamless over time in

terms of transactions and payments. I think back to this University of Chicago white paper on just how many Al Salvadorians don't even have uh mobile to use this as a means of payment. How much is there still friction and how is that keeping or helping other nations go by the way, what El Salvador has done, like the Central African Republic, which is also adopting it in a

bigger way. Yeah, you know, I think one of the problems, you know, when you're in San Salvador and in some of the big cities, I mean, it is fairly feasible to use this technology. Most people have smartphones and most

companies have means of accepting electronic payments. The problem is when you get outside of San Salvador into some of these really rural areas um and and to sort of really poor areas where people are working on farms and working as fishermen, they don't always have the technology to be able to adapt to adopt this kind of thing. So I mean in those areas, cash is still king, um, So there is, you know, and there is a big

learning curve with this kind of technology. It is it's very new to a lot of people, even in the developed world. So when you bring it to a country like El Salvador, which is still developing, uh, in a lot of areas, there's the learning curve is even steeper. Alright, So fascinating. Michael McDonald, who covers El Salvador and the big crypto bet there thank you. Along with our own Shias.

It was another big day of earnings with both Apple and Amazon reporting quarterly results are both coming in strong. Let's wrap it all up with our lad law. There must be sigh of relief tech investors today. You know, that's definitely the consensus from the early cell side notes that were getting that. You know, you were bracing for something wrong to go wrong with Apple, and it was a mixed bag, right, good iPhone performance, Paul mac wearable

services performance. But what's so interesting is Apple suspended guidance and yet you spoke to Tim Cook, and I don't know what Apple's definition of guidances, but he gave some really clear indications of how things are going in China. Things are getting better. June was good, the supply chain is improving. Revenue growth will accelerate into the September cord of fiscal fourth So that sounds to me like things are really improving and investors like what they see based

on the after hours reaction. Right. He also said they expect revenue to accelerate in the coming quarter, even though we're seeing these macroeconomic headwinds. As you said, I fone trunk. He also said, I had demand was really strong, but that was impacted along with the mac by supply constraints.

In the quarter, though supply constraints are significantly improving, and they're being prudent, right, you know, he basically said that we're in a recessionary environment, We're going to continue to invest in the future bets And it seems like he's talking about augmented reality, maybe electric vehicles. We don't really know that side of the story. But also be disciplined, right, and it kind of backs up Mark German's reporting on the slowdown and hiring. He used the word deliberate. That's

deliberate about spending. Yeah, what about Amazon. Amazon, you know, by all accounts smashed it. You know, everyone's so focused on Prime because of what Walmart and Targets told us, and you know, primed a felt outside of the courter they just reported. But subscriptions are up. People were paying even though prices were higher on subscriptions. But forget about

Prime and remember the cloud. It's all about a WS And I think we have this chart that just tells the story that no matter what the world looks like, AWS continues to be a juggernaut. It beats on the top line, it continues to support operating income. The worry for AWS was that a lot of its customers are tech startups, and yet look how well it's performing. So Andy Jesse seems to be putting a lot of eggs into that AWS basket and moving the company from its

dependence on prime. Huge bouncing Amazon shares after hours, I mean, how are we expecting the investors to react to this when the Friday Friday is going to be a big day, not just because of the market cap of Amazon, it has a big waiting on the major indicase, but I think there is a sigh of relief of the staying power of these companies and frankly that there's faith that managements can get us through worsening economic conditions, and they like this is the kind like Breadstone put it the

start of Andy Jesse's big turnaround. So we'll see. So what are the earnings to come that we're going to be keeping an eye on. Yeah, I think you know, now we moved to the software providers. You know, we've had the big mega caps, we've had all the consumer facing companies. What about all these pandemic era darlings, the software names where everyone piled into one and where perhaps corporate spendings being pulled um and you know, the Chips

story is just getting started. We've had Quitcom, we've had Intel. What about the rest of the sector, Because it's been a muddy week, right, we'll be watching. Okay, thanks for breaking that all down for us. That doesn't For this edition of Bloomberg Technology, we've got the CEO of Intel, pat Girl Singer Friday to talk about earnings and also the Chips act. Stay tuned for that on Bloomberg Television, and of course check out our podcast wherever you get

your podcasts. I'm Emily checking in San Francisco. This is Bloomberg