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Miss Bloomberg Tech coming up ASML says bookings for its most sophisticated chip making machines remain resilient thanks to the AI boom.
That's a whirlwind of data center.
News and Microsoft cutting a fourth deal. Then Scale among others will break it all down, and Apple updates its top of the line. I've had pro when other products with its own in house chip first a SML the maker of EUV equipment, the most sophisticated chip equipment that then get sent to key partners around China but also around Asia, and they're showing strong bookings. Let's get the details of Bloomberg's equities reporter Henry Wren And what's so
important is it? The EUV Extreme Ultra Violet lithography machines seem to be being still snapped up even as China has to pull away eventually.
Yeah, so thanks for having me and for this quarter, which is the market focus. Is this EUV order's number and has risen to the highest level since late twenty twenty three, a huge plus for investors, and that's why we've been seeing stock trading higher now. So we know that actually mainland China investor chip makers they can't order EUV tools directly. They can access a less advanced tool
called DUV. But it really is a sign that some other chip makers, including Samsung in South Korea, including TSMC in Taiwan, is stepping up, and to investors, it's an early sign that this rapid increase in AI infrastructure is actually translating to the orders that ASML has been seeing so far in this quarter.
Interesting is the dominance of Asia as the demand flow us starting to pick up for ASML's equipment.
But they're in the heart of the geopolitical tension right now.
They must be exposed to concerns around rare earth metals, let alone an ability to have to pull away from selling into China.
Yeah.
Indeed, a lot of discussions on rare earth in the morning as well, and ASML said that it has stacked enough rare Earth's materials for at least several months because realize that we realize that the market has a lot of concerns regarding chip equipment makers reliance on those metals because analysts said that although in terms of rare earths the total material input for ASML, it just accounts for a very small amount, but it's still a very critical
component for its most advanced EUV machines as you mentioned, but also for its partners for example, because ASML works with other partners for mirrors, for other components for uvs as well, so it's a very important ingredient into the EUV machines. But so far the company said that it hasn't seen major impact.
Most valuable European stock, Henry Ren, we appreciate the breakdown on ASML. Let's stick with that very company in the Broader AI conversation. Andrew gardners with us the City Research how of European Technology Equity Research, and you have a bio rating on a SML, you have a price target of more than a thousand euros.
What takes us there?
Andrew, good morning, Thank you for having me. Yes, we continue to be bullish on ASML, and I would say you know this morning's results and the orders in particular that you are highlighting with Henry just now are a step in the right direction in terms of the potential appreciation of this stock. I really think we've we've been on a journey over the last year in terms of resetting a base for twenty twenty six, and they have confirmed this morning that you expectations are at a reasonable level.
They don't want to yet go so far as to call out growth, but at least going to decline next year, and I think that's removed one of the key uncertainties for the stock, and that's helped to get us to where we are today, just shy of nine hundred euros. In terms of further appreciation from here, it's all about the growth beyond twenty twenty six in my view, and that really comes down to some of what you've been alluding to with the demand coming from the artificial intelligence
players into the data center here. Clearly there's a lot of momentum in terms of the news flow ASML management. We're highlighting that just recently on the conference call. It's not yet fully reflected in their order flow, but it's something that we expect to come in the future quarters, and so it's really that momentum that we'll drive the stock higher.
I love that you say that, Andrew, because I pulled this part from your note, which I think was really important for our viewers because in particularly say sml acknowledge basically the momentum in the chip industry and market more Braorley, but this is not yet reflected in firm orders, and there's a growing disconnect in the industry between the mirriaud of AICHIP deals being announced and the amount of spend committed to these equipment companies.
When will it show up?
Are you really confident that it will show up, because many are questioning the absolute financing of some of these orders.
Yeah.
I think it's a critical question for this space, as it has been talked about already this morning on this program. You're seeing all of these deals being announced by the likes of Nvidia, open Ai committing to certain volumes at AMD, in Nvidia, the memory companies, and yet ASML sure was a healthy order intake of five billion euros, but nothing too out of the ordinary for them. You know, certainly
they've had stronger quarters in terms of order intake. So I do think given the lead times in particular, we are going to see need to see orders pick up in the coming quarters in order to support the future demand that's been talked about by the artificial intelligence sector
in particular. For example, ASML, on the EUV tools that you've already highlighted, their lead times are roughly twelve months, So even if you're ordering today in the fourth quarter, you're not going to get those tools until the fourth quarter of next year, ramping production into twenty twenty seven. So the lead times are quite long, and therefore the supply chain needs to be prepared for that ramp to come.
Andrew, you don't cover the stocks in particular, but if you are thinking about an announcement coming from Nvidia saying we're going to be there with thousands of chips ready by twenty twenty six to be put into which have a data center that open Air has just asked for, and.
The AMD as well, do you think the backlog is.
There that they've got them the inventory to be able to sustain the twenty twenty six dates that we keep getting from these companies.
So in terms of thinking through the supply chain, you take ASML as a critical supplier, the only one in the world who can supply the EUV tools that necessary for many of these chips. They are close to but
not quite fully booked for twenty twenty six deliveries. That will be the case by the end of twenty twenty five, given that twelve month lead time, and so really the capacity that is already planned to be installed next year, Sure there could be a little bit of upside, but we're already getting close to the limits, and really, as I described earlier, what you're playing for is the growth
into twenty twenty seven. SML management this afternoon here in Europe commented on the fact that they don't have perfect visibility because those orders aren't there yet, but they are trying. They're acknowledging the growth in the industry, the demand that is coming, and they're trying to prepare themselves and indeed their suppliers to be able to make sure that they are not going to be a bottleneck into future years.
What was so notable about this quarter just gone that they reported on for SML was the forty two percent exposure still to China in terms of revenue. How much smaller will that became lad eventually?
Yeah, So they have called that out in terms of the expectation for twenty twenty six and saying it's going to decline significantly unquote into next year. I would say, on a year to date basis through September, they're at about thirty two percent of system sales into China. As you point out, that was higher in the third quarter at about forty two percent, So they're still generating very
strong business in China at the moment. They're just saying given the extended level of spend this year, last year, indeed the year before that, they think it should normalize into the future. At the moment, though, with the restrictions in the way that they are, the Chinese companies are ordering what they can and so yeah, we'll just have to see exactly how that pans out into twenty twenty six.
The lead times for the type of tools that the Chinese customers are buying are not twelve months in the way that they are for EUV They're much shorter, six months, perhaps even less in some cases. So again, things could as we look into twenty twenty six.
Andrew, you cover ASML and the who's who of the European hardware sector.
We appreciate you being on the show today.
Andrew Gardner of City Research, Apple updated this.
Top of the line iPad pro.
As well as this vision pro headset and the fourteen inch MacBook Pro, rounding out a series of product refreshes, all ahead of the crucial holiday shopping season that the new products all use Apple's latest in house chip five. US Consumer Tech editor Mark German joins us for more. How impactful is it that they're going yet more and more on their own supply chain, their own hardware.
Well using in house chips, of course, is you know, paramount to what Apple has been doing under Tim Cook for the last you know, a decade and a half or so. But in terms of these new products today, this is probably the most minor set of Apple product refreshes that I could remember in recent history. What they've done here is essentially taking design from prior years, the iPad pro design from last year, the MacBook Pro design
they've been using since twenty twenty one. Obviously, the Vision Pro rolled out at the beginning of twenty twenty four, and they put.
New processors inside.
So for the Vision Pro, going from the M two to the M five, that is a size of a leap.
The UI should be a bit smoother.
The device is now more comfortable, but still thirty five hundred dollars. So the fundamentals of the product have not changed to any major extent the MacBook Pro. What they've done here is they've split the line in terms of rollout timing between the entry level and the high end. So the high end machines with higher end versions of the M five chip that won't come out until early next year, and then of course the iPad pro that got a gigantic upgrade with the M four version last year.
So this is about just bringing up to the latest processor in terms of upgrades. Very unlikely that anyone should or will upgrade if they have the last generation versions of those products, but ahead of the holiday season and they keep everything humming.
So if we want something really new, we have to think about the new home devices eventually coming on tap. There's a great story on the terminal about where these are coming from. It seems as though they're leaning less on China all at the same time as Tim Cooks trying to say he's going to invest more in the country.
Yeah, both can be true.
They're going to up their investment in China, but at the same time, for some newer products they're going to differentiate, they're going to diversify. They're working with BYD obviously known as a electric car maker predominantly in Asia. They also do mass manufacturing. They've been doing some final assembly for Apple for some iPads over the last year or so. They're going to do these new devices. Why is that interesting? Typically when Apple rolls out an entirely new product category,
they start with China. This time around, they're starting with Vietnam, where they already, like I said, make some iPads. They make the vast majority of Apple watches and air pods for the US market, and they also make.
Some home podsloomg's Mark German always with the latest, We so appreciate it. Meanwhile, in China, a fatality involving Shaomi's SU seventy and v saidan when it's renewed. Scrutiny on flush door handle designs bystanders were unable to open the doors for the vehicle to rescue a suspected drunk driver
during a collision, who died when the vehicle burst into flames. Now, flush door handles they've recently come under scrutiny globally, Tesla now facing an investigation after the Bloomberg reported incidents related to the door design, and Rivian also saying they'll be redesigning their handles in an upcoming future model. For more, Bloomberg's Creatudel joins us and your team have been so on top of what has become a global concern about the design of door handles in the latest evs.
Yeah, and the big concern here, I feel like in these issues of crashes and battery fires is particularly the troubles that people are having with getting into these vehicles from the outside. Yes, there are issues with mechanical releases that are different from inside the inside the vehicle and different from the typical way you get out of the vehicle.
But what's really I think alarming for people and particularly for first responders, is if these door handles are built from the outside to where they just aren't operable when the low voltage battery fails or sort of you know, purposely goes out of commission to sort of prevent against these battery fires. You're just not able to get into the vehicle without bashing through a window or some other means.
And so to have built a vehicle where the external door handles are inoperable without low voltage battery, that's just a problem and sort of on its face a concern for regulators.
Well, why we might see a rush of buying many hammers and cutters to go inside vehicles At the moment, Craig, which the latest purchase I've just made, It might be focused on the regulatory pushback, and you're seeing China in particular looking for feedback open comment by November twenty ten, November the twenty second. But what else are we expecting Chinese regulators to do here?
Yeah, I think it's interesting that you know this is this has been spurred. This rulemaking and this soliciting of views from the industry got underway because there was a similar incident back in March, also involving a Gaomi vehicle.
Uh.
And so we've seen the regulator in China move pretty quickly here in terms of you know, there was an incident that got a lot of attention, there's this second incident, and I think interestingly we may see some manufacturers not necessarily wait for the regulator to change the rules. I think Linda LUs a story about this latest incident out today goes into this idea that you know, some manufacturers already are changing their their door handled designs to take
into account that this is a concern. And I think one of the things that we've seen in China's car market is just the level of competition is so intense that any way you can sort of sell your cars being incrementally better from different performance aspects, including safety. You're going to jump at that opportunity.
Zeker jumping at it.
The nine exports utility vehicle already going back to an old school kind of handle and a return to common sense is for one consultancy called it.
Blooms Creatudell. Thanks so much.
Now coming up, we're going to be talking all things quantum.
The CEO of d Wave joins us. This is Bloomberg Tech.
News out of Europe from d Wave, which develops quantum computing systems. Today the company announced an agreement with the Swiss Quantum Technology to deploy a D wave advantage to quantum computer in Europe. It's expanding access to the technology. Glue DA CEO Alan Ratz joins us now from Lake Como, which of course very close to Switzerland. In Italy where the announcement comes from. Alan, what does it mean to be deploying this right.
Here right now?
So we are going to be deploying an advantage to quantum computer here in the region. And it will be available to researchers, scientists, businesses in Italy to basically explore how to make the best use of quantum computers. This is a part of the Q Alliance which was announced yesterday. The WAVE is a founding member of the Q Alliance and that's all about bringing quantum to Italy and support of their Digital Transformation initiative.
Let's talk about the FOY four hundred plus cubit advantage shoe system. What can it do that is more sophisticated than classical computers today.
Alan So, our four four hundred cubit advantage to quantum computer is arguably the largest and most powerful quantum computer in the world. At over four thousand cubits. We have almost ten times more cubits than anybody else and with respect to the power of the processor, we recently published in Science a paper showing that we are able to compute properties of materials on our quantum computer in minutes that it would take nearly a million years to compute
on the fastest supercomputers in the world. So this is literally computing properties that can't be computed classically. This is what everybody in the quantum industry has aspired to, namely, the ability to do something important and useful on a quantum computer that can't be done classically, and this advantage to quantum computer has achieved that goal.
I believe you solved a physics problem on the behavior of magnetism, particularly in certain solids. What's interesting is a ton of phrase arguably, Alan, Why is it only arguably the most powerful at the moment? How is your technology differing or or still try to measure itself out versus others out there.
Yeah, so when it comes to the ability to perform a computation on a useful problem that can't be solved classically, we have the only quantum computer in the world that is capable of doing that today. I use the word arguably in the context of largest when I talked about four four hundred cubits, and the reason why I did that is because DWave quantum computers today are what's called
annealing quantum computers. Everybody else in the industry is pursuing a different approach called Gate model quantum computers, and while they have many fewer cubits, the nature of the cubits is a little different between annealing and gate model. So we believe that at four thousand and four one hundred and knealing cubits, we are significantly larger than anybody else because all these other gate model systems have tens to
a few hundred cubits. But there is an academic debate around the difference between the cubits.
What's interesting is you are making and generating real revenue.
It's small, but it's there.
But the market capitalization of yours and many other quantum computing companies has just gone so far up into the right Allen, is the promise and hope being shown up in reality from orders because this is Europe taking a ten million euro step forward.
What about other deals?
Yeah, So we announced at the end of last year that we had sold a quantum computer to the Ulick Supercomputing Center in Germany. They purchased that system to connect it to their Jupiter exoscale supercomputer to explore new AI workflows. And then earlier this year we announced that we had signed a memorandum of understanding with Yansai University and Incheon City in South Korea for the acquisition of a quantum
computer there. And we have frankly a number of other countries and research centers that are interested in acquiring our quantum computers as well, and that's just with respect to purchasing of the quantum computers. Our quantum computers today are also used commercially in support of a broad array of business applications. For example, North Wales Police is using us to compute the best way to forward place police vehicles to be able to arrive at incidents in a timely fashion.
These customers use us over the cloud, so we have both a cloud based business and an on premise.
Business North Wales UK or Australia.
UK.
Fascinating, absolutely fascinating. Thank you very much for data, Alan Barats. It's learning about the European focus that you seem to be having with the business in particular US based company and the new announcement out of lake Como.
We wish you well over their d Waceo. Welcome back to Blue Beg Tech. Let's tack in on these markets.
Because we are trading higher once again, new AI deals, AI compute deals helping push up then as that one hundred, we're at one point two percent. Amid some of the geopolitical risks, we continue trading higher. Let's go onder the hood and look, what's really moving from a points perspective.
We know about the AIRSMEL numbers, we.
Know about the optimism that chip equipment is still selling strong.
Well, let's have a look.
At AMD and indeed in video both of them getting some more mighty price target raises over at HSPC today more than eight percent. In fact, AMD is your leader in terms of points moves on the Nasdaq one hundred.
Again, this hope that yet.
More AI compute needs means more desire for their chips, and they are making an indent on the likes VideA, but in VideA could go high to the tune of what an eight trillion dollar company is what HSBC is currently outlining or one hundred and eighty one as we speak, up nine ten percent on the day. Let's dig into that particular report a little bit more and just the AI further more broadly with Bloomberg executive reporter Ryan Lastelica and Ryan they are seeing significant market cap accretion.
To invidea on what over at HSBC.
Well, it's not going to come as a surprise of many people, but they are touting the growth potential of artificial intelligence. Specifically, they see the total addressable market of these AI chips expanding beyond the hyperscalers, which are the major Nvidia customers right now, Microsoft, Amazon, Alphabet, Meta, and so forth, and really sees that expanding beyond them into
other parts of the economy. So as this continues to grow, they see in Vidia's earnings continue to grow and eventually leading it to the market cap you said before, I think it was about nearly eight trillion dollars, so certainly a significant jump from where it.
Is right now.
That the most bullish when it comes to the overall analyst recommendations ran how much you're seeing portfolio managers echoing that sort of well further and excitement, because we've had a lot of talk of bubbles just yesterday with discussing them all.
Hm.
Yeah, So I do hear some people talking about, you know, having a certain amount of skepticism, can this continue to go on the way it has been going on? But even when I ask them specifically, do you see maybe new competition threats from A and D or Broadcom just given some of the deals that those companies have announced this past week, they still continue to like in Vidia. They still see it as the market leader. It continues to have a dominant market share in the market for
these GPUs, so no one is very barre. I think there is one analyst on Wall Street right now who has a cell equivalent rating on Invidia, but other than that, people are pretty positive about it. I'd also note that as it continues to grow, the multiple has been coming in a little bit, so these are not the kind of dot Com era multiples that you know, some of
the bubble concerns might be indicating. These are certainly a little bit above their medium term average, but certainly not at the level set would be you know, real nosebleed.
Bloomberg's round plus Selca thank you so much for the breakdown. Let's talk more about the AI compute demand right now, because it's time for talking tech and Microsoft data center builder developer en Scale, Well, they've.
Just reached a fourth.
Deal, this time to build a site in Texas with power capacity of much as two hundred and forty megal watts.
The UK startup.
Says the site will have over one hundred thousand new in video chips. The GB three hundred is scheduled to open in the third quarter of next year. Plus an investment consortium including black Rocks Global Infrastructure partner, Abu Dab's MGX, Microsoft and Video, and many more.
I'm gree to buy Aligned data centers for forty billion dollars.
This is the first deal for that partnership that the investors established a year ago to invest heavily in AI data centers and energy, and Coreyeve is partnering with startup poll Side to develop a massive data center complex.
In West Texas.
Now.
The site will be powered using local natural gas and is expected to generate as much as electricity for hooverd APT. Let's talk more about all this AI investment news. Thomas Martin's, with their senior portfolio manager at Global Investments, got north of three billion dollars in assets under management.
Thomas, is this a bubble?
Well, thanks for having me on your program. And of course that is the question that people are asking when things like this just go you know, parabolic, to use a word that captures the imagination. People wonder, you know, how long can this go on, and they start comparing it to the past. We don't believe that it's a bubble. The underlying factor and force is the usefulness that can be gotten from these AI models.
And we're only at the very very beginning of that.
You know, companies are having varying degrees of success at implementing these and the compute.
Power that's needed is prodigious.
It's already been said, and all of these deals really articulate various aspects of what is going on with bringing this kind of compute to the folks and companies.
That need it.
But Thomas, what fundamental data you're looking at that shows productivity and revenue.
Will be there?
Well, that's kind of the rub is that that data is not really there yet in a way that you can put your finger on it and count on it. And I think that's why you're getting some of this questioning. So a lot of what's going on is betting on the future that problems are going to be solved and this is going to be productive, and you see that in the beginning parts of what's going on. Just anybody as a consumer who is using AI to just ask it questions about anything can see the improvement.
But that's not what really is going to drive it.
It's going to be very complex things driven by businesses and agents and automation that is still very much to come and which will require more chips than we have and more connectivity that we have.
So the need for that compute is gigantic.
Mid supply chain headaches and more is and anxiety around China whether or not can keep buying some chips the US makes more broadly whether we'll get the rare earth metals that are needed for a lot of the supply chain. Thomas, how do you factor in the risks of geopolitical.
Well, they're very significant. And the issue with the rare earths and the magnets that they go into is that when you have one country like China that possesses a very high level call it seventy eighty percent depending on what we're talking about, of that, they have a lot of leverage to be able to shut that down if they want to or to extract from the markets. And they know they have that power, and so does the
United States. So if they decide that they're going to start using that and escalating, it will take a bigger escalation to kind of resolve that. I think what the markets are looking at is the opportunity is so great that that will not be allowed to happen.
Look, you have been managing money for a long time, I mean even just twenty fourteen over at Global and I think Thomas, you are kind of talking a narrative where we have to believe, you have to ultimately have hope that this all comes to bear. Is that kind of the narrative You have to talk to your own clients about that. Ultimately, there aren't that many tangible fundamental data points you can use.
You just have to use a product and know how much.
What productive it's made you as an individual, even if you're not paying for it.
Yeah, concepts are very difficult, and they're very easy to get excited about and to capture the imagination. But where you really get the where the rubber meets the road, right, is are they actually being used? And if you point back to the Internet and to connectivity back then with the laying of fiber et cetera and the switches that got ahead of itself and it wasn't really implemented. It was easy to imagine, but the implementation took a long
time to get to where we are now. But where we are now is absolutely using all of those things and is enabling this revolution and.
This one is just happening a lot faster.
And so yes, you have to believe, but of course you have to look for proof, and in the third quarter earnings and as we go forward, that's what everybody is going to be looking for. But these deals that you just talked about our concrete evidence that real money is being put to work by a diversified number of very sophisticated and well capitalized players.
Real money of money.
To Thomas Martin's senior portfolio manager at glow World Investments, great speaking with you. Now, let's talk about billionaire Filanginis Mackenzie Scott reducing her stake in Amazon by forty two percent over the past year, according to regulatory filings that was on Tuesday, the latest disclosure from the end of September, so she now holds eighty one point one million shares,
was down fifty eight million from a year earlier. Scott had ended up with about four percent of the tech giant after her twenty nineteen divorce from Amazon founder Jeff Bezos. Coming up, Salesforce pushes its Agentaki experience in this year's Dreamforce conference or on that next This is Bloomberg Tech.
We love agent Force and we're investing huge amounts Force huge amouse. But listen to this, we've gone fast with the agent Force, and we have gone with any other technology.
Salesforce CEO mart Beni are speaking yesterday at their Dreamforce twenty twenty five conference, during which Salesforce revealed it's AI customer service tools saves its own company one hundred million dollars a year. Who makes Brodie Ford covered this story and joins us now, And that's basically the sales pitch. We're using it, we're saving.
Yeah, should do it too, right, But to me, the fact that they're leaning so heavily on internal implementation, internal savings, it could be a bit of a red flag, right. I mean, traditionally companies like to lean on their customer stories. And it kind of brings us back to the whole question of the moment, which is which companies benefit from the AI boom in the enterprise? Is it the old school leaders like Salesforce, Is it the young ones like
Open Ai? Right now, the anxiety is towards companies like Salesforce.
The question also the moment is any of this making real productive gains for other companies? And we've heard time and time again the n MIT report the ninety five percent of pilots aren't working.
How is Salesforce able to combat that narrative?
Yeap, Yeah, there's this huge gap right now where a lot of people anegotally will say AI has made my own life much more effective. I can use chat GPT for all these things and it's great in the enterprise. There is just still this big.
Gap right now.
And so Salesforce is saying that, look, we have new features all the time. We're making it easier for her to use pricing wise and all these other ways, and here's how you can adopt. But still adoption has been a little more tepid than most would have thought maybe two years ago.
And looking at the share price that tepid adoption, it's pretty painful. Stock is down twenty eight percent so far this year. And still Dreamforce is a dream and they've got Metallico and they got Zimboon and they're throwing all.
The money at the situation.
How is that reading for those in San Francisco and more broadly.
I mean, Salesforce is a cash flow monster. Right Let's say that they aren't able to capitalize in this next wave. They're still making tons of money, but the question is are they losing the mind share are they losing the
growth potential for this new investment wave? And investors can't decide every six months the narrative changes right now, application leaders like them, like Adobe, even like a service Now they're a bit in the penalty box right and so so far Benioff hasn't been able to convince them otherwise. But there is an analyst day today, and you know, maybe we'll tomorrow be able to say, actually, they're doing great.
Yeah, I mean we've just had SAP, You've got Oracle talking up. But it's a particular event at the moment. Can you steer as as to who of the new guard they're almost worried about.
Yeah, who of the new guard? It's the AI native workplace tools. I mean, I would even throw a chat GBT into this. I would throw people using anthropic models and coding their own apps. I mean, what's so interesting is that there aren't a lot of super clear competitors this point. But it's more the conceptual idea that a company like Salesforce will is the center of gravity for so long and enterprises and that maybe that paradigm is changing.
It's not a tangible competitor yet, but it's this kind of creeping anxiety.
I mean, while Salesforce is trying to get itself integrated within chat ept and doing that success to see who uses it in the product in begs, Brodie Ford is always breaking it down brilliantly. Look as Salesforce works to sell its agent Force experience, the next guest says customers, I'm not really ready for it yet, and quote Salesforce knows it, Rebecca Wetteman, Why allow our CEO principal analyst joins us. Now, what's you'll read on Dreamforce and Agent Force? Is it being adopted?
Hey, Caroline, great to be here, Thanks for having me. So I'm here in San Francis great Dreamforce and I will tell you that there's a lot of talk about the agentic enterprise and what that means for customers, and what we saw yesterday was exactly what With all due respect to Brody, we're talking about the need to show real customer adoption with real recognizable brands talking about real business results.
And I think what we've seen.
With AI is we went from sort of the fear of missing out in the beginning to what we're calling FOMU, the fear of messing up. Now customers are really concerned because they experimented on those big projects that you talked about that didn't necessarily yield results.
And so are they more willing to experiment with a non trusted partner that's already part of their overall spend from an internal software basis, or are they more willing to go out on a limb and try the new recruits that are coming intens of startups.
All we definitely heard from Salesforce customers yesterday was that trusted partner is really important. But I think we're probably seeing the biggest innovator's dilemma that we've ever seen in tech. Salesforce knows and when I was talking to Mark about this yesterday, we talked about it.
They have to.
Bring all of those customers along, which means not just innovating and driving the latest and greatest in AI technology, but really providing those safety nets, providing that guidance, providing those examples of customers like them who have achieved real business success with AIS.
Can you brag about that are making that sort of leap?
Well, I've talked to probably twenty or thirty Agent forced customers from small to large organizations across multiple verticals that have really achieved success today. The poster children yesterday were folks like Pepsi Williams and Sonoma Pandora Dell. So really across both consumer brands and more tech brands, would you say, really focused on how they're delivering success today?
I compare and contrast what you've learned at some of the other big bring together moments that we've had. You've been over an SAPs, You've also been an Oracles AI world.
Is there s reality that they're.
Vindicating the overall market capitalization of these companies and the AI bubble narrative that's brewing.
You know, I think that the challenge is customers don't want to be educated, they want to be successful, and those vendors that are really able to show and not tell how they're our customers are achieving AI success today are ultimately going to be the ones that win.
Can I can I ask a little bit about what your view is from the what that you're doing with customers, with people as to whether too much money is being thrown at this for the amount of productivity games we're getting in the heir now.
You know, I think we've seen a lot of folks sort of dip their toe in the pool and get incremental results. They really need to be comfortable diving in to get those kind of exponential benefits that we're talking about, and most folks simply aren't there yet.
So how are they getting that?
Well, it's it's like I talked with Mark about yesterday. The vendors have to bring customers along and that's not about delivering the latest innovation, which is important. It's about providing those baby steps to help them get there, to help them understand what the payback is, to help them understand what the business cases, to help them focus their efforts not on that shiny AI object, but on the one that's likely to deliver the most real value for theiranization, Rebecca.
Is an organization doing enough wholesale change in terms of interlacing human resources, people management with the CTO and the technical sides of the business to actually implement this right now?
Well, no, Caroline, the short answer is no.
I mean, we see fewer than twenty percent of companies have a policy on the use of AI today, and fewer than ten percent have training and reskilling in place, not just to train people on how to use AI effectively, but how to train them for what their future job is going to look like, and that's going to be a key part of.
This moving forward to is there a standout company that you think has been taking its clients along and helping them edicate at the pace you think is necessary.
Who's doing the best job today?
Yeah, Again, if we go back to the narrative that you have to show them, not tell them. In terms of being able to show actual customers receiving results with a gentic AI today, Salesforce is way out ahead.
Rebecca Whiteman Balois.
We thank you very much being an optimism optimistic voice when it comes to the agentic dream ever at Salesforce. Meanwhile, coming up Weimo and it plans to launch its driver US ride hailing service in London next year. We'll have all those details. That's next. There's bloombg tech.
M.
Weimo is planning to launch its driveris ride hailing service in London next year, marking its second international expansion and it's first in Europe, whom most Natalie Lung covers the gig economy for US and joins US. Now what's interesting is they're not going to be partnering with Uber and Lyft. Longer term here, they're going to have their own app offering.
Yes, Wymore is going to work with an Uber backed company Move. They were found in Africa and they used to do vehicle financing and now expanding globally. They're going to manage these fleets for Weimo and they actually were gonna planning to raise you know, more than three hundred billion dollars at like two billion valuations according to report by colleagues last month. So there's real business here for fleet companies like Move.
But London seems to be welcoming with open arms. Both we got Weimo and also Uber seems to be on a similar flight path right in terms of having robotaxis in London.
Yeah, so what happened was earlier this year the UK government moved forward their regulatory framework to pilot these autonomous vehicle trials to next year. So both companies are eyeing sort of that same timeline.
What's interesting do you go back to the days when Uber was first coming into London and the backlash from black cabs over there at the time. Are we anticipating lobbying or is it the government just so wants to be all welcoming to innovation right now.
That's really part of what's need to be done and what needs to be seen as these trials go on. As these trials start, you know, what does the community, how how do they respond and how do you know regulators? You know sort of consider all you know, all kind of voices from different.
Of course, it's not Waym's first rodeo.
They've been piloting and successfully unrolling in plenty of cities already.
What is it?
How are they going to do it in London? How will we see that integration into the ecosystem.
So they're starting with a very small fleet of vehicles around a one hundred square mile radius in London and so in the coming months and so this will sort of lay the groundwork for when they launch it commercially next year.
And I think were broadly, how are they doing elsewhere? I mean, you said, this is the second international destin.
Nice, and so the first international city was in Tokyo. They're currently still testing with the local app and local taxi company. They haven't launched commercially yet. But in the US we've seen different launch approaches, whether it's launch exclusively on the Uber app in Austin and Atlanta or on their own app in San Francisco, in LA So we're seeing different approaches.
They're trying horses for courses, robotaxis for courses.
Bloomberg's Natalie Lang, we appreciate it.
Now.
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