Google, Apple, Amazon Report Earnings

board product wise, plus the rally stores. As Caroline said in after hours, with Alphabet feeling the slowdown in ad spend, we speak to the CFO and Amazon projects lackluster sales and slower cloud unit growth shares. They're also falling after hours. Let's get straight back to Apple and bringing Julia Arsk, principal analysts at Forrester Research. You look at the numbers, the sort of more deep weak this in that holiday quarter for Apple. Perhaps it was that some new products

weren't released until the new year. What was your takeaway from the print? So my takeaway was is, you know, I'm not a financial analyst, but are certainly our expect Tachens is that sales would be lower. If we look at our data from consumers. We have seventy one percent of consumers today in the United States that are concerned about the general state of the economy. Those numbers are

even higher in Europe. We have thirty eight percent of consumers who are cutting back spending on non essential goods. And while we did have a holiday forecast that was up in the United States six point one one, a lot of that was still fueled by inflation. So all you know, savings rates are down. There's a lot of economic concerns that consumers have today. So that's that's one

of the factors that's impacting the near term. And talk to us about whether really this is a focus on services that will eventually bear fruit in that respect overall g because we have despite some of the misses that we're seeing compared to analyst expectations. The CEO, Tim Cook, the CFO really trying to talk about the strength and resilience, the amount of two billion products in people's hands, the fact that services a record revenue rate. Is that something

to be optimistic about. I think it's there's act absolutely it's something need to be optimistic about because one of the other long term factors we haven't talked about is very intentionally Apple, like other smartphone manufacturers, right, these smartphones is their number one source of revenue, are intentionally building

devices that consumers can keep for longer. Right, There's more focus on sustainability, There's more focus on a consumer's right to repair the device, their supporting devices for longer periods of time. So as we focus on some of these environmental factors, as we look into the future, consumers are

going to have also slower upgrade times. So Apple will have to look to building out an ecosystem and products and being more focused on their services revenue, which granted is a smaller proportion of their overall revenue, but certainly their highest margin business. Julie, I want to go back to this idea of new products and timing. Right, we write in our Bloomberg News story that it's a tough comparison because in the holiday quarter of one, Apple would

come out with a new line of MacBooks. They didn't

do that in two. How how dependent is Apple and churning out generation off the generation of new hardware to drive that sales growth, to drive the interest Absolutely they are we I mean, I look not only looking at let's say the MacBook cycle, whether it's a tablet cycle, and most importantly the smartphone cycle, weren't in every six months of one of their largest competitors, which is Samsung, which had which you know, rolled out a news device yesterday.

But literally they need to have the next, latest and greatest thing every year with every one of these product lines because they've got really stiff competition coming from other geographies. And Apple has a very strong focus on this profitability. It doesn't have as big of a product line as some of its competitors can do, where they may be able to sell devices, uh not the same profit margins

or any profit at all. So absolutely, you know, you look at factors like R and D and bringing people back to the office and innovation like all of that is key. Absolutely, product releases, new product releases, not only keeping up but like leap frogging ahead of the competition with every one of these products is critical. And Urine and you're out, and it's critical to be able to

make these products. Julie, and I know you're much more focused on the consumer trends, the demand trends, rather than say that my new shives supply chain over in China, but supply chain has been a real headache for Apple, particularly in the last quarter. We look at actually some of their supply chain suffering after hours Skyworks TSMC down and they've been down over the year and they're certainly

falling after hours as well. From your perspective, are you hoping this is a company that can remain diversified to be able to make the product at the right run rate and get it into the hands that can customer. Yeah. I think, you know, if you read through the quarter of the reports and our reports, I think Apple has a very good hand on the risk factors that are in place, and I think everything to to you know,

trusting what Tim Cook is saying. Everything he's saying is about diversifying the supply chain and lowering the risk of being dependent on you know, one country in one geography for so many critical components to go into their core devices.

I think absolutely it's important. We want to thank you for us to research Principal analyst Julie Arsk fascinating across the board in terms of all things Apple, and we've got to make the pivot now because there were so many key names and Daniel Newman is going to join us now to dig in to the world of Alphabet principal analyst over it for true and Research and just we had a conversation this CFI let ed dig into that because he really spoke to with poor your initial

takeaway on Alphabet, the worries about perhaps cloud growth and really though trying to talk up their AI prows, right, Yeah, I think there was mrs really across the board. And this is an adjusted down guided silver lining though, Caroline is I believe the fan wants to see things break and so if we like that devish talk for the market, we need to first see big companies that have been running pretty successfully even through this downturn over the last

year or start to miss And so that's the silver lining. Um, the AI talk is a massive consideration right now. You can absolutely tell that Google is going to have to lean in to deal with what Microsoft is doing with its open AI commitment. UM, the cloud business, the advertising business, UM, every part of the company is at risk if they don't figure out a way to combat what Microsoft is doing.

So this is definitely gonna be part and you saw that they even have new reporting that they're planning to start in their new uh the reports coming up around AI to give more clarity to their investors about how that is is transpiring. So it was a tough quarter for all these big tech names. But like I said, I think the silver lining is in the fact that starting to miss is the indication that we really have maybe hit this bottoming period that people have been waiting for. Dan.

We're grateful to have you on the program and get this quick reaction. As Karenine said, I've been on the phone with CFO Reef Parratt, and you know she framed this pretty quick, quickly and clearly, this is a reset. We are committed to re engineering our cost base to long term profitable growth. That was kind of her response to the layoffs. Are you convinced by that? Is this alphabet basically saying, Okay, this is the year of discipline. I think this is a theme across tech. I think

these reduction and forces in layoffs. I think it's in a moment where all the companies are taking to reset. I think throughout the pandemic, we hired uh, the tech industry hired to aggressively. I think it was trying to meet that rapid onset of demand and a lot of the digital transformation projects that we heard companies were doing. We're really more bodies being thrown at growth and revenue

and demand. The spiked UH during the pandemic. So now companies are looking at some of those uh those hires they had to make it way over market values. They're trying to reset some of those and trying to get back to a more favorable outfact situation, which as we've seen, as companies have announced reduction in forces and laots, the markets actually favoring these decisions because these are getting back to the roots of running these businesses. And so I

see this as a moment. Is it enough? I mean, the size of Google is still significantly larger than it was a year ago, even after twelve and that's the case of most of these tech comes. So they are reducing enforced, but there's still larger than they were a year ago, as many of them did a lot of hiring. So it's a start. But if the next quarter doesn't

look good, I would expect to see more. All right, Yeah, Alphabet confirming it will book a charge of one point nine billions two point three billion dollars as a result of those layoffs. I guess the fighting talk was about AI, and I think we knew this was coming right Dan, that executives would be quizzed on AI. What Roofport told me was basically a flex. It was basically defense saying

we've been working on AI for a long time. We're excited about momentum as, breakthroughs coming from their research team, like in language models, generative AI. A big emphasis on research because for Alphabet it's not yet out there in the real world. Do you expect Alphabet to become a real commercialized AI player this year? I think anything that was behind the curtain is going to have to start

to become more exposed. I think the p A commitment, I think chat, GPTs popularity and the general concerns to what this can mean for search for instance, or workspaces is going to force Google and Alphabet to start to reveal all of the research it's done. Now. To be clear, as you know, technology industry analysts, we are continuously impressed by what Google is capable of in the AI space.

They've been inventive, they've been innovative, but they haven't necessarily done a great job of coming out in front recently and explaining how they plan to combat what others are doing, and in the case of the open Ai came on very quickly, Microsoft's large commitment and investment, and now Google is in a situation where they have to be able to show the market, yes, we have a plan, we have technology. We are not going to let a chat bot or what open eye is doing significantly disrupt our

advertising business. Uh. And that's that's what the market's gonna want to hear, is that there isn't a big risk to that part of the business that's so critical to its long term success. But down what is the risk to that part of the business from regulation rather than perhaps competition. Yeah, I'm really glad you asked that question. I think the regulators across the board continue to look at Google and of course the disproportionate amount of ads spending.

I still don't think it's the biggest challenge that regulators actually have. I still find a lot of of what Apple does with its uh you know, it's captive app ecosystem, for instance, is a bigger issue. I mean, you see Amazon coming out with growth and its advertising business right now.

Like I said, you see what chat GPT could potentially due to the everyday search that feeds so much of our ads that isn't really commerce demanded search, and you suddenly say, you know, does Google's long term um, you know, market strength? I don't dominance is the right word prevail with all this new AI and technology that's coming into the marketplace. Look, regulators are going to continue to regulate.

Europe will always, for instance, continue to be very tough on big technology, and of course in the US we've got leadership in the FTC that's constantly looking to regulate.

Having said that, I don't think Google is its biggest focus, nor should it be, and I don't think regulators will be doing any favors to the market by harming Google because I also think with all the Apple I D you know, the I D f A Apples and other scary you know, entrent to have a really dominant opportunity in advertising as it controls so much of the flow.

Is what we saw with Meta. Well, many say Amazon is also competitive in advertising, and Amazon of course the juggnal when it comes to cloud services AWS, so some slowdown. We'll talk about that in a minute with our next guest, But talk to us about Alphabet and it's cloud offering. I mean, should it be committing this much, there's another loss. Yeah, well the losses are narrowed. And I do believe that

Google has the opportunity with its customer base. It's uh, you know, it's BROADUS user base, and it's a lot of its technologies around data that it's become part of the enterprise's larger cloud ecosystem. So in what we talk called the multi cloud ecosystem. Google has been a consistent growth engine. You saw they grew up this quarter, which was right in part with with Azure and you know,

faster than AWS. And I know you're gonna kick over to a w S, but you gotta look at a w S as an over eighty billion dollar business, and yes, slowing to is significant, but the business is so much larger than you know, some of the other cloud providers that I still think it WUS is in a really good position. Going back to Google, Google needs to continue to grow. It's going to have to hit an economy

of scale right get profitable. I don't sense that making money is its biggest focus, but I think in this time of austerity, they're gonna have to get there quicker than they maybe wanted to. Future and research analyst d and human digesting breaking down a big nings report from out Bed, Thank you very much. Now coming out, we've got to state with earnings, and we're going to dive into Amazon's lackluster results. I just want to get a quick check on Qualcom ches and how they're looking in

after hours training. We're actually down to and a half well four percent. Now that's Amazon, but I'm talking about Qualcolm the largest theory two and a half percent lower, a pretty weak forecast. At first, it was not that much of a decline because we saw this coming a slowdown in the smartphone market. But again the market listening to what executives are having to say on the call, and those losses accelerating in post market. This is Bloomberg.

All the earnings come thick and fast on Thursday, and Amazon was among them of course as well. Earnings well showing some lack luster forecasts coming through. We're down three point immediately after hours, Slower cloud unit growth as well a w S, which is the profit center in many ways. Let's talk to Minissa Verdict, because she's not only co found in president of pack for You, which of course all about making the best of your e commerce provisions

and marketing but also a tenure Amazon veteran. You know this business, particularly on the e commerce side. So let's start their overall, Melissa. When you're looking at what they're offering, the macroeconomic headwind all, they navigating it. All. They focusing and AFL and trimming costs, sudden growing growth and the way you'd like to see them. Uh, they're definitely focusing on that. I would say that they're focusing on profit

at this point. Um. Amazon is famous for, you know, changing their knobs pretty quickly and they can go from driving brow to driving profit and that's what they're doing now. UM. Q four was a really interesting kind of quarter. There was definitely a slowdown in demand. UM consumers that were coming in, they're actually coming in to buy deals and discounts. Uh. And the good news is that Amazon is always known for having the greatest prices and so that that's something

that was definitely going for them. But um, you know, unlike in years past, Amazon and Q four actually had more inventory. UM consumers wanted to buy on deals, so they came in, they bought during Black Friday's every Monday. UM. But you know, Amazon is really focused on cost cutting at this point, being efficient profit margin um in the face of having a lot of slower demand consumer demand.

It's interesting on the cool Brander's abscie the CFOs talking about the layoffs and saying this round of layoffs is over and talking about the charges and impairments which they took. But Amazon is still kind of bloated. It seems still a big beast. Do you expect the company to be more nimble in terms of how it kind of adds

and flows in hiring and reduction going forward. Absolutely, they hired half a million people and they have over one five million employees, so eighteen thou employees is not a huge amount. And in the face of slowing growths and slowing demand, you know, it's it's something to think about, which is they will have to look at their bottom line. Where do they lean into at the moment? When so, where are they able within the focus on profit to

decide to allocate cash for growth? Well, the through the two businesses at Amazon that are very profitable are advertising and AWS. Uh So those are definitely areas that they plan on continue to invest in. The AWS is slowing what you worried by about. They're definitely both slowing um and absolutely. Uh. You know, AWS market share has dropped

from forty three percent thirty four percent. They have a lot of competition with Microsoft and Google, and right now all companies unit hards are looking at cutting costs, and one of the first places you go to is AWS. So I think that is going to be a big challenge this year because companies are looking to cut be

efficient themselves, and that will impact AWS. I guess my question, Melissa is how long does AWS be the sort of bankroller of the rest of the business, Because that's the situation right where Amazon has this sort of ginormous commerce business. There's the prime subscription element, the video and content element, but it's all kind of dependent on this cash cat. How you've been inside that that company, you know how it operates. Do you think they'll have a change, They'll

have a snap snap free of that business model? Um, I mean serve the services business. Amazon has become a services business. It's over of their revenue across AWS, advertising and subscriptions, and so that will continue. And I think that you know, one thing that Amazon is well known for is innovation. The thing that can't control is the demand and the cost cutting part that other people are doing and that impacts AWS. UM, I think advertising is

a bright star. They're doing so many things there. Crime video for the first time surpassed as Netflix is the top streaming service. Amazon talked about a hundred million viewers watching a Lord of the Rings. Um, more people watching streaming means more advertising revenue to Amazon, and so that is a big star for them. Very briefly. We've touched on it with Alphabet, but the regular story overhang anything that worries you with Amazon. Uh, the DJ definitely has

Amazon as a target. It's really hard to call them and monopoly with so much competition. They actually have slipping market share in AWS. But that's not to say that it's not going to be a distraction and something that they're going to have to answer. So you know, this happened before with private label UM and they had to answer to that. So it'll continue to be something that

all these tech companies are dealing with. But I see less of kind of a like to stand on pact for your co founder and president, Melissa birt It, thank you so much for breaking down again and now they're challenging. Earnings report from Amazon now is one of the most read stories on the terminal amongst our clients, at least today, because some major hedge funds they've been asked by US

regulators to review certain employees personal mobile phones. Why because it's all part of this big probe that continues to mushroom of Wall Street's use of unofficial messasaging platforms, basically the use of WhatsApp to be able to do deals, broker potentially M and A and that sort of thing. And ultimately we're hearing that the SEC has our Steve Cohen's points on only two Ken Griffin's Citadel other firms as well. But what about the liability here? What about

people's phones? What sort of data might we end up sort of unfolding here in terms of health, in terms of finance, Well, we should say those hedge funds you name, no one's been accused of any wrongdoing, but they are literally asking them to review the devices for any transactional stuff, that business stuff that's being done on them inappropriately. That's the reality of what's playing out on Wall Street. We've already seen the fines being exerted upon the brokerages and

the actual banks. We see asset managers kind of pushed back at the moment, I'll come back to Bluemo technology. I'm Caroline had in New York, and let's get you up to speed with some of cost cuts, some of

the layoffs, whether they're done or not. Lumbag intelligence put on oil and pieces says with us Rumas Tech Executive editor Tom Jailes as well, start with you and on Amazon because ed talking about this reset and alphabet, this focus on being more disciplined and on cost cuts, the layoffs Amazon's used to be saying, look the cost cuts, Well, certainly the layoffs are done. Are they right sizing in

the way that the market wants to see? Well, they're there are laborers down for a percent and a year or a year basis, So they did right size a little. Now you can argue that could they do more? Sure, but maybe they're just waiting to see how things unfold. And remember Amazon's a business where many parts of it are still in rapid growth mode, whether that's advertising a WS or um even on the three P side where they really are growing much faster than expected, or the

overall retail business despite resolve all down. Sorry it interrupts you out, Tom, I actually want to pivot to Apple because we kind of saw this coming, you know, we knew that December would be really tasked. They missed estimates basically across all the products, and the markets reacting as you'd expect, pretty negatively. But is that a surprise. I mean, we thought they'd be weak. We saw the headlines out

of China. We knew that there were going to be supply chain constraints, We saw the lockdowns, and we saw the impact, and and Apple is absolutely feeling it. In addition to supply chain concerns, Tim Cook talked about currency headwinds that has to be taken into consideration. But also remember back the saying when Clinton was running for pred it's the economy, stupid, it's the economy. The economy is

hurting Apple. It's hurting demand for iPhones. The economy is affecting demand for ads on Alphabet, and the economy is affecting demand for a WS, the cloud services at Amazon, all of those things. That's the theme running between all of these three companies today. I love how you bring them all together and this discipline, this focus. What's interesting is rule for Apple, in particular, their supply chain headaches.

Did they speak to that in any way? Have we got an idea as to whether the China issues, whether they're now trying to broaden out of just Fox Con, whether that was what was hindering some of the sales, particularly on iPhone sales. Well, a couple of things, Caroline, great questions. First and foremost, Obviously, things have changed dramatically in China since we had the lockdowns late last year.

You've seen this opening up. Uh, So you're not seeing the headlines of like of of people just locked in their homes literally not going out, not buying um, and people not even being being able to get to work to actually manufacture the phones. So that's changing. What isn't changing, however, is these questions about, you know, just how quickly is demand overall globally going to come back. It's not roaring back. Um. You know they've had to take they've had to slow

down their hiring. Um. Everybody's taking different kinds of us theority measures. Um. You know, I sort of put out a tweet about how all these companies maybe they should be talking about, just like Zuckerberg did, is going to be the year of austerity. You're not quite hearing it as aggressively as you heard with with Meta, and remember Meta also talked about authorizing a buyback of as much as forty billion dollars. Another reason why you may not be seeing quite the rally in the stocks that you

saw with Meta earlier today. Okay, let's go back to Amazon, but also kind of links what Tom was talking about about the broader economy. You're you've written about a bifurcation in trends and particularly focus on that AWS drag. Right, You wanted to know about the macroeconomic environment. You wanted to know about cost saving progressions. Well, what did you

learn so far from Amazon's commentary? Sure, I mean the call starting as we speak, but what I've seen them say just recently on the call is that consumers are trading down. And that's obviously a concern because when you start to see a trade down, you kind of get the first signal that the economy is softening. So there are pockets of weakness that we do need to look out for as we move forward into three But overall, when I think about Amazon, Amazon is just not a

one P business. It's also a three P business, and their third party business is very very strong. It remains an attractive platform for new businesses. And existing businesses to really get the eyeballs that they want. So it's it's it's kind of a mixed story when you think about Amazon's total g m B, where one P may struggle a little, but three P is still very much on fire.

Three P third party. We love the lingo. We love the fact that both of you could draw all of these juggernauts together and sort of tell us the thread across it all, which is, of course, efficiency, efficiency, efficiency, stupid Bloomberg intelligence pot and goil. Bloomg Executive editor Tom Giles, We thank you both so much, great expertise. Meanwhile, coming up, I'm gonna pivot a little bit. Let's get out of the world of earnings. Let's go back to the world

of fts. Because we had an exclusive interview with the former f t x U S president Brett Harrison. When wrong from an inside of you, that's next and this is Greenback. It's been less than three months since f t x collapsed and a former top executive is eager to get it all behind him. Former f t x U S President Brett Harrison insists he didn't have a clue what Sam Bankman Freed was up to. He sat

down with Bloomberg Sinali Bassik in an exclusive interview. M H. There were primarily disputes that I would attribute to the growing pains of any high growth company, you know, problems around internal communication, around structuring the company, for providing better governance, especially as we as we were growing larger, around hiring enough you know, developers and other senior staff that we needed to be able to accomplish many of the goals

that we were seeking to accomplish. And when I would try to bring up these kinds of criticisms internally at the company, UM, they were never met well. And at some point, you know, we truly weren't really speaking much to each other over the course of the last queen a part of the time that I was there. Now, you had mentioned these disputes were not just with Sam Big but Free you had mentioned these disputes were with other members of his staff, his deputies. Who else did

you find those disputes with? Yeah, you know, they were primarily with Sam, but you know, I think many of the people around Sam really agree with him on most of the internal decisions, especially around trying to kind of

grow and separate the staff. Um, there was very much sort of a separation between the group of people who were the executives in the Bahamas, sort of around them, living together, who were making those kinds of decisions, versus the people on the U S side, who are you know, I guess I said, we're systematically left out of many of those decisions. Um to the extent that you believe.

You know, the number of his deputies have already come up and pled guilty to some of the charges that we're seeing against f t X. What do you think about those charges and do you think that there's anybody else that will be brought into them. I'm not sure

if there's going to be anybody else at this point. UM. I do think that the charges are they're damning, and they're truly shocking to see sort of the depths that um Sam and his close associates went to to try to conceal this fraud from the public and the private UM and you know, as as a customer of the exchange, myself, as someone who had worked extremely hard to try to build out this great business on the U S side, who had hired extremely talented individuals into the U S

Company to be able to accomplish those goals. It was really really sad to see all this come to light. Now you had said fraud, but this is still an alleged fraud. He has not been convicted yet, although others have played guilty. I'm wondering what you think about the go forward path here? I mean, do you have any evidence? Are you cooperating with authorities at this time? You know, I can't speak to whether I am or I'm not,

you know, involved in the investigation. I am very happy to cooperate in any way that I can, But at this point it's really just sort of a wait and see. You know, We're going to see if there are more details that come to light, if there are anyone else that's sort of brought in, who ends up leading guilty or not, you know, whether this case actually ends up making it to trial. It's something that I'm kind of watching and waiting and interested in the way that kind

of everyone else is in the public. Have you been in touch with Sam since you've left? No, In fact, you know, I think we were last in touch several months before I left the company. Even have you been in touch with any of his other deputies that you had said you had disputed with and if you had the opportunity to talk to Sam, would you want to and what would you say? Um? No to the first question,

and then the second one. I think nothing. You know, I think at this point it's best for me and for everyone, the media, the public, investors, everyone to sort of to move on from from Sam and find a way path forward, to be able to move forward with with crypto in this industry. UM, I think you know we're time to turn the page. M Brett Harrison, their former f t X US president and ED is great that Shannale is staying late to talk to us about

this extraordinary conversation. And I think ultimately Shannali just give us your take on the fact that he is trying to turn a page. People are handing him money, not as much money as he hoped to raise, but five millions a lot from some interesting players. Do you think he can move on? You know, it's interesting, as you said, it's not as much as he initially went out to raise. He started that process after leaving f t X, before

it had imploded. And then you look at who he raised money from, the likes of Anthony Scaramucci, who himself felt wronged by f t X. Given that Anthony Scaramucci had selt sold a part of his own firm to f t X Ventures, can he move on? It's interesting he's trying to hire former employees of f t X. He's hired about five, he said, and the road. He says he wants to move on, But how long does that take? The questions that still remain are should he have known? He says he was misled. He says he's

kept records of how he was misled. But at the end of the day, this will take a long time. Even just the responses on Twitter, people won't feel like they can move on from f TX until they start to get their money back and they get some resolution to some of the answers that are so brewing about the situation. Snali triffic interview, Just great timing around that conversation. The other big headline of the day is, according to Bloomberg sources, Silver Gates is facing d o J probes

over what happened with f t X and Alimta. What do we know? A few things? This is US prosecutors in the Justice departments fraud Unit. According to Bloomberg's Tom Schoenberg, this is a criminal investigation according to his report, and it is started fairly recently. Remember when you look at silver Gate and its relationship with Alameda, it started in two thousand and eighteen. Silvergate was really the bank of

choice for a lot of crypto large crypto companies. But when you take a look here at this investigation itself, it comes off the heels of criticism from lawmakers as well. To describe more of the relationship between silver Gate, f t X and Alometa and what silver Gate really knew about what was going on and whether they had appropriate disclosures. Remember, silver Gate is a bank here, California based bank that is still using a depression era backstop for the way

that it operates. It has short term funding that really allows it to operate in the way it does. So it is one of the more clear links to the traditional financial system when you're looking at how the crypto industry is financed generalie. What's interesting whether or not people can move on. Some people are trying to move on by the fact that prices are rallying again. They're not in anywhere near the heady heights six, but still Bitcoin

the o G is climbing higher. We've just had some numbers out of micro Strategy, which was once upon a time a software company and basically became a bitcoin vet. How are we seeing these companies still suffering from last year?

But looking forward, one thing that's interesting is on the way down, so many people lost so much money last year that when you're looking at places like micro Strategy or coin base, or places that are linked to the crypto industry, you have an instance in where people are looking at, Okay, have we bottom should we get in now? As prices of bitcoin start to recover. If you're linked to bitcoin, it's an easier way to play the industry through infrastructure than it is to really bet on other

tokens and coins if you're an institutional investor. Micro Strategy is still publicly traded stock. So it's interesting. You know, we're talking about being in Miami and seeing a lot of these big crypto players. I saw Scared Mucci. No progress is there as well. There is still an industry that is severely bruised. But that balance that you're talking about is giving people power to come up and say

we're surviving basic terrific reporting, Thank you very much. I actually want to stick with the conversation around crypto arc investment managements. Kathy would spoke to Bloomberg earlier about why she's sticking to her bitcoin strategy. You have a listen. The confidence actually was strengthened last year. Now, last year

was was a terrible year for everything crypto. But if you think about what happened, it was the centralized opaque players who went bankrupt f T x Celsius three hours Capital Um and and what did we see from bitcoin? Bitcoin is completely decentralized and transparent. It started because of oh eight oh nine, the lack of transparency in the traditional financial services ecosystem. And I remember when we did our research and Art Laugher I mentioned him. I mentioned him.

The first was on your show. Um. She took us through what bitcoin meant to him and it was wow. Art. So this is a a rules based momentary. It's a rules based digital monetary system, and it's global and and there's no human intervention. Uh, it's very disciplined. It's mathematically metered to top out at twenty one million units. Well

in the last year. The response to the last three years, the responses to COVID that the fiscal and monetary responses that you know in many countries are causing hyperinflation and you know fiscal crises. We're seeing protests and riots all over the place. Um, well, where do these people go for an insurance policy against an implosion in their purchasing power and wealth. It is in something like bitcoin. Happy with that Netflix password sharing? Why are we all freaking

out about it? Okay, let's get to the facts. Because last year Netflix told us more than a hundred million households currently use memberships and Netflix that don't pay for it, and they wanted to crack down on this password sharing, probably coming into effect in the end of the first quarter, that means by March. Now, why are we all freaking

out right here right now? Or they've already been trying ways to curtail password sharing over in Latin America in three key countries in fact, Peru, Chili, Costa Rica, and they put out a helpful article to tell users in those countries about some of the changes. That they published it in every single region, So that's why we're all worrying about it. So what are we seeing being trialed

in those three countries. Well, the users are being asked to set a primary location for where they use Netflix on their devices, and then Netflix will track a mixture of IP addresses or device ideas account activity to see if anyone outside the wholesehold is using that password. And you're going to be incentivized to add members to your own household. If you want them to be using it, You've got to pay up now right here in the US.

Take a deep breath. Nothing is exactly happening at this moment, but what's clear is Netflix is going to have to use all of its storytelling skills to get you and I on board with these changes. Oh and the fewer the outrage that was across Instagram, that was across Twitter as people got this the wrong way around, thought it was being enacted in the US immediately. And what was so ironic, I suppose is actually Netflix had some strong

news coming out on Wednesday. They wanted to talk about Netflix Spatial audio are better, an amount of more devices if you have the premium Netflix subscription, and instead it got drowned out by this. We thought this would be adds the story for Netflix right add supported tier about password sharing and Greg Peters before he was promoted to co CEO, that was his project. He was out there trying to crack this problem, whether he does it or not.

I mean, this was a really fascinating reaction, It really was. And I think now we're going to have to hear from Netflix about how this might be enacted, the trials that were going on, and what it's actually going to mean for you and me eventually in the US. Remember back in they were saying it was all about passwords sharing. Now it's a very different matter when it comes to numbers. But talking in numbers, the earnings today, I mean, what's

the afterno ours reaction looking like? Now? Yeah, I mean we're still lower across all of those mega caps. And what's so interesting is we asked our audience, did you think after meata this was us turning the corner for tech tech stocks? Actually, everyone on Twitter at least was pretty bearish. No, this is a tad cat bounce. Well, there's right. It would see that they're pre improved, right, although we're coming off our lows, aren't we? After hours?

And so we'll all go tune into tomorrow what exactly the numbers look like, how we perform in terms of tech stocks. But this addition of bl technology, do not forget to Tune in to Twitter spaces Friday midday. That's twelve noon, right head, Yeah, I got the crew of me and a special guest. This is Bloomberg.