JD Vance Bashes Europe, Musk Factories' Undocumented Workers

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I'm Tim Stenoveek and I'm Jackie Devalas in San Francisco. This is Bloomberg Technology Now coming up. US President jd Vance blasts Europe, accusing the region's leaders of undermining democratic values and taking aim at the blocks attempt to regulate hate speech and misinformation in media online. Plus, we are joined by the CEO of Data bricks on the company's AI focused partnership with SAP and a look at Elon Musk's empire and how some of his companies hired undocumented

German, who joins us now.

Mark, humanoid robots sound like something out of a sci fi movie. What is Meta's vision for this venture? Here and how much are they spending to do it?

So Meta wants to own this still nascent humanoid market. Right, These are home robots that can do chores for you, maybe fold laundry, carry a glass of water, bring something for you up the stairs. You've seen Tesla get into this game with optimists, We've seen Boston Dynamics with Spot. Other companies like Apple and Google Deep Mind or making

Mark is the idea here that they make money on the hardware, the software. At the end of the day, how is this a company How does this help the company make more money selling US ads?

I mean, Meta is investing billions of dollars in artificial intelligence and augmented reality, and those are two core technologies that are also useful in humanoid robots. Right, this technology could be applied to humanoids. They're spending sixty five billion dollar on R and D investments across twenty twenty five, so a portion of that will now go to humanoid robots.

Right.

Meta believes that the hardware stacks are pretty well done right now by the third party humanoid manufacturers.

Right.

Where they see a step down is in the AI and the software, and they believe with Loma they can.

Fill that gap.

Mark.

What has the company learned from its reality labs, prior ventures and headsets for example? What does it plan to do differently this time around with humanoid robots?

Well, I don't think they're going to do much differently right other than I think they're starting to hire a little bit more slowly than they have with the augmented reality metaverse push.

Right.

So they're hiring about one hundred people this year, right, That seems like small potatoes compared to the number of people they hired at the height of COVID, at the height of building out the metaverse and mixed reality.

Right.

So they're going to go a little bit more slowly here, maybe invest a little bit less money at the get go, but I think their ambition is still the same.

What is that, Moonshaw?

What is that long term area that we can own as a company.

Bloomberg's Mark German and joining us out there in Los Angeles. Mark, always good to see you. Congratulations on this scoop as well well. Earlier today we heard from Vice President JD Vance who spoke at the Munich Security Conference. Take a listen to what he had to say.

The threat that I worry the most about visa the Europe is not Russia, it's not China, it's not any other external actor.

And what I worry about is.

The threat from within the retreat of Europe from some of its most fundamental values, values shared with the United States of America.

Van's called out Europe's regulation of big tech, saying it's out of control and harming free speech. Van cited incidents from Germany to Sweden to the UK of what might be called woke policies as evidence of how Europe has lost its way. Bloomberg's Mike Shepherd joins us now to discuss Mike, how did this message? How did this speech land with the audience in Munich?

Well, it, Philip with flat because when you consider the context of the Munich Security Conference, you have to think about what's happened earlier this week we saw JD. Vance's boss, President Donald Trump make this sudden outreach to Vladimir Putin and Russia to try to negotiate an end to the Ukraine War. And Ukraine really did not come up very much in the speech at all from Vance, and overall

Mike Vice President Vance also seemed to suggest that the annulment of the Romanian election in December was somehow uncalled for, despite that there was evidence of Russian interference.

How did those commons land well?

Again, this is another remark that he made during his appearance. It really did not sit well with the audience, especially the Romanian delegation. There's ample evidence that Russia had tried to interfere with the results, which led to a far right candidate pulling off a surprising victory. And the concern about Russian interference with and tampering with domestic affairs of its closest neighbors is a constant concerning that we have

That's Bloomberg's Mike Shephard, appreciate you joining us. Shares of Airbnb are surging today as the company posted an upbeat forecast for the first three months of twenty twenty five, citing continued strong demand following its holiday strength.

Now for more, Bloomberg's Natalie Lung joins us.

Now, Natalie, help us understand this because gigagonomy, peers, Lift and Uber issued more muted forecasts. But what's driving Airbnb's optimism here?

Yeah, they had a very good fourth quarter during the holiday season where US airline carriers as well as online travel peer Expedia also talked about, you know, strong international travel and in particular, airbnbsaw acceleration of growth in all of the regions that's operating in, including the US, where there was some slowing demand last year, but it seems like it's really back in the later part of the year.

Natalie.

What's going on with the company's experience as part of the business and the investment that they talked about happening there?

Yeah, the company told us that they're going to be spending two hundred million to a two hundred and fifty million this year into new initiatives, including the relaunch of experiences. The CEO talked a bit about how in the past when they launched it, maybe havn't cross marketed products enough. So let's say, when you're staying in staying in a particular city that they don't push or promote their related experience as much, and so the relaunch will be better at that.

All right, Bloomberg's Natalie Lung, thanks so much for joining us on Airbnb surging. Let's bring in Tiffany Wade, senior portfolio manager at Columbia Threadnil Investments. They've got about six hundred and forty five billion dollars in assets under management. Tiffany, I want to start with Palo Alto Networks and get your thoughts there, because we're seeing shares on a little

I think across the cybersecurity space we are seeing pretty strong trends. The last couple of quarters, we saw some customer rationalization of spending. I think we're seeing that coming to an end, and we're starting to see sales growth pick up again. Palo Alto obviously down today, for the most part, the metrics were pretty good that they reported some of the key metrics that custo that investors look at, recurring revenue was very strong in the quarter, and they

Tiffany, let's stick with AI in particular, some of the big tech giants that have made some pretty wide comments about infrastructure, R and D talent investments. How discerning our investors when it comes to this kind of spend. Do they care where it's going, especially now off the news that Meta is building a humanoid robot, which is surely to take quite a bit of investment there.

Yeah, I think investors are definitely keeping a very close eye on the amount of spending that the large companies like the hyperscalers are putting into AI, and over the course of the next couple quarters, we're going to want to see returns on those investments. For the cloud providers, specifically, they're spending a significant amount of CAPEX in investing in AI processing capacity. I think in order to stay ahead

And I think that all.

Of these services should see additional demand with faster adoption of AI. And I think what we'll see is these companies are becoming kind of the toll roads for AI, where they're supplying the cloud, the tools some of the developers, and the processing capacity that their customers need to enable other companies to develop and deploy AI.

We've also seen some comments coming from Washington that the government plans to be more supportive when it comes to investments in artificial intelligence. How much of that initial enthusiasm from President Trump's Stargate venture being announced has worn off by now?

I think that that's probably the Stargate venture is a flashy announcement, but I think it's more of the same of what we're seeing. There was already a significant amount of capital investment going into infrastructure spending. Formalizing announcements with multiple companies investing is a great news story, and maybe some of the spending, but I think a lot of the spending was going to happen anyways over the next three to four years and over the next decade.

Are you not at all concerned about CAPEX spending from the hyperscalers from any members of the mag seven being too much? Are you overspending?

I don't think they're overspending right now. A lot of the spending from the mag seven companies is going to their own use cases where they're actually seeing a return on those investments in terms of better advertising models or better offerings to customers. But a lot of the spending is also going to support their customers who are trying to develop AI tools that they're going to sell in the future. So I don't think that the I wouldn't

Well, speaking of costs coming down, the news that we got from deep Seek a little over two weeks ago or three weeks ago at this point, does that mean that, indeed these companies have become more efficient when they're training ms, for example, that they won't need all the CAPEX that's been invested.

That's definitely a concern in the market, and you saw that in the Monday after the deep Seek R one model announcement. I don't think that we're going to I think what we're seeing is that the deep Seak announcement was really highlighted the efficiency of model development already. So costs for model development from the established US players like open ai or Anthropic have been coming down almost as

So if you think.

About the adoption of cell phones, as they got cheaper, more people bought them, you didn't end up needing to make less cell phones.

That's Tiffani Wade from Columbia Thread Needle Investments, thanks for joining us.

Coming up will be.

Joined by the CEO of AI startup Times on their big funding round. We're also watching shares of draft kings this as the Boston based company reported fourth quarter earnings that eat expectations. Also boosted its sales guidance for the current year to at least six point three billion dollars, in the sign that the company is overcoming concerns about a tough market for sports betting operators. This is Bloomberg on today's AI and Action. We're looking at AI software

To use f person foremost, Jackie, thank you for having me. Happy Valentine's Day. Yeah, it's a great question. We're really proud and excited to have raised this capital. I think where you'll see us invest is in the areas where we've seen kind of outsized traction over the last eighteen months. So as a startup, we've been around for about seven

Oh and as Jackie mentioned, one hundred and twenty five million dollar funding round, it increases the valuation by eighty percent, so certainly a big round when it comes to your company. I'm trying to get an understanding for how difficult it was to raise money in this environment. How long did it take?

Was it easy?

Was it tough?

I would say it's never easy, you know, raising capital, regardless of the markets is never easy. I would say that the reason we were able to raise this round, and it's only nine months since our previous fundraise, was just the success we've had in the market over the last twelve months. And so as I say, and you know, we've increased the number of automated actions, we're performing ten

Oh and let's talk about some of those customers, because a lot of European startups kind of get a bad rap for not being kind of the big heavy hitters that you see coming out of the US and Silicon Valley. Where is your customer base coming from?

Yeah, it's a great question.

So although we're headquartered here in Dublin, we also have offices in San Francisco, Boston, and in Australia, and so we very much consider ourselves a global company. About seventy five percent of our customers are in North America and Canada. We've got about twenty five percent in Europe. But it's across a variety of different segments, from commercial to enterprise, to fed to strategic. I would say that the their initial sweet spot for talents was in those high grow

We're expecting a much friendlier federal Trade Commission here in the United States and something that might open up the doors to more m and A. You operate in a space that could potentially see some of that uptick. Have you thought about how far you want to take this? Do you see yourself as a public company or perhaps sewing down the line.

Yeah, it's a great question.

I think what we love to do as a company, honestly is build product that our customers love, make our customers outrageously successful. And that's what we're going to be focused on for the next kind of like short and medium term. And I think if we do that, and then I think we'll have optionality towards the outcome. But right now, we're heads down focused on building a great product.

Owen Henchy, time CEO, joining us from Bublin this afternoon. Thank you so much for joining us. To appreciate it. Welcome back to Bloomberg Technology. I'm Jim Stenoviek in.

New York and I'm Jackie Devalis in San Francisco. SAP and Data Bricks are launching a new product combining SAP's business data with data Bricks AI platform for more. Ali Gotseed, CEO of Data Bricks, joined us. Now, Ali, you're going to invest two hundred and fifty million dollars. You say you're expecting a billion dollars in revenue. Talk to us about how this partnership is going to differentiate you from what's already on the market.

Yeah, so this is you know, we've only had one partnership this big, and that was ten years ago with Microsoft. So we think this is going to be game tending for the industry. So when we talk to our customers, we say, oh, we have an amazing platform.

It's great. They always say, but what about the SAP data.

Because SAP's data is the most important data in the world.

It's what's powering all the leaders, all the.

Financial systems of over ninety percent of fourteen five hundred, and this data has sort of been locked away and people can't access it.

So what the partnership means is that anyone that goes and now.

Buys SAP data backs from SAP, will get all this data accessible right there and they can start building a genetic systems AI and so on. So that's why we saw bullish on it, and that's why we earmarked the quarter a billion dollars, as you said, from our ten billion dollar fundraise that we just did.

You know, another important partner of yours is Microsoft, and it's increasingly becoming a competitor. It said that it's using its products. It's fabric. It's going quickly. What's the pitch to use data bricks rather than fabric.

Yeah.

Look, Microsoft's a great partner, but still remains a great partner. They're actually investor in data bricks as well. So is by the way, aws so is also a Google. But there's competition. As you pointed out, they have sometimes their

So what I mean by that is this is not just data on the.

Financial ledger of a company, it's also the travel system.

Because SAP has.

You know, a product called concur, they have success factors for HR, they have a REVA for procurement. All this data has been combined and enriched and it's just available in spe Data bricks. But that's the big difference between using SAP Data Bricks and using any other data platform out there.

Ali, there's been a huge conversation lately around inference cost and I'm wondering, if you've seen inference costs go down, what does it mean for data bricks.

Yeah, inference cost has been going down all the time in the last few years, and we have a whole research team dedicated to just optimizing the software portion of that. There's of course a hardware portion. We don't build hardware, but the software portion is actually significant. Two we're seeing you know, two and a half to three x boost just in the software.

What does it mean, Well, what it means is that it's just much cheaper to.

Build applications on top of AI. You know, it's kind of crazy if you think about if you zoom out, what it costs costs less than a dollar to produce a million orbs. That's basically three books. You can get the AI to produce three novel books for you for less than a dollar, So that's what you know, cheaper inference means and just just unlocks all these applications on pop So that's what we're excited about.

But for those applications, you need.

Special data and that's all that's going to matter. And the enterprises have all the special data. So the question is how do you combine that data AI with that special data that they have, and then of course with the inference so that you can build these AI applications.

Well, as we heard from Jackie, you recently closed this fifteen billion dollar funding at popping sixty two billion dollar valuation. Is that it for fundraising? Is that done?

Ah?

Never say never, you know, but it's a significant portant that we've raised. Now, I think it's more important for us to invest at wisely invested in AI talents, invested in building AI systems, invested in goal to market, expanding around the world, and we have significant business in Europe and in Asia and Latin America, you know, so continuing to expand. We're about eight thousand people we want to grow very fast. We're still hiring, so that's more focused on that.

But never say never, Ali, We're seeing some reporting coming out of our colleagues here on the venture capital team that late stage startups are actually kind of struggling to get additional funding because of just this dry up in IPOs. What's the future for Data Bricks? Is that coming down the pike for you?

Well, I've said many many times we will be a public company. There's no doubt about it. So it's not a question of if, it's a question of when, you know. But the thing is, we're not trying to time the market. We're trying to win the market. So that's what we're focusing on. We've raised all the funding, now we're going to use it. We did this big partnership with SAP where we can get all the most important data in Data Bricks. Now we want to build AI for our

What kind of milestone are you setting for yourself before you actually get to the point where you tell investors that you're ready to go public, that you're ready.

We are ready. We could press a button and we would be public today.

It's really sort of a question of what's the priority right now and how much benefit do we get out of going public this fundraise that we just did, the fifteen billion that you just referred to.

We're also using a large portion of that towards.

Liquidity for our employees, so you know, we're solving the liquidity problem. We're solving investing in you know, our business, in our products. So you know, there's not an extreme sense of urgency. But we evaluate, you know, every day. If it's in our interest, we will go. If not, you know, we'll stay private. I do think my guess is that we will be public, and it's not going to be too far in the distant future.

How far in the distant future twenty twenty five, twenty twenty six, what can you tell us?

Yeah, I mean I would say the earliest would be probably this year, but you know, I think that's unlikely. That's that's all I can say. And then, you know, but I don't think this is like a five years out thing.

But still, I just want to confirm the option to raise more money before going public, if you need it is still on the table.

I mean, look, when we did this fundraise. We weren't sure we were there's going to be enough interest. In fact, we were you know, maybe we set the price too high and there's not going to be enough capital. That actually happened to some other late stage companies that tried this year or two ago.

So we're worried about that.

And we got twice the amount that we wanted to raise in interest. You know, we got close to twenty billion dollars of interest, and you know, our pro and the problem was the investors kept calling me and saying, please don't cut me back, let me allocate the full amount that I want to put in, let me put one billion, let me leave this round.

So the interest for AI and data is just insane.

I have never seen anything like it in you know, the ten fifteen years I've been doing this. So there's a lot of capital out there, but they want to invest it towards AI. So you're right, if you're not an AI then it might be a completely different story. So it's sort of a tale of two different cities, you know, the AI companies where there was seems to be infinite amount of interest, and then a non AI companies where you know.

There's like it's sort of not great. It stopped growing.

They don't want to invess, right you know, multiples are depressed, so unfortunately it's like that.

Right now, Ali got Zi Data Bricks CEO. Good to see Ali, Thanks so much for joining us. Well, you heard Ali mentioned it's kind of this tale of two different types of companies, those ones that are AI backed and those ones that aren't VC backed. Unicorns, though some reaching a tipping point. Over one thousand startups with a one billion dollar valuation or higher are struggling to IPO

Yeah, I wasn't surprised at all.

I was well aware that there's a lot of investor interests in data bricks, but you know, they are in a league of their own. There's a small number of these unicorns that are able to raise a lot or deck accords in their case, that are able to raise a lot of money.

You know, there are over a.

Thousand unicorns, maybe over twelve hundred according to CB Insights, and the vast majority, especially the ones that aren't AI, are.

Going through a tough spot.

According to data reviewed by Karta, about well fewer than thirty percent of the unicorns have raised money in the last few years, and almost half of those were down rounds, which used to be, you know, something that you wouldn't do in greener times.

Katie, what about Zoo's other startups that aren't in a league of their own, What sorts of desperate measures are they now resorting to.

So beyond the down rounds, we've seen other things like reopening the last round, you know, quietly raising more money at the same valuation.

But then sometimes.

More desperate things like pay to play rounds, where you require investors to you know, pay more money to be able to keep their existing stake. There's all sorts of different ways that they're getting creative here. Some of them are taking on pretty difficult terms. You know, much was made of what service Titan did. They took some difficult terms from TBG, although in the end they were able to go public at you know, above their round. But

That's Bloomberg's Katie Riff, thanks for joining us. Coming up, advertisers return to X. More on that story. Next, this is Bloomberg. Social media platform X is seeing a resurgence in advertising. The company's revenue jumped over forty percent in December compared to a year ago. This as marketers rethink their position with the platform as Elon Musk gains newfound influence with the US government. More on this. Bloomberg's Kurt

Yeah, I think the influenced part from Elon as a huge factor here, right, because I think if you look at what X looks like today versus what it looked like six months ago. I don't see a huge difference. The marketers that I talk to don't necessarily see a huge difference. What has changed is to point out Jackie is of course Elon's role within the government, and also the fact that X is now outsuing brands that aren't

Them at the end of the day, though Kirk, does it work? Does it work better than meta platforms? Instagram? Does it work better than TikTok?

As far as advertising goes, I mean it has never worked better. It's a different type of ad, right, So usually with X or formerly with Twitter, you would be doing what's called the brand ad, essentially, you know, the digital version of a TV commercial type of thing, and you know that could be great if you're going alongside the super Bowl or the Grammys or some other major news event. You're not really going to drive sales in the way that you would on Google or Meta, and

Kurt, Now, with that we're seeing this kind of improvement on the platform, where does this leave X in the broader array of businesses that Elon Musk oversees.

Yeah, I mean it's always been you know, the most maybe culturally important of those, just given the speech factor, right, given the fact that Elon's out here commenting on on you know, politics and other things that are happening in the world, it's still certainly going to be a much smaller part of the business than or his empire excuse me,

Bloomberg' Kurt Wagner to subscribe to the Bloomberg Tech In Depth newsletter. Go to Bloomberg dot com slash newsletters. Well, let's look elsewhere in Elon Musk's empire. Today's Big Take looks at how Tesla and SpaceX both relied on work by undocumented immigrants all the while, well, Elon A. Musk advocated for a broader crackdout Bloomberg Sarah Fryar joins us for more on this. As I mentioned, Sarah, it is today's big take. Julia Loves investigation. What did she find?

Well, it's really quite stunning.

I think we are all used to the idea that a lot of construction projects, a lot of agriculture projects, a lot of cleaning projects, do you undocumented labor? What's what's different here is evil and must proximity to that issue and advocacy against undocumented immigrants, of working with Donald Trump on policy in that area. Tweeting started posting on

Workforce for the gigafactory and for some SpaceX projects. So we have been talking to those to those people and trying to understand their role. Julia spoke with about a dozen people.

Sarah, what did the company have to say about what you guys found in the reporting? Are they improving practices in any way?

We have not gotten a response yet from the company, although of course, as we as journalists always do, we ask for comment. We have not heard any response, but we worked very hard to Julia Love worked very hard to verify everything that she was.

Told Bloomberg Sarah Fryer, thanks for joining us. Apple and Alphabet are restoring TikTok to its app stores after US Attorney General Pam Bondi sent a letter to two companies assuring that a band wouldn't immediately be enforced for more.

Bloomberg's Alex joins us.

Now Alex this has been quite the tit for tat ever since the ban was initially passed. This is kind of something that is underpinned by federal legislation. So even though it's momentarily brought on, where does this leave the fate of TikTok's future.

I think, Jackie, that it can seem like this is a huge win. I do think that it is a big win in sort of this longer saga that TikTok is now back online in both the Apple and Google app stores. However, it is definitely not the end of the road for the platform. Donald Trump has essentially stopped enforcement of the law that went into effect for seventy five days, so from now that ME and C has

Alex, what could that deal look like? Does that deal? Is it on the table for the US perhaps to buy TikTok via a sovereign wealth fund if that does get established.

The terms of the deal, and you know, various proposals that have been thrown around are very mushy. I think that you know, every week we hear another kind of proposal, we hear about another interested potential acquire, another interested potential buyer. Some of the names that have been thrown out have

Here, Alex.

Do we know what kind of assurances lawmakers want to see before we end up getting any kind of deal between President and Trump and any other party involved.

That is a great question, and most lawmakers have been mum on this ever since the executive order was signed by Donald Trump during his first day in office. We know that a large number of the folks that actually pushed this legislation across the finish line to begin with were members of Trump's own party, and some of them, for example Tom Cotton, have come out to say the

Bloomberg's Alex Levine joining us from New York today. Alex, thanks so much. Have a great long weekend, and you have a great long weekend everybody, because that is going to do it for this edition of Bloomberg Technology. Do not forget to check out our podcast. You can find it on a terminal as well as online on Apple, Spotify, and iHeart This is Bloomberg. We'll see you on Tuesday.