From the heart where innovation, money and power. Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed Ludlove.
We are live from New York and San Francisco. This is Bloomberg Technology coming up. Open ai gets closer to a new AI model that reasons and a new mega valuation of one hundred and fifty billion dollars.
An inteler at a crossroads, the chipmaker reaching a pivotal moment with a decade of dominance at risk.
And the first commercial spacewalk plaras Dawn hits mission goals seven hundred kilometers above the Earth. But first, let's just check in on these markets, because we are rallying once again, four straight days agains on then aw's that one hundred I'm looking at ED four and a half the high we add a trillion dollars in large part because some single names like in video, but in video is also linked to the world of artificial intelligence and exactly where we want to dig in on.
Yeah, let's get to our top story. Open ai is in talks to raise six point five billion dollars from investors, catapulting the AI startup to a one hundred and fifty billion dollar valuation. This is the company gets ready to release its latest AI model, code named Strawberry. For more Bloombergs, Rachel Metz joins us and Rachel You and I working with Gillian tan mark Bergen on reporting this primary round and long story short, one hundred and fifty billion dollars
is a very big number in terms of valuation. What do we know about open AI's latest fundraise.
Well, we know that they are trying to raise quite a bit of money, and they're also trying to raise an amount in the form of debt. And then as as you and I and some of our colleagues reported that they are hoping to do this at quite a high valuation. This would be on hundred fifty billion, would be much higher than the amount that we've previously reported, which was under one hundred million, sorry, under one hundred billion.
And I mean, I think we have to think about when we think about this company trying to raise a lot of money, is that what you're doing is extremely expensive. I mean, they are building enormous AI systems and they're running enormous AI systems, and that costs a lot of money.
Let's just talk about where the money is being spent. The latest model Strawberry. This is where training of these models the compute the talent, but what's the outcome.
So Strawberry is a model that's been in the works for a while, and essentially what they are hoping that it can do is some tasks that are similar to how humans would conduct reasoning. It's going to be aimed at things like more complicated math and coding questions and prompts than have been possible in the past. Source that I spoke to that has tried it out said it was able to solve a problem that's been kind of
popular on social media lately. Is nine point one point one larger than nine point nine, which is the kind of thing that a human might find simple but convex computers.
The other thing we reported rachel our sources telling us that open ais one to the banks and is looking at doing about five billion dollars of debt in the form of a revolving credit line. It's not sort of unusual, but it makes me think that open ai is kind of getting to company scale. We keep calling it a startup, but do we actually have any sense of how much money all of this technology is bringing in for them.
How much of a business they have beyond just constant R and D and new model innovation.
Yeah, they actually have been able to scale their business quite a bit over the past year. They've released several different enterprise products, and we actually know from our recent reporting that they reached over they reached a milestone in terms of how many people are using their enterprise versions of chat GBT. This would be individual users, not customers. So if they're able to keep growing and growing on
that side, then they're bringing in lots of money. So the money that they're raising, perhaps that could be there'd be a little less pressure on that.
Bloombost Rachel Mets brilliant reporting, deep reporting, and something that a lot of people talking about online as well. Thank you very much. Now, this week is a pivotal one
for Intel. Intel's board has been weighing how to move forward after its latest earnings report and plans to slash fifteen thousand job which leaves Intel with a few options, including scaling back some of its multi billion dollar factory projects, selling off subsidiaries, or splitting Intel's core operations into separate units or companies. Bloomberg's Ian King pend this big take and actually you kind of get it all in the
first paragraph is slow motion disaster. Where are they in the slow motion action that's happening.
It's been tough for a while, right, They've been trying to do too fundamentally competing things, which is to spend a lot of money on restoring this company to where it was at a time when business has turned against them and away from them.
And in just jumping in here, what's so interesting is what's on the exact agenda over these three days which culminates today. Pat Gelsinger in any trouble here.
Yeah, I mean not according to our reporting. As you saw in the story. One of the sources that we spoke to said that that's not the kind of board meeting that we're up to at this particular point. What we're up to is looking at what Intel does. It's a huge company, one hundred thousand people, what it does, where it's focusing, where it's spending, to look at perhaps discontinuing some of the things that are a little bit peripheral to save some money to focus on trying to
push that plan. And that's Pat Gelsinger's plan forward at this point that's kind of where we are.
As best you can then take us inside the room of the board meeting and kind of of all the options available to them. What are they considering right now?
Yeah, I mean the first thing on the agenda, as far as we understand it, is this factory network. You'll remember we've done all of these stories and spoken about big plants in Ohio, big plant in Magdeburg and Germany. Obviously an extension of what they already have in Arizona, and smaller projects around the world. That is a lot of money being poured into the ground in anticipation of
business growing significantly. What we learned from earnings was that business is not growing to match that footprint, whether it's a footprint physically or whether it's a headcount. So clearly that focus is on right sizing the company around what they've got coming in in terms of orders and money, and.
In what you do so well in the story. It's a context, isn't it that this isn't an overnight issue. This has been long time coming.
Yeah, I know, that's that's absolutely true. I mean, you know, the focus that the traditional Wall Street playbook would be or look at the management, do we need a new management. Do we need to spit all of those kind of standard playbook things don't really apply here, at least not yet. I mean Pat Gelsinger, remember, was brought in to fix the problems that already existed.
He gave a.
Prescription that everybody signed off on and agreed with. The problem that we have is that that prescription is being proving more painful than perhaps we had expected, and clearly the market does not like that.
We're just looking at the revenue growth that the market does not like. Inking we so appreciate it, thank you. Let's just talk about what the market's also having to digest with Microsoft saying it's going to be cutting six hundred and fifty jobs in its Xbox unit, the third such layoffs this year, as the company is just trying to rein in costs and integrate that massive sixty nine
billion dollar acquisition of Activision Blizzard. The roles to be eliminated are, in quote, mostly corporate and supporting functions, according to a memo sent staff like Xbox chief Phil Spencer. Today and what have we got coming up?
Yes, some breaking news on the Bloomberg terminal. Apple has got FDA authorization for its AirPods to act as hearing aids in a hearing aid feature. We were tracking this one because they said just on Monday during the presentation that they were going to get it, and they did. And you look at some of the other hearing aid stocks, they're not moving right now. They were when that news first came out. Apple flat in what's been an interesting week.
But we've got a lot coming up on the show too. Yeah, we've got to talk about what's happening up in the Skycarrier. Historic day for SpaceX and Polarist.
Dawn.
I'm very much looking forward to this one. Stick with us. This is Bloomberg Technology. Some quick cause. Micron under pressure this morning. They start stock touching it's lowest level nearly seven months. As some analyst reactions. BNP with a double downgrade, cutting shares to underperform from outperform with a street low price target. The analyst warning of a correction in DRAM prices due to some oversupply risks.
Carroc now some breaking new some brumbo that General Motors is in discussions to buy EV batteries that we use technology from China's c at L and be assembled at a new plant slated actually to be built here in the United States. It's all according to sources. Gabikopole is here to break it down, and well, this is a political handball.
It feels like, yes, you know, it is very sensitive.
You know, we've got US and China.
The US is trying really hard to decouple from China, and Chinese companies are trying really hard to access the US market. And the automakers, the American automakers are cart in the middle because you know, GM for you know, every st they've all poured billions of dollars into making batteries and forming joint ventures with their Korean battery makers, and you know, I've gotten a lot of subsidies from
the US government order to do so. But because evs are not selling well, because they've had struggles making batteries, which is normal, you know, making batteries and evs for the first time in your one hundred year history. It's not going to go smoothly right off of bat It never does. Didn't for Tesla, it doesn't for anybody. So they're under pressure. And so this potential deal, which is still tentative, you know, it's just talks. Nothing is finalized.
Would be a way for American car companies to get access to cheap, you know, really cutting edge battery technology from China without tripping up all the political wires that could you know, potentially trip up when you work with a Chinese company.
Right, Well, I think the basics of what we heard
from sources is really important. The mechanics are such that the battery technology is licensed from c ATL, a Chinese company, but the operations around by a conglomerate from Japan called TDK, which many of the people on this show probably haven't heard of, but they're basically a consumer electronics company, and then GM and other automakers, I think is what we're hearing, right Gabby would buy the batteries on fixed term contracts, so they're kind of insulated from price wings take it
from there.
What else do we know, Well, I think, you know, I think one of the most interesting things about this is that you've got a Japanese company acting as a middleman. You know, up until now, we've seen Ford and Tesla do these kind of cute kind of licensing the hills where they can use c ATL technology without you know,
violating rules or tripping any political wires. Now this is a new development and how the auto industry is adapting to the political environment and the UV environment and the fact that they're.
You know, not profitable on making VS yet.
So we know that, yes, we know that GM and CTL and Japan's TDK, which makes battery, there's employer for the iPhone. They you know, make batteries consumer electronics. They want to get into the EV battery business and this could be a way into it. So they're looking at states in the southern US, you know. And I think that you know, obviously this is so sensitive politically that I think the results of the presidential election November it could potentially, you know, affect the outcome.
Of these talks.
That's what sources told us. Bloombergs Gavy Coppl are great reporting, really interesting reporting alongside you. Thank you. Okay. It was a historic day for SpaceX. The company's polarist, Dawn Crewe, successfully completed the first commercial spacewalk. Tech billionaire Jaredisingcman was the first of the crew to step foot outside. Here's what he experienced.
Back at home.
We all have a lot of working here, but from here works looked like a perfect.
World for more ez in a Uzukoro of the Harvard Belfa Center joins us. She was formerly Assistant Director for Space Policy at the White House, where she led advancements in space launch capabilities, as well as a former NASA executive with over sixty space mission contributions. And let's start with your reaction to what happened in just a few hours ago.
This is a huge success at its monumental not just for astronauts, but for anybody with a dream for space ACX to test the market viability of space tourism, for us to determine if space tourism can really grow quite like the early days of aviation. So this is fantastic.
The images on the screen that you're seeing are from Jared Isaigman's helmet camera from the custom spacesuit, and now what you're seeing is the nose cone camera from atop the Dragon capsule. But this is the question so many people asked me this morning. Was it actually a spacewalk?
Yes, technically it was because they were outside their capsule, their spacecraft, and they have a railing that they were holding on to and they were outside their capsule for ten minutes each, Both tired and Sarah the other astronaut, and this is risky. You think of a spacesuit as a spacecraft in itself because it monitors their temperature and
controls their vitals while they are outside. And what we see is is how successful this was after a mere few years of training versus the decade that one trains for when you were a professional astronaut.
Phenomenal when it comes to commercial space success as an a what we love when they come back and they're tested, because this is about radiation exposure as well. How tough could this have been on their bodies?
Absolutely tough. You can be hot for one moment, you could be cold another moment. Your fingers could hurt.
So even though it's.
Cold in space, there could be pressures within the suit that make you feel a very warm. So this was a complete thorough test of the spacesuit which SpaceX intends to use for future Moon missions, for future Mars missions, and so there will be a lot of lessons learned
in those regards. But I think if you think of the trillion dollar space economy that has been discussed for decades now, this is really an exciting point to see if there is viability in that market, to see how much growth the sector will endure due to this SASS Today.
Sarah Gillis was out there as well, and I think it was hers saying, this is really integral for data to back to SpaceX, but they don't really know yet what they'll be doing with it. At the moment, it just feels like SpaceX is cleaning up when it comes to space success is.
It and they are doing remarkably well. It's it's obviously due to their their vision, their hard work, and this success is just so so impressive because space walks are risky and you have astronauts that are not professional astronauts, and the company has been planning this mission for years and not decades and they pulled it off us successfully. So it's it's very critical to realize the feed that was accomplished today. It's incredibly impressive.
Thanks for giving the context it deserves as in a Okura, Great to have you with us. Harvid Belfer Center senior fellow and former NASSER executive. Broadening out to the world of tech investing investing more broadly, Betterment, which builds itself as the largest independent digital financial advisor, just come out with first of it's kind survey showing four in five advisors using AI in their work to discuss how artificial intelligence is managing your money. Vetterment CEO Sarah Levy is
here with us. Sarah, what made you run these sorts of numbers. I know that you're looking at this particular part of the business, you're rebranding it, but you just wanted to understand how these advisors are getting to groups of AI.
So the key for us is that the advisor we serve tends to be more of a millennial advisor, and this is a growing group and they're much more technically sophisticated than their predecessors, and so they don't sort of suffer fools lightly when you think about the technology choices, the user interface, the power, we really they need to provide them with powerful tools and so Betterment Advisor Solutions is our advisor arm and our roots were originally with
the retail investor, where we learned a lot, But what we've learned for advisors is they can harness the power of technology just so much more, and AI for.
Me is really a continuation on that spectrum.
Right.
We introduced automation to save time, to save money, to help with customer retention, and AI just furthers that journey.
Really, what are they using are they're using generative AIPSA, and how are they saving themselves time? How they're more productive?
So I think of AI a lot like digital.
If you think back to call it two decades ago, when we talked about digital and you said, you have digital companies and you have analog companies, right, And at the time people would ask, you know, are you going to work in digital?
And then digital became sort of part of the fabric of everything we do.
That's how we think about AI, which is it's really just powering the humans to do better, stronger, faster. Right, So everything from pair of planning right before you meet with a client as advisor, and then after you meet with that client, there's a lot of work to do. AI can just take a lot of that administrative burden off the plate.
That's just one great example, Sarah.
The better question posed by the Better Men survey is whether those four out of five financial advisors who are using AI, because loads of people watching this program will have a financial advisor, whether AI actually makes them better in managing people's money. Is there any evidence of that?
Well, I think I wouldn't think about AI as actually managing people's money. Remember, as a financial planner, we are fiduciary. Our advisors are fiduciaries. We as an RIA or fiduciaries. So I think the way you want to think about AI is basically giving back time and saving money for the advisor so that the advisor can focus on the client and on the investment solutions. And that's really the
benefit that they're getting AI. The computers are not taking over the world, right, The human advice is still a critical component of getting people to great outcomes and great plans.
An extension of that is whether it then becomes the economics kind of change, right, and fees and the incentive of somebody using a service or a digital format such as yours.
Well.
I think look in the early days of where we began, our roots were robo advisory, right, and there was a lot of sort of dismay in the advisor community, Right, is technology going to take over the human interaction? And I just think that was very overblown And I would say the same about AI, which is not to diminish its potential. I think it is going to be a huge sort of power tool enhancer.
If you will.
But we've been building power tools for both advisors and retail investors for the better part of a decade and a half, and this just takes that really to the next level. That's the way we're thinking about it.
Okay, so cools Classic sixty forty portfolio. It's just that the financial advisor will have more time being freed up by AI Betterment CEO Sarah Levy really appreciate you being here on Bloomberg Technology.
Welcome back to Bloomberg Technology. I'm Caroline Hyed.
In New York and I met love Low in San Francisco.
Make check on these market said, because actually we have SAD now four straight days and gains on the NASAC and NASDAQ one hundred.
We're on a roll.
We've actually added a trillion dollars in terms of market capitalization over those four days. Despite those headwinds of perhaps that CPI coming in a little hot on the core basis two year yields actually just pushing up a little bit. So maybe we're still anticipating what the Fed will do. Will they be able to cut as much has been anticipated?
Many now seeing just twenty five basis point cup coming for September I'm looking at Bitcoin just have a quarter of percent, so a little bit of risk on there as well. Move on and have a look at the individual movers. Look a lot of the push forward in the Nasdaq is thanks to Nvidia and some of the chip names. I think Broadcom is one of the biggest names for points contributing today. Warner Brothers Discovery doing well up almost two percent. Child Communications, yes, they will still
have that distribution deal. Both arising. We're looking at MasterCard off by six tens percent, but big deal. More than two billion dollars being spent in cybersecurity for this particular company, So they're doing a deal. They're focusing on your data. But of course when they splash the cash, maybe the chairs come under pressure a little bit. Maderna though your key underperformer. I'm talking tech pot biotech here, and really a lack of clarity coming in future revenue from this
business that doesn't seem to be amazing analysts. They feel that there's a lack of clarity in general on this business. But we are seeing revenue and the revenue guide being pulled down.
And what do you got an opportunity to get clarity on another business as the Goldman Sachs Tech Conference comes to a close in San Francisco. We're thinking about how fintech is revolutionizing the financial sector. But we're also joined by one of the main players in global e commerce, Macado Libre. It's CFO Martin de Los Angeles joins us. Now, welcome to Bloomberg in San Francisco. I think about your business in this way that e commerce, but fifty percent
of it is now essentially fintech. You've met with the anchors and your investors and the other members of the technology community in the last few days. What business outlook and update did you give them? Thank you ed for having me. It's a pleasure of being here.
We are celebrating the twenty fifth anniversary of our company this quarter, and over the past twenty five years, we have built the largest e commerce platform and fintech platform in Latin America.
We recently became the largest the.
Most valuable company in that of market CUP in Latin So we're very excited about the growth and the opportunities that we.
Are facing on.
The change that we're making in our society is on the commerce side of the business. We hope with last year we had more than ninety million buyers purchasing one point five billion products in our platform for more than fifty billion dollars and growing very rapidly. This is one of the things that the investor community was very surprised
of our QUE two results. We build a very large logistic infrastructure that enabled us to deliver seventy five percent of the products within four day, within two days in Latin America.
That would be something and dream of in Latin America ten years ago before.
We build a logistic infrastructure on the fintech side of the business with process payments for over one hundred and seventy billion dollars, serving fifty two million active users in our fintech solution Mercallo Power platform, and we're serving mostly people who had been excluded from the financial system, you know, individuals or SMBs who had never had access to credit or financial products. So we're doing a lot of financial
inclusion in Latin America. So I'm very excited about the past twenty five years, but we have plenty of row opportunities going forward for the next twenty five years.
Martin.
We're looking at your shares at a record high. What about competition. You've seen the fintech the unbanked opportunity, but so have a lot of others. How you as you search for a go for a banking license, thinking about others wanting in on the space.
Yes, Carol, and we see a tremendous opportunity on fintech in particular because of the banks have done a really poor job in Latin America, including people in the system.
If you look at.
Mexico, for instance, where we're very active. We are the largest fintech in Mexico in terms of a number of users and a credit book. For instance, this is a country where fifty percent of the people don't have doesn't have a banking account, less than twenty percent of people have a credit count.
So there's plenty of room for us to grow.
And of course in Mexico, it's not just the bank account. I'm thinking about deposits and loans, other financial products. Are you having success in Mexico exactly.
Our credit book is rowing fifty one percent year on year. We have a one point five billion dollar book in Mexico, which is the largest for any fintech in the country. Our users on the fintech side of the business are rowing at thirty seven percent year on year from a very large base. So Mexico is wide open really, so there are players who are also going to that market, and we think there would be a lot of financial inclusion.
That would be space for several other players.
Nike commerce where winner takes most in fintech, there is room for several players to be very innovative, to actually create, you know, change the lots of people, you know, by including them financially.
Let's go back to the winner takes most in a commerce. You've got some Chinese competition. In fact, Mark Cello Clare himself is helping chin for example. How are you seeing the Chinese competition in in commerce?
Yeah, we've seen the know, we operated for twenty five years in the region with a lot of competition. Initially the world platform similar to Marcal.
Oliria that we competed with.
Then we be obviously with all the local retailers. More recently with you know the Americans Amazon and Walmart, and more recently we have seen a lot.
Of competitions from the Chinese. So the way we face competition.
Is we base that we compete basing basing on our strength, which is the logistic infrastructure, that we have in Latin America that enables us to provide a world class service to our users. And then the fintech and the payments, the solutions that we have built in a region where most people don't have a credit card, having our own
payment solutions is a really big competitive advantage. In case of Mexico, twenty five percent of the payments that are done on our platform are done with our own payment methods to our own credits, our credit cards and so on.
But I think before we run out of time, we should talk about Argentina. A lot of people are trying to make a conclusion of the economic policy of MELA. How do you view that market? What are you going to do in Argentina.
Yeah, Argentina is a market glob We have a very solid position. We actually started the company back back in the days in Argentina. We had a tough first quarter, but we're regain growth in the second quarter, so we see a lot of opportunities there. We're investing in Argentina. We opened our new full fillment center there. After five years, we're reinvested in Argentina and we see a lot of good prospects for the country.
So the good thing about our business is that we've seen it.
All in Latin America over the past twenty five years, and the secular trend of people moving online. You know, fifteen percent of the retail is done online in Latin America compared to twenty high twenties in the US high thirties in China. So it's plenty of room to continue growing the e commerce market, and we are the leading player in e commerce, so we have we play a very important role in that transition. And the fintex side,
there's plenty of continue growing. So as we say in bergalalibree, the best is yet to come.
We have a very good prospect for the future.
Beclor libre ce Fo Martin de la Santos, Thank you so much, Caroline.
Let's get to some talking tech now. First up, China wants to keep its EV tech to itself. According to sources, Beijing has asked carmakers to keep its EV export kits from foreign plants, meaning key parts of the vehicle would need to be produced domestically now and the move comes as more companies build out factories in other territories. Plus two of China's most prominent AI chip designers are looking
to an IPO, calling into sources. Shanghai end Flame and rival Shanghai Barn are planning and IPO as soon as this year. The move comes as China looks to sure up at semiconductor industry to combat US led sanctions and vans.
Ed a little bit more to come in the show. We're going to be joined by Anderill founder Palmer Lucky for an exclusive interview on the company's latest set of autonomous defense vehicles and CARO. We actually have even more breaking news coming up as well.
We do a new COO over at Microsoft, Slatya Nadella saying this is building on capabilities essential in AI and operational at Excellence. Carolina Dibeck Habit is joining Microsoft as EVP and COO. It's a newly created role, which can we be joining the senior leadership team reporting to Satya. Still not moving the share price. This is Bluemberg Technology.
Fuse Energy is raised thirty two million dollars in a new funding round, valuing the nuclear fusion testing startup above two hundred million dollars. Right now, Industry experts say producing commercially viable fusion will require another decade or two of work, giving Fuse plenty of runway for customers to test their
new technology. Bloom Box Lazette Chapman has the story, You and I know loads of people in the valley who have been talking about fusion for a while, and this is like a sort of tangible startup and part of the process. But my goodness, it sounds like we're still a long way off it being mainstream.
The technology will take a decade or two at least to create commercially viable source of energy. Like you said, this company is looking to make money along the way by providing radiation as a service to not only the
private startups that are looking to do this. As we've discussed, there's a lot of money and a lot of interests being commercializing this, but more importantly to provide revenue and testing results immediately by providing radiation as a service to harden nuclear weapons testing and then also use that data to build their own fusion generator.
Pulsed power machines is what they're building. Who wants to take the financial risk to back this, Who is interested in full string? Who is in the round?
Right, So there are a number of investors. There's Buckley Ventures Josh Buckley, there's Tamarek as well as the Chainsmokers, the musical group, their their venture capital firm, along with former d D and.
Officials and also.
Someone from Lucky Martin, the former chief executive of Asia. So they'll be looking to use this technology in incremental ways, looking to rent their machines, UH to just blast different mis machines like cider pilots, etc. To see what the effects of a nuclear explosion would be on planes and other materials that.
US would need. And time of war is that Chapman, we appreciate it. And talking of time of war, Andreil has just unveiled the Barracuda family of autonomous air vehicles, revealing its offering of a course to the Defense Department program aimed at mass producing aerial vehicles were cheaply, Andreill founder Harma Lucky joins us now and the philosophy here, Parma is just making it ever more easy, fewer parts and making it quicker to make.
Well.
You know, I think that having fewer parts easier to make that's downstream of the real goal, which is to make sure that the United States are allies and our partners around the world have the tools that we need to deter expansionist dictatorships like China. Right now in a lot of war games we are modeling, the United States is running out of critical munitions, particularly missiles, in just a few days of conflict. And all for years has been working to build a family of systems that solves this.
And we just announced that family of systems today. It's called Barracuda. It's made with half the parts, in half the time, using ninety five percent less tools than a lot of the existing missile systems.
On the market.
It is a mass manufacturer product that is designed to be made at scale, many thousands of systems at a time. Because that's what the United States need, that's what our allies need, It's what our partners need.
Talking of partners and allies, drone AI over in Ukraine at the moment, your supplying drones, we understand piloted by AI. But how much is it AI? How much is it the human? How much autonomy do they have about targets?
Well, in our case, it's all about AI. Our core product is called Lattice. Interol Industries has been working on AI powered weapons for about seven years now, and the core software is Lattice, this brain that powers all of our different systems, including Barracuda, including alts, including Ghost which.
Are in Ukraine and have been since this a week of the war.
We've destroyed hundreds of millions of dollars in critical Russian hardware that can't really be destroyed by things that require a real time link to a person, because the Russians are quite good at jamming communications links when it comes to things that are important to them.
They don't have enough of these jammers to hit the entire battlefield.
But that's why it's so important that we keep taking those things out and eventually hopefully leave them help us to these types of systems.
Palmerate, it's great to have you back on Bloomberg technology. You know, in the context of Ukraine, I'm kind of thinking about the existing work and then you know what we're hearing from Ukraine at the moment, which is they kind of want to push deeper or strike deeper into Russia. Does Andrew have any technology where you would work with Ukraine on that goal or be a part of that process.
Absolutely, with the caveat that these decisions are not up to us, It's up to the United States.
Government.
They decide understand who we sell to, how we sell to them, and to a large extent, what they do with these weapons systems. And I don't think that AROL or any private defense company, any private company period should be in a position where we're de facto controlling the United States foreign policy position by saying, oh, we would help with this, we would help with that. I think that we need to put that decision with the people who are supposed to be making that decision, which are
people who are accountable to the electorate. In other words, you should not trust me, You should not have to trust me. You should trust somebody that you can vote for and then vote accordingly.
We're showing images of the barracuted system. And at the top of the program you talked about allies, and so when I think about scalability, is that because you want to be in service of any specific allies beyond the US government. What is the sort of benefit of the scalability of the design.
Well, this gets into a little bit of the philosophy of it. But I'll tell you how I think about things. I don't think the United States needs to be the world police. I think we need to be the World gun Store. We need to be able to provide our allies and our partners around the world with the tools that they need to turn themselves into prickly porcupines that
nobody wants to step on. And I think that sending American lives overseas boots on the ground is not going to be the future of how we support support our friends around the world. I think it's going to be making sure that we can make things at a scale where they believe that our support for them is more than just words. We can actually send them the things
that we say that we're willing to send them. I think Ukraine has really exposed this weakness in the United States foreign policy strategy where we say we support all of these people, but they look to say, well, they can't even manufacture the basics like artillery shells or small missiles. How could I possibly count on these people to be able to cash these checks if they're writing And I think that Barracuda is a response to that.
Largely.
It's something that was designed from the beginning for low cost, high rate manufacturability, and it's a flying operational system right now with multiple customers. I think that partners are going to be able to trust that Barracuda is something that we could actually make for them and deliver to them when they need it, not just now, but also if a conflict to erupt and.
You're delivering by manufacturing ever more in the United States and with money doing cash and checks. You've just recently got a whopping valuation of fourteen billion dollars by raising more money to build in the US as the Arsenal one and other manufacturing units. Can you update us as to where they might be the sprawling manufacturing areas.
We just closed a huge round with our investors.
It was all of our previous investors coming in and a whole bunch of new strategic investors who want to help us build a lot of things, but particularly Arsenal one, which is a five million square foot factory that we're building that is going to create thousands of jobs and build vast numbers of AI powered autonomous weapons systems. And it's not just Barracuda, it's actually the entire product suite
of things that ANDROL makes. It's all of our missiles, it's all of our drones, it's our submarines, it's a reconfigurable factory line that is able to share a lot of the equipment and tooling between these programs, which gets the costs down and it gets the rates up and the benefits flow on.
To our customers.
Palma is Anderil's selling air defense systems to Israel.
Well, look, I think I can't comment on any specific deployments about especially about something is sensitive to that, but I'll tell you this, I have no problem with Israel. I have no problem selling things like that to Israel. But a better target for your.
Question would be the United States government.
And I have to ask you. You mentioned China at the top of the conversation. Has Anderil a commercial relationship with Taiwan.
Oh, we have a very strong relationship with Taiwan. I've I've been there many times. In fact, I'm going there again soon. And I think that you know that strong relationship is actually one of the reasons that ANDROL was recently sanctioned by the Chinese Communist Party. They announced that we are that they're going to seize all our Chinese assets and that we're prohibited from entering the country.
Jokes on them. We don't have any Chinese assets.
But it was in the wake of a recent deal that we did with Taiwan, getting them some systems that I think China, frankly, is really afraid of. They know that our systems are the real deal, and they know they can't jam them, they know they can't hack them, and that's because they're powered by AI.
Ander or founder parme Lucky. It's been a while. It's great to have you back here on Bloomberg Technology. Thank you very much.
Sixty seven million viewers tuned into the presidential debate between Vice President Kamala Harris and former President Donald Trump. And that's only on TV. It's, acording to Nielsen data, blow well past the fifty one million who watched the Republican nominee take on President Joe Biden. Back in June. Trump said he is not inclined to have another debate with Harris, though he later added he hadn't completely ruled out another matchup.
I streamed it ed, So going to know is what the numbers we really were?
Yeah, believe it or not. Earning season is continuing. The next wave of generator of AI services may depend whether tech companies can find enough detail. Three D renderings of tractor trailers and shampoo bottles Adobe and Video Audodesk and said that other startups are working on just that. This is something Bloomberg's Brady Ford reported, and he did it before Adobe's innings after the bell tonight. Let's start with
the report. I saw the image attached to the story, what are you going on about?
You know, Look, you could go on the internet if you're so inclined and scrape a bunch of photos, a bunch of videos, a bunch of books. If you want to create a three D model that can generate a coffee cup or something like that, you need something that is not You can't scrape it, right. And so we're seeing companies like Adobe going out and note that they're not scraping otherwise, but we're seeing them go out and
buy three D data directly from creators. We're seeing Autodesk go to its companies for construction management and design saying, hey, you have these three D renderings of bridges, what if you share them with us so we can build this three D model. I think the same way we've seeing photo models get created.
A year or two down the line, we're gonna start seeing these three D models come out more.
How much is Adobe able to monetize this new AI focus.
Well, that's a big question for tonight.
Right, everybody wants to know whether Adobe is going to be able to really get money from all of their generative AI innovations.
Right.
They've rolled out a lot throughout their products through higher pricing tiers, some credit packs, but like many software companies, it is not totally clear whether they are actually making money from it yet.
We'll wait to see if that revenue can indeed hit the ten percent increased level I expected. Brodie Ford, we hope you'll join us tomorrow to break down those numbers. We appreciate rank you. Meanwhile, that does it for this edition of Bloomberg Technology, conning on what.
An addition it was, from private companies to public companies, everything in between. Don't you've recap on the podcast. You know where to find it on the terminal, online, on Apple, Spotify, and of course on iHeart from New York City with Caroline out here in San Francisco with me and a visiting Brodie Ford. This is Bloomberg Technology