Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is a live from Coast to Coast with Caroline Hide in New York and Va Lowe in Sentrancisco.
This is Bloomberg Tech coming up. Salesforce sell off as lackluster top line growth forecast suggests AI isn't paying.
Off just yet.
Plus, Apple plans.
To up its AI game with a web search for Siri as it leans towards Google's Gemini for its next gen voice assistant.
An HPE, where there's a profit squeeze as AI hits the server maker's margins despite demand.
First, let's take a look at the broader markets.
You're going to dig into the details of these earnings. Z I look at a context that it's up three ten percent on the NASDAG. We are digesting pretty woful labor data once more, but all eyes on the FED to cut ninety chance the money markets that there will move as soon as this month, as we still are looking at what the Senate is discussing on the future of the FED and who's actually sitting on it.
There's a lot going on this week, but software in particular now earnings in that context are driving markets lower in this case. So Salesforce is talking of its kind of historic growth rates, but the outlook for its top line growth, particularly as it relates to AI, it's just not there yet. We're going to get into the analysis in just a second now, Figma, this is its first earnings post IPO at the end of July.
Big drop on the stock.
Remember it jumped to one hundred and fifty percent in its debut. Carrow, you were there, you lived through it. It basically met estimates, but it just shows how high and lofty expectations of the market are. Right now, I want to dig into numbers, starting with Salesforce. Let's get out to Blomberg Intelligence senior tech analyst and rag Rana. Maybe you caught Benny off on the call, maybe you
caught him in interviews on other networks. He was talking up about like Salesforce growth rates and a RAG they are better than anyone out there. But the story seems to be the out and how AI is contributing.
What do you think? Yeah, I think the expectations were a little bit high in that case from the AI contribution point of view, But if you look at results from Workday and other tech companies, out there. We are still struggling to see discritionary it spending bounce back. We have not seen any of that stuff. And given the size of a company salesforces, you're going to see the impact of that on bottom lines. If there are no massive secrets out there, you're not going to see revenue
acce rate. And I think that's the story, which is, you know, I think common to most of the software landscape, except the companies that you know only work on AI, infrastructure, parking. If you leave them alone, the rest of the industry is struggling.
Right now, what do you make the first numbers from Figma, because in many ways it was a company that pivoted well embraced generator of AI was able to show how it's working for its bottom line as a public company.
We are seeing a tunnel in the shares.
Yeah, I would say that my expectations were pretty bad or wrong in this case. I was looking for a revenue to improve because of a price increase they have put in. But it seems like, you know, they basically met the expectations that they gave. And to be very frank, in an IPO landscape, it doesn't work like that. The first few quoters. You really need to showcase, you know,
an improvement in fundamentals. This just shows that there is a lot they have to do in order to get and I would say match up to the valuation that they have achieved right now.
An Agrana holding yourself accountable. We appreciate that. Bluemeg Intelligence. We always love the expertise. Let's get a broader look at the tech sector right now because Carol Schlife is with us BIMO Private Wealth Chief market Strategist.
Carol, it's been a while.
Great to have you on Bloomberg Tech and more broadly, how are you thinking of the software story the AI winners versus Lewis's right now.
Now we really first up, thanks for having me on. It's great to be back again, and it really is important. It takes you know, investors are very black and white. They want to see instantaneous results, but all of this stuff takes some time to filter through a figure out how we're going to deploy it. But the software and that moving away from, if you will, the picks and shovels of building out the infrastructure into the use cases
and how that factors in. That is definitely a way that we see things playing out in the intermediate to longer term because you're not going to be able to get away from AI. A lot of companies are trying to figure out how to deploy it, how to use it, how to train their employees in using it. Because you've got those early adopters who are using it actively, and you've got the others that are not as willing to be on the bleeding edge, if you will, of the day to day use case.
What therefore, is the likelihood that some of the older companies with big presence in the market, such as a salesforce, can fend off new competition. How much you having to build that in to an invest the risk right now that we are seeing a totally new cohort come to a powerful place in general to AI, you are, but.
You're also seeing those the old line, old guard have the cash flow to be able to snap up some of those. It's almost like a whales and krill kind of scenario out there, and you look at, for example, in the build out of the infrastructure, You've got a lot of that going on too, where the largest companies are buying up the smaller companies in the competition, so
that really smart, really useful competition. One of the ways they get leverage and into a lot of end users too, is through the distribution channel of some of those larger companies. So there's a use case to be made or an investment case to be made for a whole lot of sizes in that software industry.
Carol, I really appreciate that the command you've got over what's happening right particularly in software. We've been talking about it all week. I mean, one of our guests this week said that September was the most hated month for investors. But basically, you know, we're going back to old fashioned earnings talk. Did they meet or excited high expectation, particularly in software sense? Not really? Did AI have a tangible contribution to top line growth?
Not?
Really?
Is that the way that you approach a week like this, Well, I.
Think a piece of it is is investors have to understand where what timeframe they're using, and where their expectations are, because you know, we've looked at a lot of these companies and you've got very active. When you step back from it, you look at the margins on these companies relative to most of the rest of the S and P those margins are great margins are cash flowing businesses, and as we all know, once you put a software system into a company, it's really hard to make a
decision to change that or move that. And so from that perspective, I think investors have to ask themselves on an absolute basis, are these companies generating the kinds of revenues that I want? Even if they didn't be what
the wildest expectations that I was hoping for. Because the industry tends to run or investors tend to run ahead of themselves, and the whisper numbers always a little bit higher than where they're at, and yet the companies, the industry in general are generating amazing returns.
Carol, this week we talked at about concentration risk, and the more sanguine of your peers in the market would say, well, we look at profit estimates for the MAG seven in particular, but tech generally so much better than the S and P five hundred aggregate. But you have concentration risk. How are you thinking about that at the moment.
I think one of the ways that we deal with it is barbelling portfolios and really leaning into that diversification because there is concentration risk. You've also got higher valuations overall, and you've got markets that are primed for perfection if you will, so they don't, they don't leave. That doesn't leave much wiggle room other than when you get big
pullbacks like we had in April. It's one of the reasons why I think the pullback was so short lived back then and the reset was quick is people who have been sitting on the sidelines looking for an opportunity
to get in dead. So one of the ways that you deal with that is you school yourself to expect some level of volatility, don't freak out when it first happens, and maybe own some other industries, some other segments, some other parts of the globe, and maybe some fixed incomers to balance the portfolio and to allow it to be able to ride through those storms.
Diversification key.
But just going back to the concentration risk and the area of hardware having been the most loved.
Salesforce is down thirty.
Percent basically year to date with looking at Broadcom up thirty percent year to date, and we got their earnings after the ball is hardware and picks and shovels still where it's at Carol, Well, I think.
A piece of it. We're not through with that build ut segment yet, but you know, a piece of the questions you're starting to ask yourself is particularly as it relates to data centers and some of the other things that are going on. It's great if you can put them up, if you can put a side, then not in my backyard, and sorts of pushback you're getting in some of those, but then when you're getting told it's going to take five or six years to hook it
to the grid. So there's lots of different ways to play the hardware and the buildout and who's got capacity and able to do it. But there's a whole other segment of bringing in some of the reshoring activities that are going on as well.
Carol, it's got to that time of the show where I ask you the impossible question, what happens next in the balance of twenty twenty five for the technology sector? Your big predictions, please, We.
Do think that you'll see continued grind higher. I mean, markets have been climbing a wall of worry technology as well all year, and we think you'll see a continued sort of grudging climb higher. You know, many company managements have told us they're nauseously optimistic for this final quarter, and I would think we're in that camp too.
Carol's life a bemo private wealth. It's great to have you back on the show and we always appreciate a prediction. Thank you very much. Now we have some breaking news crossing the Bloomberg time or. Rhode Island and Connecticut have sued the Trump administration over the administration order blocking further construction of a nearly completed offshore wind palm, which was meant to provide power to the two New England states.
You'll remember, Carra, August twenty second, the administration issued that stop work order. We also had the companies involved have a parallel suit against the US in order that the wind farm work can continue. But the breaking news right now is that Rhode Island and Connecticut, two of the New England states, participating in a suit against the administration, trying to get the judge to allow that work to move forward.
What we got next future.
Of energy is important to AI. We go back to aied coming up, Apple looking to go toe to toe with Open AI. Of course company it has a partnership with, but it's launching its own AI web search, integrating it in SyRI.
We'll dig into that next. This is Bloomberg Tech.
Apple said to be launching its own AI web search tool integrated into Siri, basically rivaling the likes of Open AI. Of Perplexity megs Mark German joins us, Now, it is such a thoroughly reported piece you put out yesterday and moved the stock. What's interesting is who's going to be helping build the underlying LLM and generator of AI within it. And it's not Perplexity, and it's seemingly not anthropic either.
Yeah, that's right. We've known for some time that Apple's launching an overhauled version of Siri around March. This is going to include delayed features like the ability to tap into your personal data to fulfill queries. Obviously it's surprising it couldn't do that till now after launching fifteen years ago. But the feature that we didn't know was coming until yesterday is an AI web search tool, sort of an
answer engine. Siri right now is able to answer questions, broad strokes of information it can provide, can control your phone, send messages, and what have you. What it doesn't do well is tap into the open web to get information and to still it down for you in the way that AI search engines today can do things like perplexity,
things like CHATCHGPT. So now Apple will be launching their own answer engine that's going to come in March as part of an update called iOS twenty six point four, and over time I anticipate them to integrate it into Safari, into Spotlight and other parts of its operating systems. You know, Google Search is very important to Apple. It makes them roughly twenty billion plus per year. But the industry is shifting. You know, how many times are you going to Google
Search right now? Probably fewer than you used to a lot of people are doing their searches from CHATCHGPT or perplexity. It's an increasing number of people. So this is important for Apple for its long term.
Few world knowledge answers is just one part. You know, you're reporting shows us what the market has actually been asking for, which is when this revamp SERI comes as a package, so spring next year. I see basically three parts, right, a Siri redesign, a health AI subscription service, and then some conversational features on the home devices which we've discussed on the show What are we waiting for? That's coming in March?
Mark in total, So what's coming in March is this AI search product I mentioned. The ability to tap into personal data to fulfill queries, things like who did I meet with a month ago? What song did ED text me last week? The ability to fulfill queries based on on screen content. You're looking at a picture of someone, tell me more. And then you have voice based navigation, so using your voice to control your phone, move around your operating system, telling Siri to like something on Instagram.
Later in the year, you'll see the Health Plus subscription service, which is basically an AI agent for health. And you're also going to see a visual redesign for Siri later next year, and then the year after is likely when you're going to see the conversational Siri tied to that new robotic home device, the tabletop Robot, which is essentially a virtual person to have in your workspace to help you get things done throughout your day.
So my question is, first, ed, what song did you message Mark German?
Was it?
I believe it was, Yeah, it was Pink Pony Club. That's no surprise any regular followers on social media. But I'm interested, Like you know, when I look at how Siri works right now, or Apple Intelligence, it summarizes what's in my email. It often will be like, here's your Spotify playlist of the day. Spotify sends updates as well. What would you have sent, Mark Carrot?
What would I have sent? I? Did you see Oasis? So probably an Oasis song? But Mark Brawley, the question that I'm also going to ask you is, therefore I go back to the underlying technology here, the relationship between Google and Apple. We've just had such an update on it from Judge.
Meta this week.
That's going to be integral for what's going to be building the underlying technology for this product.
Right Ah, Yes, you asked me that earlier.
I did not answer the question, So.
Go for it.
Yes.
So Apple has talked to open Ai and Thropic and Google most recently to partner with them to rebuild Siri as one of the components underlying the new Serie engine, and a lot of signs right now are pointing to them working with Gemini. Google has built a model for them. The two companies signed an agreement earlier this week a formal evaluation agreement. This doesn't mean they have a commercial agreement. That means they've agreed for Apple to evaluate a model.
They're fine tuning it, and they're heavily considering it. They've also considered Anthropic very heavily, and they still are for different parts of Siri. The problem is is that Anthropic wants north of one point five billion a year and then revenue number that's going to escalate annually for the next three years, and that is a pretty a very
big dollar amount to pay for technology like this. In Apple's mind, they feel they have little leverage here, and Google's a longtime partner and obviously that partnership is going to continue, so it all seems to fit. So we'll see what ends up happening, but I'm thinking Google.
As of now.
Bloomberg's Mark German, who, as Cary said, very detailed report on what happens next with Siri, Thank you very much. Meanwhile, open AI rival deep Seek's said to be developing an AI model with more advanced AI agent features. I want to get out to our AI editor Bloomberg Seth Figureman. Very interesting story that Bloomberg broke because like deep Seek, actually despite the sort of volatility of April, which deep
Seat calls in markets. It moves slower than some of the other Chinese names working on models, but the whole point is that this is a gentic AI. They want something that goes beyond the chatbot.
Yeah, that's right. I think we've all been a little bit surprised at how little we've heard from deep Seek in the last eight months since up ended the markets. We've seen a lot of products from Chinese and US rivals, and there's a lot of speculation mat what's going on behind the scenes. There are other challenges that might be facing, but what we've hurt and reported today is that its focus is really trying to make a splash in the
agent market. And you know, for viewers here, this has really been where the tech industry has shifted to in the last six months or so. Open the eye, Anthropic, Google and others are all pushing out AI agent products. I think what Deepseeek is trying to do is basically build a new model that has agentic capabilities you know, embeded within it so that it can field more complex,
multi step tasks on your behalf with minimal intervention. Again, a lot of companies are trying to do this, and we are seeing very mixed range of execution here, and it seems like deep Sea probably wants to make sure they put out something that will move the needle in this potentially crowded market.
But the crowding really for deep Seek is its popularity in China. At the moment, is still the most popular chatbot tool. But as we say, Ali Baba Tencent, they've just had a rapid rate of innovations in their models.
When do we anticipate R two will come out?
Yeah, so again we gotta know if this one is R two, but this model is supposed to come out before the end of the Year's interesting though, is that Ali Baba tends up the ones you mentioned haven't been as active I think in the agent marketplace. I mean, they're doing a lot of image and digo generation technology, a lot of more sophisticated chatbots manners which we and others have covered, which is originally from Chinese origin, but
now trying to move into Singapore. They have made a bigger splash with agent products, So there might be a bigger market within China and globally if deep Sea can do something competitive on the agent front. But it's hard to say right now how much it'll be different from what's out there.
Seth Fiegerman breaking it down on Deep Seat. We so appreciate it.
It is time now for talking tech and first up.
Red Note so its.
Valuation served nineteen percent in just three months.
I think thirty one billion dollars now. The social media firm emerged the year this year.
As a real viable competitor to TikTok, which faces threats of a ban in the United States. Remember some Red Note investors anticipate in an imminent IPO plus s k Heinex is set to pay two week seven billion dollars in bonuses to twelve labour tensions. Now, the company's labor union has improven landmark agreement allocating ten percent of the company's annual profitence to a bonus pool of its thirty
three thousand, six and twenty five employees. For twenty twenty five alone, employees could receive only eighty thousand.
Dollars in bonus.
And in Vidia's venture capital arm is set to invest in Honeywell's Quantinum for.
The first time.
In Vidier is the latest big name backer behind the quantum computing company with the latest investment set to value quantinum at ten million dollars ed.
All right, this week British finance app Revelue offered a secondary share sale with a seventy five billion dollar valuation. We covered it on the show Bloomberg's learned that Revolute is putting in extra work to remain private while retaining talent and appease some of its VC backers. Let's get out to bloombost Tom Metcalfe, who's been following the company. So this is like some financial engineering, like different valuations
on different transactions. But there is one big point here, which is that Revolute wants to stay private.
Why yeah, exactly exactly that it's the age old story of you know, get you get a little bit more flexibility as a private company, and if you can put off quite a tricky task of keeping those investors happy your employees happy as well, then you're able to I think, do you get a competitive of entries against any public peers. You know, it's very few sort of startups that can do this. They always grab the attention. But you know,
it's that blend valuation that's really interesting. There is a little bit of kind of give and take here, like on the primary they again given out a lower evaluation, employees get a pretty decent one, and then they actually are buying back some shares from a very select class of investors at a different valuation as well, and.
A forty five billion dollar valuation.
But that's probably a lot of upside if you've been a very early investor. But more broadly, I mean you cover the billionaires here, right, the CEO really does seem to be up there in terms of his own valuation as a billionaire.
Now, yeah, exactly.
I mean I remember, gosh's been years now since been tracking these folks, and you know, when Stronsky came out, you've seen Revolute go through a whole range of valuations. But unlike Klana, which is sort of the earlier of hearing startup, I always kind of compare it with those paper valuations. It should be clear they're on paper, so you know, until that crystallizes, it's a long way off,
like kind of money in the bank, I suppose. But whereas Clara had a very much roller coaster riders now just about to IPO, Revolute always seem to be in a position where it could pick and choose when it could go out for new money. So its valuation has very much been steady or in recent years or even months as jump. So it was thirty three billion, then forty five, that's hits sixty five and now seventy five. But that's on a second evaluation.
Of course, next Toron Sky two hundred and first richest person. If you're basing it on that seventy five billion dollar valuation, Bloomberg's Tom Metcalf brilliant to have you, Thank you, Welcome.
Back to Bloomberg Tech.
Let's get straight to earnings now, because shares of HPE they are training higher throughout this morning. The company reporting fiscal third quarter earnings that did show operating margin and the serving unit had narrowed, but the CEO Antonio and Arry on the call telling investors, look, it's going to return to roughly ten percent by the end of the current period. Well, now we've got him here to explain
a little bit more. HPE CEO Antonio n Airy. We get into how you're building out this business, how Juniper adds to the networking side, but for now, the AI systems, the server unit, how is profitability to improve?
Well, good morning, Caareran thanks for having me. We are very pleased with our quarter. It turned out to be very solid with record breaking performance on revenue and we expand the profitability sequentially. And to your question around the server segment, we deliver what we say we will do. But most importantly, our traditional server business return it to
a historical level. And so when I think about you four, we're going to see a return to approximately ten percent for the quarter because of the momentum in traditional servers, which by the way, group double digits here over here, and the balance of AI mix between sovere and an enterprise which now represents more than fifty percent of our orders compared to the service providers.
So the AI serve a bit is that to improve?
How well broadly is the AI system's profitability improving as we see this monumental buildout of infrastructure.
Well, as I think about the AI servers, I think it's important character to think about different customer types and how we participate in each of the segments. So we think about the service providers and the hyper scales and the mother buildings where a lot of the capital expenses are taking place. To your point, we are now going to lead. We're networking for AI. We are extremely pleased
we close the Juniper transaction. Junior is already a reference in many of those buildouts, and that's where how we're going to lead in that particular segment of the market. And we're going to sell the server compute platforms whether our partner where it makes sense from a profitability perspective. But what we saw in the last couple of quarters in particular discorder, sovereign and neoclouds and enterprise now represent
more than sixty percent of the market. There, we participate in a slightly different approach which the market profile is different. We lead with a rack scale integrated architecture for the sovereign space, and we lead with an integrated solution for enterprise Enterprise group for the seventh Conservative quarder and we double the number of logos. And then in sovereign we grew more than two hundred and fifty percent. And we want some marquee deals in the Middle.
East, Antonio, that might be the answer. Actually, I've studied the traditional server business and the storage business, and you're doing better than your peers Dell net app. But why are the dynamics better for you when you have these analogous businesses with those other names I mentioned.
Is multiple things. First, in the enterprise traditional server, we see a refreshed cycle taking place or age infrastructure with more richly configured servers. And we have two phenomenal platforms which is HP pro I and Jene eleven and Gene twelve. We did a fantastic job in really hitting the sweet spot to the market with better performance per core, lower energy consumption, better security, quantum proof for the maother and
two worldad optimization. And so now as we go to the June twelve that AUP continues to growth and the ability to attach services is much higher. As I go to the storage business, we really transform the entire industry in my mind by deploying a consistent architecture, whether it is structural data block storage, or whether it is obstructural data which you need for AI. And that's what we call the object data with file ingestion, so the customer can do one one investment with a peace of mind
as they grow their data needs for AI. So I think that's what's resonating in the market. But often we have a fantastic go to market. We play in one hundred and seventy two countries and that reach together whether partner is a major differentiation. In addition to the fact that Green Lake provides through AI dream and life cycle management serpability.
Those are the things specific to you, Antony, Would you give me an outlook for enterprise IT spending and because we have a lot of macro uncertainty right now, and you must see in the pipeline that how that uncertainty is really manifesting.
I was based on our pipeline. First of all, is solid across the three segments we participate in networking, server, and hybrid cloud. It is uniform across the three geos. There was another question in another interview, did how North America versus oldiers are doing North America very very well for us this quarter? And so I think the demand will continue to be there. Every enterprise have to modernize and deploy AI. We as a company are deploy AI
very extensively. We see the productivity improvements across many functions and many businesses, so that will continue. But at the same time, there is a way to modernize the legacy by freeing up space, power and cooling so you can
deploy this new technology. So we are very confident about the outlook, and with Juniper, that outlook becomes even stronger because now we have a complete portfolio networking that makes us unique as we want to build the best networking business in a modern, secure, cloud, native and AI driven portfolio.
And you're expecting to cut costs.
I think we're seeing six hundred million dollars in cost savings are expected by that combination, Antonio. Cost savings are necessary for many businesses right now as you think about some of the pressure from tariffs, your bird's eye perspective on how much that's implicating your business right now.
You have to have a mindset of continuously transform the company. That's a fact, and you know the future belongs to the fastest said all the time. But the at least six hundred million dollars in synergies is related just to the Juniper transaction, and are re iterated that yesterday and then there is an incremental three hundred and fifty million
dollars through three key strategic levers. Continue to optimize our portfolio, continue to optimize the workforce, and aggressively deploy this set of technologies and other core is not just a cost take out, is a way to improve the experiences and become more efficient and agile in this market which you have to react and in the moment. So we are very encouraged about what we're seeing and Juniper actually give us the opportunity to rethink some of the processes we have had for a long time.
Here, Antonio, I ask you this every Coquo house the relationship in partnership within video, but is Jensen one would see it right for the supply chain and the partners they give great visibility to future iterations product right. They commit to the annual cadence of new GPU. They're increasingly involved in the networking through mv link. Is anything changing for you because of the way that video operates generationally technology to technology every year.
We have a fantastic strong partnership at the company level and at the personal level. Jensen is available in the moment. If I need something, he picks the phone and we chat that we solve it. But I will say the following. I think from a collaboration perspective, from a core engineering perspective. The proof of that is our AI factor for enterprise with our private CLOUDI we actually took a very different approach together with a video we integrated entire Nvidia AI
suite of software inside our green lay cloud. We took a software down into infrastructure and together we provide an integrated solution for our enterprise customers. That's a testament how you co engineer despite the fact a lot of the value is on the GPU, but reality is the software and the experience that you deliver. On the other hand, now with networking, we have another set of opportunities because above the MVY link and the spectrum as you refer to,
you need a full data center architecture. Nvidia does not participate into that. Our major competitors obviously our Cisco and Arista, but Juriper has become the reference for many of these large AI deployments. But I do believe together with the Nvidia we can do a better job in a way. We deploy that copex and we run that infrastructure from an opex perspective using AI technologies for that matter, in full manage the network. So we are very excited about that.
And look, you know in the last ward that we announced new innovation together with Nvidia, the RTX six thousand pro, the latest Ultra you know Blackwell, we are committed to be time to market with Jensen and team.
I'm interested by the adoption and generative AI by the companies that are helping them become a reality. Of course, benefits your share price, which is near a record high, Antonio, But how is it benefiting your employees or indeed, how are the pilot's runn because there's been a lot of questions about whether there's been efficacy there since the MIT report.
Yeah, I think it's fair to say, Carol, we went from generative AI to agentic AI, and I think about, you know, agentic KI as the next evolution for what really enterprise needed. And my view is that AGENTAKI will transform business processes by simplifying them, automating them and then bring intelligence to it. In our company, we are using
agentic ai aggressively in our offers. So Green Lake Intelligence, which we announce it June, is one of the most comprehensive clouds that includes a gent ki no reserveability in the way deploy and manage infrastructure and so forth. On the other hand, as a company, we have deploying agentki across finance. Our CFO is incredibly aggressive on this, so
she is on the leading edge on this. Our marketing team uses for demand generation and the brand capaigns and targeting segments where it makes sense, and our services team is used to provide better support experiences in our supply chain. We use it for forecasting and planning, and there is many other examples of that, and so I think this generative I now became agent KI. In the future, of course will be the robotics part, but the productivity level we see in is pretty significant and we are not
put of a concept. We have deployed more than sixty use cases across the company and we have more than two hundred in testing as we speak. Some will fail, Carol run, and that's fine, and the mentality there needs to be fell fast and improved and focus on our return and investor capital.
Antonio, you've been CEO since the start of twenty eighteen. Where does HPE sit today relative to your big vision for what HPE is can or should be against your peers.
When I became CEO, I had a vision to be
an edge centric, cloud level and data driven company. We invested at the edge was the Ruba acquisition, and we delivered tremendous value for our shoholders from seven hundred and fifty million dollar revenue all the way to over five billion, and obviously now the next move was the acquisition of Juniper to make this company a networking centric company because I believe the next AI era here is the convergence of networking cloud and then obviously the business process that
we will run as an enterprise, and that to me is the core foundation that have been envisioned for our company going forward, and on that core foundation we deliver the best cloud and AI experiences. So is continue to be shaped. I'm very pleased with the progress, but let's not forget it's not just the division itself. It's how you execute with the culture and a set of values
that makes us unique. And HP has been recognized also along the way as one of the best places to come and work by many surveys and magazines and institutions. So my view is that we are shaping the future, but ultimately is about delivering Shopholder value and we are going to be positioned for the next three year to accelerate that value as you see today because our stock
price still undervalue in terms of multiples. Our goal is to deliver that value accelerator for our shareholders and be relevant to our customers in this new environment we live.
In, I should have disasked you if your stock price was undervalued. Antonio Anderi, President and CEO of HP. Will leave it there, but a really robust conversation, thank you very much. Coming up, tech leaders are set to gather a President Trump's brand new Rose Garden for a discussion about AI. We're gonna have more on that next. This is Bloomberg Tech, President.
Trump and the First Lady. Well, they're set to host a group of tech leaders.
And the newly renovated Rose Garden.
Those joining include Mark Zuckerberg, Tim Cook, Satia Nadella for an event on AI education Bloemos Katherine Lucy joins us. Now this really is a powerful Rose Garden meeting.
Yeah, it's quite a lineup, right. A lot of bald faced names are expected, both for a event with the as you said, with the First Lady around AI and AI and children, but also for a reception the President is hosting on the newly repaved Rose Garden, which he has made clear he wants to use more as a space to host gatherings at the White House.
Catherine, I went to d C for the Winning the AI Race speech. The President made. So while this is, you know, it's a nice thing with the CEOs, go at the heart of it, what is this administration's attitude to AI. I feel like there has been a lot of traffic of leaders from California Silicon Valley going to the White House to discuss that issue.
Yeah, the President and his ministers have been very clear they are intered investing in AI. They have put a big action plan around AI. They have had a lot of tech CEOs in not US today obviously, but throughout this year as they look for ways to invest in manufacturing, to invest in domestic production, to support tech centers. They've also been closely aligned with chip manufacturers. So there's been a lot of activity in this space throughout the year.
Bloomberg's Caafine Lucy with the reporting. Thank you very much. Let's stick with recent news from the Trump administration. The president has torn up a Biden era compromise that allowed some of the world's biggest chip makers to maintain operations in China. I want to get out to Bloomberg's senior editor, Mike Shephard. We're talking about validated end user authorizations or VEUS, and there's been this pipeline of breaking news announcements around it.
There's a little bit of pressure on the chip stocks. Why are we focused on what the president's doing in this domain?
Well, this ends this so called blanket waiver that had allowed the company's Samsung sk Heinex in TSMC to avoid becoming collateral damage ed in the US effort to reign in China's artificial intelligence ambitions, and that efforts included imposing export restrictions not only in US com companies, but also on businesses in Europe and elsewhere that supplied those makers
with facilities in China. Samsung and sk Heinex are South Korean companies and they do have facilities in China, and even though they are not Chinese flagged, they were nonetheless targeted by potentially these export restrictions. So the waivers were designed to spare them from feeling the brunt of it, and it would allow them to ship in semiconductor manufacturing equipment, materials, chemicals,
and things needed to keep those plants running. And it was really critical for Samsung and Skhinis to have that ability to not have to go to the US government for permission every single time they needed to make a shipment. It allowed them to keep those facilities running, and it has become a complication for them and for their suppliers too.
Kara, I mean what a labor impact is going to have. I mean, we see the US government trying to brush it off. It's going to be easy to facilitate.
But remind us of why the current.
Administration was so worried about this particular loophole as they call it.
Well, you know, Caro, I mentioned data leakage, and that, of course, you know, the idea that tech from these factories could somehow leak into the Chinese market, and that China would be able to somehow copy or mimic or use this technology in some fashion, or these materials in some fashion learning they know how. But there is also
another factor. We're seeing more than just South Korea and Taiwan getting caught up in the tug of war between the US and China, this is also a tug of war with allies with South Korea and Taiwan and the US over competition over trade. The Commerce Department made clear that look, they see this as a question of leveling the playing field not just with China, but with companies from South Korea. And Taiwan. They want to make sure that advantages given through these way are also not unfairly
putting US companies in an unfair position themselves. So this is why the waivers have ended, and it's going to set up four months of intense negotiations for these companies to figure out how to proceed.
In most my Shepherd, we thank you from Washington. Now coming up French AI firm Mistral. It's solidifying its position as one of Europe's most valuable tech startups.
We talk about the funding that's going on now.
Discipling their tech. French AI start up Mistral is.
In talks to raise a new investment that will value the company at fourteen billion dollars in most. Cake Clark joins us now with the story, it's a high evaluation.
This is really the French startup, the European version of open ai.
Exactly.
Has it got any niche a tool to compete against the rest.
It's developing open source models, so that's one of its that's its niece. But it's also a European company me as you said, so perhaps people in Europe would prefer to use a European homegrown AI company as opposed to chat to BT.
Or Entthropics Claude, It's interesting where the capitules coming from. It's also based on the news flow of this week. Forteen billion dollars is modest, right, Kate, relative to Anthropic.
That's exactly right. I was thinking, Wow, this seems cheap compared to anthropics one hundred and eighty three billion dollar valuation and open AI's five hundred dollars billion dollar, five hundred billion dollar valuation, and so.
Many cross over in some of them where the capital is coming from at the moment, because we all focused on the fat that Anthropic kind of went to the Middle East when many thought they.
Wouldn't exactly, and we don't know who's leading this Mistral around. I have been told it is not likely to be a Middle East investor, but we'll see, and we're we're doing that reporting to find out. But it does have several US venture capital firms that are backers of Mistral, Andries and Horowitz is one of the major investors, which is also a firm that is invested in other US lms.
Very quick, Kate, just summarize demand. I'm seeing a lot of newsflow, deal flow, primary secondaries, the appetite is still there for these AI startups.
There is an incredible amount of appetite for these AI startups. There's words cannot really even describe how much appetite there is for an open AI and anthropic even if a stroll, investors are extremely excited to put their money into these large language models and into the application layer AI companies.
Bloomberg's k Clark great reporting as always, and yeah, there's a lot going on, Carrot.
That does it for this edition of Bloomberg Tech, where there is insatiable demand for content, whether it be on Open ai or Mistrial and many others.
Yeah, hardware or software, we got it all. So check out the podcast. You know where to find it on the Bloomberg terminal as well as online on Apple, Spotify, Nihart. From San Francisco, New York City, This is Bloomberg