From Marhard where Innovation, Money and power Collie in Silicon Valley, NBN.
This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
I'm Kroene Heindeer Bloomberg's world headquarters in New York, and I'm Med Lovelow in San Francisco.
This is Bloomberg Technology.
Coming up Intel.
The shares they pop as the company's turnaround effort gains momentum.
We'll discuss with the CEO, Pat Gelsinger.
Plus we'll continue with the earnings coverage. Is Amazon's results show a boost in its cloud computing unit, We'll break down those numbers.
And one year on since Elon must truck over, the company formerly known as Twitter and the Billionaire announces plans to take on the likes of YouTube, LinkedIn and push into payments more. We'll discuss that and so much more throughout the hour, but first has.
Check in and what is a to finish up the week.
It's notable, though, we're seeing a rally across stocks and bonds, which are usually at odds. And that's even as we see those inflationary pressures build. From a macro perspective, Certainly, consumers anticipated to see more inflation, so says Umiss, the University of Michigan numbers and indeed that all important PC number coming in strong. So we do though see tech on top. Is that all to do with earnings? We'll to get into it with you. Ed Nasdaq at one
point two percent, but still down on the week. I'm looking at the two year yield just pulling in on the longer round, it's pulling in a little bit more. We're flat, but we're still above that five percent level. But is there like a risk aversion as we head towards the week and amid of course ongoing geo political concerns, particularly with the Middle East, Bloomberg Dollar Index is actually off by a quarter of percent despite that inflation gauge.
Let's have a little look at what's happening in terms of the world a bitcoin, because over the last five days it has been on a tear. We're up some fourteen percent. Is this desire for haven Probably not. This is still more a focus, a hope, a prayer, a reality ed that maybe an ETF and spot bit coin is coming soon.
Yeah, it's kind of like a broad risk on sentiment. And you talked about tech being on top and earnings is kind of the driver of that. Intel gave a sales forecast for the current period that at the top end of the range was way above street expectations, and the story that they're trying to tell is that the PC market is bottomed out. PC chips are their biggest sort of volume sales, and that's been important. We will
speak to Pat Gelsinger later in the show. One point in the session where I'm pointing to over there, biggest jump on the stock since January of twenty twenty one. But it's also the third straight quarter where investors have looked at the story of Intel and said, yeah, we like it. We believe you that the turnaround's happening. That's what we're going to discuss. The other big, big name is Amazon, and with Amazon right now, we've paired some of the sessions gains. We were up a little more
than that, but we're still up significantly. The story was actually beats across the board apart from aws in the top line relative to expectations, but if you look at the bottom line, the cloud unit brought in almost one point five billion dollars of operating and come more than the street was expect they've added customers in the quarter, and generative AI is what's going to be the driver of growth for AWS, the cash cow of Amazon's business for years to come.
That's the story that Andy Jasse wanted to tell.
Let's get more with Bloomberg's Poonam goil Bloomberg Intelligence.
That's the story. But what did the numbers tell you? Poonam?
The numbers actually looked really good.
From a results perspective. Three Q was strong both for AWS in our mind, the twelve percent game was in line with last quarter, and the retail business did much better than expected, which bodes well going into the all important holiday season coming up.
So consumer looking more resilient.
What was it that Andy Jasse was able to get across on the cool poonam that really studded nerves around AWS and cloud in particular.
I think for EWUS, you know, the real important thing was his tone and the fact that he said the deal books were good and that things weren't any further So it's like the trend is kind of just continuing to stabilize, which was very encouraging, and it was in contrast to what we heard from the other tech companies are cloud providers earlier so I think that really was what took the stock up during the call, and I think that's what you're seeing today, just the confidence and
the cloud business near term and of course for the longer term. We remain very optimistic on the cloud business, both on the margin side and the top line.
All right, Pounam Goyle of Bloomberg Intelligence, thank you very much, Caroline. Some news crossing the Bloomberg terminal that I've broken with colleagues around the world in the last few minutes. ASC, which is a Japanese battery maker, has just closed a one billion dollar Series B led by GIC, Singapore's wealth fund.
But what I'm hearing from.
Sources is that they're also working already on a Series C with their bankers and advisors that would value them in the billions of dollars. This is a battery company that makes the seals that go into evs. It has deals with the likes of BMW and Mercedes here in the US, some of the automakers in the UK. But here's the next step that sources tell us they're looking at a USIPO down the line as well.
And it's interesting.
It started life as a JV between Nissan and NEC back in two thousand and seven. But in twenty eighteen, a Chinese energy technology company called Envision bought a controlling steak and Jang Lai, who is the founder CEO of Envision, is also the chairman of ASC. So a lot of questions from investors and insiders about how that ownership and the Chinese relationships perceived, especially in the context of the IRA.
Check that story out on Bloomberg dot com.
Yeah, a great big school coming from ued. I don't know where you find the time. Meanwhile, someone else is busy at the moment, and it's one Sam mag Munfried. He has taken a stand again today in the FDx flaud trial, now this time in front of a jury. Yesterday, of course we understood that there was a focus where the judges being allowed, in particular for sanbackmcfree to testify
on ftx' data retention before this jury. At the moment, he is currently discussing really the terms of service that were created, he says back in May of twenty twenty
two documents currently being displayed on the monitor. Actually in that particular court, he said he skimmed over a few times overall, and that he went through parts of it in more detail when they were released, But his understanding was that this was referring to two different features on the platform, first look coordation of user accounts, and second
clawbacks or socializing losses Bagmenfred is talking about. This is basically all about explaining how maybe funds were used, particularly when it comes in between Alameda Research, the Hedge Fund, and FTX.
Part of what he was trying to explain was kind of the role that FTX lawyers had in the lead up to the collapse, that, you know, just drawing on my own experience. As a parallel, I covered Trevor Milton, the Nikola founder's trial on securities fraud, and I raised that because Milton chose not to testify or his lawyer's advice not to, it's highly unusual.
Not only the SBF is.
Testifying, but he's actually going to do so twice and put it all on the line on the stand.
So we'll continue to cover that one character.
And of course no cameras inside the courtroom. That's why I was thinking so much drawing of all of this. But what's notable is we have got our reporters on the ground. We are getting a tea live blog chee throughout so go. Of course, that's one of the most red stories on the Bloomberg terminal today Tea live if you're lucky enough to have a Bloomberg. But overall, the blow by blow blogging account of really what's going on within that trial.
Welcome to our Bloomberg TV and radio audiences worldwide. Shares of Intel popping today as the chip maker predicted a return to sales growth in the fourth quarter, fueled by a rebound in the personal computer market but also a more competitive product lineup. Joining us now is Intel CEO Pat Gelsinger. And look, Pat, there was quite a long
list of things that investors cheered, right. This is the third quarter where the market's basically said, Pat, we believe you on the turnaround story, on your to do list, where do you think you are and what do you think you have left to do on that turnaround story?
Yeah?
Thanks Ed, And you know, overall, hey, it was a great as we say, just a clean beat and raise on all the financial metrics, but even more important was the operational performance. And you know, as we said, hey, getting back to process leadership, and we delivered key milestones and we still have at least another year or two to go on getting that done, but major milestones starting to deliver foundry customers.
You know, I promised one at the start of.
The year, and now we have three on our most advanced process technology, major packaging wins, and of course the product execution you know, clean launch of the AI PC generation, but also the server business getting back to profitability ahead of schedule and a little bit better performance there and delivering the AI Everywhere message with our accelerators our server product line. So a really excellent quarter, and I'm just
so grateful for the Intel team. It's been a journey and we are clearly coming.
Back a pat You've talked to investors and indeed to Caroline and I about these new customers for the foundry business. When do we get names? When are you going to announce who these customers are?
Well, you two things there, ed, One is it's not generally the practice of the foundry industry for the foundry to be declaring their customer names.
So one, it's not practice, and also many of.
The customers consider it confidential and part of their competitive advantage.
And how and what technologies they choose.
So I can't promise names but we're going to characterize them as best we can. And as we said, these are high performance and AI customers. And we've really seen the surge of interest in using the Intel technologies and foundry for different AI offerings in the marketplace. And that's both a wafer but also a packaging and this idea
of advanced packaging. In addition into the three on the wafer side, we had two advanced packaging customers in AI and that revenue materializes more rapidly and six more in the pipeline, so overall a really substantial quarter. And the AI space in particular has been the customers that have seen the most enthusiasm.
And let's talk about the AI space because the running of AI models is where you see your future. It's not all just about the foundation models. It's actually the running of them, not the building. But can you just relieve some of the anxiety coming from investors about a lack of clarity over data center future and indeed, what is it that they need to hear from you? What more can you articulate that really makes it clear to them that you're going to be front of center in the AI race.
Yeah, thanks Carolyn, And you know, really.
You know, first, let's characterize what we're talking about in this idea of creating you know, these frontier or foundation models. This is described versus using right and the training and the inferencing against those models, and I sort of compare it to like weather models. Not that many people generate weather models, but a lot of people use them. And that's how we think about this next phase of AI. How do we make this inferencing or the use of
the models broadly available. And that's going to be in the client, right we talked about the AIPC. It's going to be at the edge right in retail and manufacturing and supply chains. But it's also going to be an on premise data centers. And as we've said, instead of taking my data to the cloud, I want to bring the AI to my data center where the data is already and finally work in the cloud.
And for the data center proper.
As your question talks about, hey, you know, we knew we were going to lose some market share here, right. Those losses happened last year and they're sort of playing out in the marketplace. But our roadmap is strong and we over executed in the quarter on our next gen R Gen four product that did a bit better than we thought in a lot of AI use cases in this area of inferencing. The next generation Gen five, we're already ramping that in production and that's going to get
announced in December. But next year's products, we're already seeing great health and we're ahead of schedule in those and those really improve our competitiveness. And the twenty five products will go into fab in the first quarter of next year. So our whole roadmap and execution has really improved, and we start to see ourselves regaining market share in twenty four in that area. And I think that will be
sort of the final piece of the turnaround story. When you know the market sees okay, data center is backstrong, they're winning in the AI space. You know that'll be the end of the turnaround story and people say, Okay, they did it.
We'll go back to that building that training of data. Can you talk a little about stability AI. Of course you've got to deal to build their AI supercomputer. Was that them really going to you for ultimately what GOUDI can provide over what in video would or is it that you wanted to really be sort of offering them some carrots in the situation to be able to be helping with the training of the models.
Yeah, great question.
And you know, now with Goudi, we're now deliver performance and benchmarks that are as good as the best in the industry. So we've gotten our performance there. You know, there was also some of this work that you know, the models were created and much of the software industry was working, you know, on the n video platform, so we had to do some of the software work to get those running on the Gaudy platform. And they're looking for more cost effective choices and ones that are supply
chain available in the industry. And as we're ramping our Goudy product line, we're getting that software work done.
You know, they're priced more competitively.
Customers are saying, wow, I can do that work and do it at a much lower power performance envelope than the alternatives and have a much more cost effective model training and inferencing at scale. Okay, you were seeing a real surge of interest, and as I said, we doubled our pipeline of customers this quarter, you know, and we you know, like others in the industry, are now supply chain constrained and we're racing to catch up to that demand on our gaudy product.
Line throppening by radio and television audience worldwide. We're speaking to the CEO of Intel, Pat Gelsinger. Pat, the story of this week has been chip companies entering the PC processor market on architecture, how do you hold off those newcomers? You know, attention for example one Apple this coming Monday, and they have done well in that domain.
Yeah, and I think of the AI PC as an exciting category and this is one that we announced. We've been the first company on that and we're now ramping our first generation AI PC products called the Core Ultra. So others are talking about what they might do in a year or two years, we're ramping products in the marketplace.
Today we announced over one hundred is svs in our AI Acceleration program, so they're coming on board, and before others have their products even shipping in the marketplace, we'll be launching our next generation, our lunar Lake product, which we've already demonstrated for next year, and panther La like
our twenty five product. We're sending that into fab on our leadership Intel eighteen A process Technology and Q one so I feel like we have a very strong roadmap, and Hey, the idea of an ARM based PC, you know, they've always been sort of niche and low end, with the exception of Apple, and there it's not ARM, it's Apple and their ecosystem. So for the broader windows are market, you know, it's always been pretty low end and insignificant
in the bigger context. And as long as we deliver our roadmap, I feel very confident that it's other surge into the AIPC space. You know, this is a lift to the overall PC market and will be uniquely positioned to benefit from that.
Pat going back just a second to Stability in the AI supercomputer. That's kind of in the assembled component domain. But are you saying or are you able to confirm that's a paid relationship with Stability to praise you for use of Goudy.
Oh yeah, yeah, this is a is a major customer and we'll be building that with them, of course, working closely with them, but this is a paid customer relationship.
You know.
We also see quite another set around our OEMs.
We announced the major partnership with Dell right for not only Xeon's but also Goudy's as they come on premise and their cloud offerings. You know, we've seen a big upsurge in Goudy interest in the Intel Developer Cloud. We had a five x increase in the developers on our developer cloud, much of that on the Goudi platform. And as I said, we saw you well over a billion
dollars last quarter. We've approximately doubled that to this quarter of Goudy demand worldwide, and those are largely paid customer engagements. So overall, we're just seeing a surge of interest with stability, AI, Dell and many others.
Pat we every earnings look to your forecast for the PC market and you're slightly more positive than consensus in terms of literally how many PCs you think we'll ship around the world this year. I guess part of that is baked into your sales forecast for the current period as well. What gives you that confidence and why is it that consumers will return to buying PCs?
Yeah, and there's probably three different factors there.
You know. One is I can say, hey, we gave this two hundred and seventy million ish PCs being sold through this year, and we said that earlier in the year.
Many thought that we were too optimistic.
Hey, we look at it today and we're almost spot on with our accuracy on that forecast. Second, we've seen the industry, you know, not just Intel, but the industry overall. Inventory levels are now healthy, you know, and we look at our selling rate versus sellout rate, you know, the product is selling through. I'd also say, hey, we're off to a good start in Q four. We're a couple of weeks into the quarter, and as I said on the earnings call, really good start.
To Q four as well.
And you know, seasonality is a bit above in Q four or historical levels. We also have things like Windows ten end of service coming from Microsoft. Microsoft's about to release their copilot products. But I'd say the sizzle in the marketplaces around this AIPC brad new use cases for the PC. And I've compared it to the Centrino moment of twenty years ago when Centrino really ushered Wi Fi at scale into the industry. And we think that's exactly
what's going to happen with the AIPC. It will be a driver of new applications and use cases for the PC and bringing a bit more excitement, a bit acceleration more users coming into the marketplace because it's going to give significant new capabilities to PC users.
Is that what gives you your gross margin level of sixty percent? Again, is that where the confidence comes from.
Well, to get our overall gross margins up above sixty percent, I need the whole business to improve, Carolyn. Obviously we're making good progress in the PC. I also need to improve my factory network. And as we get back to leadership, we finished this super aggressive five nodes in four years. You know, I'm churning through capital very rapidly to get back to leadership. That's a big factor getting the data center business healthy. Going back to one of your earlier questions,
another factor in getting back to our margin structures. One of the other things we did this quarter was also have great operational success on our cost saving initiatives, and we said, you know, we would result in three billion savings.
We've also cleaned up the company.
I've exited ten businesses since I've been here, and now we think we're finished with that phase and we just get focused on growing the company again to the future. So part of its growth, part of it's this focus areas across the businesses and part of it's just increased operational discipline. But this quarter's results were well on our way to accomplishing that.
And you talk of operations there, and we didn't get time to talk about it, but we know that you do, indeed have operations in Israel, and we think of your own employees and your infrastructure there at this time, Pats, so thank you, thank you very much for spending some time with us and walking us through your numbers.
Intel CEO Pat Gelsinger.
There time for talking tech. First up.
Apple enthusiasts are getting ready for the company to real it's latest Imax and MacBook pros. Bloomberg's reported the new computers will likely include the new M three three nanometer processors.
The product reveal will be Apple's last of twenty twenty three this upcoming Monday, plus Huawei's Mate sixty smartphone breakthrough driving sales to the company as profit doubles in the most recent quart, Adding to signs the Chinese tech leader is steadying a business rocked by US sanctions and Elon Musk setting his sites on YouTube and LinkedIn ex executives
whole staff at a company meeting. They see the two sites as future competitors Bloomberg reports as must also planning to create a new service called x wire that would rither scisions, pr newswir and interesting one from us overnight Carrot.
Yeah, I mean from you ed overnight.
And really, ultimately this is coming down to wanting to be that global town hall, wanting stilled to be the place where you go to X for news in particular, I mean really got a lot of convincing of business or corporates there to want to be filing them press releases for example.
Yeah, there's a lot of battlegrounds.
Remember today is the one year anniversary of Musk closing the deal to take Twitter private now X and this was the first time the Acarina and Musk had done a joint all hands together, I'm told by sources.
So some interesting data coming out of that one.
Welcome back to Bloomberg Technology. I'm Caroline Hired in.
New York and I'm Loavelo in San Francisco. Look, we made it to the end of a megaweek for megacat Tech earnings and it's interesting to see holistically how.
The market looks right now.
And that's that one hundred on a five day basis down for a second consecutive week, down two percent. We're up one percent in Friday session. Amazon a big part of the points moving to the upside driving that, but on the whole into kind of we're waiting for the next two Apple and Nvidia. Remember Carroe that we went into this earning season saying the big five are going to bring all of the EPs growth for the S
and P five hundred. And if you took out those big five, the three of which reported this week, and then in Vidia and Apple to come, the SMP five hundred would have an earning's growth decline or lack of growth down around five percent. So we've been waiting and there's more to come. Dig in on one specific name, which is Amazon going gangbusters this Friday. We've got the perfect guests to talk about Amazon as well, and bring in a Yoko Yoshioka portfolio manager, a wealth enhancement group.
You heard my pre amble on the big five tech names. Was your scorecard for the three that have gone so far?
Well, clearly Microsoft is a big winner during earning season, but Amazon wasn't too shabby either, And it's really you know the story of AI and.
The impact that AI is going to have going forward.
Amazon did a great job on their conference call talking about the impact of AI and how that's going to add tens of billions of dollars of revenue for AWS, which was something that investors really like to hear.
What they don't like to hear, IAKO is consumer concern or macro concerns, And that was a business macro perspective that we got that let us down on the metafront, for example, and maybe a little bit on Alphabet as well. What do you think about the resiliency of the macro pitch for these tech names right now?
Sure, you know, from a overall standpoint, all of these companies have just very strong balance sheets, and so you know, it's it's been a flight to quality to a certain degree for many investors who are concerned about the overall
macro environment. Having companies that have high quality balance sheets, that have cash that is now generating you know, five percent plus, that's a huge relief for a lot of investors that they can rely on despite the valuations being a little bit elevated, I think in the near term.
And what we've seen over the course of this week is the idiosyncratic nature of big tech some of them doing well on earnings and leading gages high, and then the macro perspective just pushing back and over the course of the week, the Nazark is lower going for is AI. Do you think the silver line necessary to allow these companies to continue to go up into the right.
Absolutely?
And I think one of the things that Andy Jassey highlighted on the Amazon call yesterday was just the impact of some of these AI technologies. You know, whether it's code Whisper for Amazon's AWS or duet for Google and GitHub Copilot for Microsoft.
You know, all of these are going to produce productivity gains, you know, just removing some of.
That repetitive code for developers, and I think that's going to be a big game changer and really speed up the acceleration of the changes and the impact that AI can bring a you know, not just for these three companies, but across.
The board for every company.
It's hard to believe, but we're already basically in November, and Caroline and I have been thinking about the end of the year. We started the year with just mass layoffs across big tech and cutting back costs. How much of that is what's showing up now, particularly on the bottom line with tech that all the pain that they went through, actually it seems to have benefited them at least financially.
Absolutely.
You know, it was you heard all of these companies talking about cloud optimization, and that's really their customers.
Sort of dialing back a little.
Bit in terms of how much cloud usage they're going to have with these big providers, and you know, you because of that, I think a lot of these Microsoft, Meta Amazon, they all pulled back on their own spend and I think you saw them see the benefit of you know, the lower expenses.
Especially with Amazon.
They talked about the lower headcount you know in AWS and just you know, fewer engineers there. So I think that was a huge positive for them and continue to sort of strengthen their overall financial position.
It may seem premature, but I'm going to do it anyway. What does twenty twenty four look like for big tech in your mind?
You know a lot of it is going to depend on the overall macro environment. But I think it is difficult to you know, slow down the impact of AI and you know, cloud is still relatively early and it's journey. There's still workloads that need to migrate to the cloud, and it's just going to accelerate.
I think because of AI.
You know, twenty twenty four will be determined by you know, other factors other than just AI. But I think a lot of these companies can whether through that over the long term.
The reason why you're such a group group for to have on is not only how you're having to navigate what I think Wealth Enhancement Group has thousands, forty nine thousand households of wealthy individuals that you're helping manage their money, but your relationship having build up all the research analysis
and they're moving into portfolio management. You've got a whole host of tech companies that you own, Io Cohen, are there any that are overlooked or how do you think about the Kathy Woods of this world that feel that in videos and some of the big cap names just too obvious when it comes to the aiplay.
Sure.
I mean we like a lot of the sort of value oriented tech names as well. Oracles been in that space as well, and Oracle has been talked about their cloud evolution has really come a long way.
And so there are other names outside of just the big megacat tech that.
We like Accenture is another name that we like in the space in technology. They have consultants who are going to help all of these companies adopt newer technologies like AI and so you know there there are other technology names outside of just the big five that we constantly talk about.
It wouldn't be a week if we didn't speak FED speak, and you know, for our global audience and Bloomberg Technology, just give your perspective on why rates and the FED and the outlook for rates influences your decision about your allocation to technology names in a portfolio.
It's a great question, ed. You know, we get this a lot, and you know, why do we focus so much on the FED and interest rates? And I go back to just sort of valuation one O one discounted cash flows. You know, you have to use the risk free rate, which tends to be the ten year, right, so the tenure treasury rate, and what we see there is what's used in order to discount all of those
long term cash flows back to the present. And that's why there's such a huge focus on what the FED will do and how the treasury curve will.
React to FED action.
So yes, it is something that we continuously talk about but it impacts not just tech valuations, but valuations across the board, inequities as well as real estate and other markets.
IACO great to have some time with you, Iico Yeshioka of Wealth Enhancement Group. We thank you coming to us from LA. Meanwhile, no, we're going to keep on talking about AI and indeed how machine learning can have kind of major impact on how companies and governments handle climate change questions since Witherspoon, head of Climate and Sustainability of Google deep Mind, spoke about it the use cases in particular, but also it's orangines and gaming take listen.
Go was a really offha Go was a system that we developed that hopefully folks are familiar with. But games are a really interesting place to test AI because they have very clear goals, success metrics, clear benchmarks, and the end lots of data. And so that's the kind of system that is really interesting for AI because it's a
perfect test bed. And one of the things that was really interesting about Alpha Go is that even though it's a game we've been playing for hundreds of years, using an AI system actually taught us new information that we didn't know about the game. Before, and we've really expanded this idea into other systems like Alpha fold. For instance. Alpha fold is a system that takes in amino acid
sequences and tells us how proteins are folded. We developed a database that basically works like Google Search for proteins, and we were able to give that to the research community in order to further their research. So if you look at kind of the development of systems like alpha fold, you can see that some of the scientists that might use that would understand proteins, for instance, if they're engineering enzymes.
We actually do work with a partner who is looking into enzymes that biodietegrade plastics and are able to do their work more quickly because they have access to the library that Alpha fold provides.
Deep Mind CEO is a big guitar you fan, so stories let your kids play video games.
I mean the answer to how do you go from Alpha go to climate science is where you just go via you know, two hundred million protein Yeah, you know which is which is which is great? So you know in the episode that you are in next month, we take a very global view because it's a global show, but we're here in the UK with.
Our fantastic climate and weather.
You know, it's lovely today.
So can you tell us about something you've done here, that you've been, that you've seen and that is going to excite everybody.
Yeah, we'll talk about the weather, since the UK loves talking about especially rainfall, so maybe i'll go with that example.
We did a partnership with the Met Office, particularly working with some of their expert meteorologists looking at heavy rainfall because heavy rainfall is what causes damage to people and property, and so we developed a system that was a generative AI system so effectively you can think about it, you know when you look at the weather and you see those you know, beautiful pictures on screen with lots of colors of like where where rain is going to happen,
like where it's going to be heavy, where it's going to be light, how it's going to move throughout the UK. And we basically fed that radar data to our system and it watched it like a movie effectively and predicted the next frame. So we were able to This is something we call precipitation now casting, so it's the forecasting for two hours ahead of time, so very short term for forecasting.
And we worked with the Met Office to do this.
They were an incredible partner because actually ninety nine percent of the country here in the UK is covered by the radar data.
That was Sims Witherspoon, Climate and Sustainability lead at Google Deep Mind and now come out here on Bloomberg Technology ion CUE shift into commercialization is fully underway. We're going to talk it to the CEO, Peter Chapman, about recent partnership, some departures and one roller coaster.
This has been bot Technology.
Quantum computing company ion Q, when it's placing some big bets on it shift into national security. How Q is actually teaming up with the US Air Force Research Lab to develop and apply quantum systems. Now, this news comes in the wake of the co found at Chris Monroe's departure from the company. Now all of this rattle the stock and we want to really get clarity the picture forward with none other than well the CEO Peter Chapman,
who joins us. Now and Peter, going back to basics, like your aim at the company is to build the best quantum computers and basically solve some of the most complex tasks out of there.
You came out of universities, out of the labs into the real world. But your chief science officer is sort of.
Going back into the labs, back into the research, back into the universities. And some analysts are saying, look, they're worried about the timing and the reasoning. Explain the timing and the reasoning for us.
Yeah.
Sure.
So the company was co founded by two college professors originally from the University of Maryland and Duke, although both are today at Duke University. They in Chris's case, he still teaches classes at Duke and they run Duke's Quantum Lab, which is a significant undertaking unto itself. And we have a relationship with Duke University where the work that they do there, funded by the government, is exclusively licensed and royalty free to the company. So Chris is going back
to Duke University to lead that program. But the relationship between Duke and and Chris is really not It's not changed in any way, shape or form. Chris would be the first one to tell you that the physics for what it is that we're doing was solved long, long ago. If you'll go back and listen to Chris, you know, from several years ago, you will find tapes where he says exactly that where the company is today is no
longer about academic research. It's not about fundamental physics. And that's actually quite a difference between I and Q and many of our kind of competitors. They're still working on fundamental physics sometimes, you know, and we're we're not. We're actually migrating out of an academic phase and now into an engineering and product phase, and so we're in the middle of that transition, Peter.
One of the analysts that that Caroline reference was Benchmark's David Williams, and he basically says that the timing and motivation of Chris's departure is curious. Just on the timing part, could you just explain why now, why the process that you just outlined is being announced this week?
Well, I think I'm not sure I'd want to speak for Chris, but I think there's a number of likely factors. One is, he did state that he wants to go back to his academic roots. He seems to enjoy that, and and that's exactly what it is that he's doing. The other aspects just in terms I think you know, the companies often outgrow their founders. The You know, we're at a place today where it's no longer an academic endeavor.
It really is a engineering and product based endeavor. And I think that the Chris felt that his skill set is better in the academic.
Side of it.
So let's talk about the application of the technology now, Peter, where do you feel.
The reward of your investors? Start to push in on.
We were just talking about applications in national security for example.
Yep.
So we're just on the verge of We just announced just recently a news system which is going to have enough we call them algorithmic cubits sixty four algorithmic cubits, and this will allow you to explore our computational space of two to the sixty four in parallel and so two to the sixty four is eighteen quintillion different possibilities states in a single instruction in a fraction of a second, similar to the instruction speeds you have on your laptop.
This will allow now applications to be developed which can take on the world's largest supercomputers. Quantum is not good for everything. It strangely has a tough time adding one plus one, and at the same time, maybe is good for solving differential equations. In terms of applications that we have seen so far, machine learning is certainly one area where quantum seems to have a huge advantage. My guess
would be that strong AI will be another area. The original premise of quantum is that exploring the natural world, which is not digital, it's not analog, it's quantum, is that you need a quantum computer to be able to
model mother nature. So you know, it has been thought that at about ninety six good enough cubits, algorithmic cubits, you could model the photosynthesis and be able to unlock how plants can turn sunlight into energy, and that would produce the next generation of solar cells that would be four times more efficient than what they are today.
Peter, much of our global audience does think in floating point operations the second that are just unimaginable as the human brain. But just quickly, in a layman's perspective, explain what's proprie tree about your technology quickly.
So what we do is we use atomic clocks. Actually have one of them here, and it's a chip which is sitting in a little vacuum chamber, and it's using thirty two to sixty four atoms, and it uses those atoms for computation. And what's unusual about it is that it can run at room temperature. We're down at point zero two nanometers, so you know, the standard silicon at seven nanometers is way up from where we are. And
we use white to program the atoms. We shine little lasers onto these atoms and put a spin on them and entangle them to be able to do the computation.
All right, Pizza Chapman, CEO, I Cut, thank you very much for your time.
It's official. Tailor's is a billionaire. Welcome to the Aristour. Her Aristour alone is a party generating hundreds of millions of dollars. It's a multinational conglomerate with the world's most devoted customer base and an ultra charismatic CEO. Swift has made her fortune almost exclusively from her music. Bloomberg estimates Swift has made one hundred and twenty five million dollars over the years from record sales.
We estimate that her total income from streaming is one hundred and seventy five million.
The biggest part of our earnings is undoubtedly her concert revenue.
We estimated that Taylor, and that's about thirty five percent of the ticket sales. Is profit about five hundred million from touring over the years.
Her tours, her record sales, and streaming royalties are all earnings, but she also has assets, including her recording catalog.
We estimate that her catalog is worth about four hundred million.
Then, of course there's her actual property.
That include a condo in the state in Nashville, in a state in Los Angeles, a large apartment in Tribeca in New York City, as well as a summer house in Rhode Island. The total value of her properties is about one hundred and ten billion.
Subtract her expenses, taxes, staff costs, and so on, and you get a net worth of one point one billion dollars.
Some reporting from the Bloomberg Big Tight team there on Swift's influence, reach and wealth and Karen never in her wildest dreams, which she probably thinks she'd be where she.
Is now, Well never know. She might have thought that from very young, age ed, big ambious man.
But what's so interesting is, well, maybe her success isn't always paying off completely. To Universal Music Group, of course, she is the biggest seller in terms of artists, but actually their numbers came out amsonam based company and actually underwhelmed. They saw a lot of growth but did missanish estimate overall, but Midnight album the release was the biggest impact and indeed perhaps she's outformed too much in previous years.
That's it from Bloomberg Technology.
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