Bloomberg Tech is alive from coast to coast, with Caroline Hide in New York and Ed Lavelow into then Rince's goal.
This is Bloomberg Tech coming up. Tech earnings are in focus, with Texas Instruments and AT and T already out and looking to Alphabet and Tesla after the bell today, Plus the Microsoft.
SharePoint hack hits the US Nuclear Weapons Agency as the tally grows of organizations breached, and the.
White House unveils its AI action plan, including the promotion of a rapid buildout of data centers for AI.
Meanwhile, let's check in on these markets because maybe then, as that one hundred is lagging some of the other key benchmarks today, the enthusiasm for the SMP, for the Dow post, that Japan trade deal not quite filtering through, We've got more anxiety around individual earnings that you're digging into. Currently flat on the Naskak one hundred key tech benchmark.
What are you looking at?
Yeah, we're kind of trying water to tonight, right, But the two earnings that are our AT and T, which is also completely flat the story. They just didn't hype themselves up as much as some of their peers had taken advantage of policy. We'll get into that in just a minute, but look at Texas Instruments down twelve point three percent.
Do the math on tariffs.
Maybe part of this, Carrow is that for a company that makes chips that go into basically everything, they can't do the math on tariffs.
And I think that's where we go.
We do because one hundred thousand customers, they couldn't tell us who is dragging inventory forward or not.
In King joins us for more.
And look, this is the worst fall in the stock since two thousand and eighty in.
Yeah, they're having a very bad day. And it's not because the numbers are terrible, they're absolutely not. It's more of a directional thing. And it's more because, as you guys just alluded to, they're kind of pressing the wrong buttons, the fear buttons for the market right now, which is tariffs are going to have an impact. Maybe they're having
an impact already. Frankly, we don't know. And that was really then of the call yesterday, and obviously analysts and investors this morning did not like that.
Ian.
In your interview with CFO Raphael Lazardi, he basically said this idea, right, we have all these customers in all these different domains. It's hard of us for us to keep track. But executives on the call also talked about the idea that in the current period, the order data is quite strong.
Yeah, I mean the way that they described it was that it was kind of long, nonlinear, that when there was a lot of uncertainty about what was going to happen with tariffs, at the beginning of the quarter, we had a kind of a spike very strong orders, and then after that things kind of evened out a little
bit more and followed normal patterns. But that is the kind of thing that analysts and investors have kind of been looking for as like a sign that this demand that we're seeing isn't real demand, that it's this inventory build up that Caroline just sort of alluded to that this kind of pulled forward.
So again, the numbers were good, right.
Sixteen percent then forecasting eleven percent growth.
There's nothing wrong with that.
The problem is that people are concerned about how much of that is real and how much of that can continue.
What's the reader cross Because NXP sort of signaled this, but Texas Instruments is the Bellweather.
Yeah, Texas Instruments is a more diverse company than an XP. What they have in common was auto and what Texas Instruments said about automotive, which is, as you know, one of the great hopes for the chip industry. Things haven't got better yet. We perhaps or a bit of pull forward in China. And again this is a you know, this should be turning into a positive story. This should be sort of heading upwards and making everybody smile again.
And it's not right. So that as we look at other companies throughout this earnings period, companies that are trying to do well in auto, perhaps the company is like Qualcomm, which is part of the IDA versification story. People are now concerned about this area. People are now concerned more in general.
Blue Magsie King, thank you very much.
Another company that's out of earnings is AT and T shares have been slipping. They're now flat after the company reiterated a profit forecast that fell short of analyst estimate. Still, the company saw rapid wireless phone subscriber growth, adding four hundred and one thousand customers with the help of increased perks and incentives in the second quarter. For more Bloombers. Kelsey Griffiths is here in Washington, DC. So basically investors
are saying, well, hold on a minute. One of your big rivals, Verizon big themselves up what they've been able to do because of President Trump's policies, particularly around tax i. Guess the reader cross is that they're disappointed AT and T's not doing the same thing exactly.
So what we saw this Maureene is that AT and T became a bit of a victim of inflated Wall Street expectations. After a Verizon ended up posting these really good numbers, they ended up updating their full year forecast, and I think the market was kind of hoping that AT and T would do the same. Now, AT and T did adjust their numbers a bit, but it wasn't anything as dramatic as we saw a Verizon.
Meanwhile, what was dramatically better than Verizon was the amount of net ads they're making in terms of phone use.
Kelsey just push us forward.
Therefore, on AT and T, perhaps what was baked in because these stocks have run up this year.
That's right.
AT and T is on a really good growth trajectory and they're seen as this pretty steady you.
Know growing business.
They've been investing a lot of cash into their Fiver subscriber ads, and although they were a little short of expectations this quarter, that is still an area where they're predicting massive growth.
They were bullish about their commitment to investing in this country. This is a theme Caroline and I've discussed with AT and T in the past. What did the CFO say they're going to prioritize and what's the kind of level of investment that they're talking about here.
That's right, So in the wake of the big beautiful bill, all companies, including Verizon and AT and T are looking to really invest in their networks. They're looking at these tax savings and kind of thinking about how they're going to spend that. For AT and T, we've heard that they're going to invest an extra billion or so in the fiber network, I believe per year. And then we're also going to see some pretty big contributions to the employee pension plan.
We'll keep an eye on it.
Kelsey Griffiths, we thanks so much on the wrap up on AT and T, But now let's get some other earnings context and what we expect to come after.
The closing bell today. Of course it's Alphabet.
Brad Ericsson, internet analyst that obviously Capital Markets joins us now and you've got I think it's about a two hundred dollars price.
Tag outperform on Alphabet.
How can they live up to the prior to this day ten day run up, a longest winning streak for Alphabet that we've seen since twenty ten.
Rat.
Yeah, there's a couple of kind of cross current things going on. I think first on the fundamental side, we're going to see really good numbers our checks through the quarter. We're fairly strong, and I do expect them to print
upside tonight. So I think that's kind of why you've seen the market price that in a little bit and run the stock up here in front of the print off setting that maybe not quite as good from a from a forward set of perspective, is that once they print numbers tonight, say what they say, then we've got to sit around and wait two three four weeks for this regulatory decision out of the judge that the obviously will we'll scare some people, so and let's.
Just think about that regulatory overhang. And we love reading your notes and really we're talking about how this is a strong fundamentally company but challenged thematically in a waiting regulatory wild card. We await what Judge Meta says in August. But when you think about the challenge thematically, any numbers that you're going to be looking at that would tell you that there is competition in terms of search that CHATCHBT is eating in to their breadwinner.
Yeah, I mean they'll they'll obviously again, they'll print the numbers tonight. I do expect them to be good and so just objectively on that piece of it, I think they'll have a really strong case and story to tell on the conference.
Call around why AI is good for their business.
They're not going to directly address sort of the competitive threats, but they will definitely be I think in a good position tonight to position AIS as sort of nothing but a good thing for the business.
But yeah, I think the point of our note was the numbers will be good.
They can say what they want, but the reality is, so long as you know chat GPT, Perplexity, anthropic, there's a number of companies that are really making a lot of headway on the AI front. Everyone's well aware of that bare case that AI narrative against Google's core business is not going anywhere for the foreseeable future.
Right.
The technology story I see is quite simple. How does the Gemini model become more embedded across all of Google's business? But I guess i'd love to know where you want to see it show up in the financial results to give you faith that the payoff is there.
Yeah, you know, I think the most important piece and it's not.
I don't think it gets enough focus. Is Gemini the model?
Right?
Partially, it's just because of the brand. People have learned the name. It's obviously driving the Gemini app, and that is important. Where we're actually really focused is certainly on AI overviews.
But bringing Gemini to AI mode, I call it the my mom test. Right when my mom.
Is suddenly using some of these tools, we know they're really hitting sort of broad based. In fairness, my mom doesn't do a lot with technology, So there it is. But the point is that if you're spoon feeding AI mode to people that would ultimately just be coming to Google for normal purposes, and you've got the power of a really solid set of Gemini models, that's where I think it becomes to a bigger and bigger tailwind.
For these guys.
Brad.
We got the White House's AI action plan this morning, twenty three pages. I printed it out for you, so for some light reading. Later in the program, we'll get into the detail and the politics of it. But the simple question is whether or not Alphabet is going to be a beneficiary of what this administration wants America to do in AI.
Do you think it will be.
Generally yes, But I do think there's going to be more and more attention paid to how sort of equitable the value distribution is of AI. I think that's something we spend a lot of time thinking about these days, which is, I think if you look at the parts and pieces of what we know of AI today, it would suggest that a lot of the value could accrue to only a very few number of companies. And I don't think that's going to work bigger picture from a regulatory perspective.
And the reason we like Google in that perspective is.
Google is the distributor of traffic right the biggest one on the Internet, and I don't see that changing, and so I actually think that plays quite well into the regulatory framework going forward.
Let's go to regulatory overhang just the last case though, Brad, because that is the cloud you signal coming in August.
What do you brace for.
Do you think Judge Meta would break up the company?
Shorty answer is we don't. We don't think so.
I think that we have we ascribe kind of a lower probability to that. But there's sort of two or three things we think about. Number one is you're not going to be able to pay for placement nd fall search.
We're pretty certain that's that's that is going away.
Two, there could be some some sort of opening up the kimono on data that Google has to competitors. We actually don't think that matters that much, but that could certainly play out. And then the third one is the divest at your potential of Chrome, and there are stances. You know, Chrome's not a business, it's a product. I think the maybe the dj comments sort of ignored that piece in their aspirations to have that piece of it removed, and so ultimately you can they could force them to
do that. It's certainly possible, but then you're introducing a whole other set of issues, as we've seen Perplexity, open AI, all these companies talking about opening browsers right, it's clearly going to be very important for distribution.
Seems incredibly arbitrary to sort of.
Hand away Google's browser in the hands of another when they're saying that is going to be critical to the technology innovation here for the future.
It would just be handing value away. So we see low likelihood of that happening.
Brad ericson RBC Capital Markets into the analysts, pushing ahead to alphabet after the bell, thank you.
The other name after the bell is Tesla.
This is a stock that's down seventeen percent year to date, it's up half a percent in the moment, and the data carro is like probably biggest dropping revenue for a decade year on year, but the street probably looking past that because it's not about selling cars anymore.
It's not it's about one man really and his vision. And let's just stick with Elon and Elon's enpart because actually, look, you took a look at the language the fine print included in the tender off of this going on for SpaceX, right, and you notice that there's a new little warning just tucked in there about his potential to get more involved in politics.
Yeah, so what we saw was the risk factors section in the tender documents that valued SpaceX at four hundred billion dollars. Right, and this is what it literally says. It acknowledges that Musk was previously a senior advisor to President Trump.
As part of DOGE.
But also this is the key bit, may in the future serve in similar roles in devote significant time and energy to such roles. The reason that's important right now and analogous to Tesla, is that Tesla investors are also saying all we need to hear is that Musk is committed to the company and other companies, not necessarily what his political beliefs. So I think that's kind of what we're watching for.
And look, he's been trying to signal that on X right he's sleeping, eating, repeating work.
Amid a little bit of like childcare.
Yeah, seven days a week back at the company. But there's this big overhang about the America Party, and people on X are saying, will he even address the America Party thing during Tesla's earnings calls.
That's the state of play right now.
Yeah, Well, we keep our eyes on it. More coming up up right now on the Microsoft SharePoint TCAD. It's widening.
Now.
The number of companies and organizations that have been breached by the hack on Microsoft's SharePoint has going to about four hundred entities now, but it's according to Bloomberg reporting that this includes the US National Nuclear.
Security Administration, which of course oversees the design of nuclear weapons. For more, Bloomberg's Jake Bleiberg joins us and just how extreme are these hacks?
What sort of information do we understand that they've managed to gather?
So we're still learning about what they're gathering, and it's a hard question to answer.
In a lot of cases.
The thing we know they've taken in at least some instances are signing credentials, user names, passwords, other information that's used to secure systems. And that's particularly concerning because it means the hackers can potentially branch out from what the one system they got into here, Jake.
When Bloomberg break the storyline last night about this particular agency being hacked that is responsible for the development and disposal of nuclear weapons, understandably, loads of Americans on social media were like.
What on earth are we in trouble?
Do we know the limits of what the hackers were able to gather what is the agency's response. I think it's a time where we just like, here's the reality of the situation.
So what are reporting shows so far is that there wasn't sensitive or classified information taken from this nuclear agency, and that the classified information within it and most other government agencies is sort of sectioned off from the type of system that was easily breached in this attack. However, as I just mentioned, one of the concerns here is that once the hackers get in, they may be able to branch out and burrow in elsewhere.
Now, what's interesting is the number of agencies in companies and entities has been identified by Dutch cyber company at the moment, this one being I Security. They're saying it's largely US based, but actually very international. What has Microsoft been identifying? They've of course told us who pers actually the hackers are, but how are they keeping us abreast of this?
So Microsoft has told us that at least two Chinese state backed hacking groups are behind some of these attacks, and that there's another group based in China that is carrying out attacks to what we know is that the servers that were made vulnerable by this attack, for the common micro or soft software SharePoint are spread out all over the globe, and that the number that we're potentially vulnerable is in the thousand, it's not the hundreds.
So the scope of this is.
Really something that's still coming into view. And you know, Microsoft up to now has not told us how many of their customers have experienced breaches, Jake.
Many Microsoft customers watch this program, many Microsoft employees watch this program. What has Microsoft told us in terms of their response and how they're handling it.
So Microsoft moved quite quickly to roll out patches to this vulnerability once they became.
Aware of it.
They rolled out a patch over the weekend and more during the week to sort of try to close this door and keep it shut.
But what we've heard from other.
Security researchers is that once the hackers are in, you're still potentially vulnerable. Closing the door once they're in the house doesn't solve your problems, and that really requires sort of continuing to search and understand did we.
Get hit.
Bloombergs Jake Bleiberg with ongoing reporting.
Thank you very much.
It's time now for talking tech and first up, Uber is testing a ride option in the un The match is female riders and drivers now. The safety feature is already available in some international markets. The pilot will launch in Los Angeles, San Fransle, us Go, and Detroit in the next few weeks.
Has long been offered by Lyft Plus.
Sonos has named interim leader Tom Conrad as chief executive officer. The appointment is a vote of confidence in his effort to get the struggling audio company back on track after a disastrous software launch that hurts sales and force the company to layoff workers.
And the UK's antitrust watchdog.
Is proposing giving Apple and Google's Android so called strategic market status now. The move would pave the way for regulation of their mobile operating systems, app stores and mobile web browsers.
Ed a stick with Apple, it's launching a new version of its device insurance plan Apple Care. The new twenty dollars a month plan can cover up to three devices. Bloomberg Sam Kelly has the details. So often have I tapped into Apple Care having dropped this thing on the floor? What's new about it? Why are they updating it?
HI?
Good morning?
Yeah.
So, basically, this new twenty dollars a month subscription allows you to have three different devices of any different base.
And also you could have.
A newer iPhone or a Vision Pro or an Apple Watch and for twenty dollars, it will protect against spills, accidents, crack screens, you can talk to somebody twenty four seven if you have it, help battery replacements before Previously, the company has long offered a subscription plan where you can opt into the same type of thing for the iPhone, but you would have to pay for it almost a la carte. So if you had an Apple Watch, you'd have to do just that, you'd have to do the iPhone.
This bundles packages everything very nicely together for twenty dollars a month, and in theory there could be some savings here for some consumers as well, and obviously a subscription play for Apple as well.
Let's go there because I can see what the appetizing for consumer, particularly if there's loss and theft coverage.
What is in this for Apple?
Yeah, so this is a major play for Apple. Again, you know, devices and insurance isn't exactly it doesn't sound sexy on the service, but there is a major play here.
So basically the services to.
In general is Apple's second biggest money maker behind the iPhone.
Not only is it the.
App Store, there's Apple TV Plus, there's Apple Fitness, there's iCloud. So here with Apple Care you're able to keep you have two billion devices out there. This is people who maybe have one device ensured.
If that this is.
Money that they would be able to make, and it would in theory, help upset some of the different challenges that they're seeing right now around the Apple Store or lagging behind AI in certain areas, against competitors trying to drum up subscription sales in general. And this is money that potentially people might not be paying, but they might say, you know what, for twenty dollars a month, if my phone breaks, if I lose it, maybe this is enticing enough for me to do it.
Where all the limitations though, for me, I think the off putting thing is, Yes, I can see you want.
Into opt in if you're buying a new device, but then to get.
The oldest stuff that you already have, and should you kind of go to get it diagnostically tested, Yes.
You do.
So you have to go through a short sort of a several minutes testing to make sure that the screen is okay, you know, the battery they want to make sure everything is okay before your insurance, almost like health insurance, they want to make sure things are okay.
But it does go back four years.
So you might say, you know, I have a brand new iPhone, but I haven't bought an Apple Watch in quite a while, and so this might be a way for you to say, oh, you know, maybe I can opt into something a little bit more.
Bloomberg'smartha Kelly, great analysis.
We appreciate it. Welcome back to Bluemberg Tech. Let's check in on these markets.
Because actually tech it's kind of under performing some of the other major benchmarks today. There is uplifted euphoria around Japan US trade deal.
Is there more to come?
But on the big tech benchmark were flat on the NASA one hundred, we had some key earnings that drag us.
Lower from a point's perspective. Let's dig into them.
Texas Instruments and we talked about it at the top of the show.
It is having its worst day since two thousand and eight.
Clear global tariffs impact to the business, but the executives can't all articulate.
How much is there is a pull forward.
On the previous quarter and it just didn't live up to the expectations of investors. Meanwhile, we're also down on SAP and trading in Europe. We've just closed the market, were off by five.
Percent again, Tariff headwinds, the dollar.
Weakness impacting this particular software business.
At okay AI.
Leaders are gathering here in Washington as President Trump is set to give an address on his AI roadmap for the United States. Details that it includes the rapid buildout of data centers and the removal of quote onerous AI regulations. Bloomberg's Michael Sheppard joins us with more. We've both printed
it out, all twenty three pages. We haven't read the entirety of it, skimmed it, but we've been talking for a while about how the focus of the document, it's infrastructure related, the American technology stack and the energy to support it is their substance to it, and.
Well, the substance will really bear out over time mat as we see a lot of administrations and all those up administration, but all of its predecessors have flooded Washington with these sorts of policy directives in the past, and the catch here will be to see whether they can actually gain some traction with this document, not only with industry, but also with Congress, with the federal bureaucracy, with the agencies that they currently oversee, and then at the state
and local level too. They have to make sure that a lot of this can be done. And it's an onerous process. They talk about removing onerous regulations, but they will have a lot of digging to do on it. That is, to cut some of the red tape that they talk about right in the beginning of the report. To also try to pave the way not only for the data centers, but for the energy needed to power them.
That's a big deal.
It's a big pillar of this.
And then also you talked about this, and we've talked about this on the program before too, and it was in your conversation with David Sachs just last week. Building AI globally on the American tech stack. That's another pillar of this document and it's something we'll have to watch to see how they implement, yeah.
Sort of helping promote exports to an extent. Mike dig into what they're looking at abroad right now, because yes, there's been anxiety about states going it alone, but meanwhile Europe's on top of AI regulation.
How do they counteract that.
Well, what they're trying to do first is set the tone here in use when it comes to regulation of AI by pursuing what they consider to be a lighter touch CARO. More importantly, though, they are focusing on deployment of technology and the infrastructure that is needed to power it abroad, and that is why in part you saw the relaxation of the export curbs on Age twenty eight chips from Nvidia to China. And this is a step that the administration sees and certainly one that Jensen Wang endorses.
That's needed to be able to have American companies, especially in Vidia, competing in China so that it doesn't make it so easy for China to be able to export its own technology, perfected at home, to other markets as well.
And that's a really critical step for them.
They've articulated here, and President Donald Trump will be signing orders later today to implement parts of this plan. Among them, we expect to see orders instructing US export agencies to take steps that would enhance deployment of American technology and export of not only just the chips themselves, but everything that goes with it, for the software and everything else too, Caro, Max Mike.
Shephard with the latest on the report.
We appreciate it that for more in the future of AI and President Trump's Action Plan, Naarena singers with us Cudo AI CEO. You really look at the way in which we can implement AI from a governance perspective, from a rose tolerance perspective, from a cultural perspective within businesses Navarna, when you're looking at this report, when you're thinking about AI being more hands off, more pro growth, is that the right way?
Well, good to see you, Caroline, and today we really commend the White House on launching the AI Action Plan.
I think if you dive a little bit deeper into the AI Action Plan, there's a key, key.
Statement and sentiment which is the bottleneck to harnessing AI's full potential is not necessarily the availability of models or tooled an application. It is slow adoption and central to that is lack of trust. And I think, as you know that Tredo AI has been on this journey to embed that trust in the full AI life cycle, and I think the AI Action Plan is really diving deep into it with how do you standardize evaluations, how do you actually bring more transparency to AI so that you can fuel.
Growth, but all that growth has.
To be grounded in trust, and that's what the Action Plan is focused on.
Navarena Impillar.
One of the document, which is titled Accelerate AI Innovation. Something very high up is the commitment to encourage open source and open weight AI, and I thought that was really interesting the prominence of it within the document. Why is it important that this administration focuses on open source and open way AI.
Yeah, ed, great question.
I think we've seen historically that open source really contributes to more innovation and in artificial intelligence, especially with the United States leading, we are finding a lot of great innovation is coming from our open source ecosystem. So the focus in the AI Action Plan on open source further strengthens the capability for everyone else to build on top of AI innovation at large scale.
There is a really heavy emphasis on deregulation, cutting red tape to facilitate the infrastructure side of this. Does that concern you that that's the plan as opposed to I guess a codified or framework piece of rulemaking around AI.
So, as you know, creed OI serves some of the largest global two thousand companies in the world, and what we are finding is governance and oversight and control of AI systems is not just tied to regulation.
It is really about.
Understanding these AI systems and making sure that you have the right you know, not only standards, but also some guardrails which are in place. So what we are going to see I think coming out of this AI Action Plan as stated, is a focus on more contextual evaluations, which are paramount for making these systems happen. I would like to see Obviously the CI action plans stretch a little bit further into standardizing what does good look like for AI and more to come on that soon.
Navarna, let's just tick into the global perspective you have and the fact that the context is this is a race and this is a win. It takes sol us versus China. Is that what you're saying.
Absolutely?
You know what has been really important is this isn't just a policy moment. I really believe this is a moonshot moment for US and to continue lead leading and artificial intelligence, US will need to lead with trust and that's how we are going to unlock the power of this technology.
So this is our arms race.
United States is leading, and it's going to be critical.
How we bring.
Our allies and partners together on this journey by grounding them in trust, oversight, and right responsibility is going to be key.
So when we go back to the open source question, that feels in reaction to what happened with deep Seek and China, and ultimately is that do you think where this sentiment is coming from and what does that mean for the players here in the United States is all in our meta's viewpoint.
You know, Caroline, that's a great question. You know, United States has been leading in artificial intelligence and we will continue to maintain that leadership. The open source focus is a really pivotal one because if we want to lead, especially with heart sciences, in using artificial intelligence, building on each other's work has always been foundational to how open
source works. So I don't think this is in reaction, but this is a continued leadership from the United States perspective in terms of how we are going to lead an artificial intelligence.
Verna saying of credo AI, great to have you back on the show.
Thank you very much.
This is bloombg Tech and you are looking in a live shot at the principal room.
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Find it on the terminal as well as online on Apple, Spotify, and iHeart. This is Bloomberg compliance startup vanter Well. It's raised one hundred and fifty million dollars in its Series D round, bringing its valuation to over four billion dollars now. The eight year old company helps businesses stay in line with rules and regulations around managing and storing customer data.
Banta's CEO and co founder, Christina Kacciopo joins us. Now, So the one hundred and fifty million what does that help you do?
It helps us continue to help our customers build and demonstrate trust across the internet.
Okay, demonstrates trust across the internet. I mean it immediately makes me think of today's news flow. We're worrying about Microsoft and the hack there. I mean, is this something that you're worrying about more broadly, that security isn't strong enough, particularly when it comes to access to third parties.
Yeah, I think what we've seen is security online. It's an increasing concern. This has been true for years, It been true for decades, it will continue to be true. And it's not because smart people aren't working on it.
Lots of smart people are. It is just an increasingly hard cat and mouse game as adversaries get stronger and stronger now with AI as well, and so it is increasingly hard for businesses to build out trustworthy platforms, secure customer data, and we hope vantas a part in helping them do that.
Twelve thousand of them already customers that you're helping.
What has been the demand like for your own AI applications AI agents in particular.
Yeah, we launched our AI agents earlier this year. We've seen great reception from customers. I think we've had the agent's kind of automated a lot of manual worker customers. We're doing customer It's like Duo Lingo and Ramp and Snowflake are all using the AI agents to automate kind of what we're manual security and compliance workflows.
What's interesting is the way in which you want to expand now is by looking not just at companies, but at governments and government agencies.
We can show your customers.
We can also show the vcs that are continuing to back you, one of whom, of course is well the business of Craft Ventures and that we associate with David Sachs. Is he going to be able to open doors for you?
You know, what we've heard from David and Craft is David is very focused on Washington, DC. He left an incredibly strong team at Craft, but there's kind of strong guardrails and in place between those two teams. So we really enjoy working on you know, with the folks at Craft, and you know, separately we're pursuing engagements in DC. But from what I hear, David's really engaged with us work with the government.
And do you think just in the current administration and environment that they are more willing to work up with startups such as yourself that government now is a more accessible area for your company.
I think so we've seen this government be very receptive to software providers. They want to get more software into the government, save time, save money for taxpayers. And there's programs like fed Ramp twenty x, this pilot that is going through to help software providers prepare better and faster to serve the government. Because US government is just a different sort of customer than almost any other in the world.
It is, and what I'm interested there for is how you beef yourself up to meet that demand. You said that you want to continue to expanding, continuing to help your own clients that you already have. Where are the bottlenecks for you? Is it about hiring more talent? Is it more about a marketing play just getting into.
The orbit of other businesses.
Talent is a huge part of it, and we are only as good as the people who.
Work at Vanta.
At Vanta and there are all sorts of different pieces of that. So AI talent is definitely a part of it for a very hot area of the market. I'm sure you're covering the government pieces another one again that is just a specialized skill set. And so we are hiring across the board, lots of roles, lots of opportunity.
And where are you hiring.
I know you've been beefing up offices in London, You've been put data centers in Australia.
How global does this get? Quite global?
So we've got five global officers around the world follow the Sun coverage for our customers. We also in the US have folks spread out across the country, which we've found to be a very successful hiring strategy over the last five years.
Christina and Kechiopo.
We will let you get back to that hiring strategy and running the business. The CEO and co founder of Vanter congratulations on the rays.
Tesla.
It is set to report earnings after the bell. The quarter was a busy one, but the re engagement of CEO Elon Musk the launch of the company's robot taxi service in Austin the most Creatrudell is here to tell.
Us well, whether investors are going to care about the.
F fundamental business picture, which is an ugly one. We're expecting revenues to fool the most severely in more than a decade.
Yeah, and I think, you know, we only have to go back a quarter for you know how Musk is likely to approach you know tonight's call where you know, he said something to the effect of kind of look, don't don't look at what's going on now, cast your gaze on you know, this bright shiny object on a hill.
Uh.
You know that that is likely what we're going to have a sort of repeat of here, because this is a company that it's it's fundamentals are in really rough shape.
Uh.
You know the car business. Uh, not only is it is it not growing anymore, but it's actually shrinking pretty substantially. And you know, they did indicate earlier this year that the energy business, which has been a source of growth, is going to get hit hardest by by tariff. So you know, the the leaning into the robotaxi messaging, the AI story is absolutely what we can expect to hear from Musk tonight.
It's also not just tarifs that they're exposed to, but are pulling away of support for ev measures. Does that ultimately matter when you're thinking of a company that is valued at one hundred and forty two times projective profit? Do they care about what happens from a support perspective for buying.
I think that's that's got to come up at some point on tonight's call, right, is where are regulatory credit revenues headed? Because there's a lot of concern particularly about you know, the state of affairs in the US where you have you know, as part of the Big Beautiful Bill, you had the zeroing out of penalties for not meeting
fuel economy standards. So that sort of source of revenue where other manufacturers who are having trouble meeting those numbers they no longer need to go to Tesla for help. You know, there's also the Trump administration going after the California ZEV mandate, and you know also on the EPA front tailpipe emission standards. So really sort of across the board, there's less and less reason for Tesla's rivals to have to turn to Musk and say, hey, we need some help from a regulatory perspective.
And that's been a huge source.
Of revenue for this company over the years.
And how much does that matter for plowing money into the future bets As Nick Kolos over at Data Trecks puts it in our story, I think ninety five percent of the valuation of Tesla is basically based on its futures, which are optimists, which are ROBOTAXI. But is that at risk if we don't have the cash cap.
Yeah, I mean we're talking when we talk about just how much revenue you know, over the years, going back to you know, since this has been a public company, we're talking about over twelve billion dollars. That's a substantial amount of money, and a lot of that has is weighted towards just the last few years, where we've seen you know, steadily Tesla report more and more of this revenue.
And so when you if then when you.
See that reverse and also this company is no longer to generate cash from its its car business because that is no longer growing, and yet it has all of these you know, operations to tend to, you know, with with plans that are underutilize. This starts to become a real issue. And you do have to sort of question if these robotaxi statements sort of don't pan out, what
what next? You know, what what can investors sort of count on, you know, from from Tesla to sort of steady things and get back to a state where you can feel comfortable putting that sort of multiple on the stock.
Can they count on elon being focused on the business? Crowtidel, We thank you so much for looking ahead to after the bell, and look let's continue looking at because we've got IBM coming up as well.
And it's flipping the script at the moment.
This is once some relic of another era and big Blue is back.
As our Brodie Ford says, let's just.
Talk about how this company has steadily convinced investors that it can grow.
You put it perfectly right.
I mean, IBM has been talking about re orienting around software and services since the nineties. People didn't really believe them until a year or two ago, and you can see it in the stock price right that investors are really trying to starting to buy into this idea of
an IBM based around largely infrastructure, software and consulting. The real star right now is that software picture, led by the acquisitions of red Hat and Hashi Corp. This year, And if you look at large scale software companies, most of them are struggling to really keep growing revenue steadily. IBM is doing it, making a better profit picture stick your business. Clearly Wall Street is happy about it.
They are sending the shares up thirty percent so far this year, Brody. But the flying the ointment has been, of course global narrative of trade issues and worry about people really playing money into consultancy. How much do you think the Genai piece of that is going to be eroded because they've already done what six billion dollars in business, but largely through consulting.
It's a really good point.
Yeah, Consulting is the other half of the IBM empire, and that really has struggled because when the economy looks funky, what do you do, you can see your consulting projects, and so IBM has booked a lot of business and consulting for Jenai products. You know, these big companies saying, hey, which tools do we use?
We're confused.
What is kind of an issue is that this is coming at the expense of traditional consulting, and so it may not be a net increase. But what we've seen so far is that as long as software keeps getting purchased, investors are willing to overlook the choppy consulting.
Well for now, analysts none of them say buy nine to hold, just for say, sell Bloomberg's Brodie Ford across IBM or waiting for your reporting after the bill when it breaks. But meanwhile, that does it for this edition of Bloomberg Tech. Don't forget to check out our podcast. You can find it on the terminal as well as online on Apple.
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And don't forget to tune into Ed Ludlow as he's over in the White House, of course, listening in on the AI summit and what that will bring in terms of the look ahead from President Trump. We've also got S and P five hundred and at session highs records across the board that sack just lags a little bit, though today it is Blue Bag Tech