tv Bloomberg Technology Bloomberg January 26, 2022 5:00pm-6:00pm EST
♪ >> from the heart of where innovation, money and power collide, in silicon valley and beyond, this is "bloomberg technology," with emily chang. ♪ emily: r.i.m --i am emily chang in san francisco and this is "bloomberg technology," tesla says supply chains will continue the rest of the year -- supply chain constraint will continue
the rest of the year. we breakdown the results. what to expect this year in entertainment, with former disney had kevin meyer, who is racking up new projects with kindle media. and souped up with the launch of a super app. what does that mean for the future of crypto? all of that in a moment, but first, stock gains fizzling after jerome powell signals the fed will steadily unwind pandemic-era stimulus as it fights elevated inflation. let's go to ed ludlow with more on how markets reacted. ed: the day started with earnings and ended with the fed. simple as that. the nasdaq 100 closing up .2%, but it had been much higher in the session. microsoft does close up after a strong earnings print tuesday night, the biggest point gainer on that index. but it fell away. we are pretty certain of a rate
lift off in march, then we come with the shrinking of the balance sheet and fed chair powell getting a lot of questions on inflation, inflation running hot right now. he could adjust his own inflation forecast. a strong rebound in the semiconductor space, philadelphia semiconductor up when 7%, strong game -- shop .7%, strong gain. bitcoin higher, look at the action over the last five days. down at $33,000 u.s. per token, which raises the question what is bitcoin? we have seen bitcoin making gains throughout the duration of fed chair powell's comments, then falling, swinging around 36,000 throughout wednesday's session. is it an inflation hedge? intel, the chipmaker in the news a lot, off, and it seems data
center customers are not spending on ships. -- chips. that is the main takeaway. intel is investment mode and investors seem worried about the outlook for profit. tesla is the one we have been waiting for, strong performance in the fourth quarter, beat on the top and bottom lines, strong deliveries, outdoing themselves with gross margin and you read down the shareholder debt. what is not there? the 2022 outlook. they are hit by supply chain constraints which they say have depressed volumes in the shanghai and fremont plants, but what happens when austin and berlin come online? we don't have a number of cars coming out of those factories this year, and what is the profitability of the company in 2020 this year? emily: let's get that are picture of the picture and bring in steve westly of the wesley group and a former tesla board member. steve, good to have you back.
what is your take on these results? steve: tesla announced lackluster results today. they have actually grown revenues 32 billion dollars in 202253 point $8 billion in 2021, 63 percent growth. no other automobile company in the world is doing anything close to that. more importantly, they produced 970,000 electric vehicles. the next-closest lawmaker -- automaker is volkswagen, with half. look at general motors, 27,000, 25,000 vehicles for ford. tesla is the king of the hill for now. but you have to understand, tesla has opened two new factories. elon is temping the market down, saying there may be supply chain issues. the company said they will produce roughly 1.5 million vehicles next year -- this year, i think it is going to be closer to 1.8 million. but no one is doing better in the ev market. emily: are you concerned by the
chip shortage and supply constraints? steve: everybody is. i served on the board of tesla. no one is more fanatical about bringing production in-house than elon musk. yes, on battery production. i think they are going to benefit. if you are general motors, i give them credit for investing $7 billion, but they should have done that five years ago. they are just going to work on planting tennessee and michigan, those won't be open for years, and they announced they will be building a battery facility. test at -- tesla has five facilities in china, europe and north america. they are ready to go. mark my words, by q3, q4, i think they will deliver if not 1.5 million, 1.8 million vehicles. emily: if not gm, can ford catch up with tesla? steve: ford produced 27,000
vehicles, tesla is producing one million. they will have a hard time catching up. i hate to say this, volkswagen has sold half as many vehicles but they have e profits, massive electric vehicle presence and they are taking battery production in-house. another want to look at is the chinese, they have three firms with close to 100,000 vehicles a year with neo, >> j and sai -- ne-yo, asked j and -- xj and saie. chinese will likely be landing chinese vehicles on our shores in 2023 and will be a tough competitor. it is all about the electric vehicle market. keep an eye on the chinese, big story. emily: as i understand, you
don't own tesla shares anymore. why? steve: if you are a venture capital firm and have liquidity investors does liquidity for investors, they like to give you shares back. -- they like you to give shares back. emily: i always appreciate you joining us, steve wesley, founder and managing partner of the wesley group, thank you for stopping by. we will continue watching tesla results. coming up, what led to the downfall for mark zuckerberg's plan for crypto, this is bloomberg. ♪
♪ emily: the controversial cryptocurrency project that mark zuckerberg once defended for congress seems to have met it demise. bloomberg has learned that diem, the cryptocurrency once known as libra, is trying to sell it assets. i'm joined by bloomberg's kurt wagner, what was the final blow? kutt -- kurt: diem had been struggling with regulatory issues for the last year and a half. what happened was, they had a bank lined up to try to issue a
stablecoin for them in the u.s., and the federal reserve said we are not going to approve this, or can't guarantee we are going to approve this. as a result, there was this muddy future. ultimately, the bank and partner decided, we are not willing to stick our neck out for this project any longer. and here you are, diem doesn't have a coin, doesn't have a partner and are now trying to selloff the assets they have left. emily: jack dorsey, former ceo of twitter and ceo of block working on his own cryptocurrency project, so your story and tweeted out carpe diem , seize the day. -- seize the day. >> jack dorsey was not a big fan
of crypto and i don't think he saw this as real crypto. he saw this as a mark zuckerberg, facebook-controlled invention. to him, that goes against what crypto is supposed to be. so clearly, not a fan of mark zuckerberg and here we have the perfect cocktail for jack dorsey to enjoy hating on mark. emily: what does the failure say about mark zuckerberg's ability to work with regulators? he has said time and again, i welcome regulation, i don't want to be making all these decisions myself. how does diem fit into this picture? kurt: facebook raised their hand early, went to d.c. early, we want to work with you, we're going to send mark zuckerberg to answer your questions, we don't want to launch this without your approval. they tried to play nice and it still failed. i think what they learned is
that, one, regulators are going to be tough on anything facebook builds, even if they do try to help out. and two, financial regulation is so much different than what they have experienced with general regulation. there is not nearly the red tape around the stuff that they create with instagram or facebook, so this is a totally new world for them. it did not work despite their best efforts and it makes me wonder, how much are they going to be willing to raise their hand in the future with things like the diverse if this is the reception they got when they tried to do it with diem? emily: kurt wagner, great scoop, thank you for joining us. meantime, president biden met with more than half a dozen ceo's of some of the biggest companies to promote his stalled economic agenda. among those in attendance, ford president and ceo jim farley. i sat down with farley before the meeting and asked what he would stress to the president today. >> the gundry needs to be
competitive the end electric. we naiad -- the country needs to be competitive and electric. we need to catch up in europe in china. we need to build batteries in this country, get raw material is for the batteries in this company, that will all happen as customers go electric. emily: coming up, more of my sit down with ford ceo jim farley next. this is bloomberg. ♪
launching its f-150 lightning pickup, made a stop in sonoma, california, to announce a collaboration with the wind industry as a pilot program for ford program of the commercial division that provides electric vans and pickups and services to manage those fleets. i sat down with ford ceo jim farley to talk about tesla, rivian and competition, but i started by asking whether we should expect the supply chain crunch to ease or get worse. jim: i wish i could tell you there was relief in sight, but fourth-quarter was very difficult. we started seeing a new supply problems with omicron and absenteeism in our supply base, where we started to get basic automotive arts shortages in the fourth quarter. that has eased a lot, but we still see the semi conductor impacting us now. we think it would last through this year, potentially into next year. the number of chips in our vehicles have gone from 2000 up
with this kind of electric vehicle like lightning. we are using more and more of these. even if capacity increases, it is not fast enough for the advancement in the vehicles. it is something we have to deal with that we are making our most profitable vehicles in protecting production of them that is our first priority. emily: you said 40% of ford sales will be even by 2030. you have doubled production of lightning twice, tripled production in mexico, so i wonder if the 40% number is low? jim: it is a good question. we are going to learn a lot unlike thing -- a lot on lightning. ford is been the best-selling pickup for decades. we just wanted to again last year. if the f-150 goes beyond 100 thousand, this could go faster than we think. emily: mary barra said she wants all gm sales to bev by 2035.
why not make a similar pledge? jim: we will see. right now, we don't know what the administration is going to do on consumer incentives. the u.s. market is only 3% all electric. europe is 20%. the difference is really support for consumer incentives. we don't know how fast that will go. i think gm aspired to that but did not say heavy duty vehicles like super duty and big vans, i think they meant only light duty. i think it will be a while before a super duty customer goes all electric. emily: how do you think lightning compares to the chevy silverado gm just unveiled? jim: we have 200,000 orders and are launching right now. look, what we have been on with built ford tough and all the testing and knowledge we have, and people use it for commuting and work, that is our bet.
we bet on $40,000 for an xlt truck that is affordable. others are betting a very high-end products. we are betting on production now. we are going to scale now, not waiting a year or two or three. and we made that bet several years ago and are betting on affordability for people like customers here in sonoma. that is our bet. i think it is different than any other companies. emily: you congratulated elon musk on being "time" person of the year. what are you learning from elon musk? jim: a lot. the thing i learned the most is that what it takes to succeed in this digital, connected, electric product, our talents and know-how and a way of managing the business that is different than what we have done for 118 years. it is like snowboarding and skiing. we both share the left but as soon as you get off the lift,
the intuitions are wrong between both businesses. you have to kind of learned how to get down the slope. and i really admire the difficulties they had and the way they managed those difficulties into the success that they have. they are now making more than $10,000 per vehicle because of the scale. i like that kind of business. emily: tesla's number one by far but you told bloomberg ford could be number one in electric cars. how many years off could that be? jim: in 22 months, we get to a running rate of 600,000 production in the company. that will put us solidly at number two. we will see. and that is before tennessee comes online in three years. we have our biggest assembly plant ever, a brand-new facility in tennessee and new battery plants coming online in three years. and then, we will see after
that. emily: the revival of the bronco has been popular. will there be an electric bronco? jim: why not? [laughter] one -- why not? what we have learned with electric vehicles, not all vehicles will be an electric version that is exactly like the other vehicle. mustang maki is totally different than a mustang v8 coupe. we are in the midst of our lineup right now, but the bronco success is a big signal the market. people want off rotors. emily: your investment in rivian , for $1.2 billion, now worth $8 million. any plans to sell that now that you are not developing a car together? you could make some money on that investment.
jim: it is been a great investment -- has been a great investment. we like rj, like what he is doing, the fact is that we are both in almost the same segments. we will work through that. we have seen this as a strategic investment in their are a lot of possibilities we could do with rivian beyond building a vehicle together. i won't go any further than that. emily: no plans to sell just now? jim: no. but we will look at everything. our lockout period begins in may. our f-150 lightning isn't out yet, they are just scaling up. it is early days. i don't expect us to be in the same cross shopping in early days. the f-150 lightning, rj and i talked about this, it is very
different than their truck. it is much smaller, there's is a lifestyle of rotor, our truck is a working person's vehicle. each transit is very different from their amazon van. in the early days as the brands fill out, i don't see has been cross shop initially, but we are in the same segments. emily: you just stop taking orders for the maverick, hundred $20,000 car, super popular. what does that tell you about the demand for affordable cars now that the average price of a cars is $47,000? jim: a lot of truck customers are paying more than bmw customers and mercedes customers, so cars are getting more expensive electrification will accelerate that. we have seen resale values and used cars that we have not seen in decades. there is such an appetite for an affordable vehicle and it is on us as an adjuster to make electric affordable.
that is a huge opportunity. what we found with electric is, the brands can get reinvented when you go electric and digital. you can enter segments you have not been in in a long time, so i am interested in the team's thoughts on this affordable section. we have had a huge hit with the maverick. we got a lot of negative press and invested that in broncos and the lightning and no one is talking about getting out of sedans nowadays. i have a lot of faith in our team on this affordable segment. the maverick has been a hit beyond expectations. it is a pretty big signal from the market. emily: catch the full interview with jim farley on bloomberg.com. rivian ramping up its outlook on 200 delivery-ready units a week after the ev maker had to work through production snags after missing goals in 2021. news of the production sent rivian shares up almost 14%, the
biggest intraday gain since november. another story we are watching, temporary restraining order issued against a virginia woman accused of harassing and stocking tim cook. reportedly, it had been going on for more than a year. the 45-year-old woman reportedly contacting cook and showing up at his home on two occasions. documents show the woman sent cook pictures of guns and ammunition. coming up, the future of entertainment, will streaming wars have way to consolidation? we speak to former disney exec and candle media co-ceo kevin meyer next. this is bloomberg. ♪
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>> welcome back to bloomberg technology. i am emily chang in san francisco. get back to earnings. a disappointing forecast for profit. filling concerns about the turnaround plan will weigh heavily on the chipmaker financial performance. bloomberg intelligence joining us now. what are the big takeaways? >> the topline print was better than consensus but i think investors are looking at the long-term plan and then looking at the industry dynamics. when you look at the
semiconductor demand, this is probably the best demand environment for semiconductors. you see them talking about 20 to 25% growth. that makes you wonder. there are a lot of? surround the turnaround and how long it will take to drive that topline growth even though the demand -- this is the best set up for a semiconductor company. >> the big question is if the spending spree will pay off. >> one aspect of it is intel specializes in architecture. the trend is moving toward arms here. you see that on the smartphone side. that is the key question for investors, to figure out if this as capacity on this side. will they have enough demand
from customers because the customers -- i think that is one of the key questions that intel has to address in terms of the new apps they are adding and the hyper skate cloud and some of the customers. >> thank you for that update. i want to move on to streaming on the road of entertainment. next flights -- nets -- netflix shares have slowed. will we go from streaming wars to major consolidation next year? what are the next big trend in entertainment? i have to ask your thoughts on what is happening with netflix. it is almost like the pandemic never happened and will that demand for content has
evaporated. >> necklace is a very profitable company right now. i think that the market probably got ahead of itself in evaluation. it is a valuation move. i think this was built into their stock price and the growth will be a little bit more moderate. i think that pops the balloon a little bit. that does not mean that >> is not a healthy company and a great product and the content they make is not only prolific and high-volume but a lot of it is very good. i just see that as a valuation. not an indictment of the business model at all. >> you told me you always look at this as there will be a handful of global letters but there will be some smaller niche players. now that you have seen what has happened over the last year, do you expect consolidation?
what core services stand out and survive? >> i do expect consolidation. i think that the stock price movement concerns that thesis. when your spending that kind of money, netlist, amazon, hbo max, -- there is a limit to have any subscribers will join the club. it will be a small universe. i think that is probably for these services. i maintain my thesis of smaller niche programming.
the investment in content will be smaller as well. four or five services, that is probably about it. >> asking where you put your money. is it netlist, disney, hbo as we near the close of the warner media discovery merger? why? >> necklace has a huge lead and there is a flywheel effect to it. the more subscribers you have, the more money you have to expose -- investing your content. -- invest in your content. there is definitely a positive feedback loop. necklace is at the top of that. i think they are in a great position. disney has too many brands. their programming is great.
their creativity is second to none and they have a smaller flywheel and they have other businesses as well. but disney is a big winner. hbo max has a huge library. i figure they will be a big winner as well. then you have apple tv plus, all the money in the world. they are building a big team. i know zach and amber well. he is a quality grade of executive and i think they are there for the long haul. they could be a survivor or a winner, amazon also. you get to some of the other services and maybe one or two could survive with their big global aspirations. or they could reduce their aspirations to be something more niche.
>> given the role at disney and espn, do you think that disney might ever spin off espn at this point? >> it is always a possibility. they have all their theme parks based on the zip. star wars, pixar, marvel. they have consumer products that are based on those properties as well. that ecosystem is very definable. espn is different. espn was strategic to disney for a while because it help to them sell their channel bundle in the u.s. in a more robust and possible way. -- plausible way. they are going to have to transition to be an over-the-top service over the next several years. there are all the other bands that disney has. a little weaker than it once --
it once was. it is quiet valuable in that rall -- realm. when channels become less important to disney, that could be seen differently. the bundle that is in place between espn and disney plus and hulu is quiet valuable. having espn over sports, it could go either way. >> you have been making a lot of deals by reese witherspoon's hello sunshine. westboro company, your adding production. how are all of the companies you have bought going to work together? >> we are a big bully people in the future of media. we like traditional film and tv
businesses because they sell to streamers. they are growing strong double-digit. i don't see that stopping anytime soon. if you think about reese witherspoon's company, it is fantastic. their center of gravity is film and television. they also have social media and social commerce opportunities associated. our companies, we want to be in the film and tv business but we also want to be in the social storytelling business and one thing i noticed when i looked at tictoc is if you can have an authentic connection between a brand and the creator and the social media audience, there are very substantial commerce opportunities. we would like to be in all of those. content, community, social media storytelling and if you think about another company we bought,
they own cocoa melon. there is some of the more modern property for kids. all of that comes from youtube. they start off with social media storytellers. cocoa melon was the number two screen show. this stuff really works. that company was based on social media storytelling. we like that configuration of our company. >> since you mentioned youtube -- lots of cocoa melon being washed in my house. we talked about the creative economy and her and -- and the outlook. listen to what she had to say. >> we saw 35% increase in the
number of creators generating six-figure incomes out of youtube. in the last year. that is just an example of how the cree outer -- creator economy is continuing to grow. >> how do you see the creator economy unfolding? there are these established players and smaller players all across youtube. there is so much competition and demand for their time. it is also a different kind of content. >> it is. if you look at them and television, that is two hours for film. those are pretty longform. youtube is in the middle. four to 10 minute in length storytelling. that is where we are with moon bugs and cocoa melon and that -- we think that is a different form of storytelling. you can take four to six to 10 minute clubs and make a traditional media full-length tv
show and that is what we did with cocoa melon. then you get down to the very short videos. less than 60 seconds on tictoc. that takes a different muscle. i think you have to have a storytelling capability that reaches across all of those from an >>. then there are podcast. that is a different form of storytelling altogether. i think we are going to have a coexist is of all of these different lines of video from traditional down to very short videos. and then the marketing messages are going to get shorter. these five to six second ads that are from youtube videos. they are pretty effective. that takes a different type of creative approach as well. it is telling stories in different formats and different ways. the difference between a landscape or or horizontal video, even that makes a big difference. you do have to understand how to tell stories in these ways.
that is like in a media and the others -- that is why candle media and others are building that in mind. we have a pretty moderate approach to how we are getting content in front of people. cripes we will watch the moves that you make there. you for joining us. coming up, one of the biggest by now pay later firms. my asus of interview with a firm about their new super app that lets you use the service even if you haven't joined yet. this is bloomberg. ♪
>> a firm is out with a new super app. it will give customers a one-stop shop to help them manage their finances. the upgraded app is in anticipation of the upcoming crypto offering. joining me now is the ceo and founder of a firm. talk to us about this super app. how does it set you apart from the other options out there. what other options could we see? >> it is now a really beautiful way of accessing this for our consumers. you can get access to all of the retailers that we work with and we can generate virtual cards. we don't have direct integration or safe enough.
we will find a crypto offering inside here. >> talk to us about the crypto offering and what it means. obviously given that we are in the middle of winter and some people are getting worried. >> even in the current volatility, it is one of the best-performing asset classes of the last decade. and we also wanted to offer our consumers a chance to access that appreciation in a safe and responsible way. there are ways of saving money. it made national sense to add some of the yield into crypto. >> everyone is watching inflation, especially with what is happening with the fed this week. how will it affect consumers?
and the purchase of how they use this by now and pay later option. >> inflation robs consumers of their purchasing power and this helps them get them back. we know this is our time to shine. we are going to help everyone afford the things they need responsibly without late fees and all of the garbage that you have to resort to. a firm is the better option. -- affirm is the better option. >> regulars are looking into the by now pay later industry. how are those conversations going? >> very optimistic. i think it is important that creators create a rulebook especially around things like credit reporting and rules of engagement.
he would eat a happy meal on tv if the restaurant chain excepted. it did not take long for me, to respond. saying they would except the deal. this exchange is launching an avalanche of memes from michael seiler and mark. also, does coin spiking as much as -- another day, another elon musk twitter story. >> keep his intention -- he pays attention to the internet. he kept referencing the internet and pictures he had seen on the internet. is elon musk responding to that? >> mcdonald's is needling.
we have heard that one before. i am not sure what is different this time. >> tesla is so far and away ahead of the other competitors but perhaps what we should be watching is china. >> shanghai and china have been depressed for several quarters because of supply chain issues. they get a lot more detail in austin and berlin. they have a new generation of cells. those deliveries will start this quarter. elon musk says supply chain should improve this year but it will still be an impact. >> what are you looking at as these results continue to roll in? especially given the outlook for
this year and the supply crunch we heard about earlier. there really isn't relief in sight. >> i love this question because going into earnings, they published a note saying that tesla is not just a contact company. if you don't own tesla, you run the risk of not owning a stock that could make the likes of ford and gm obsolete. and then elon musk said the big thing this year is the human robot. that sounds like a concept company. it is really hard to track. >> ed ludlow tracking tesla earnings for us. thank you for that round up. that does it for this edition of uber technology. you can tune in tomorrow. -- bloomberg technology. tune in tomorrow. you don't want to miss it, this is bloomberg. ♪
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