Salesforce to Buy Informatica for $8 Billion, Apple’s Tariff Headwinds
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Bloomberg Audio Studios. Podcasts. Radio. News. From the heart of where innovation, money, and power collide. In Silicon Valley and beyond. This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. ♪

Live from New York and San Francisco, this is Bloomberg Technology. Coming up, Salesforce will acquire Informatica for $8 billion, one of the biggest ever deals for the company for the next phase of AI-driven growth. Plus, Apple shares coming off their longest sell-off in more than three years as attacks from the White House escalate. And Elon Musk turns his attention back to his rocket company, SpaceX, and will lay out his vision to all in

in an X livestream later today. But first, we check it on the markets. Ed, we're kind of rocketing higher on this space as well. We're currently up 1.8%, let's call it, on the NASDAQ 100. You're seeing strength as consumer sentiment manages to show some encouragement, as we see maybe encouragement when it comes to US and European trade talks, and it's game on after what was a down week last week. But you're looking at some of the biggest movers in the index.

Yeah, we have a deal and that deal is between Salesforce and the cloud data management platform Informatica. $8 billion deal, as you said, $25 per share going to Informatica and Salesforce saying that they're going to use a combination of cash

and some debt to finance the deal. But this is kind of interesting. It's a second bite of the apple. Informatica now $23.80 in the session. Confirmation of earlier Bloomberg reporting. A lot more to learn about what happened, not just in the last few days, but in the last year. Exactly. And let's get to someone who helped break the scoop on Friday, Liana Baker. It was a Friday story when it comes to this round of M&A. But of course, Salesforce had eyed Informatica a year ago.

We've been tracking it also since the deal fell apart, but once you have a deal get scuttled and not happen, you have to be really sure that it's going to happen. So late Friday we heard that this could be coming as early as this week and we sort of went for it here and we were trying to understand what had changed for Salesforce. Well for sure what's changed is that they're paying $2 billion less than they were a year ago, so they definitely look smart in that respect.

Right. A year ago, well, what changed for Informatica is its shares were above $30 a year ago. And when we broke the story Friday, I think it was somewhere around $20 or so. How Salesforce is funding this, the sort of mechanics of the deal, Salesforce's history of M&A, how much of this was surprising to the team?

So Salesforce is sort of a juggernaut in M&A. They came in the crosshairs of activist investors a few years ago. Both of you covered that really closely, where Benioff's acquisition strategy was under the spotlight. So he sort of took a breather for a few years, and here he's back in a big way with this $8 billion acquisition strategy.

You might recall in the fall, we broke another story. Salesforce bought OWN, which is a smaller deal at $1.9 billion. So Salesforce still has been doing deals, but this is the largest in a while. Historically, Slack was larger, and they also did Tableau software many years ago. So this is a company that just loves inorganic growth, and it's back on track.

in terms of getting those deals. I mean, they also bought MuleSoft, which, of course, actually competes with Informatica. So how is the regulatory process going to look? So analysts are watching this overlap between the companies. It'll definitely be a test to see how Salesforce and Mark Benioff are maybe viewed under this administration. So we'll be tracking that closely. But from what we understand, they got this deal done. It didn't stop them from getting it announced. And we'll see what comes next.

Bloomberg's Liana Baker, who leads our deals team. Thank you very much. Let's get to some markets reaction. Janet Moody, head of market analysis at RBC Brewing Dolphin. It's an interesting headline, right, Janet? We have some M&A in the software space. Just as a moment in time, how do you see that playing out more broadly for SaaS and software corners of the tech market?

Hi, Ed. Thanks for having me. I think that's very exciting. I think AI is still driving a lot of this excitement. And what we are looking is that there is some more consolidation in the industry. I think companies want to deepen and strengthen their capability in AI-driven technologies.

growth in data analytics and CRM management and also developing further in the cloud. So I guess this is very exciting and sort of builds up further the case for that long-term AI investment. I'm just looking at shares of Nvidia. They're up now 3% in the session. The macro event of the week, the macro event is probably Nvidia's earnings after the market closed on Wednesday night.

On your desk, for your clients in your world, is it a macro level event, something like NVIDIA earnings?

Yeah, definitely. I think everyone is very excited about it. I think what we'll be looking at is definitely the profit margins. It is getting harder and harder to defend. And also, of course, the ramp up of Blackwell and how the servers, data servers are basically digesting the inventories.

And also sovereign AI, I think that's a very important tailwind for NVIDIA in the future. And I think, of course, commentaries on the geopolitics situation, sales to China and things like that. And also, I think in general, I think the valuations of NVIDIA is not...

demanding at all. It's only 25 times for the earnings. But I guess the market is still having doubts on the digestion of those AI chips, given that the hyperscalers have already spent hundreds, billions of dollars and how much of that sovereign AI and Stargate is going to compensate for that. And I think we're still in this digestion phase. So it will be very interesting to hear how

the executives are going to comment on that. So do you need to hear that bullishness, that ultimate demand being pushed forward, a really enthusiastic guidance coming from Jensen to build around the AI theme once again outweighing what has been geopolitics that weighs down on some of these hardware names?

I think so. I think we actually need to see a pretty bullish guidance. The problem is that the stock has risen, I think, about 40 percent since it's low. And to get even higher, to break that previous high, I think we need more good deals. And as I said, there's still a lot of concerns on geopolitics. I mean, President Trump has

cancel that ai diffusion route but for sure something else is coming so i guess there's still a lot of concern on the competitive landscape china is very close behind you know i guess we need a lot of good news for the share prices to power ahead and just take stock for a moment of

The onslaught of headwinds we've had from a geopolitical nature. We're about to dig into Apple, of course, the tariff anxiety there, but also the tit for tat that might come back if Europe does indeed have its eye on big tech in terms of yet more digital services, taxes, ways to respond. Janet, how hard is it to invest in big tech, big US names at the moment?

To be honest, I think the long-term story is intact. I think these are great growth compounders that I don't think people are doubtful of their potential and their long-term growth. But the problem is that near term, there's still so much uncertainty on the tariff. And I think even if the tariffs are scaled back or paused or whatever,

I think at the end of the day, some of these big tech companies that are highly linked in the supply chains will still see some erosion in their profit margin. So I guess that's the concern. And the thing is they're already very big and it is very hard to grow at such a fast pace.

going forward. So I guess given the valuations have come back up again after the recent rally, I guess investors are going to be back in a more cautious mode going forward. We need more good news. We need more trade deals. We need more AI good news. We need better economic data from the US and lower inflation, for example. Janet, is there a corner of the technology sector that's underappreciated by the market?

I think, I mean, for us, right, we are more enthusiastic on the AI picks and shovels play. But as I said, I think the recent rally has moved back up some of those valuations. I think software remains a good place to be given that it is arguably less impacted by tariff. And I think there's still a lot of innovation going on.

I think some of the share price movement in big tech companies, for example, Apple, has been quite negative. And I think, obviously, it is impacted by geopolitics and tariffs, but I guess investors are also looking for some new innovation, new products, pipelines, and things like that, like new features on AI. I think if Apple were able to

deliver that I think that can offset some of that worries and may potentially recover from the recent negative share price reaction. We're going to be digging into that in but a moment. A little bit more on Apple. Janet Mui, RBC Bruin Dolphin, Head of Market Analysis. Thank you. Coming up as I say, well actually Apple is getting a bit of a reprieve after its longest sell-off we've seen in more than three years but President Trump's tariff threats could introduce more volatility. We're going to discuss that in a moment but Ed, we've got some breaking news on moving Trump media.

Yeah, did you see DJT, the parent company of Truth Social? So the stock's down more than 9%. The news, it's a pretty simple story. Trump media is going to raise $2.5 billion US dollars in capital to buy Bitcoin. There was some choppy trading. I think we opened markedly higher. We are now very much down more than 9%. We'll continue to track that story, Caro. This is Bloomberg Technology.

Take a look at shares of Apple, the tech giant finally in the green after eight straight days of losses. Still, Apple remains the Mag 7's worst performing stock in 2025, having fallen 21% so far year to date. Bloomberg's Ryan Veselica writes today, the iPhone maker faces still more pain and he joins us now. Ryan, where is that pain coming from, from the stock's perspective?

Hey, thanks for having me on. So obviously last week we got the surprise announcement about tariffs specifically on Apple if it doesn't bring its manufacturing to the United States. This was later expanded to include all smartphone makers. But I think just the level of political uncertainty remains extremely elevated for Apple. Obviously we saw so much volatility following the initial tariff announcement in April.

There was then exemptions provided for a certain electronics category, a sort of a pause with respect to China. We saw another tariffs against the European Union, which were also paused. So just the back and forth really has investors and analysts struggling to kind of figure out what is the impact to Apple going to be, how

do they navigate this kind of environment and what is going to be the sort of knock-on effects with respects to its earnings, its margins, with demand, with pricing, still a lot of very fundamental questions surrounding the company right now. What's so interesting is we had Gil Luria on the show last week really talking from DA Davidson analysis saying he's surprised at how poorly Tim Cook seems to be navigating this on a political perspective but also there's so many other headwinds that are buffeting the company right now.

Yeah, absolutely. So they've already been struggling with their AI offerings. Growth has been pretty tepid, especially relative to other mega cap companies for quite some time. The multiple remains sort of at the higher end of things. There are a lot of issues that have investors kind of looking around and saying, if you're going to buy a big tech company, what is really the argument for owning Apple over other ones that offer stronger growth or a lower multiple?

or a stronger AI position, or they don't come with this kind of political risk. So certainly all the sort of headwinds are stacked up against Apple in a way that they are not for the other mega cap tech stocks. Set the scene for us then, year to date for the Mag7. Apple's down 21%. But what does the rest of the field look like? You cover each of these names.

Other names are doing pretty well. There's been obviously a great deal of volatility, but some names have recently broken back into the green for the year. I think a lot of these companies continue to have a lot of really adamant supporters. They are still well-liked on Wall Street. The most recent earnings season showed pretty durable growth trends. A lot of them deal in market positions that don't

have too much tariff impact like software or just internet services, online advertising. There's some sort of second derivative move if you consider the impact to just economic growth and so forth. But otherwise, the names are doing pretty well. Apple is really an outlier here. And the only one that's pretty close to it is Tesla, although I think I checked this morning and that stock is down about 13% or so this year. So the degree to which that one is even lacking is far lower. Ron, this is

Sorry. Ryan Vlastelica, it's great to have you. Always some really well-read stories. We appreciate it. Look, let's just go back to the nuts and bolts of the Apple story with Carolina Milanesi, who's Creative Strategies President and Principal Analyst. And going back to, well, the torrent of two social posts that were out on Friday, first focused on Apple, but then spreading their way, it would feel, from Trump, that all foreign-made smartphones would potentially be looking at a 25% tariff. Does Apple in some way end up having an edge in that?

You know, the phone is still the most valued device that consumers are carrying. And so hitting on smartphones when initially Trump had said that they were going to be exempt is going to be hard for everybody.

If you're looking at the US market, Samsung and Apple are dominating the market. And so having tariffs applied to Samsung as well, who will have limited availability to make devices here in the US, is going to be hard.

But for Apple, it's all about juggling the short-term and the longer-term prospect, trying to balance not upsetting the president further, but at the same time, not upsetting China either, because it's a big market for them as well. And India, where they've been shifting manufacturing. Carolina, what does Tim Cook do to satisfy all players right now?

I think buying time is probably its best option and so making whatever promise you can make of investing in the US. Obviously if you're thinking about repositioning the production here in the US, we're talking way further than the term that Trump is going to be serving. And so buying time for the next two to three years might be all that is needed for now.

The way that Tim Cook put it in 2017, I think it was on stage with Fortune magazine, is that in China, you could fill a football stadium with specialist tooling engineers. And in America, you couldn't fill a room, a meeting room, with that same level of skill set.

You know all about vertical integration and how the iPhone is assembled and all the different hands that touch one handset. Just try and help our audience understand what it would mean not to move an iPhone factory to America, but everything else that comes with it.

That is what is impossible to do. I mean, moving the supply chain and then food production here is really impossible unless you're willing to invest, and not just from an Apple perspective, but from a government perspective, you know, billions of dollars in replicating this and investing 10 plus years to do so. I think what you can aspire to do is, you know, an assembled in America, the same way as you have designed in Cupertino,

on the back of the device. That is the short-term hope. Everything else is really more a fairy tale. Apple shares fell last week when a headline crossed the Bloomberg terminal that OpenAI was buying Johnny Ives hardware startup IO for $6.5 billion to make a suite of devices. Your reaction, please, Carolina Milanesi.

That is definitely pressure that right now Apple could do without. They have Apple Vision Pro, very successful in enterprise from an interest perspective, not necessarily a volume perspective, but hasn't really hit consumers for a range of things from the price point to the ecosystem.

hearing somebody that has worked for Apple so closely and maybe didn't leave on best terms coming with OpenAI. So you're bringing together the AI sore point for Apple right now with Apple Intelligence plus a competition from Glass or some kind of XRAR play. Definitely not a good moment for Apple. Not a good moment, but only four

sell ratings on the stock it's still very close to a three trillion dollar company can they swiftly turn things around can they be galvanized growth here Carolina I do think that we are gonna have some of the answer in a couple of weeks at WWDC when we're gonna see possibly like Mark Gurman was reporting a redesign from an OS perspective both for iPhone watch and Mac

uh... but also hearing awfully uh... some improvement on d or or or some development on d apple intelligence apart i think ultimately apple is still from a vendor perspective from a consumer point of view the one that has the strongest ecosystem and that can tie in consumers but from a services for set perspective and hardware and i think that

The point that is getting people scratching their heads right now is how long it's been taking from an Apple intelligence perspective. But I still believe that ultimately they have all the pieces that can come together to really continue to develop their ecosystem in a strong way and please their customers.

Carolina Milanesi of Creative Strategies, great to have you back here on Bloomberg Technology. Thank you. Now, coming up, Mark Zuckerberg's effort to get close with President Trump have given him direct access to the White House. But what's that actually done for his company? We have more on that next. This is Bloomberg Technology.

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Mark Zuckerberg's efforts to win over MAGA World have brought the meta CEO closer to President Trump and his administration. But according to the latest Bloomberg Big Take, Zuck's efforts have yet to bear significant fruit for the social media company. Joining us with more is Bloomberg's Riley Griffin, one of the authors of that Big Take. It's so deeply reported and it's look at

how Mark Zuckerberg has almost changed himself over a period of time to kind of more align with this administration. But the conclusion of the piece is that for Meta, it's not yet opened any doors in a way that helps the company's profile. Absolutely. My colleague Kurt Wagner and I spoke with more than 50 people for this story, which spans several decades, really. And what we found is that the efforts to pivot towards Trump and his administration have not yet borne the fruit

that the company so desires. And one of the case in points of that strategy, and it's perhaps failing so far, has been Mark Zuckerberg's attempts to end the FTC trial that you and I have spoken so often about, Ed. Mark Zuckerberg ended up taking the stand. But that was one of the moments that might show some of the weakness of this strategy. I love going through the piece, the frequent flyer

visualizations of how often he's on his plane trying to go back and forth to Washington. But also what stunned me was just how little respect, ultimately, it seemed that previous President Biden had for Mark Zuckerberg and ultimately for Meta.

Yes, that was one of the most interesting lines of reporting for me too, Caroline. What we found was that the Biden administration did not have a productive relationship with Meta over years and that President Biden himself, even dating back to when he was a vice president, was incredibly skeptical of the social media giant and Mark Zuckerberg personally. We learned that he called him behind closed doors, little twerp, among other perhaps, uh,

more colorful terms. And this really came to a head during the COVID-19 pandemic as misinformation spread. There was that notable moment where Joe Biden, President Joe Biden called Meta, said Meta was killing people as it was spreading misinformation online. Hey, real quick, how's morale inside Meta right now? You learned very quickly in Silicon Valley that

that a company's figurehead doesn't necessarily reflect its workforce? Yeah, well Meta is full of tens of thousands of employees so obviously there's a wide range but what we've found is that a lot of employees are really

discontent with this approach. They're holding secret book clubs to talk about Sarah Wynne Williams' memoir, Careless People. They are having wellness checks. Many folks have believed that Meta had done layoffs in an effort to quell dissent. The company obviously denies that claim, but it's sour inside the company.

Bloomberg's Riley Griffin. It's a very long piece. I urge you to go and read it. Some deep dives there. Coming up, cutting the cost of satellite manufacturing. My Founders Fund is doubling down on demand in the space sector for its latest investment in Endurosat. This is Bloomberg Technology.

Welcome back to Bloomberg Technology. I'm Caroline Hyde in New York. And I'm Ed Ludlow in San Francisco. Some momentum in the markets, Cara. Certainly is when it comes to stocks. Just check out what's happening on the Nasdaq. Best day since about mid-May. We are higher by the tune of 2%. In fact, only four stocks of this major benchmark are actually in the red. What's the moon music about? It's about macro. It's about consumer sentiment looking better. It's about the bond market looking a little bit calmer. It's about, of course, that key macro event that is NVIDIA's numbers coming as soon as tomorrow. But I'm

also looking at Bitcoin actually not catching that upward draft. It's interesting, 109,000. Look, we still need those all-time highs. It's notable that we haven't followed stocks higher. Move on and though, have a look at what equities are doing in response to a Bitcoin play. Everyone wants to be Michael Saylor nowadays. The strategy strategy being borne out with Trump. The DJT, take care as it's known, Trump media, they're going to be selling stocks

to buy Bitcoin. It spends it lower by 11% at the moment. But I'm looking at PDD, Woeful, the worst performer in the Nasdaq 100. This is, of course, the owner of Timu. Well, it looks as though, of course, geopolitics, trade anxiety plays out with profit tumbling some 47%, Ed. But notably, no future path that looks pretty. They have to invest to change up the business model, Ed.

All right, let's go from public markets to private markets and head to space. Bulgarian satellite manufacturer Endurosat has announced it's raised 43 million euros. That's around 49 million US dollars. This latest funding round was led by Peter Thiel's Founders Fund, delighted to bring in Endurosat CEO, Raishul Raichav.

and Founders Fund partner, Delian Asparov, who join us from Sofia, Bulgaria's capital. And Raicho, I'll start with you. You have managed to change the way that satellites are manufactured and also how profitable that business is. So why do you need to raise this money? What are you going to do to expand your production of those next-gen satellites? - Yeah, so first of all, we really believe that there will be a paradigm shift in the way that humanity builds the next future infrastructures in space.

which in simple terms means how do we put multiple new sensors like cameras, radars, navigation systems of the future as fast as humanly possible to orbit and how do we objectively lower the data to cost as little as $1 per gigabyte of any type of space data. And the way that we approach this problem is basically trying to our best to build a satellite that was from day one

for manufacturing, which is very unusual in a traditionally very hardware-centric industry where everyone is usually building tailor-made solutions for every individual mission. We believe that's the way to go. We have leveraged a lot of our experience in the region of the center of Eastern Europe

concerning automotive designs, medical, robotic industries and we have tried our best to embed those into the satellite design. Delian, you are Bulgarian and I know this is a really big moment for you and important to you. You see Endurosat as being to Bulgaria almost like what TSMC is to Taiwan. Just explain your thesis there.

Yeah, I mean, admit obviously as being a native of the country, I had a predisposition to, you know, sort of find an investment here for a long time, but only if it met the, you know, sort of standard, you know, founder's fund bar.

As you know, Ed, we've been a big investor in a ton of the leading aerospace companies, everything obviously from behemoths like SpaceX, where we were an early and consistent backer, but also in some of the next generation companies that are coming up. Impulse, led by Tom Mueller. Varda, the company that I incubated. Hadrian, focused on automated CNC manufacturing.

One of the core thesis that we wanted to focus on as we see this explosion in the industry was somebody that was focused on mass manufacturing of satellites, but in a way that more closely resembles, you were talking about Apple early on in the show, something that looks more like a consumer electronics application

manufacturing line than how the vast majority of satellites, even Starlink satellites are assembled today, which is very tailored, one-off, super custom made. If you look at the sort of average American satellite in terms of its overlap with the automotive, consumer electronics, or medical industries, there's very little.

And so for a long time, I'd kind of given up on the thesis of actually being able to invest in somebody in this category. The thesis was always find somebody that's like the sort of Dell for satellites. But I'd been catching up with Raicho at Endurosat for several years. And he had very little funding to get going on the company. And so he had to use some of these more consumer electronics, automotive supply chains to build up his satellites and steadily made them bigger and bigger. Revenues got bigger and bigger.

to the point where in Q4 of last year, even though I'd always had this sort of, you know, negative bias towards Bulgaria because I was like, God, if I tell Peter that he hired a Bulgarian and he wants to invest in a Bulgarian company, he's going to kick me out of the room, obviously. He's going to say, you know, Del, you're crazy. But at some point, the numbers

the quality of the technology, the culture of the team, the fact that they've invested into the local university programs to start to train their own next generation talent. That's what I mean when I talk about the TSMC of Bulgaria, where it's both this national jewel in this very technologically forward sector, but deeply integrated in the society to the point where if you're a 15-year-old Bulgarian physicist or computer engineer or mechanical engineer, all you can dream of is the day that you graduate university and getting to go work for Raichu.

So Raicho, we hear about the thesis, we know that the revenues are climbing, but how can you be like Apple in terms of profitability, in terms of margin? How profitable are you? Well, there is a lot of components in achieving profitability. I'm happy to say that we went on the market selling satellites in early 2018 and we became profitable that same year, which usually never happens for a space company. Usually they need like a decade at best.

and ever since our business grows between two and three times here over in terms of revenue and every single line of our business today has average gross margin between 75 and 77 percent. So I think we're pretty close to those type of metrics but again we are only focused on the challenges that we really want to bring the industry to a completely new level and scale and I believe

Honestly, at the end of the day, the authenticity of the products and the execution of the team would lead to, anyway, immense market opportunity. And this is what we are hoping to achieve with our new and incredible partners from Founders Fund. And those partners, Delian, can they be other of your investments? Just thinking of SpaceX, as you mentioned, Varda, which you, of course, are president of. How much are you going to turn to Endurosat

full your equipment. Yeah, I mean, look, as we're sort of looking at the next generation vehicles across the portfolio, if you just look at the economics of what RYCHO is offering, it is just vastly differentiated relative to anything that you can find either in the European or the American market, right? If you think about the sort of traditional aerospace suppliers, think folks like Airbus, Raytheon, Lockheed Martin, Blue Canyon Space Systems, all

all of their components are these things that are based off of 1970s technologies that have been ever so slowly iterated on. And there is benefit to that in that they have flight heritage, but they're somewhat stuck and not able to take that monumental leap forward. So I won't comment on the specific companies, but I can already say is part of how I got alerted to Enduro was because we already had a significant amount of the Founders Fund portfolio and some of the broader Silicon Valley funded defense tech and space startups

already as customers of his. As I started to analyze everyone, I realized there was an arms dealer, there was a Dell for satellites already. It just happened to be this Bulgarian company that for a long time I just wasn't sure that I could take seriously, given that I knew that I had this predisposition towards Bulgaria.

and to have these margins that we're talking about. I mean, the fact that you can build a space company probably growing quickly at 70 plus percent margins. I mean, those are the things that you see in, you know, sort of consumer electronics behemoths like Apple. But if you look at the like average American aerospace or defense company, these are all like, you know, best case 20, 30% margins burning hundreds of millions of dollars before they ever get to any semblance of profitability. And all of these things never get to this level of margin. This is why when you look at everything from Planet Labs to Maxar to Iridium, all these companies that, you know, uh, uh, uh,

operate in the satellite world, they never trade above like three X revenues because there's no growth and there's no profitability. When you look under the hood at Raichu's business, it's insane to see these metrics that you almost look like a traditional Silicon Valley SaaS company in terms of margin and growth. Raichu, let me ask you this to finish. What's your strategy for manufacturing in the United States in the future?

I'm proud to say that the majority of our business is already in the US and we are heavily involved in supporting the local ecosystem. We have quite an advanced team in Denver already. We are assembling and operating satellites for our US customer base from the US. So I really consider that there is no such dramatic difference between what we do in Bulgaria and in Europe generally and what we are planning to even expand further in the US. Just to give you the context, we have already invested significant amounts, millions,

just starting last year, way before there was this tension that arrived between the two continents. And I think this tension will be very healthy for our business. I mean, we need to learn how to do local stuff better than anyone else. We need to empower the local ecosystem. And I think we also bring the knowledge and the know-how and a little bit of innovation that will be very healthy for the U.S. market in general.

Righto Recha, CEO of Endurosat, Delian Asparov, partner at Founders Fund. We appreciate your time. Thank you both from Sofia, Bulgaria. Coming up, a new company started by the founder of quantum computing firm, Rigetti. They used to use quantum to address cost and energy bottlenecks in scaling AI. That's next. This is Bloomberg Technology. Remember when a single technology glitch could bring an entire workday to a standstill? I'm Mark Banfield, Chief Commercial Officer at TeamViewer. Today, most technical issues are recurring.

If you know the patterns, these issues can be remediated before they impact your business. One major UK retailer discovered a single point of sale outage cost them around $1 million in lost sales during a single lunchtime. Now, using TeamViewer's digital workplace platform, the same company is able to identify and fix those issues before they even happen. But proactive troubleshooting isn't just about the incremental improvements.

is about fundamentally reimagining how work happens for everyone. And the companies that move first get competitive advantages in terms of efficiency, productivity, and innovation. To find out more, visit bloomberg.com forward slash teamviewer.

The world is built on code. From the apps we use every day to the systems powering industries, developers like you are the architects of tomorrow. But let's be real. The road to innovation can get a little tricky. You need the right tools to move fast, but you also need a community to help you go further. That's where Microsoft comes in. Microsoft has the tools to help you move at lightning speed, like GitHub Copilot, VS Code, and a ton of AI resources to keep you on the cutting edge.

But here's the best part. You can build with confidence, knowing that Microsoft security and compliance are already taken care of. No more worrying about vulnerabilities or threats while you focus on your craft.

And with Azure AI Foundry, you can build your way. The future is yours to build, no strings attached. From ready-to-code tools to full flexibility, it's all in one place. The future's in your hands. So learn more at developer.microsoft.com.

The name Chad Rigetti may be familiar to those in the quantum computing world. Now the quantum computer entrepreneur and physicist is launching a new company called Sigildry. It aims to use quantum to address cost and energy bottlenecks that are associated with AI. Delighted to say Chad Rigetti joins us now. I think we will get to the backstory of your involvement in the earlier days of this industry, but what is the objective of the new company and what is different about the new company's technology?

Hi Ed, great to be here today. Sigildry is building quantum accelerated AI servers to exponentially speed up training and inference for these large models. As you've heard about, there's growing energy requirements, power requirements that are very challenging to meet, and there's growing costs for training new models. And ultimately, quantum can provide a solution to that with these exponential speedups. In the last few years, there's been new algorithms developed

that can exponentially speed up things like stochastic gradient descent or low rank adaptation that are critical for training and inference in large models and really bringing about the accessibility, affordability and sustainability of true widespread adoption of AI.

We were recently at Nvidia GTC's Quantum Day. We did a special show where many sort of the leaders in this field joined us. And kind of what struck me is they all sat there on stage with Nvidia CEO Jensen Huang, is how many companies are working on this? How many publicly traded companies? And I give you that preamble to ask, why do we need a new company focused on this task? Why can the technology been developed by all these others, including the namesake company you founded, not crack it themselves?

It's a great question and I've thought about that as well and ultimately that led me to starting Sigildry with my co-founder Idelia Friedson who also worked with me at Rigetti and helped take the company public in 2022. Ultimately all of these companies that are out there today are making tremendous progress. There's been tremendous advancement just in the last three years alone. New qubit types like neutral atoms and photonics have advanced as much or even more than superconducting qubits have.

And ultimately, what we see is an opportunity to combine these different modalities within a single fault tolerant architecture. And we thought about, you know, and then on the flip side of that, to take a laser focus on accelerating these compute challenges in AI. Ultimately, over the past two or three years, AI has become so useful and so widely used that it's redefined. It's basically created a new abstraction layer for computing hardware.

And with that, computer hardware itself needs to evolve and change. If you look at the quantum computing companies that are out there right now, even the public ones and the one that I built in Rigetti Computing, all of those roadmaps, their plans for five, ten years out were locked in before AI became the dominant compute paradigm.

And so today we see an opportunity to bring a new architecture that is specifically focused on accelerating training and inference, on lowering the cost and energy requirements, and also at combining different qubit modalities because all the companies today also are siloed with respect to their technology choices, which again were made before AI became the dominant paradigm. So we're bringing multiple different qubit types together within a single fault-tolerant architecture explicitly built for AI.

Chad, do you need more money to do this? Because at the moment you're backed by Y Combinator. I'm sure you've got some money made on your previous company, but how much do you need outside investment? Well, of course, this is deep technology in the end and the size of this market. If you can crack this, when quantum really comes online and starts to impact AI training and inference costs, it's going to be a trillion dollar market.

And we see this as completely inevitable. Ultimately, nature itself runs on quantum mechanics. In the most information-rich environments at the lowest level of nature, we use quantum mechanics to process that information. And quantum reflects that, mirrors that reality, and ultimately is a more efficient way of computing long-term. So we're going to use this in conjunction with GPUs, in conjunction with large-scale classical infrastructure. It's an enormous opportunity.

And ultimately, we believe that when our multi-modality quantum architecture comes online, that other single modality architectures aren't ultimately going to be able to compete with it. We will absolutely need to raise additional capital going forward. The company is just getting going. We're launching and publicly announcing the company today. So we're in the early stages, but we're really excited. Our team is growing very fast, and we're very excited about what the next few years holds.

To be personal about it, how has Rigetti responded? It bears your name. I'm sure it's a help in many ways for you because your name is still so legendary within Quantum, but how did they respond when they're also teaming up with Quanta in Taiwan, which is a server maker and looking at the adoption of Quantum there?

Yeah, well, ultimately, you need to ask Sabote and the team there. I think with respect to the progress towards AI, these are deep architectural choices that need to be made early on in establishing your hardware roadmap and your company vision and plan. You need the DNA. You need to, you know, early on in the organization. And once those things get locked in,

There are forces that make it very challenging to adjust that vision, to adjust those roadmaps, because it relates to all of your partnerships, it relates to your talent base, it relates to how you think and talk about the technology internally in your culture. So ultimately, we think being started from the very get-go, focused on AI as the singular killer application for quantum technologies,

Getting the right team together very early on in developing an architecture, leveraging multiple different qubit types that are needed to ultimately reach the combination of cost, speed, and scale to unlock these AI applications is the winning approach to this.

Chad, it's great speaking with you. Chad Rigetti, his new company, Siguldry, we appreciate you joining. Shares of China's BYD, they extended losses for the second day in its Hong Kong trading. They're down here in depository receipts as well. This after the electric car maker announced sweeping price cuts of up to 34% on some of its vehicles. That says competition at home intensifies for the sector. Bloomberg's David Welch joins us now. How fierce is the price competition in China, David?

It's the one market where you really have price competition is in the Chinese market because the domestic players, they so dominate their home market. And there are very few imports into the market that tariffs aren't really wreaking havoc on it the way it is in other parts of the world. So you don't have companies looking to raise prices to deal with tariffs. They're all domestic anyways, and they get all of their parts, batteries, everything domestically domestically.

So they don't have that kind of pressure. The pressure is still there as it has been for a few years to lower prices and gain market share, probably try to get some of the foreign players out of the market. That's been going on for a long time. That's why General Motors and Volkswagen have struggled. That's why Tesla is struggling. And I think you have companies like BYD and Xiaomi who have such, they've had a lot of growth. They want to keep it going. So they're going to keep slashing prices too to gain that market share.

You mentioned Tesla. The other battleground that we compare Tesla to BYD on is Europe. And the data over the holiday weekend in the U.S. was that Tesla is suffering in Europe because of the political backlash of Elon Musk. There's also BYD doing well there.

That's right. The Chinese automakers have done very well to gain a lot of ground there. And Tesla's got a lot of problems in that market. I think Europeans, particularly with this new round of tariffs, 50% being announced by Trump, Elon Musk being close to Trump, I think that's going to continue to hurt the brand. It's going to continue to kind of put a shadow over Tesla in the market.

They've also got stale product. The Europeans have a lot of EVs now. Chinese competition is there, even though that's getting hit with some tariffs. But it's not good for Tesla in that market. And I think only fresh product would help them out. Even if Elon were to say tomorrow he's quitting Doge and going back to running Tesla, that doesn't really change what's happened with his brand in terms of the politics with some American buyers and with a bunch of European buyers. So that trouble is going to stick around for a while, I think.

Bloomberg's David Welch in Detroit. Thank you very much. Stick with Elon Musk. He's set to address his SpaceX workforce today. Among the discussions will be his long-term goal for the company of sending humans to Mars. All this ahead of a scheduled test flight of the company's Starship rocket, 6.30 p.m. local time. Bloomberg's Lauren Grush is here. Set the scene. You and I used to attend these kind of Elon big picture, star-based moments in person. What are we expecting him to talk about?

Yeah, I would say I would expect probably some of the same hits that he normally does. You know, he gives these Starship and Mars updates about once a year or so. But, you know, every time he does give one of these discussions, he gives a few new tweaks. Maybe there's some new timelines, some new changes, new upgrades to the hardware for Starship was the plan. So, you know, I think we'll be listening for some of the same old updates.

phrases you know preserving the light of consciousness is a big one but also looking forward to some some maybe updates on timelines and uh where what we might expect in the year ahead for certain milestones that they need to achieve well big day for starship how are we bracing ourselves because the last two tests have ended in explosion

I would say the stakes for this flight are particularly high because of those explosions you mentioned. The last two flights did not end well. Both ended in debris streaming over the sky, over the Gulf. And so hopefully they have fixed the problems from those two flights.

SpaceX did provide an update saying they know the causes for both of those explosions, that they were actually distinctly different in terms of what caused them, and that they have provided the appropriate design and hardware fixes. So we'll see if that holds. I think we'll all be holding our breath at about the eight-minute mark, which was when both of those flights terminated early.

Lauren, we just have 20 seconds, but remind us the ultimate goal, which is getting humans to Mars and how Starship fits.

Yes. So Starship is the primary vehicle for which SpaceX intends to send humans to Mars. Also has a contract with NASA to land humans on the moon with the vehicle. And eventually Starship will be the primary vehicle that SpaceX uses to launch everything in the future. So a lot is riding on this vehicle. Bloomberg's Lauren Grush, a busy day. We appreciate it. Now that does it for this edition of Bloomberg Technology, Ed.

Tune in tomorrow for a special edition of Bloomberg Technology looking at NVIDIA's earnings. That's 6.30 p.m. Eastern Time, 3.30 p.m. Pacific. And big thanks to everyone that tunes into the podcast, listens to the podcast. You know where to find it. Online on Apple, Spotify, iHeart, and all the Bloomberg platforms. This is Bloomberg Technology.

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