Tech Stocks Rise on US-China Trade Talks, Trump Says Apple Will Raise US Investment
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Live from New York, this is Bloomberg Technology. Coming up, stocks powering higher as global risk-on rally through a potential U.S.-China truce. Plus, President Trump says he spoke to Apple CEO Tim Cook this morning about building plants in the United States and all eyes on CATL as China's battery giant gets ready for a Hong Kong listing without U.S. investors. But first, we check in on these markets. Could we be on track for a bull market?

A bull market in the NASDAQ 100. We are more than 20% off.

of our lows that we hit in earlier April all of that surrounding the anxiety that was of course Trump trade tariffs and the impact on Magnificent 7 we're currently up 3% on the day as we pull back on those extraordinary 145 percent tariffs now we see a 30 percent tariff instead going on Chinese goods coming into the United States move on and have a look at the individual movers though because in this 90-day reprieve it really does drive big tech up

up the most we see a seven percent move for amazon of course retail therefore maybe comes back from china into the us not the full 145 cost impact and notably maybe those chinese retailers continue to advertise with amazon we see apple up more than five percent but does this still potentially impact their move and shifts towards india and the like because 20 tariff is still a lot

on the likes of your smartphone remember they not impacted by the 10 reciprocal tesla up more than six percent as they managed to get once again get access to rare earths that we're worried would be a limitation but all of this is president trump really spoke earlier this morning and said he's likely to speak with chinese leader later this week just take a listen

The talks in Geneva were very friendly. The relationship is very good. We're not looking to hurt China. China was being hurt very badly. They were closing up factories. They were having a lot of unrest. And they were very happy to be able to do something with us. And the relationship is very, very good. I'll speak to President Xi maybe at the end of the week.

We bring you the analysis. Mike Shepherd is standing by. All of this, a huge relief to markets. Look, we're still down on the year when it comes to the NASDAQ 100, but the fact that we're back in a technical bull market is extraordinary, Mike. Should they be this risk-on?

Well, that's a great question about whether risk on is appropriate, given that we're only awaiting a 90-day break as negotiators from the U.S. and China try to hash through some of the fine print of what was discussed over the weekend between the leading negotiators from both countries. Now, they have a lot to get through. The fine print includes where they end up on tariffs.

but also some of the non-monetary tariff barriers that President Donald Trump said that China had agreed to lift as a way of opening the Chinese market more to American goods. And likewise, the Chinese have their own asks of the administration. And it's not clear, at least from what we're hearing from President Donald Trump, what those might be too. So there is a lot

of road ahead of us on this. And then also we have to await what could be coming in terms of sector wide tariffs. Now you mentioned in the open there that Apple is exempt for now from that 10 percent reciprocal tariff. But Apple and other tech companies are awaiting what could be happening with semiconductors. Remember the administration is conducting this investigation into the semiconductor market

to determine whether tariffs are called for on imported chips into the United States and what level that tariff should be at. So there is still a fair amount of uncertainty lingering out there for tech and for its investors. And certainly, Nvidia wrapped up in this semiconductor anxiety as well, Mike. So push us forward as to what really is the devil in the detail. We have a lot to now be discussed over the next 90 days. Who leads that charge and in what capacity?

Well, that's another great question. Does Scott Besson continue to play this leading role? Clearly, he was one of the drivers of the discussions together with U.S. Trade Representative Jameson Greer in Geneva with Chinese officials led by Hu Lefong. Now, do they delegate this now to a lower level? And where do they start? And how fast can they move?

You remember back in 2018, 2019, 2020, the U.S. came close to deals and then pulled back. Donald Trump in 2018 scrapped a plan for an agreement with China because he wasn't happy with it. Ultimately, they ended up with the deal that was signed in January 2020, the so-called phase one agreement. But that never really fully bore fruit, not in the view of President Donald Trump and not even in the view of his presidency.

Joe Biden. They each saw China not living up to all of the elements of that deal, including purchases of U.S. agricultural products, for example. But there are a lot of areas where the fine print, even after it's signed, may end up falling apart for both sides. Look, we're still thinking that there's

an adversarial relationship. And this is highlighted by a key share sale going on in Hong Kong this week. We understand CATL, it is like the Chinese battery maker. You can't buy it if you're a US investor, right, Mike?

Well, that's right. And they are discouraged from doing so. And some House lawmakers sent a warning shot in a letter to U.S. banks last month saying, steer clear of this one because we are looking at CATL on national security grounds. They have concerns that there may be some security implication from the use of these batteries here in the U.S., in U.S. products. And they also see an element of competition. The U.S. wants to make sure that China doesn't get too far

even further ahead when it comes to electric vehicles. And the batteries, of course, are where it all starts. Now, when you look at this share sale, though, Caro, it is a sign of optimism. The fact that they are pricing this up to $4 billion in U.S. terms, that signals that there is some optimism that maybe trade tensions won't be quite as bad as they were and won't be so much of an overhang even in the China IPO market.

We wave a bated breath on how it goes and indeed the banks that are still leading it. Michael Shebbard, we thank you very much indeed. Let's get more on how all these trade changes, how they're impacting the tech sector. We welcome Jason Oxman, President and CEO of the Information Technology Industry Council. And we're so pleased to have your voice because within your trade industry, there are the likes of Nvidia, there are the likes of Apple. How are these companies going to be reacting today?

Very positive reaction. I think you'll see today and in the days ahead and great to be with you with this breaking news. I think the most important element, and Mike alluded to this in your conversation, is the statement that came out jointly from the U.S. and Chinese negotiators.

in Geneva. Now, in the trade world, the joint statements are really something that we want to look and parse at and see what it really means. But the fact that this statement was issued jointly by the negotiators, they didn't put out separate statements, they put out one together. And the very opening language of that joint statement that was put out this morning

is about the importance of the economic relationship, of the trade relationship between the U.S. and China, about the importance of a sustainable, long-term, mutually beneficial economic and trade relationship between the U.S. and China. So today's announcement of the tariff pause is obviously enormously important. But I think what it suggests

for the negotiation in the months ahead is that the parties are very focused and very dedicated and believe that a mutually beneficial agreement can be struck. And so looking even in the medium and long term, I'm feeling very optimistic and the tech industry is feeling very optimistic about where we're headed. Now, interestingly, Scott Besson, Treasury Secretary, who's been negotiating this in Switzerland over the weekend, joined our colleagues on Bloomberg Surveillance a little bit earlier. Just have a listen to what he said.

China was the only country who escalated their tariffs in response to our reciprocal tariff level. So that resulted in an unfortunate escalation. So we now have a mechanism to deal with that. Neither side wants a generalized decoupling. The U.S. is going to do a strategic decoupling.

I want your take on what strategic decoupling now means, Jason, for your key members of your trade association, Nvidia, who wants to sell into China, Apple, who wants to bring phones from China.

Yeah, I think it's a really important statement from the Treasury Secretary. It means that we're returning to a place where we look at national security issues separate and apart from economic issues. Where we were in a bad place, as the Treasury Secretary said, with the reciprocal tariffs and the escalating on both sides, was heading toward decoupling.

Where we're returning to, and I think we'll see this in the negotiations going forward, is a place where we look at national security issues like the highest security need to make sure, for example, that the Chinese Communist Party military doesn't get access to the latest generation of AI technology. But at the same time, China, which is an enormously valuable market, one and a half billion people, top three economy in the world, can get access to other U.S. technology. The semiconductor space is a great example of

that. We're going to make semiconductors here in the United States going forward. President Trump is very focused on that. You've seen the tech industry announce hundreds of billions of dollars in investments here in the U.S. But if you can't sell any semiconductors to China, that investment in the U.S. doesn't make as much sense.

as if you can. So if we focus very narrowly, not on the total decoupling of the economies, but just on that national security issue to make sure that, for example, the military doesn't get the next generation of technology, then we can make sure that the economic investment that's necessary to trade with China continues to happen. And that's what we're seeing today. I mean, it's interesting that

We had President Trump saying he's already spoken to Tim Cook about that $500 billion that's being committed. We understand a lot of that was already committed into the United States. But that in some way is about semiconductor production here in the U.S., Jason. How have CEOs like Jensen, like Tim Cook, got the clarity they need to invest and to invest locally right now?

Yeah, and you saw it in the White House just the day after the president was inaugurated, a $500 billion announcement in AI manufacturing here in the U.S. from OpenAI, Oracle, and SoftBank. Since that time, you've seen over a trillion and a half dollars of additional announcement in investment. So you're absolutely right. The tech industry is very focused on bringing manufacturing back to the U.S. This period of uncertainty created by the escalating reciprocal tariffs,

could have been harmful to that investment, no question about it. But what we're seeing today is getting back to where we need to be, where the tech industry is very focused on that investment. Semiconductors, AI manufacturing, data centers, servers, all of that happening in the U.S. to the tune of over a trillion and a half dollars, close to $2 trillion that's been announced.

in recent weeks and months. And I think we'll see that investment only accelerate going forward now that we're getting back to a place where we know that trade with China is going to happen. It's a huge market. We need to sell internationally. You know, 95% of the people that live on the planet don't live in the United States. So if you're manufacturing in the U.S., you need to access the world. So moving to trade agreements that these technology company investments can use in order to sell to the rest of the world.

That's going to drive more manufacturing investment in the U.S. So just on that point, it feels as though you're currently voicing the issue that Jensen Wang has, that he wants to be able to access the Chinese market, not with the most sophisticated chips, but at least some. Do you think that he'll manage that?

I do. And here's the second reason, in addition to accessing global markets, it's really important for U.S. companies. We want the U.S. to lead in the world in AI and manufacturing. So if manufacturing in the U.S. means that companies that manufacture in the U.S. can access the rest of the world, that's only going to encourage more manufacturing investment. But the second thing it's going to do is make sure that we don't provide a perverse incentive for Chinese manufacturers to step up their game and access global markets. We want

the rest of the world to buy from the US as well, not just China. So if US technology is not available to the rest of the world, if the US is not a reliable trading partner for manufacturing that happens in the US, we're going to see other countries take advantage of that opportunity. We want Nvidia and all the other great US companies, great technology companies that are manufacturing in the US to lead the world.

and making sure that these trade agreements that we're moving to very quickly make that access possible, that's going to encourage them to invest in and manufacture in the U.S., and it will make sure that U.S. AI leadership continues, a clear Trump administration priority. Jason Oxman, great to have you on today, President and CEO of the Information Technology Industry Council, who represents companies such as NVIDIA, as we were just speaking about.

Now, SoftBank's AI ambitions in the US seem to have hit a speed bump. The company had planned a $100 billion investment in AI infrastructure. And three months ago, it was all part of the project Stargate. But Japan's giant has yet to actually develop a project financing template or even begin detailed discussions with banks and investors. For more, Bloomberg's Seth Fiegeman joins us now. And Seth, this is about putting AI infrastructure here in the United States. Now, is it about

the deep-seek cheaper model issue or is it about trade tensions and tariff anxiety? You know, I really think it's about all of the above. The picture for the AI market has changed pretty dramatically just in the three months since this deal was announced and probably not for the better. The same week that they announced this at the White House, deep-seek launched and suddenly since then there's been a glut of these cheap Chinese AI models that potentially raise questions about the profit and revenue picture for OpenAI, one of the big backers of this project. At the same time, we've seen a bit of a data center pullback

potentially raising concerns about oversupply in the U.S. and other markets. And as you mentioned, with tariffs, there's just general broader economic uncertainty. None of that seems favorable for a $100 or $500 billion infrastructure bet. Yeah, because it was meant to be scaling up. And just remind us how integral SoftBank is to the financing part of the equation, because Oracle and OpenAI are there too, but

less on the money side. Yeah, I think ultimately SoftBank is a very big piece of both the $100 billion and $500 billion pledge. They do have other substantial backers, but one of them is OpenAI, which is also leaning very heavily on financing from SoftBank through VC round and through this deal. So if SoftBank has any second thoughts or reservations here, that does impact it greatly. I will just say as a caveat, SoftBank publicly and OpenAI publicly remain fully committed to moving forward with this venture. Seth Fiegeman, great.

to have you articulating it. Thank you. Staying on AI, President Trump's plan to rescind that Biden era policy to curb AI chip exports, but it aims to simplify, to ensure AI dominance for the United States. But Ankur Crawford, Alja portfolio manager, says there's a lot of moving parts right now, and it's critical to think long term about AI and diffusion rules. Ankur's here with us now. And we've just come off discussing how

maybe the equation of what is profitable in AI infrastructure here in the US is changing. How much does the abandonment of AI diffusion rule help or hinder those sorts of maps? - Well, the diffusion rules being mitigated by the Trump administration was an important step forward because quite honestly, they didn't make any sense to limit the technology to go to a wide swath of countries that really in many cases were our friends, not foe.

And so the question is what comes next? And what are the rules that they will put in place to hold the strategic kind of lead that they perceive?

What's interesting is, as you say, countries that were deemed allies, Israel, India, suddenly on a tier two level, not as able to access as many sophisticated chips as they'd wanted to. That was the proposed AI diffusion rule. But now we come to this awkwardness where it's going to be sort of a case-by-case basis, country-by-country basis. Malaysia, where Oracle wants to be putting a huge data center, for example. When are we going to need clarity on that? And how do you start to see companies and countries navigate it?

Yeah, I think it's going to be, they're going to use it almost as a bartering tool in these trade negotiations, and it is a strong bartering tool. I think, however, the administration has to be very careful that we have to look after our own strategic initiatives and own strategy for national security, but we cannot overreach. And in part because there is a very viable competitor with Huawei.

We want to pretend that Nvidia is a monopoly. It is not. Huawei has shown an incredible prowess over the last two months even. They've introduced these fantastic chips and fantastic racks that in fact do compete with Nvidia. So if we push too far on this, there is an alternative for the Malaysians to move to a different vendor.

So when that argument comes from Jensen Huang that I actually want to not only access Malaysia and Indonesia and, well, most of Southeast Asia, but I also want to sell into China still, should he be able to?

You know, I do think that we're looking at this in the wrong way, to be completely frank. Let's think about DeepSeek. DeepSeek's innovation actually is helping our models. And Facebook is adopting some of the innovation that came out of DeepSeek.

One thing we can't forget is that innovation begets innovation. And you cannot stop that kind of life cycle of innovation. And if we slow innovation in China, we're slowing innovation here as well. So, you know, what I think this should focus on is, in fact, IP theft. So focus on making sure that our IP across the board, not only for GPUs, but across the

any kind of equipment, whether it's robotics or medical equipment, that's not being stolen by the Chinese, right? Instead of kind of fighting over the widgets. So I think we like to think of this as, you know, are you friend or foe or are you? And perhaps there's some place in the middle where

where we can't treat China as this enemy of the people when they're really not. They too are innovating at a pace that is probably faster than we are.

So when a CATL is looking to list in Hong Kong and U.S. residing investors aren't able to access that, how does that make you feel as a portfolio manager who wants to be able to thrive in innovation worldwide? Yeah, frustrating. But you know what is also frustrating? A CATL wanted to build a factory here, you know, a few years ago and was stopped by the Biden administration. They actually wanted to move manufacturing back to the U.S. and weren't able to. So that too is frustrating as an American to have

you know, that the initiatives of bringing manufacturing back of these technologies to the U.S. is being hindered, which hopefully will stop with this administration. I think CATL, you know, us not being able to access it, you know, this too will be overcome, and I think these are...

along the way that we'll have to work through with the Chinese and the Trump administration. Uncle, you were very clear that you did not want the AI diffusion rule and you felt that it was just harming most people in this environment. What then as a portfolio manager do you do in this current

lack of clarity, the fact that it's going to be a case-by-case. Do you still think NVIDIA will compete, will be able to compete well, will be able to access markets? And you're from the optimistic side of things. Do you start to add on in this point? I think it only makes sense to allow for our technology giant, NVIDIA, who, you know, quite honestly, is the pride of our nation at this point, right? They are driving forward the AI revolution. And

So I do think that over time, I think by September, we'll have very clear boundary conditions around where we can and what we can or cannot ship. And IP will be protected, do you think?

And I hope IP will be protected. And I think that's the most important thing here. IP should be protected on a go-forward basis across all industries with a commitment from the Chinese government to make sure that that is in fact the case because we can't have this industrial espionage occurring all over throughout many industries. So I feel very optimistic for the rest of the world and for China that we will sort through this because we are a globalized country.

And we can't pull back from that. We can bring manufacturing back here, which I wholeheartedly believe in, but in a controlled way. Ankur Crawford of Alger. It's great to have her on. Meanwhile, coming up, global stories from Nissan nearly doubling the amount of employees expected to let go. That's next. That's Bloomberg Technology. Possibility surrounds us in digital innovation, evolving markets and disruptive ideas. And while promises can inspire dreams, proof is the catalyst for transformation.

At EY Consulting, technology unlocks value. It's data that sharpens your competitive edge, and it's our deep sector insights that can navigate a pathway to real outcomes. This is high-value transformation that drives real change and challenges competitors to keep up. With EY Consulting, it's about proof, not promises. 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

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

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Time now for Talking Tech. First up, shares of Xiaomi falling almost 6% in Hong Kong trading after a local report over the weekend cited as much as 300 people wanted to cancel orders for the company's SU7 ultra-electric vehicles over false advertising related to the car's carbon fibre hood and dual air duct.

Xiaomi issued an apology for the unclear communication. Plus, Nissan is cutting 11,000 more jobs than previously planned. Now, that's according to a report by NHK. The company previously announced restructuring plans in November, announcing a cut of 9,000 positions at the time. That's after weak sales in the US and China saw a 94% drop in net income.

And New Zealand's Prime Minister says a proposal to ban children under the age of 16 from accessing social media will become part of the government's work programme to protect the youth from bullying, harmful content. If approved, the restrictions could become law before the country's 2026 election. Now, coming up, President Trump spoke with Apple CEO Tim Cook earlier today. More on that next. This is Bluebird Technology. Bluebird.

Welcome back to Bloomberg Technology. I'm Caroline Hyde in New York. Let's get a check on these markets because we are in full-on rally mode. The reason? Well, trade tensions dial back a notch as we see new tariffs put in at a much lower rate between China and U.S. You're going to be paying 30% tariffs on your Chinese goods coming into the U.S.,

and just 10 on u.s goods going into china well lower than had been expected it's a 90-day reprieve 4.7 higher on the magnificent seven move on to the individual movers of course we see the companies have been the eye of the storm managed to push higher semiconductors up six percent now it's the best day since oh april the ninth when they rallied hard on the fact that some semiconductors got reprieve from the original reciprocals but we are up six percent amazon of course up more than seven percent as chinese goods can now flow at a lower

price point than they were worrying about. And Apple up more than 5%, $151 billion in market cap added to this company. And all of this, as we, of course, hear from President Trump a little bit earlier, as part of his remarks on trade, he did indeed say he spoke with Apple CEO Tim Cook. Here's what the president said. I spoke to Tim Cook this morning, and he's going to, I think, even up his...

His numbers, $500 billion, he's going to be building a lot of plants in the United States for Apple. And we look forward to that. I really do look forward to that.

Let's talk about Apple and the remaining challenges that remain. Bloomberg's Dana Wallman is with us. And look, if they're going to be recommitting to spending in the U.S., they're probably still going to be facing, what, at the moment, 20% tariffs on an iPhone ship from China. They're still going to be looking to move into India. The headwinds aren't stopping, but the market is still at least a bit more relieved.

Absolutely. This would signal some relief. But to your point, this doesn't exactly eliminate tariffs. And as we've reported before, even if Apple wanted to shift production more to places like India, the ramp up on that is going to be gradual. It doesn't happen overnight and won't necessarily happen in time for the big iPhone launch this fall.

And time and time again, Mark Gurman's been out there saying, look, maybe they have to protect margins. Maybe you look at a slight price increase. We've been thinking about how they tend to enact that, whether it's an actual more costly iPhone or whether it's more about the data and the services. But what are you hearing in terms of how they innovate in this context as well?

So it does feel very safe to assume that Apple is at least considering price hikes. Every other consumer electronics company, including Microsoft recently with the Xbox, has had to weigh, if not impose, tariffs. And I think you're going to see more in that space in the consumer electronics industry. Apple, for its part,

If these price hikes do come to bear, they're going to be coming at a time when Apple is expected to announce a radically, radically might be a strong word, but a noticeably redesigned iPhone, more than just spec bumps, more than just software upgrades, but thinner, just something that might actually persuade people to upgrade. And it would be interesting to see how much Apple frames any sort of potential hike around, quote, technology improvements, design improvements, etc.

I don't expect them to mention tariffs in any sort of big presentation that it makes. But the real redesigns, they're coming in 2027. That's when we get curvature. That's when we get foldable, right? 2027, Mark Gurman has reported, is the year that you can see maybe more ambitious, bold Apple designs. And we're talking, as you say, more than just a slimmed-down iPhone. But things like a foldable phone, an entry into home robotics would be really interesting and is something that Bloomberg has reported on.

But there is a really interesting and possibly unfortunate gap between the present and when Apple's finally going to be able to catch up in terms of its ability to manufacture and market these devices. And, of course, bring genitive AI to bear as well. Dana Warman on all the latest out of Apple right now. And look, let's shift gears to another magnificent seven stock, Tesla.

It is, of course, rising today along with the rest of the market. The stock has faced so much volatility of late, whipsawed by global trade tensions, weak sales, Elon Musk himself. The tech billionaire, of course, has faced backlash from his Doge efforts and Bloomberg opinion columnist, Gautam Mukunda, is sounding the alarm on Musk. He's writing that the call is coming from inside the house. It's Musk's approach to leadership that is sowing the seeds for Tesla's next crisis.

one that could affect the entire industry. He needs to realize that being bold doesn't just mean playing fast and loose on safety. Gautam Mukunda joins us now. Can you bring us the examples, Gautam, where you think Elon Musk has been playing fast and loose with safety? Caroline, my critique is about the culture that he's establishing at Tesla, right? So what we know about safety culture is in every company that has ever decided to make safety its number one priority,

is they de-emphasize hierarchy and they make it safe to dissent. But physical safety for your customers and for your employees comes from psychological safety. From your employees being willing to say, "Hey, we're making a mistake. We need to stop this."

And if there's anything that you can see about the way Musk runs everything, not just Tesla, it's he's incredibly intolerant of dissent, of people beneath him saying, hey, I don't think this is right. We've seen a multitude of lawsuits against Tesla from employees saying that they've been retaliated against for raising safety concerns. When you have that kind of a culture, being a safe company becomes almost impossible.

And you sort of take echoes from the past with Boeing, for example, and the issues that company has faced in a similar time of going for growth over potentially safety calls and a clearer chain of command.

Boeing used to be the safest of all airline companies because they had this culture, one that was dominated by engineers, where when people thought there was a safety concern, everything else would go by the wayside until it was fixed. And where you had complete freedom as an employee at Boeing to go to anyone at Boeing and say, no, we have a problem and this is a really, really important problem.

When Boeing abandoned that culture in order to pursue short-term shareholder returns, we found out that they got the short-term returns for a little while, although not recently, of course. But much worse than that, the safety reputation of Boeing that had been cultivated for almost a century was thrown away because their airplanes started crashing, which they had never done in the same way.

not mutually exclusive outcomes here. Just because you're putting safety first doesn't mean you need to hold back innovation. And you highlight, well, a couple of key executives in the past, particularly in the mining field, that really went for security and actually benefited them. So, yes, the most famous example of this in the United States is Paul O'Neill at Alcoa, who said, we are going to make this the safest company in the world.

And when he first announced this, when he became CEO, one of his investors went and sort of said, they've appointed a hippie to run the company and he's going to destroy it. And in fact, while he was CEO, the value of the company went up by a factor of nine. Because what O'Neill realized is there is no such thing as a well-run unsafe factory. Similarly, Cynthia Carroll at Anglo-American, when she transformed safety in Anglo-American, said there is no such thing as a well-run unsafe mine.

So, no, these are absolutely not intentions. Psychological safety helps you on safety issues at the company as a whole. They also help you on innovation. It is the single determined factor more important than any other in determining the success of a team is how psychologically safe the people on it feel. When you take it away, you take away everything. It's interesting, Gautam, though, you reference a lot about the push into the robo-taxi space in particular, that this is the moment that Elon Musk needs to be focused on safety above all else.

But actually, he's been outrun by local competition, Waymo already on the streets performing. You've got China in particular showing growth when it comes to robo-taxis and autonomous vehicles. So he's not really sort of running ahead of himself in terms of pushing for innovation ahead of safety. Or do you feel that there has been moments where that's occurred?

So, I mean, there certainly have been moments. So before robo-taxis, Teslas are incredibly safe cars if you are in a crash. But the ideally safe car is one that never gets in a crash in the first place, and Teslas do nearly as well. In fact, autopilot, for example, does not seem to make you safer when you're driving the car. It may actually make you a little less safe because it decreases driver attention. So we were already starting to see concerns about that with Tesla. But going forward, I mean...

Tesla is not the leader in automated driving. Waymo is. We all know this. They are vastly ahead technologically. But Tesla's promises of what they're saying they will offer, if they want to offer anything like that successfully, they have to be at least as safe as Waymo, and they probably need to be better.

And that will be very, very difficult to do if they don't have a culture where people, every single person at Tesla, feel safe to say, "Elon Musk, we are not a safe company." Gautam, do you have the confidence that the culture will allow for that? Because thus far, the corporate governance is saying, "We are sticking by Elon and Elon only." We're not even assessing whether anyone could ever indeed replace him if needed.

I don't at all. I would never underestimate Elon Musk to work miracles or what seem like miracles, but there is a track record of CEOs who have transformed the culture of their companies in ways like this. O'Neill is one example. Alan Mulally would be another. And the thing you'd say about them is they really don't operate anything like Elon Musk.

They emphasize that the team is more important than themselves. They emphasize that hierarchy is the death of success in an organization. This is not the way Musk has operated anywhere he has been, certainly in the last 10 years. You could make a real question about whether early Elon operated like that, but the one we see today just does not.

Gautam Mukunda, thank you so much for joining us from Bloomberg Opinion. We appreciate it. Now some breaking news from a geopolitical perspective. In the last few minutes, we are reporting the headline that Hamas indeed has released Israeli-American hostage Eden Alexander.

It was a hastily announced move, of course, ahead of US President Donald Trump's visit to the Middle East. Now, hours earlier, we did know, of course, that Israel is planning on sending its negotiating team to Qatar on Tuesday as part of the latest efforts to secure the release of the remaining hostages who are in Gaza. Now coming up, investor Carter Reum joins us to discuss how this easing of trade tensions that we're seeing between the US and China could impact global supply chains and e-commerce. This is Bloomberg Technology.

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Now, a bit, to say the least, of a reprieve in the trade war between China and the United States has people talking, in particular, Flexport CEO Ryan Peterson commenting on X this morning saying, get ready for a shipping boom. Let's talk more about the tariff reprieve that night today paused with Carter Ream, co-founder and partner at venture firm M13, which counts sourcing and services start-up

Pietra as one of its portfolio companies. That company, it seems, helps brands shift supply chains away from China and make business decisions based on the tariff environment. Carter, boy, Pietra must have had an interesting few months.

Absolutely. Pietro is building kind of the AI brain for e-commerce companies. And part of that is supply chain. You know, they have over 30,000, you know, non-China suppliers on their platform, about 6,000 of those in the U.S. And they have definitely been busy. They've seen about a 5x increase in people wanting to reshore. And reshore.

an extremely higher cost? Like how are they helping startups, wannabe D2C companies, navigate the fact that making a product in the US is likely to be a lot more expensive than if they had source from China?

Yeah, I think, you know, it used to take a few months to reshore. Now using AI, you can literally upload a photo of your product you were previously making in China. And within about two days, you can find kind of the most, the best factories, the vetted factories in the U.S. You can compare costs. But this is where the power of AI can just take something that literally took months and now do it in days. So you couldn't do it in days, but have we seen slight improvements?

elastic nature in the desire for companies to reshore and they will swallow either margin hit or they will pass on that increased cost to their user base.

You know, I think right now there's just a lot of uncertainty. And with today's news, it obviously gives people reprieve. But I think the one thing that every kind of brand or company realizes, you have to have multiple options in your supply chain. So I think to be decided on, you know, the cost structure and whether they pass it along. But I think everyone right now is just panicked and trying to figure out

how to make sure they have alternative sources. And there's a lot of great sources and factories in the U.S. and also other places outside of China. So let's talk about the underlying technology of how, by just taking a photo, you're suddenly able to ensure that you can source, make, manufacture closer to home. How does it work?

Yeah, I mean, I think, you know, they have about over 30,000 vetted factories. Then you can use a Gentic AI, reach out to those factories while you're sleeping. You can have them, you know, negotiate. You can have them do samples. But there are a ton of great factories all over the world. And you can see what other brands are, you know, produced at those, made at those factories and things like that. Let's just talk about the rest of your portfolio at the moment, Carter, because you've clearly got Pietra seeing the upside. How have the rest managed to...

Well, ultimately, try and steer in this moment of uncertainty. Yes, we see tariff-approved for 90 days, but maybe it's just 90 days.

Yeah, I mean, thankfully, at M13, we don't invest in hardware companies. We don't invest in a ton of companies that have been impacted directly by the tariffs. Obviously, a lot of companies are affected indirectly. You know, right now, obviously, so many companies are just obsessing about AI, how to supercharge their current business models or create new business models. So we've been fortunate that, you know, we haven't been impacted like a lot of others.

And is the resilience there to commit to investing in generative AI, to reorientating the business when many are just trying to make ends meet when trying to understand the latest headline impact, Carter? Are you willing to invest in some of the latest startups in this environment?

Yeah, I think as a venture capitalist, you take a very long-term time horizon. We're looking eight or 10 years out. Obviously, it's an exciting time. AI is disrupting so much. I think right now, everyone's talking about the technology, but we obsess about what are the implications of that technology? What's not possible? What's the next billion-dollar company that will be run by three people? So I think it's an exciting time. There's a lot of change, and that will not let up.

But there's a lot of opportunity. Katarine, partner and co-founder of M13. Great to have you on. All thanks, Pietra, and more broadly across your portfolio.

Some breaking news on AI valuations for you. As Wall Street Journal is currently reporting, Perplexity is in talks to raise about half a billion dollars, 500 million, and about a $14 billion valuation. Now, interestingly, back in March, Bloomberg was reporting that Perplexity was in early talks for funding at an $18 billion valuation, so maybe pulling back a little bit.

But we'll keep you abreast of the latest fundraising going on in general to the eye. Let's shift over to the world of media companies right now because they are showcasing their new TV lineups to advertisers this week. But only 28% of marketers plan to actually increase their ad purchases during the upfront period. Bloomberg's Asia Counts joins us and I'm assuming it's because of, well, complete anxiety around the economy right now.

Exactly, right? The wave of economic uncertainty across the board is really making folks hesitant to go into the up-fronts and commit ad dollars for the next 12, 14, 15 months, right? Not knowing what could happen tomorrow, what could happen in the next month. So it's broadly expected that there's going to be a little bit of a pullback in those commitments this time going into the up-fronts this week, just because people don't know what's going to happen to their business and they don't know what's going to happen in the broader market. Now,

We did hear some enthusiasm. Paramount Global, for example, the interim leaders there had said, look, we're hearing really good things and conversations. Who are the main companies trying to woo right now? I'm assuming it's the likes of Paramount's overall media. We've got Fox, we've got NBC as well. And who are they trying to take money from?

Yeah, absolutely. Disney's another one. You'll also have some of the streamers, so Amazon Prime Video. I think a lot of the conversation is going to be around sports. So over the past year, there's obviously been a broad sort of decline in viewership on cable, but sports has remained really strong. And if you want to get ads next to those premium sports that are on the NBA, the NFL, the NHL, you have to commit during upfront. So I think that's where we're going to see some strength. And the companies that have strong sports programming,

are going to do really well and up front, I think they're going to see some of those commitments. Asia Counts, perfect way that we now continue the conversation about the sports side of things. We thank you. Let's take a look at the new features that NBC Peacock in particular is going to be offering in return for its coverage on the NBA games for the first time in decades. Newest, Clarissa Palmieri joins us. We're just hearing from Asia how it's basically all about live sports and, well, it's a good time for Peacock, therefore.

Yeah, so they just announced today, you know, they had this big deal to broadcast NBA games. They stole them from Turner. It's an 11-year deal. And so when the season starts later this year, if you go to Peacock, you'll see right away, even if you weren't planning on it, if there's a live game, there'll be a little window showing you the game. You click on through, there's going to be all sorts of interactive features. For example, celebrity cams. You could watch the reaction of some of the celebrities in the audience. You can...

using augmented reality feature that's going to show you not just player names as they move around the court, but their statistics, if they're trying to make a shot, what the percentage is, they're going to...

have a feature called Scorecard that's sort of like a daily fantasy contest, not for real money, but you earn points and they're gonna have a leaderboard for the viewers. So you can imagine a lot of excitement there. - This takes investment though. And unlike some other rivals, Disney Plus I'm thinking about or a Warner Brothers offering, Peacock's not profitable, right, Chris?

That's correct. Paramount Plus and Peacock are the outliers and most of the other guys have turned profits. But this is the direction the industry is going, so they have to invest. If you just think about this event, the upfronts began in the 60s when there were three broadcast channels and now really all the

big news this week that we're expecting are going to be around streaming. You had the Peacock announcements. Fox this morning said that, talked about their new streaming thing called Fox One. It's going to be their channels tomorrow. We're expecting a big presentation from ESPN talking about their standalone streaming product. So it's really all about streaming these days.

got the feedback that this is what fans want, that this is the way fans are going to engage, then they're not just going to be going to TikTok to get the latest news on sports and see the ads that are being associated with the sports content over there instead.

Well, we'll see. I mean, part of the ESPN presentation, we expect there's going to be a lot of interactive features as well, betting and all that. I mean, seeing the screen as Peacock has presented it, it just seems a little bit too much. There's already a lot going on during sporting events and all the data you see. But there'll be the option not to watch that, I think. And streaming is, I mean, it was a big deal, and Amazon got Thursday Night Football.

The viewer numbers weren't quite as big as they had been on Fox, but they've been coming back. People are gradually getting used to finding their favorite teams on streaming.

Sports rights, that's where it's at. Not to mention the sports documentaries too. Chris Capal, Mary, we thank so much. It's a great read. Go and check out what Peacock's doing about the NBA. But meanwhile, that does it for this edition of Bloomberg Technology. You don't want to forget to check out our podcast. You can find it on the Terminal as well as online on Apple, Spotify and iHeart. What a day in terms of the markets. Currently soaring on the NASDAQ. The NASDAQ 100 currently up more than 3%. We are back officially in a bull market. This is Bloomberg Technology.

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