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All right, welcome to the Risk Reversal Podcast. I'm Dan Nathan. I'm joined by Deirdre Bosa. She is CNBC's host of Tech Check. Debo, welcome back to the pod.

Hey, Dan. Always thrilled to be here. All right. This is one that I just needed to get set up here because there's a lot of stuff going on next week. This is stuff that's so in your wheelhouse. Obviously, WWDC, we start out the week and then we get into the RoboTaxi event. I know you were just reporting on that on Tech Check. There's a whole host of other things we got to talk about. You've been doing a lot on perplexity and who they are partnering with, I guess, as it relates to

smartphones, um, Meta AI shakeup. That's an interesting one. And we can talk a little bit about what that means, right? For actually the broader ecosystem, but what it means for their designs with llama and the like, as they keep rolling out different versions, um,

of that and if we get time i'd love to get your sense of what you think of this meme situation with core weave and uh just the competitive setup but let's start with tesla you were just talking about um robo taxi but you're really talking about you know situations as it relates to evs full self-driving and the like where are you on this one and then we'll kind of debate a little bit about the expectations for robo taxi event

So very, very, very big moment when Tesla rolls out its fleet, right? This is something that's normal to you if you live in a place like San Francisco, where we've had robo taxis from Waymo on the streets for years and in commercial operation for paid rides for at least a year. So it's normal to us, but it feels like whenever I talk to someone from the East Coast, they're like,

I'm like explaining the future and they're so skeptical about the safety of it and the adoption of it. When you're here, it's just now truly like a normal piece of life. And people, you know, everyone I know prefers them to actually taking an Uber. The experience is better. You feel really safe.

For Tesla, it's going to create a lot and bring a lot of attention to the space, even though it's only starting with less than 10 vehicles in Austin. So this is a big moment, but I've been covering this space for a long time. And while Wall Street and investors talk a lot about speed and scale, in my experience, it's safety and trust that matter a whole lot more. I'm sure you remember, Dan, years ago when Uber

let go of all of its ambitions after that horrible accident that killed a pedestrian. That was really what ended it all for them. And then Cruise, more recently within the last few years, had an accident here in San Francisco. These were deployed. I took a cruise. I didn't feel particularly safe in it, actually. It's just anecdotal. But dragged a pedestrian. Didn't kill a pedestrian, but dragged a pedestrian. And the video was out there. And after $10 billion invested by GM, completely shut down. So, you know, Tesla...

has to get this right on trust and safety. Otherwise it could have the same effect. And to bring this back to stocks, right, Dan, of course we know that Elon Musk has said that self-driving is the difference between Tesla being worth a lot or being worth, you know, essentially nothing. So that is really going to be the real test. And I mentioned it today because new footage was released. Bloomberg got a hold of footage by asking for the public records of a

a Tesla using FSD that struck and killed a pedestrian. And that just, you know, seeing it is quite shocking. And it also sort of raises the debate, how do you develop self-driving cars? Elon Musk's version is vision only, doesn't use lighters or sensors. He said that cars just need to be able to see as well as a human versus Waymo, which is

all about redundancy. You have cameras, you have LiDAR, you have radar. And when I talked to the co-CEO a few weeks ago, she said, that's absolutely necessary. You need the belts and you need the suspenders because you can't play around with trust and safety. Yeah. And I guess Elon's version of full self-driving that leads to autonomous taxis in the lake, and it just hasn't proven out yet. And when you think about how many millions of hours or rides that

Waymo has already booked and I've been out there. You and I've talked about it. I mean, there is a trust aspect that gets solved very quickly once you get in those cars. And, you know, the way it's geofenced, the speed in which they can go, they seem to be almost overly cautious, if you will. And if you take it the other way with an Uber driver, you know,

on average, and this could be anecdotal too, they tend to be the opposite way as it relates to that. And if Elon is correct about this technology ultimately being far safer than that of human drivers, then it's really, how do we get from here to there? And we get this thing in kind of, you know, a month,

we're way more than four cities right now and they're going to have a big lead because i think we will all take the over of you know originally they were supposed to have 100 cars in austin by the time by the end of this month now it's 10 they're talking about having revenue in q4 this year that's not happening right and so when you think about also some of the other limitations of this this taxi is a two-seater um which seems kind of odd especially if you've been in a um

You know, in a way, Mo, and the last thing I'll just say is like, I was reading some analyst reports the other day in anticipation of this event. They're talking about customer owned vehicles being in the fleet. The logistics of that are so like just daunting if you think about it. So there's just there's more questions than there are answers at this point. I have a Tesla and I do use FSD and I've seen

firsthand the improvements especially over the last year I mean I use it to get onto the highway to go over the Golden Gate Bridge every day to work to navigate through the city I wouldn't have done that a year ago it was way more clunky there was way more driver interventions so it has gotten a lot better but I mean to sit in the back seat like you do a Waymo that is a completely different proposition would I do that right now on the FSD that I experience absolutely not um

but we'll see how that ramps. Well, when you think about Elon just leaving the administration just this past week or so and now kind of turning his sights on whether it be this tax bill or whether it be some of the folks in Congress who vote for this bill and speaking up one more time about, you know, the idea of primarying people.

I mean, this is a situation where if you think there's been massive brand degradation and a lack of trust in Elon, the way he took over Twitter and some of the stuff that he went on there and just alienating a whole host of folks, just not only here, but obviously abroad. We've seen the sales figures in Europe that have been plunging in China. He has a ton of competition. There's a whole host of other issues there with the trade war and that sort of stuff. But now that he's out of the administration...

Now that we know that they have been in a horrible price war for the last few years, we know that their auto gross margins are that of GM and Ford. We know that GM and Ford are pulling away from the EV space. And if you have these $7,500 tax credits taken out because Trump is pissed off at Musk or it was always going to be that way,

This is going to be a really difficult situation for the EV business at Tesla. And that's the business that's supposed to fund the build out of this, you know, of this robot taxi thing. And so I don't I think it's going to take much longer than a lot of people expect. And I think the real test will be next week when they come back, when the investors and the analysts come back and they tell us what they had to say about this, because last year,

Remember they had to delay the RoboTaxi event and people were not particularly impressed, you know, and the stock sold off a lot. So what are you hearing about expectations? Because you said it, trust is a big one. If this is a big flop, then you lose trust every step of the way in their ability to execute here.

I mean, and the other side of it is there's a ton of opportunity, right? Just as the EV race gets harder, more competitive, you know, somewhat a race to the bottom, robo taxis, it's just Waymo and Tesla, right? Amazon has something going on. But Tesla, if you believe it can scale, if you believe the technology is going to be good, does represent that huge opportunity. But I will note when you say what are expectations, there was a note this morning from Citi. And, you know, the first thing they talked about is watch Tesla's rollout this month.

and be ready to buy Uber essentially. Because if there's an accident, Uber is going to bounce on that, which was pretty morbid and you don't want to ever have the other side of any kind of horrible accident. But Wall Street is Wall Street. And that's what they said. They said, watch the news. So you see some of that skepticism creeping in even from these notes. Let's talk about Uber for a second. I know this is a name that you've...

I think covered since they went public a very long time ago, probably before that. And, you know, it's interesting. So, you know, that robo taxi event last year was supposed to be in July. They pushed it out to October. People were not particularly impressed. And I know you remember this, but the day after the event,

Uber gapped up and was up like 10%. It was a new all-time high. And because some of the initial kind of feedback was that it was particularly unimpressive, but then the stock proceeded to sell off 30% over the next couple of months or so. Now the stock's above

above those sorts of levels where it made a new all-time high. And so it's come back a great deal. Maybe that has to do with the lack of confidence and the ability for Tesla to really scale this. But how does this shake out for Uber? You know, Travis Kalanick, you remember, I know you knew him. You were probably interviewing him back then. He got in a lot of trouble. He said, "Our biggest problem are the drivers," right?

But Dara doesn't seem that focused on building out or working towards autonomous network. I think he values the driver. So talk to me a little bit about where Uber sits in this whole kind of debate going forward.

So completely different views between the founder, one of the founders, Travis Kalanick, who, you know, ushered Uber through 1.0 and Dara Khosrowshahi, the operator who has done a really good job ushering Uber through 2.0. But this you could say is Uber 3.0, right? Because this is an existential question. What happens when you get robo taxi adoption? I don't know if you saw that Mary Meeker slides presentation. 300 pages. Yeah.

300 plus pages from Bond Capital. This is one of the most anticipated, most read reports in Silicon Valley. She actually hadn't done one in five years. This one was all about AI, but buried within those 300 plus pages was a slide on the robo-taxi race. And she used some data that showed that Waymo in San Francisco has surpassed

Lyft rides or market share and is getting closer, catching up to Uber's market share. I mean, that's huge. And you look at that and you say, okay, Lyft and Uber market shares are shrinking. And that's because people really like robo taxis, right? You don't need to get in someone else's car, even though you said, Dan, that maybe it's more on the cautious side. I would actually argue that it surprised me in how

you know, smart it was. It was cautious, yes, but it was also like fairly aggressive more than I thought. I thought it would be sort of like stalling to let anyone in and it doesn't really do that. So it's a good experience. And then Uber will counter and Dara Khosrowshahi is fond of saying that Uber is going to be a platform.

This isn't gonna be a winner take all market. And there's gonna be many different autonomous driving companies like Amazon with Zoox, and they don't wanna make their own platforms nor do they wanna do all of the fleet management or all the other stuff related to maintaining cars or running a platform.

My question, which I think is still very much unanswered, is, is this a Trojan horse situation? Yes, Waymo is partnering with Uber in Austin, but are they just gaining all the knowledge and scale that Uber can provide right now? Because clearly they're going it alone in places like San Francisco to huge success. And I guess it comes down to what does it do to the margins, right? Does it help them to have a partner or not?

I mean, it's very easy, as they've shown, to run a rideshare platform. And as Elon Musk is fond of saying, too, it's very easy to get up and going. Yeah. When you think about a business like this, that's so capital intensive, right? If you're going to like own these sorts of fleets. I mean, in the case of Uber, I think it's like 50%.

15% or less of the cars that are driving for Uber are fleet owned, right? So these are largely individuals and they're dealing with all the logistics about fueling, about cleaning, about, you know what I mean, when they're going to be out there on

the road, you know, that sort of thing. And they're making decisions about how much they want to drive versus how much they think they can get paid to do it and surge and this and that, whatever. So, you know, I heard Dara with Ben Thompson on Stratechery, I want to say at least a month ago, and it was a great interview. And they were talking exactly what you're speaking about here. And, you know, he seems to be willing to sit back.

and see how things play out a little bit, partner, you know what I mean, with a Waymo and get like, you just use the expression Trojan horse, but because they have the network, because they built out the infrastructure, at least for, you know, the ride hailing aspect, the hard part is obviously all the tech that goes into the full self-driving, whether it's LiDAR with Waymo or the camera operation, you know what I mean, with Tesla. And I think you are 100%

correct it is not a winner take all this is going to be something that's going to be very different in a lot of different cities i don't know if i said it's a winner i think dara believes it's not a winner take all i don't know about that i think waymo could be the winner here yeah i just think that the the waymo thing like who knows how well it scales you know these are expensive cars and they have a hundred thousand dollars worth of equipment they're going down they're using chinese zekers right which which opens up a tariff conversation but they're also looking at personal ownership

So I'm not convinced yet that anyone else, Tesla or Amazon Zooks or Cruise, obviously, has...

The footprint or is able to scale the way that Waymo has, I mean, 10 million paid rides who they've such a far lead now. I don't know if you saw the journal over the weekend, but they had a big. It's Waymo's world and we're all living in it. Yeah. Yeah. No, I agree. This is going to be one of the more fascinating sort of things in tech that, that play out. It's also AI adjacent to, you know, so there's a lot going on there. Well, and one more thing, what do we know about big tech? They love vertical integration. Yeah.

I mean, is Alphabet – remember, Waymo is owned by Alphabet. Are they going to say, okay, we'll let someone else run the platform for this one? They could easily do so. No. I mean, they love to own the software, the hardware, the whole stack. That's what they do in AI. But by the way, that's probably why Lyft gets bought at some point. If you think that their distribution or their network or their platform is used for a while. Well, what are you buying? You can build the platform.

Yeah, but I mean, like, just think about it. If you're Waymo right now and you're letting Uber kind of book rides for you, if you're somebody who just wants to kind of get in there and get that data of 10 years of the, you know, I don't know. I'm not obviously a particularly technical guy. You know, you and I are going to be together in a few weeks in San Francisco. Let's just take a nice long Uber ride in and around town. The pod from a Waymo. Let's do it.

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All right, let's hit the other much anticipated event next week. And it's WWDC. And I know this is not 100% your beat, but I think the most important part of what's going to come out of this event is 100% your beat. What's going on? The Samsung perplexity conversation is very interesting. You and I, going back to the first half of 24, we kept on going back and forth. Well, Apple, they got nothing here. You know, why not just take a wrapper like a perplexity

jam it into iOS and all of a sudden you could say that we have, you know what I mean, generative AI search. It wouldn't be that hard. It doesn't need to be built into the phone just yet. Thoughts there about what your reporting is suggesting. Would a deal with Samsung be exclusive? Like, you know, how are they thinking about this?

Well, first of all, the Apple problem from people I talk to and everything that I've read and reported on just feels so cultural, right? I mean, you look at Apple versus the other mega caps and who's leading their AI operations and they don't have some really credible white paper data scientists, right? And they just put the head of their Vision Pro right now in charge of their AI operations. So part of this, and they've been

you

we go back to vertical integration, right? They don't want an open AI or a perplexity to take over their user-facing AI. And they care about things like privacy, which I feel like has been turned on its head in the AI era. You give up so much to be able to get more out of these chatbots for better or for worse. So when you look at WWDC in less than a week now, the stakes are so high, but it doesn't feel like

They're gonna put anything out there that's gonna wow us like they did last year. I was at WWDC last year, I was really impressed.

with the demo, which made it all the more crushing that nothing has come out of it. Right. Well, I think the expectations were really high into that last year and they're really low now. And I think that they just kind of the push out of Apple intelligence and, you know, like it was leaked out that they're the big news is going to be a software developers kit and that sort of thing. I think investors are not particularly excited about what's to come. And, you know, my whole view about this is like I wasn't there. I didn't see the demos. But when I heard what they were

building this on the back of Siri and then some of the other features that they were talking about, it just didn't seem like the sort of thing that would drive an upgrade cycle for iPhones. And that's the most important thing, as you know, in the near term. iPhone units have been flat year over year for like three consecutive years. While they've been able to maintain pricing, if all of a sudden Samsung phones have this tricked out technology or Google Pixels

has Gemini infused through it, right? Or cheaper phones around the world that are not paying $1,000, $1,200 for a phone. You have Android and you have some of this other functionality kind of built into it. Then you say to yourself, why am I upgrading my iPhone? Do you know what I mean? So I just think that this year expectations are low. I think it's safe to say they're not going to outperform those expectations because there's nothing there for them to kind of release right now.

Right. And they'd have to change their whole cultural outlook in order to really catch up here. Another way of looking at this, there's the Apple side of it. They need to sell phones. They need a big upgrade cycle. But there's so much opportunity for other players in the AI race. We talked about this on Tech Check a few days ago this week. Yeah, I think it was on Monday. How distribution or the front door is now sort of the ultimate prize in the AI battle.

used to be about who had the best models, the most robust models, but it doesn't matter anymore because they're all commoditized. So who can get in front of users? Who owns the front door? Apple still owns it. And Samsung, right? Essentially a duopoly on the smartphone market, the devices we use to access AI. If you think that AI is going to become more integrated in our lives and we're going to be interacting with

it more. So there's a real opportunity for a company like Perplexity. Dan, the conference we were at a few weeks ago, right, in LA, RBC, we heard from Dimitri at Perplexity. And he was as surprised as anyone that Eddie Q, the Apple executive, named him in that Google testimony just a few days before because

as he put it, the first rule about working with Apple is you don't talk about working with Apple, right? You've seen suppliers just absolutely crush because they said too much. You still see that in the conference call. They'll call out one big customer, but they won't name Apple. The fact that Eddie Q is,

at Apple, one of the most senior executives, was glowing about and raving about perplexity and saying that there was the potential that they could integrate it is so huge for that startup, which is still very small compared to,

the Gemini reach from Google or the chat GPT reach from open AI could be big for them. And that's even just the Apple side with Samsung. You know, I've actually heard from a source as well that they are nearing a deal. I don't know if it would be exclusive, but it would be a big hit to Google who's had that relationship. Yeah. When you talk about the gatekeepers on the smartphone space, obviously, you know, Apple, Samsung, that's it. But when you talk to Dimitri Shevlenko, he's the chief business officer at

that perplexity, he asked him the question about browsers and he said, it's coming. And you know, when I think about my own behavior and maybe you and I are just early adopters, that sort of thing, but I only do Google searches when I have my Chrome browser up. Okay. So if that Chrome browser is not up and I'm, I have my, my phone in my hand, I'm going to the perplexity app rather than going to the Chrome browser on my phone or whatever. And I think the browser is a game changer. You

Folks are not inclined to pay for Perplexity Pro or ChatGPT for 20 bucks. If you have a browser now and there's this functionality, the user interface maybe looks as simple as Google or maybe it's just cooler. I don't know. We don't know what's going to come out. That could change the game and that could be the thing

And I think that's why Google is suffering right now. Obviously, remedies to the DOJ case and the FTC stuff is obviously front and center. But I think the assault on their search business is one of the things that are keeping investors up at night.

Yeah, I couldn't agree more. I think that there was a lot of cool stuff that came out of IO, a lot of really impressive technology products, which Google's getting better and better at, but it still hasn't solved that sort of innovators dilemma that will let its stock get out of this, you know, teens valuation, making it, you know, the cheapest of the Mag7s.

Yeah, no doubt. Let's talk for a few minutes about Meta AI and the shake up there. And just like, so what you just said is really interesting to me that like this Gemini IO event seemed to be the first in a very long time where folks left it and they were like, okay, these guys, they're starting to get their arms around it. They have the potential for mass distribution, not too different than what you just kind of explained, you know, with these other platforms and the like, and now the models they're starting to kind of get

better accolades. The people can kind of see the integration across these different platforms. Meta, you know, like I guess the narrative around generative AI is yeah, they've been building this open source llama. It hasn't been kind of getting the sort of accolades as some of the other models.

But they've been able to use the spend for the metaverse into integrating this technology to better serve ads. They launched or they announced the other day, I don't know if the announcer was reported, that they're basically going to start offering tools for advertisers to create their own ads. You saw Adobe sold off pretty hard on that. What's going on within Meta AI and why are they reshuffling the decks as it relates to management?

Okay, let me go really broad here. Again, in my conversations here in San Francisco, when I talk to VCs and founders, et cetera, there's always this sort of feeling that Apple and meta are the kind of

the left behind, even though in very different ways, right? Meta was on the open source train early, which is well respected. People in tech love open source. They love that Meta was pushing this while all of the other companies were pushing closed source, large language models. So that's like one thing. But a lot of people point to the idea that Meta doesn't have the kind of talent, right? It largely comes down to talent, the talent that Google and Microsoft and OpenAI and Anthropic have.

And I think that the reorg that you heard about last week really speaks to this. They announced a reorganization that split off product from research. Research is essentially like the more cautious side of the business. The idea of the so-called decels or the decelerators versus the accelerators. The idea that you have to split off those that were cautious about developing like Yann LeCun and

i don't know if i'm saying his name right so i apologize if i'm not i love that guy by the way he's always up in elon's grill on the socials he seems like a brilliant guy but he's cautious right he's more on the cautious side and i think you know having your research and your product in one organization has hurt

the overall progress that Meta has made in AI. And you see that because its behemoth model is delayed. When DeepSeq first came out, I remember talking to a really smart AI founder who said, okay, well, Meta is now going to be able to use this method of distillation to catch up right away. And they have it. And now they're working on a behemoth model, which is a huge large language model when the rest of the industry, especially in open source, is going to smaller, lighter, more efficient models. So I don't know

exactly where they stand or what they can do to catch up, but it does, there is this general feeling that they're behind, they have to regroup, which they are with this reorganization. And, you know, how do they, how do they not get displaced by a Chinese open source lab? Yeah. And one thing I'll just say is I know a couple of the product people without naming names, and they're really brilliant people on the product front, right? And so they, I think the idea of creating different sets of priorities, whether it be from the research side of the

product side is something that might make a lot of sense. We won't know for a while. All right, last thing before we get out of here, CoreWeave, it's become a mega meme stock, $70 billion market cap. It went public, I want to say at 38 bucks. This thing is kind of stuck around there for a while. It's a very tight float. They placed the IPO in the hands of existing holders and NVIDIA, which is basically one of their biggest customers, right? And they said that if NVIDIA had not come in, they wouldn't have gotten the deal done.

My concern here is that obviously 30% short interest hedge funds are short this thing. They don't like the customer concentration. There's a whole host of other things. What are you hearing? Because to me, this is one of the very few pure plays in generative AI, right? When you think about it. And maybe that has caught retail, you know what I mean? Like the excitement there. But hedge funds are not...

buying this. They're very cynical about it. So I'm just curious what the vibe is out there about this company. I mean, what can I say about meme stocks, right? I mean, we've been through this a few times now in my career at CNBC. They don't trade on fundamentals, which is what I think you're saying. Interesting idea that, yes, it's the only public sort of pure AI play. And I can tell you that

In the private markets too, I mean, you see this kind of enthusiasm and crazy buying and bidding up of valuations because people just want to get their hands on anything AI. So there's so few chances to do that in the public market, but I would say that you see that in the private market as well, all these mega rounds. Yeah.

It's interesting, though, how long it's taken this perplexity deal to happen. We've been talking about a $14 billion. It started out as a $19 billion deal. And now it really is attached to whether a Samsung does a strategic or some sort of partnership. So all interesting stuff. One thing I'll just, before we get out of here, the fateful eight. Apple is the worst performing year to date. And then the rest of them, Microsoft's very much near its prior all-time highs from over a year ago. And then Broadcom.

which reports Thursday has quietly made a new all-time high, which I think is interesting to me. And the rest are still down meaningfully from their prior all-time high. So it's interesting to me only because the S&P is within 2% of its prior all-time highs. Some of the biggest leaders, while they've come back, they were the hardest hit in April, and now their ones came roaring back, but they're still not at the highs. The AI trade is back, baby. There you go. All right, Deirdre Bosa, Tech Check, CNBC, my good friend. Thanks so much for being here. I appreciate it.

Thanks, Sam.