CoreWeave Shares Tumble After Loss Widens on AI Buildout Costs

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1:21Podcasts. Radio. News. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts. or watch us live on YouTube. Anurag Rana joins us here. He's a tech analyst for Bloomberg Intelligence. CoreWeave. Anurag, we've been talking about CoreWeave today. I need a better understanding. Just give me the DES function kind of definition, basic definition of what CoreWeave does and what's going on with the news. So in the most simplistic way, they are renting out GPUs for people who are looking for anywhere to run their AI workloads.

2:05That could be training of the models or that could be, you know, the inference workloads from the applications that you're running. So very simple business model. They are a partner with NVIDIA. NVIDIA is also invested there. They buy their chips. They put it in a data center and people, you know, rent it out from them. So when I look at the stock performance for CoreWeave, of course, we know it IPO'd back in late March. We're seeing shares that are up about 200 percent. But I want to know why is there this conversation about the rally sputtering out? What's really weighing on the stock here? So when you look at it and you go back to March when the IPO was coming out, it was actually really poorly received.

2:43You know, one could argue it was underpriced because not looking at the growth prospects of the company, but focused more on the capital expenditure and the expense and the loss, and they have to go out to debt markets to issue. So that was the sentiment back then. And suddenly within a two, three month period, all of that evaporated and the stock went up to, you know, 160 or so. What we are seeing as of last night is fundamentals are strong. They're still getting a lot of bookings, people using their cloud, but everybody's now suddenly again worried about interest expense and capital expenditure and so forth.

3:17And that's the growing pain I think this company will have to endure being in public markets because you could do that as a private company, but very difficult. People will get excited and people will worry about one thing or the other at one point. All right. I have to ask Anurag just about what we saw yesterday about refresh my memory on this whole Google Chrome thing. Who's put a bit out there? Right. Give us what's going on out there. I just kind of just please. We need to know. What do you know? Yeah, I did a terrible job asking that question. So just tell us what the news is. Well, so what's happening is there is, again, you know, the DOJ case that's happening with Google and the whole decision, you know, the argument of trying to break it up and why Chrome is a monopoly and the whole thing.

4:09Perplexity, on the other hand, as also a search, AI search product. And one way they can gain a lot of users if they have ability to control Chrome. But frankly speaking, I mean, if you look at, you know, some of the paperwork that was filed as part of the DOJ case, that product is probably worth north of$50 billion. And I have no idea why a company that's probably valued at about$18 billion or so wants to buy this asset. And, you know, it just sounds a bit, you know, strange or a bit unusual for us to even, for them to even be talking about it. Am I the only one that didn't know that Google Chrome was up for sale?

4:48Well, it's not. That's the point. No, it is not. It's one of the things that – is this right, Omar? It may be deemed a remedy that will be ordered by the judge? It would be too harsh. But, you know, again, this is one of the hypothetical 20 things that can happen. But at the same time, I mean, let's – I'm just, you know, making this up. Google may decide, you know what, shareholders, you can have this as a, you know, separate company altogether. That would be so much more powerful, you know, with Gemini and all that stuff. But again, from our experts, we don't think that's going to happen or on the table.

5:19But yes, it is expected. In the long laundry list of things that can happen, this is one of the things that people have talked about. Stay with us. More from Bloomberg Intelligence coming up after this. When your options are limited, so are your opportunities. At SIBO, the global exchange that pioneered options trading, we offer more ways to move with the market. From VIX and SPX options to global market data solutions, SIBO helps investors diversify, manage risk, and stay ahead of whatever the market does next. SIBO. Life is better with options. Your investments could be too. There are risks associated with SIBO company products.

5:57Review the disclosures and disclaimers at SIBO.com slash US underscore disclaimers. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same. The thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals. Adio is designed for that moment. It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster. With revenue agents and automations working around the clock, you'll have everything you need to scale your go-to market efforts. Elevate your wins with Adio.

6:29Start your free trial at adio.com slash iHeart. Next week on Leaders with me, Francine Lacroix. I speak with Harvard Business School professor Linda Hill about what CEOs need to know to be successful. It really is not about them. It is about the organization. About how to lead in the age of AI. That requires a lot of confidence. And why great leaders embrace conflict. You need to amplify difference. Listen and watch Leaders, the podcast with me, Francine Lacroix, on Bloomberg TV or wherever you get your podcasts. you're listening to the bloomberg intelligence podcast catch us live weekdays at 10 a.m eastern on apple car play and android auto with the bloomberg business app listen on demand wherever you get your podcasts or watch us live on youtube in other news we had a little m &a trade here today which i think is very interesting um we have gildan which is a canadian company buying hanes brands like on the underwear company 2.2 billion dollars abigail gilmartin joins us here Bloomberg Intelligence footwear and athleisure analyst here.

7:35Abigail, thanks for joining us here in studio. Can you tell us who is Gildan? Because I don't think a lot of people know of them. And why are they buying an underwear company? Yeah, definitely. That makes a lot of sense. I think a lot of people probably own Gildan and don't know it. Right. Because it's really a basic apparel manufacturer. So they create the t-shirts that then they sell to your favorite sports teams or to Walmart. And then they put the logos on it. So they're heavily in the printware space. They do have exposure to innerwear, which is what Hanes is. Hanes is, you know, the basics underwears, bras, tees.

8:07And they used to be in activewear until they spun off Champion. So they're very complimentary. Yes, they spun off Champion about a year ago. Okay. Interesting. And I definitely remember, Gilden, as you mentioned, when you just start to look into the tags of your T-shirts, you'll start to see the name pop up there. But, I mean, what's the latest with consolidation more broadly in your industry? I know you have a lot of names that you cover that are doing a lot of mergers. Yeah, definitely. I think, you know, it comes at a time with tariffs and costs looming, as well as, I mean, for this acquisition, I think it's been considered for a while.

8:41This actually, there was a whole proxy battle about it a few years ago where they actually ousted the CEO over it. And then he has returned since then, and they completely changed the board over. So this didn't come completely out of nowhere, but I think it makes a lot of sense just in terms of, you know, Gilden's building out their whole manufacturing footprint. And it's, once again, really complimentary. They already kind of make everything that Haynes does, but on a larger scale at a lower cost. And Haynes Brand's based in Winston-Salem, North Carolina. Yeah, okay there. Talk to us about, you mentioned the tariffs.

9:16How is it impacting your world? Because I would think that would be immediate. Yes. So it definitely is impacting my world with, you know, the footwear brands. But for Gildan and Hanes, actually, Gildan is one of the largest users of U.S. cotton. So, yes, they are probably one of the largest ones. And so that is actually going to help them not have to deal with as many tariff costs just since the products are made with U.S. cotton. So they're subject to a lower tariff rate. So that's actually something that they can benefit from. They also are less exposed to Asia and more in Central America, as well as Hanes brands.

9:50Their manufacturing footprints are very complementary and overlap. So they'll be able to kind of mitigate that pretty well. But for Hanes brands, Gilding gives them a much more financial stability and opportunity for that. I want to quickly move over to on holdings. I know this is also a company that you cover, a sneaker firm. They're basically seeing analysts at Jeffries that are saying that 2025 will mark the peak. in the company's sales. And I want to know, what is your reaction to this downgrade here? Yeah, I don't think we've seen the peak of on. I think they're just starting in apparel. Apparel, they actually sold more units of apparel this quarter than they did footwear.

10:31It grew over 75%, and they're really just getting started with that. They're also really just getting started with their DTC expansion, opening stores, as we've seen in New York, a few pop up, but they're doing really well with that. So I think they have a long runway for growth. Stay with us. More from Bloomberg Intelligence coming up after this. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same, the thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals. Adio is designed for that moment.

11:02It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster with revenue agents and automations working around the clock. You'll have everything you need to scale your go-to market efforts. Elevate your wins with Adio. Start your free trial at adio.com slash iHeart. Hi, I'm Barry Ritholtz, inviting you to join me for the Masters in Business podcast. Every week, we bring you conversations with the people who shape markets, investing, and business. I speak with CEOs, Nobel laureates, market innovators, and legendary investors. Whether you own stocks, bonds, real estate, commodities, even crypto, these are discussions you absolutely need to hear.

11:44Subscribe to the Masters in Business podcast on Apple, Spotify, or anywhere you listen. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. You know what I'm doing? I'm finding myself doing more and more, which is just the self-checkout. You know, whether it's at the supermarket, going to the self-checkout line, scanning your thing, you know, paying. Airports, you know, they don't have cashiers anymore when you go get a snack and a bottle of water.

12:20So more and more. And I'm always wondering, who does that stuff? Who does that technology? Who's behind it? And I think the next guest is going to help us out here. So Geet Manor joins us. He's a chief financial officer. And the company's name is NYAX. It trades on the NASDAQ NYAX. Market cap about$1.6 billion. Stocks up about 47 % year to date. They reported some numbers, I believe, yesterday or today. So, Guy, thanks so much for joining us here. Tell us what you guys do at NIAX. How are you guys in that kind of self-service space in the fintech space? Good morning. So, we are actually the global leader in payment and management solution for the unattended market.

12:57And what does it mean unattended? It's really the vending machine, massage chair, EV chargers, when it's just you in front of the machine. There's no cashier in between. And in fact, if you bought a drink in a vending machine lately at the JFK, you probably used one of our NIACS yellow devices. So we have more than 100 ,000 customers. We sell our product in more than 120 countries. And we have a very simple mission statement to help our customers grow the business. What does it mean? Increase their revenue, decrease their cost, and through loyalty, create that stickiness with our customers, with their customers.

13:42How do you stay ahead in today's fintech landscape? Of course, there's a lot of players now. So actually in our area, there's not a lot of competition. I'm talking about the payment in the unattended space. So in fact, we are the only global, as I said, player in this unattended space. It's a very fragmented business and decentralized. So there's a lot of small players and we are with our global solution, basically integrated hardware, payment and services all together. We can bring that to the local market. It's also a very highly regulated market. So there's a lot of barriers to entry. So whether it's a regulation on payment, whether it's privacy.

14:38and with our global solution and with us being there for 20 years, we were able to overcome that. We look at ourselves as a payment company and what do you need as a payment company? You need basically three things. You need the trust, you need the scalability and you really need the easy doing business. So from a trust perspective, we build that trust over the 20 years. We have a very strong brand. Look now for the yellow devices. You would see that everywhere. from an easy to do business with. It's again, it's a B2B2C. So we have a very, you know, it's a high profile company. You go to whether it's the car wash to the vending machine and you see us.

15:19So B2B, it's all about regulation. And we were able to overcome that. When it comes to B2C, as I said, it's in front of us. And you want that in a nanosecond to get your snack, to get your coffee. So on the scalability, this is where we are focusing, right? This is what takes time to build. And we've showed that we are using more than 80 distributors all around the world, right? So we are setting our product straight to the OEM. So when the vending machine, the massage chair, the kiddie ride are coming from the manufacturers, it will already bring that NIAX device. Talk to us about the EV business, electric vehicle business.

16:01How are you guys approaching that? What is your expectation for how that business will grow for you? So, great question. EV is definitely one of the three main growth drivers as we look into 2025 and even beyond. There's a few elements there. It can be as easy as any unattended verticals that we're already in. and we're already working with the EVgo electrify america electrify canada where we are providing the payment device but it can also be where we are developed the management suite the electricity management suite that has a lot of regulation around it and we were able to to accommodate that as well and then for small businesses which and i haven't mentioned that but most of our customers of small and medium businesses, that's where we provide the oil solution, the hardware, the management, electricity, basically, as well as payment.

17:05So EV, we just signed a couple of days ago, announced the agreement with HOTEL, which is a potential of 100 ,000 EV charging stations to be deployed in North America and also in Europe and many other contracts like that that shows the potential with the fact that we are a global company. So it can be done in France or in the state of California. And you have the same exact product all around the globe. Are there any particular market gaps or audiences that are underserved that you're targeting right now? So, you know, from in the unattended space, which is the majority of our revenue today, definitely there's a place on the EV to grow, the electric vehicle charges, smart coolers is a very fast-growing area, parking as well, micro markets.

18:10So this is in the unattended, but we also are stepping in into more of areas like, as I said, the EB charger that is beyond the payment or even the retail. What we've learned over the 20 years that we're doing business with small businesses is that they're still in the attendant, inside the store, inside the whatever it is that you're selling. There's not a good product for those small businesses. And we are, as we speak, expanding that into other countries as well. Stay with us. More from Bloomberg Intelligence coming up after this.

19:20with Adio. Start your free trial at adio.com slash iHeart. Gain insight on the innovators, disruptors, and tech-driven trends shaping today's complex economy. I'm Carol Masser. And I'm Tim Stenevec. Wrap up your work day with the Bloomberg Business Week Daily Podcast. We bring you deeper dives into the story shaping your world from the evolution of AI to the shifting priorities of global business. Plus, Silicon Valley power players and the latest tech trends. Catch up on the conversations you miss during the day. Subscribe to the Bloomberg Business Week Daily Podcast on Apple, Spotify, or anywhere you listen.

19:56You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Well, the only time I get to ask the question, how's a U.S. farmer doing? It's usually when we're talking to somebody from like, you know, deer or caterpillar or something like that, the people who make all the equipment for. But we want to go right to the source. And boy, do we have a source on the ground. Brian Hefty, he's a co-host of Ag PhD TV and radio and CEO of Hefty Seed Company.

20:31He's coming to us from the Hefty Farm, which is located near Baltic, South Dakota, which is about 10 miles from Sioux Falls, South Dakota. And he sent me a zoom map. man, there is nothing but farm out there. Holy cow. Look at his background. I know. It's awesome. Brian, thank you so much for joining us here. We really appreciate you taking the time. You referred to me as somebody who's just the expert on kind of give us a sense of how things are going out there on the farm. So give us a sense, Brian, how is the U.S. farmer doing these days? Well, first of all, one of the things you didn't mention is we do farm.

21:06We farm about 3 ,500 crop acres. And I would just say right now, the farm economy is not real great, mainly because commodity prices aren't good. They haven't been good for the last couple of years. We've had rising costs as farmers, and so we're struggling a little bit. But the flip side of that is we're doing, as farmers, a phenomenal job producing food for our growing world. We might have a record crop this year. In the United States, I mean, a lot of people forget this. We have the cheapest, safest, most abundant food supply in the world. So, I mean, from that respect, farmers are doing great.

21:39But yeah, financially, not the best right now. Brian, are tariffs filtering into any of those increases in costs that you're seeing that you just cited? Not a lot, but I mean, there's so much going on with this whole trade thing. One day markets go way up, the next day they go down. So it's more impact on the markets in the short term. But as far as our costs, the biggest thing would be some crop protection products, maybe up just a little bit because of that, but not much. Fertilizer is really the biggest thing right now that's gone up a lot. But, I mean, honestly, we source a lot of the phosphorus right from here in the United States.

22:21And we're at not record high or anything, but it's really high, especially in relation to the corn price right now. So, no, tariffs haven't had an enormous impact to date. But obviously, we as farmers are very concerned about international trade. It has a huge impact on our commodity prices. Brian, Matt from New Jersey mails in with a simple question, till or no till? I have no idea what that means, but I suspect you do. I definitely do. We've done both. We've done everything on our farm. But anyway, it's basically, are you going to run over your fields and stir in all the residue into the soil?

23:02So we as farmers often talk about turning the ground black. So basically tilling under, working under that residue that we have. And so years ago, we had no other way to control weeds, insects, or diseases other than with tillage. Oh, and prepare a good seedbed too. Thanks to modern technology, we don't have to do tillage. But the advantage to doing tillage is the soil warms up more quickly. The disadvantage is it's going to be more prone to erosion. Now, one of the things that concerns a lot of just non-farmers out there is they get worried about pesticides. And I would say, yeah, when we reduce tillage, we have to use more pesticides.

23:44But the good news is a lot of the dangerous pesticides, they're off the market today. A lot of things we're using now are what we call more natural alternatives. So, for example, the most popular herbicide in the United States, or one of the most, it comes from a tree, the most popular insecticide. It comes from the chrysanthemum flower. So we've got a lot of these things where they're derived from nature, much, much safer to human beings, and I feel great. Because we work with these things every day. People talk about safety to food and everything else. Well, don't forget, as farmers, we're the ones who have to work with pesticides.

24:16So we're not doing dumb things. We're not using products that are super crazy dangerous or anything like that. Just a lot of misconceptions out there. Are there any concerns in terms of changes in the climate? Is that affecting you at all as a U.S. farmer? No, we believe what's going on with climate is mainly cyclical. But I will say this. I'm from South Dakota. My dad was originally a farmer from Iowa 50 years ago, moved here. And at that time, they weren't really raising a lot of summer crops. And what I mean by that is crops that grow all through the summer and all into the fall. There was a lot of small green that was produced.

24:51Those are spring crops and they get harvested in the middle of the summer. So then there was nothing growing for a while. Well, when you talk about climate change, the biggest thing a lot of people want is less carbon dioxide in the air. We can do that with more plants and having more stuff growing longer during the growing season. And because of that, we have more humidity now in our region than we've ever had before because of these summer crops. So, you know, there's some little changes like that. But otherwise, no, I'm not worried about climate change as a general statement, not impacting farmers.

25:22Brian, your top line obviously has depended in large part on just kind of where commodity prices are. Not much you can do there. How about on the cost side? How's the cost of running your farm and for the average U.S. farmer, how's that kind of changed over the years? Well, equipment's a lot more expensive, but the technology is good to go along with it. Seed is a lot more expensive. I mean, way more expensive, but we have a lot better seed genetics. The cost of just labor in general, much, much higher. I don't like the fact that interest costs are as high as they are right now. Granted, historically, they aren't like the highest level ever or anything, but I loved it for a long time when we had super cheap interest because me, just like every other farmer out there, we borrow lots of money.

26:04So if we can get those interest rates down even another one or 2%, wow, that would make a huge difference on the cost side. So, yes, our costs are dramatically higher than they used to be, but that's just that's part of modern life. This is the Bloomberg Intelligence Podcast, available on Apple, Spotify and anywhere else you get your podcasts. Listen live each weekday, 10 a.m. to noon Eastern on Bloomberg.com, the iHeartRadio app, TuneIn and the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg Terminal.

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