China Expands Travel Curbs to Top AI Talent

24:41Absolutely. That was quite, I must say, a pretty powerful message that came from the Pope. Just to give you an idea, this is the first encyclical by the new pope elected last year. And also the encyclical itself is the most important, the most official act from the pope. So it really includes some of the priorities of a new pope. And the fact that it shows artificial intelligence, not only that, but the way artificial intelligence is changing our lives, it might change our lives in the future, I think it really says something. As you said, he actually used this word disarm and disarmed. It needs to be disarmed.

25:27It doesn't mean that the artificial intelligence must be somehow blocked, but must be regulated. That was the main thing. and also the fact that it basically said that it must be used, of course, for, you know, just for good intentions and kind of indicated all the possible risks. For example, indicated the fact that using computing, using artificial intelligence in a war, in the military and defense sector is really a dangerous adding and a quote, no algorithm can make war morally acceptable. Seems to be a lot of things going on outside the Rome Bureau right now. Flavia Rotundi of Bloomberg talking about what is about magnificent humanity.

26:22That is ultimately what Magnifica Humanitas is all about, Ed. What's so interesting is about 135 years after the original Pope Leo talked about all the new things, the first industrial revolution, and how to help humanity through that coming of age of technology. And now they look at the age of AI.

26:39Caroline Hyde:Yeah, 1.4 billion Catholics around the world. If you want to talk to someone about AI, one message is a Pope's address, one way of doing it. Certainly. Well, from the AI humanity question, it's a bit of M &A for you. How's that as a plot shift? Delivery hero up next. This is Bloomberg Tech.

27:04Welcome back to Bloomberg Tech and let's take a look at today's big number over$11 billion. That's Delivery Hero's current market cap as it stands. And that is after Uber has offered to take over the German delivery company in a deal that would value it at about 10 billion euros. Now, clearly, the market thinks it can be maybe pushed a little bit higher. We're getting into that very thing now with the details from equities reporter Jordan Fitzgerald. So an offer being made. Is there more being discussed on the table at the moment, Jordan? Thank you. Yes. So over the weekend, news broke that Uber made this 33 euro per share offer for German based food delivery company Delivery Hero.

27:43And like you said, this value is accompanied about 10 billion euros. But we don't have any guarantees yet. Delivery Hero has been reviewing its strategic options. It's important to note that Uber already has amassed a 20 percent stake in the company. but there's no guarantees here. The Financial Times did report that Uber had rebuffed, that Delivery Hero had rebuffed Uber's offer, but things are still up in the air.

28:09Caroline Hyde:Delivery Hero just stopped trading in Europe at$38.23 a share. So the market's kind of saying, you know, we see this going higher than 33 euros a share, but also like a lot of analysts, and I think you've been writing about this, right, are saying this makes a lot of sense to do this deal from Uber's perspective? From Uber's perspective and from Delivery Hero's, Delivery Hero has been reviewing its options. Shares are up quite a bit for the year as the company has been going down the path of a strategic review. And for Uber, analysts are really saying that this is a strategically sound deal for them.

28:43Uber is in a space, the food delivery space, where things are consolidating. And like I said, they've already amassed the stake in Delivery Hero. And Delivery Hero in particular gives them exposure on the delivery side to international markets, particularly in Asia and Europe, where they're already offering ride shares, but they can expand into that delivery side and really grow their business.

29:07Caroline Hyde:Bloomberg's Jordan Fitzgerald, top reporting. Thank you very much. I want to get back to check on Micron because what is happening is nuts. It's up 17 percent, in part because UBS upgraded its price target to$1 ,625 a share, which, as you can see, See, looking at your screen would be double basically what it's currently trading at. But generally speaking, AI names absolutely ripping this Tuesday. Micron, top of the heap. But as we talked about earlier in the show, it is a global story. Here to discuss the AI trade, Daniel Pilling, Portfolio Manager at Sands Capital. Who counts? NVIDIA and TSMC among top holdings.

29:42Caroline Hyde:It's just so interesting to work out what's going on here. I think that you would say, similar to what I wrote about in the tech in depth overnight, NVIDIA is sold out. So whether your goal in this market is to play the SpaceX IPO for space-based data center, Orbital Data Center, or you're just trying to build out data center on Earth, demand is vastly outpacing supply. Does that sum it up? Yes, indeed. I think so. And maybe to put some numbers behind it. So I think if we think about AI, you can break it down in three sort of bullet points, right? Like one, it's viral, right? So it's sort of like Zoom during COVID.

30:21Caroline Hyde:The growth is unparalleled. And we can see this in the anthropic numbers. Two, though, it's also highly underpenetrated. So, you know, there's a billion office workers in the world. And a tiny, tiny fraction of them are actually using these tools as of today. We try to estimate it as maybe 2 % or 3%. So it's a very, very small number. And then three, you know, all this sort of virality and underpenetration is hitting this market, the semiconductor market, where you have companies that have long lead times. They're oligopolistic. They're pricing power. So if you add all these things together, it's likely we're going to be supply constrained for quite some time.

30:55How broad, therefore, should the holdings go? When I'm looking at some of the funds you manage, clearly you got with the program when it came to NVIDIA. But you're also thinking about those that are offering not only chips, but also the entire vertical stack. When I think of Alphabet that you're in, there's Microsoft and Amazon. But why not broaden into other areas of the chip stack? Because we've seen them just do so well.

31:16Caroline Hyde:Yes, we totally agree. So we actually also own memory companies such as SK Hynix and Samsung in Korea. Memory is going to be an increasingly significant bottleneck. We're heavily exposed to semi-capics companies, business like such as ASML and LAM Research to provide the equipment to the foundries of the world. I think one should also look at electricity companies. So anybody that supplies electricity to data centers, one particular interesting business there that we own is called Bloom Energy. And then lastly, CPUs. CPUs are back for us. That's particularly interesting on ARM, but Argentic AI needs a lot of CPUs.

31:52Caroline Hyde:So I think you're right. One should look at the total stack, and there's many, many winners across the entire stack. Daniel, our top story in the show today was news from Huawei on logic folding, basically a new method of passing the signal through the transistor, taking you outside of Moore's law. You're not dependent on extreme miniaturization. the way the market responded first in Asia then in Europe and then in the United States everything was up irrespective of their ties to Huawei why do you think that is well I mean I I do think that in Asia in particular in China there's a sense that they do not have access to ASML nor leading edge chips from Taiwan semi so any sort of announcement that they can make that might provide them the opportunity to build their own leading-edge chips is much appreciated.

32:43Caroline Hyde:Now, the counter to that, though, is that this technology has been around for a while. This idea of sort of stacking chips on top of each other is also something that Taiwan Semi has been pursuing for really a decade. The problem with it is that it's twofold. One, you have to stack them on top of each other. And two, there's a heat dissipation issue, which is very, very difficult to solve. So time will tell, but we're somewhat skeptical about the Huawei announcements as they are as of today. How skeptical are you or not of just China's prowess when it comes to AI and owning its own supply chain right now?

33:16Caroline Hyde:Yes, so I have to say we're very impressed what China has been doing. But the core issue remains as ever the same, I think. So China does not have ASML and or lithography manufacturing capabilities that would allow them to build leading-edge chips. so anything above sort of five nanometer plus so and and as long as that doesn't change they will struggle to compete with invidia's of the world with a with a sky nexus and microns of the world and in our opinion there may be a decade away from that it took 15 20 years for western nations to build something like asml so as long as that's the case they will struggle to compete daniel how's your math been going post nvidia earnings right i think about the one trillion dollar figure which which is Blackwell, Rubin, calendar 25 to calendar 27.

34:06Caroline Hyde:And then what NVIDIA said was they see hyperscaler capex 1 trillion for the coming 12-month period. So you're trying to work out how much should they capture in sales and how does that translate for NVIDIA into free cash flow? Have you done that math? Yes. So the math we have actually done, and I would humbly argue is equally interesting maybe, is, so Jensen has said something about 3 to 4 trillion CAPEX for 2030 for the entire industry. So 3 to 4 trillion, an enormously large number. Now, NVIDIA tends to have something like, we believe, 60 % market share across training and inference. Now, if that number is true, which we actually find hard to dismiss, then NVIDIA would generate something close to$40 of earnings per share and close to$1 trillion of free cash flow by 2030.

34:54Caroline Hyde:And that would indicate the stock at sort of five times earnings in that time period. So that to us was sort of a super interesting number. They've mentioned it before. And it seems very, very large as of now. So you'd have to have a lot of growth in the anthropics of the world. But Jensen has shown over time that he tends to hit the numbers that he talks about. So we're very positive on that. Daniel Pilling from Sands Capital, good at math. Thank you very much. Caro, plenty of other news headlines out there. But it's time now for Talking Tech Ed. First up, a Samsung union representing workers outside the ultra-profitable semiconductor division has asked a Korean court to block voting on a tentative deal that would distribute about$26.6 billion in bonuses.

35:35Look, the smaller union is arguing that the agreement disproportionately favors Samsung's chip business, with semiconductor staff set to receive average bonuses of about$340 ,000 compared with roughly$4 ,000 for workers in Samsung's digital experience division. Plus, shares of Ferrari tumbling after the luxury automaker unveiled its first fully electric vehicle to a wave of negative reviews over its design. Critics and social media users compared the$640 ,000 Ferrari, that's Luce, to mainstream EVs, raising questions about the company's push into electric vehicles and Johnny Ives' design. And Honeywell-backed Quantinium is seeking to raise as much as$1.05 billion in an IPO.

36:16Now, according to an SEC filing, the quantum computing firm pronounced itself 21 million shares priced between$45 and$50 each at the top end of the range. Now, Quantum would be valued at roughly$12.7 billion.

36:28Caroline Hyde:OK, coming up, SpaceX scores another successful launch, fueling fresh speculation about the company's IPO prospects and Elon Musk growing dominance in the commercial space race. We have more on that next. This is Bloomberg Tech.

36:53You need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process. Need a last-minute pitch deck? Do that with Acrobat. Need to level up your presentation design? Do that with Acrobat. You have 30 plus documents that need to be simplified into a proposal. Do that. Do that. Do that with Acrobat. Learn more at adobe.com slash do that with Acrobat. Support for the show comes from Public. Public is an investing platform that offers access to stocks, options, bonds, and crypto.

37:33And they've also integrated AI with tools that can assist investors in building customized portfolios. One of these tools is called Generated Assets. It allows you to turn your ideas into investable indexes. So let's say you're interested in something specific like biotech companies with high R &D spend, small cap stocks with improving operating margins, or the S &P 500 minus high debt companies. Chances are there isn't an ETF that fits your exact criteria. But on public, you just type in a prompt and their AI screens thousands of stocks and build a one-of-a-kind index. You can even backtest it against the S &P 500.

38:08Then you can invest in a few clicks. Go to public.com slash market and earn an uncapped 1 % bonus when you transfer your portfolio. That's public.com slash market.

38:19Caroline Hyde:And paid for by Public Holdings. Brokered services by Public Investing, member FINRA SIPC. Advisory services by Public Advisors, SEC Registered Advisor. Crypto services by ZeroHash. Sample prompts are for illustrative purposes only, not investment advice. All investing involves risk of loss. See complete disclosures at public.com slash disclosures. Being a small business owner isn't just a career, it's a calling. Chase for Business knows how much heart and effort go into building something of your own. That's why they make business growth their priority. The Chase team takes the time to understand your mission, where you are now, and where you want to go.

38:54Their broad range of solutions is designed with you in mind so you can bring your ideas to life. From banking to payment acceptance to credit cards, you can conveniently manage all your business finances all in one place with their digital tools. Looking for tips and advice? Their online resources are always available to give you the solutions you need to help your business thrive. See how your business can get stronger and go farther with Chase for Business. Learn more at chase.com slash business. Chase for Business. Make more of what's yours. The Chase mobile app is available for select mobile devices.

39:28Message and data rates may apply. JPMorgan Chase Bank N.A. Member FDIC. Copyright 2026. JPMorgan Chase and Company.

39:43Caroline Hyde:taking a look at some of what's going on in the space sector a lot of names are on the move simply by association validation that the space sector is legit it is for real post spacex's s1 last week but also after spacex's upgraded starship successfully deployed mock satellites and return to Earth mostly unscathed. That was on Friday night. Bloomberg space correspondent Lauren Grush is with us. For SpaceX, success is the data, right? So irrespective of really what happens in the end, this was a completely new re-engineered new architecture V3 starship and they wanted to see how it would work. How did it work?

40:26I would say that it was a largely successful debut of the vehicle. As you mentioned, this was a completely redesigned version of Starship. Mainly it had a lot of new upgrades, new Raptor engines that were supposed to significantly increase the thrust at liftoff. It also had a number of upgrades to help with the reusability that they're after. And so by and large, it was a successful test. There were some uncomfortable moments. For instance, that super heavy booster, which you can see climbing and sending Starship to space. Once it separated, it was supposed to do a controlled splashdown or landing in the Gulf.

41:01And that didn't quite work as planned. It kind of spun out of control at one point and then seemed to break apart. And then also there was an engine out on Starship. So just a few moments where it did not go to plan. It was a little bit incomplete, but I think it was by and large a really successful mission for the debut of this upgraded version of the vehicle. I love all the quotes from employee Kate Tice. We were expecting the re-entry to be super spicy, and I guess that's what we got. But where does this put us in the longer-term trajectory of the plans for satellites, for the business model, for Mars and the like?

41:38Yeah, I would say we're still marching forward. There are still some kinks to work out. For instance, you know, the big thing about Starship is that it's supposed to be fully reusable. That's never been done before. And so that problem that they had with the super heavy booster not doing that controlled landing complicates that on the path to that full reusability. But as they demonstrated during this mission, they were able to deploy satellites like they had planned. They were dummy satellites, but they did demonstrate that that could work. So it does seem, you know, it stands to reason that that could potentially happen soon.

42:13I know They're aiming that within the next year. But still, there's definitely a long road ahead in order to really fully unlock this vehicle for what it's supposed to be. And maybe vindicate evaluation as we see some extraordinary footage coming from the launch on Friday night. Lauren Grush, thank you so much for breaking it all down for us. Let's get the latest on SpaceX's potential listing into the market as well as the wider IPO landscape. Because we've got Jay Ritter with us. He's director of the IPO initiative, University of Florida Emeritus professor. They call you Mr. IPO. So, Mr. IPO, tell us as to how we see a vindication in the market capitalization of SpaceX as it goes public.

42:53Because as Ed was writing in his newsletter today, an awful lot has to go right. I'm in complete agreement. An awful lot has to go right. But this is a great company. As Lauren was indicating, Starship is an incredible engineering feat. It's complicated. But this is actually a competitive advantage. It's so difficult for a competitor to come up with something similar that's going to be able to lower launch costs as much as SpaceX can, that it's going to allow SpaceX to have a big technological lead over any potential competitor. And this will allow it to put Starlink satellites into low Earth orbit and offer Starlink Internet access at much lower cost than competitors can.

43:53Caroline Hyde:Jay, Professor Ritter, you are called Mr. IPO, if you don't mind me saying, because you're probably the most influential, most cited academic researcher in the field of IPOs of the last 40 years. What is different about this IPO and what is the same as those that you have studied deeply in your career? Well, what's different is this is going to be the largest private sector company ever to go public. valuation of something like$1.5 trillion, dramatically higher than any other. Of the big companies that have gone public in the past, they've generally been large state-owned enterprises with very large operations and profitability.

44:46This is a company where the market and venture capitalists have been valuing it based upon enormous potential future profitability. But as was mentioned previously, a lot of stuff has to go right to justify this valuation. When you think about just the multiples that are going to be digested, and I know you've looked a lot into that, where does it sit in past and historical terms compared to those that did list? Because as we've been talking about time and time again across this entire network, look, companies are staying much longer private and they're coming in extraordinary valuations. And so you wonder how much money is left on the table for a retail investor or a different type of investor that hasn't been funding it from day one.

45:32Right. This is a company where last year it had$18.7 billion in sales, bigger than just about any tech startup or private company that hadn't already been public, has in terms of revenue at the time of going public. But it's also got the really huge valuation. And to justify a$1.5 trillion valuation, very big future profits have to be there. There have only been about 18 companies that have gone public in the U.S. with inflation-adjusted revenue of at least$100 million per year and a price-to-sales ratio of more than 40. At a$1.5 trillion valuation, SpaceX is going to be going public at a price-to-sales ratio of about 80.

46:37So there haven't been all that many companies that have done this before. But of those that have, on average, the stock has been a disappointment to investors. Lots of things have to go right.

46:53Caroline Hyde:Lots of things have to go right. Jay, repeated throughout the S1 is a warning that they will be constrained by compute now in the future and Starship has to work. Very quickly, is that just boilerplate or they have to say that? You know, it's technologically true that the profitability of sending people to Mars is very questionable. But the ability to get things going in the foreseeable future with Starlink can be an enormous source of profits. Jay Ritter of the IPO initiative, the University of Florida, they call him Mr. IPO. Thank you very much. Now, coming up, Google comes out with the Fitbit Air trying to catch up to whoop in the AI-powered wellness space.

47:42Caroline Hyde:You can have a look. This is Bloomberg Tech.

47:56Tech companies, they are racing into an era of personalized health. And Google is out with its latest product in the space, the Fitbit Air. It's a new$100 screenless wearable, which represents a major evolution in what consumers can expect from fitness trackers. For more, let's speak to Bloomberg's consumer tech editor, Dana Woman. Now, you have a whoop, which might be a direct comparison here. But what's so interesting is Google having more of an sort of open way in which they're going to be allowing us to use our data. Yes. So I think the business model is going to be quite more appealing for a wider swath of consumers.

48:31So you pay up front for Google's hardware. And then if you like, you can just use Google Health for free as a free app. They do have a premium tier that offers a lot more interesting features. And that's where you might be paying locked into a subscription model. But Whoop is entirely subscription based. Technically, you aren't even paying for the hardware itself. You're paying for these annual subscriptions. And if you ever cancel, your device is pretty much bricked.

48:56Caroline Hyde:The business models are so different between the two, right? I mean, like just last week, we were talking about different form factor, but Aura Ring and IPO. You're the editor on the consumer tech team. We do reviews. Like we get into the tech, how it works. What was the team's kind of like impression? So we think competition is good. Sorry to sound so buttoned up there. But competition is good, I think, for consumers. And we like both is really sort of the long and the short of it. Whoop is still probably a better choice for more advanced users. It has a more data-focused approach. So it pulls more data.

49:30It presents it in a very clean but sort of geeky way. I think if you are looking to interact with a device like this, really leaning into the AI, having a conversation with a coach that is proactive, Google's AI is more advanced than whoops. I found it more natural, more conversational. It was easier, for instance, to explain, hey, if I wake up in the middle of the night, it's because my toddler woke me up briefly. It's not because I have chosen to wake up at 2 a.m. So having conversations like that is a lot easier with Google's device. You will get more data still with Whoop, and you will, in my opinion, see it presented in a way that makes a little more sense and is a little more aesthetically pleasing.

50:10What's interesting is the way in which, briefly, we're going to be using them so much more than sleep or heart rate and the like. Oh, I'm sorry? When you're using them more for, like, you're using for meal plans, for example, how you can fold it in more. Yes, absolutely. So I used it for a combination of, I tried to use it really like any consumer would. I used it for a combination of sleep tracking overnight, analyzing my sleep and my readiness for the coming day. And I really played around a lot with the food tracking here. I took pictures of my meals. I said, how many calories is this? And actually, the estimate seemed pretty accurate as far as I can tell.

50:46Dana, great getting your perspective, Amy Wollman. And over to you.

50:50Caroline Hyde:Yeah, check out the full review on Bloomberg.com. Unfortunately, that does it for this edition of Bloomberg Tech. Don't forget to check out the podcast. You can find it on the terminal as well as online on Apple, Spotify, and iHeart. This is Bloomberg. If you follow markets, you know the value of long-term thinking. You plan, you diversify, you prepare for volatility. But in life, even the best strategies can't prevent every bad day. A fire, a loss, a disruption that demands immediate attention. When that happens, what matters isn't just what you planned, it's who shows up. That's where Cincinnati Insurance comes in.

51:25For more than 75 years, they've helped individuals and businesses navigate life's toughest moments with care, expertise, and personal attention. Together with independent agents, Cincinnati Insurance focuses on relationships, not transactions. Their approach is grounded in experience, follow-through, and trust built over time. Bad days happen, and when they do, you deserve an insurance partner who understands risk, respects what you've built, and is ready to help you move forward. The Cincinnati Insurance Companies. Let them make your bad day better. Find an independent agent at CINFIN.com. This dog salon?

52:04Operational excellence. Thanks to genius from Global Payments. Scheduling? Personalized. Checkouts? Instant. Absolutely genius. Big League reliability for any business. That's genius. Travel smarter, not harder at America's Best Value In by Sonesta. With convenient locations from coast to coast and value-packed comfort at every turn. It's a practical choice for road trips, quick getaways, and everyday travel that keeps things simple without sacrificing comfort. And when you're a Sonesta Travel Pass member, staying at America's Best Value In means earning points toward free nights, upgrades, and more every time you stay.

52:40Go to Sonesta.com to book your stay and unlock the best rates with Sonesta Travel Pass. Here today, roam tomorrow. Join now at Sonesta.com. Terms and conditions apply.