Figma CEO Dylan Field on Strong Earnings

22:41And Elon Musk's ex-AI is officially entering the coding agent race with the launch of GrokBuild in an attempt to catch up with Anthropik's Claude. Musk is racing to close that gap in the developer market as coding agents become the next multi-billion dollar frontier in AI.

22:57Caroline Hyde:Ed? Let's chat about OpenAI. You sat down with CFO Sarah Fryer last night. And she, you, had the opportunity to basically say, good timing. Sam Altman's underway in a very big case against Elon Musk. And then there's the breaking news last night about Apple. And the relationship falling apart, just reflect on it. I mean, an extraordinary leader as CFO. Great timing, though. A joy, a bounty of news when you're sitting down with a key executive. and Sarah Fry is very clear about what she needs at the moment. She needs money for compute. That continues. She's already got more than$120 billion of it and she's got plenty of optionality.

23:39We talked about her relationship with Sam Altman. What's she saying? What's so interesting is she's saying, look, if you want your CEO and CFO to be, you know, always agreeing on absolutely everything, you're sort of getting the wrong steer here. That shouldn't be how it works. But they have a really good working relationship. She was just in California at his ranch on the weekend they're working extra time on things like compute. Here is a close relationship, but yes, at times they have to disagree. So that was an interesting discussion, particularly when we've had Sam Altman's own sort of way in which he presents himself and the business being under the coals and under the limelight.

24:14I think it was notable. I asked her about the OpenAI and Apple relationship, and of course she couldn't comment. But this is a company that depends on partnerships to get their technology into people's hands. Apple is key for ChatGPT, but it was meant to be better integrated into the overall Apple intelligence experience.

24:29Caroline Hyde:We're going to get the detail on that in just a sec, but we're going to hear more from Cara's conversation with Sarah Fryer later this hour. Stick around for that. Here's the details. Apple and OpenAI's relationship is fraying. OpenAI is weighing possible legal action against the iPhone maker, arguing it hasn't seen the expected benefits from the partnership, and that Apple's use of its technology remains limited and hard for users to find. Let's get out to Bloomberg senior tech editor, Dana Wallman. Incredibly detailed report from the team. I suppose, what was that agreement initially? So the two companies teamed up and really OpenAI saw this as an opportunity to, as you said, get its product as big of a name as it is in front of even more people, Apple's huge user base.

25:10So OpenAI's technology would be built into Apple's platforms. And for a lot of users, especially users who are perhaps less tech savvy, it might have been their first exposure to OpenAI's technology. and OpenAI was hoping that this would result in billions of dollars worth annually in new subscribers. Let's talk about whether or not they have to be forced to some legal action to get recompense here. But more broadly, it's a time where Apple's own Apple intelligence is not working as they hope. They're having to depend on Google to help build Siri more broadly. Are they just having to go to more players in the ecosystem?

25:45I'm sorry, can you repeat the question? I don't know if I fully heard you. How are we thinking about Apple's own dependence on other offerings for its own Apple intelligence that isn't working? So Apple is going to be opening up its own platforms to other developers as well, which surely is not helping with the dynamic with open AI. It's something that Mark Gurman mentioned in his report. That said, and this has come up in other of Bloomberg Technologies' reports as well, is that Apple is sort of benefiting from the investment that all of these other AI developers have invested over the years in AI.

26:23Now it's getting to sort of integrate this menu of different increasingly advanced tools, as you said, as it continues to build out its own much-delayed product of its own. Dana Wallman, we so appreciate you. Thank you for coming on regarding OpenAI and Apple. Coming right up, we're discussing AI in another area, Figma. It is flipping the script on the AI disruption narrative. CEO Dylan Fields joining us next after earnings were a blowout. Much better than expected. And so much for that disruption. This is BlueMog Tech.

27:10welcome back to bloomberg tech and we got to focus in on the company figma it is defying those fears that ai would disrupt the design stack the company has just reported a massive first quarter with revenue growth accelerating to 46 it successfully begins to monetize new ai features joining us now figma founder ceo dylan field dylan look there has been many many a question on software providers about the disruption that will come from the likes of large language model, front-end makers, Anthropic being one. What is driving your revenue growth and the ability to exceed guidance as well?

27:46Caroline Hyde:Well, first of all, thank you for having me and good to see you. And yeah, a strong quarter. We had revenue accelerate 46 % year over year and our net dollar retention for customers that were over 10K of ARR is now at 139 % and also strong cash flow with a non-GAAP margin of 16 % in the quarter and free cash flow of 27%. We also raised our guidance, so we're very glad with the results. And I think in terms of taking a step back around what is behind the quarter and also the moment you're mentioning, I mean, as AI commoditizes code, it makes it so that code is easier than ever to write. The layer above code, as that gets commoditized, is fine.

28:40Caroline Hyde:I got an audience question for you on that in just a moment. But for me, I don't know what you would call it, like the credit caps or the way you charge on usage was so fascinating. So in March, you started charging customers a fee to use AI in particular beyond a certain limit. And the responses varied, right? When people hit that cap, many were willing to pay for like more credits. There was some drop off, though, like a small group was saying, well, if that's the case, I won't use a Figma product anymore. Where do you see that netting out? Well, we have many products. And you're always welcome to, as a free user, use one of our free surfaces or as a paid user of the seat, use our traditional design tool.

29:23Caroline Hyde:But yes, if you want to use the product, we have Figma Make. We want to use AI features in Figma Design. What we did was we essentially added some number of free credits to paid seats to make sure that people had a way to try these features out. And then we also made it so that if you want to buy additional credits, you can. And for a long time, we actually made it so that everything was free. But, you know, that's not exactly the move for the business to do that forever. And it does cost real money. We also have Thigma Weave. And Weave is extremely exciting. And with Weave, what you can do is essentially create a workflow, which is a through-node-based editing tool, where you connect up different outputs from models, think images, videos, 3D models, and more.

30:15Caroline Hyde:And then you can push them through a workflow so that you're able to really mold those model outputs like clay. So, for example, NBBJ, an architecture firm, one of the customers we mentioned during this call, they used to do these very extensive customer shoots where they would go out to site and they would really understand what is the different lighting at different times, and they would then superimpose the 3D model of the building. And with Figma Weave, they can do that all in a workflow where they can just really easily control all sorts of different parameters, and it saves them a ton of time and gets better results for the client.

30:55Caroline Hyde:So that's another one where we also see a inference kick in. And you bring real anecdotal evidence to bear. And the anecdotal evidence that we hear is like, if you ever try and strip away Figma from those that use it within the workforce, they'll up and leave. Employees will like march out the building because they so love the product. But how do you then fight this narrative that investors just want to sell first, ask questions later, and has put your stock under pressure since the IPO? I mean, I think we control the inputs. and we need to deliver for our customers. It's as simple as that. And so we're working very hard always on making sure that we're doing the right thing for the long term.

31:40Caroline Hyde:And I think that the long term is thankfully aligned with our strategy. We're in the best position we think we possibly can be in. It is either becoming more important than ever. And I think that one area when it comes to maybe the market or the world, as we're seeing design go more broad in these companies and also be more appreciated as the way that you win, but also you break through a very competitive information landscape. we have to really teach people what design is it's not just you know creating something that uh you know you think is beautiful because you know many people have different aesthetics uh it's how it works it's ux it's form it's function yeah and uh we have to i think really help people understand uh the many different facets of design and in figma design is not always just uh you know how it looks how it works it's also the thinking process out there and I think in this world yes sorry I don't mean to cut you off we're running out of time and I want to get that audience question to you because as you know I think it's really important uh regular of the show Ben how do you see inference and token costs affecting your margins going forward you kind of alluded to it earlier yeah we talked about in our earnings call yesterday and how uh if we see an opportunity to go really big and have a ton of growth we will take it and we able to push hard.

33:04Caroline Hyde:But I think there's the short term, there's the long term. And sometimes there's ways to push hard on short term. And that might create downward pressure and margins. But if you're going for a massive TAM in the long term, I think that's the right move and what our investors should be cheering us on to do. And the TAM is very large, both for design, for sculpting, advertising, marketing, and breaking through noise. And I think that in general, if we're able to deliver on that and able to win this increasingly competitive landscape, which is growing so fast of design when it's the new code, I think that puts us in an amazing position for the future.

33:49Caroline Hyde:So very excited to bring more people into the design process. It's what we're seeing with our customers. It's not just designers, it's many others as well, but also level them up on design. Figma CEO did and field back on Bloomberg Tech. Thank you very much for joining us. Now coming up, FIGIA is putting their humanoid robots out of the lab and onto the live stream. CEO Brett Adcock with us next. This is Bloomberg Tech.

34:18Amazon Health AI presents Painful Thoughts. I can't stop scratching my downtown.

34:27Caroline Hyde:Yeah, but I'm not itching to go downtown and tell a receptionist I'm here to talk about my downtown. Some things you'd rather type than say out loud. There's no question too embarrassing for Amazon Health AI. Chat your symptoms and get virtual care 24-7. Healthcare just got less painful. Support for the show comes from Public, the investing platform for those who take it seriously. On public, you can build a multi-asset portfolio of stocks, bonds, options, crypto, and now generated assets, which allow you to turn any idea into an investable index with AI. It all starts with your prompt. From renewable energy companies with high free cash flow to semiconductor suppliers growing revenue over 20 % year over year.

35:10You can literally type any prompt and put the AI to work. It screens thousands of stocks, builds a one-of-a-kind index, and lets you backtest it against the S &P 500. Then you can invest in a few clicks. generated assets are like etfs with infinite possibilities completely customizable and based on your thesis not someone else's go to public.com slash podcast and earn an uncapped one percent bonus when you transfer your portfolio that's public.com slash podcast paid for by public investing brokerage services by open to the public investing inc member finra and sipc advisory services by public advisors llc sec registered advisor generated assets is an interactive analysis tool output is for informational purposes only and is not an investment recommendation or advice.

35:46Complete disclosures available at public.com slash disclosures. If your best finance people are doing expense reports, chasing receipts, or spending time on month-end close, it's time to get Brex AF, a Gentic finance that eliminates that work before it starts. Learn more at brex.com slash AF.

36:06Caroline Hyde:Figure says its humanoid robots just completed more than 24 hours of continuous package sorting autonomously, a live stream watched by millions across YouTube and X. Three FO3 robots worked in shifts, scanning, flipping, sorting packages at roughly human speed, all powered by its in-house AI software running directly on board the robots. But that demonstration did spark some skepticism. Was it real? Joining us now is Brett Adcock, founder, CEO of FIGURE. That's where we start. But you can say, Brett, definitively, over the 24 hours or more, there was no teleoperation. A lot of people in the comments, as you know, pointed to the idea, and I think we have video of it, that the three on shift kept gesturing to the head, which is a telltale sign in robotics of teleoperation.

36:57Caroline Hyde:Your pledge that there was none? There's absolutely no teleoperation in any of this. The robots are all operating fully autonomously using an onboard neural network redesign called Helix-2. Sometimes when the robot takes a turn to left to grab packages, it moves its left hand out of the way upwards. You'll see this behavior happen every single time the robot turns for packages. But we've been running autonomously now for close to 50 hours. The robot's operating shifts. There's been basically almost no downtime on the belt. We've pushed over close to 60 ,000 packages. and we're just going to keep going now and see how far this can go.

37:35Caroline Hyde:So this was live streamed, right? And that was one reason I really wanted you to come on the program because there's the bit people don't see. What's happening behind the scenes, like in shift changes? Where does the robot go? Like, does it need maintenance? For the most part, the robots operate on a four-hour battery life. After the battery's low, the robot messages another robot to come out to take its place. The robots didn't do a swap. The robot that's just left the conveyor system is going to go charge wirelessly on the stand while the other robot continues to do work. If there are issues, say we have hardware or software issues, the robots can basically walk off into maintenance and call another robot to take its place.

38:17The goal is to be able to enlist it 24-7 operations with basically no failures on the use case itself, which we haven't had today. So the robots, basically the conveyor system has been running 24-7 since like middle of this week. I think we're now, we're approaching 50 hours of just full, like every single hour since we've launched. The robots have been basically, I've been doing work now on this line, which I think is like, which I think is crazy. You know, like Figure wants to build like, you know, we want to build like iRobot. You know, we want robots everywhere in the world, in the commercial market.

38:52Like this is like the first large step to doing that. Okay, so what's harder now? Robots getting faster or making them even more reliable? Because at the moment you seem to be doing both. the robot that you're seeing here is roughly operating around human speech about three seconds a package that's that's the requirement to operate on this logistics line so we're at like we're at human parity and speed uh the goal is also to have like 90 success rate on the bar the package flips for barcode scanning we're we're in we're in that as well in that requirement um the robots are also like getting extremely reliable like part of this whole process of running this 24 seven with no downtime is to show how reliable humanoid robots are.

39:36And four years ago, when I started the company, human robots were falling, they were extremely unreliable systems. We've designed the systems and engineered this now to a point where the robots are, I think extremely reliable. I think we're showing that now in the live stream to the entire world. The big focus for us is like, how do we solve for a truly general purpose machine? And then he had how do we manufacture unprecedented volumes similar to cell phones today. So like, um, so, so this week, Bocu, our manufacturing facility will manufacture anywhere between like 60 and 70 humanoid robots just this week.

40:10Right. And we do it right next door on, uh, on the figure campus.

40:13Caroline Hyde:So Brett, I want to get into the idea. This is full stack. I've, I've been hearing a lot growing speculation that open AI could get back into robotics and you have a history right where you had a partnership, you decided on the software side, you could do better yourself. You know, what do you make of that, that idea that ultimately a big party is going to want to own the entire stack that powers the humanoid robot? To really do this right, like if we want to really build like iRobot, like the movie, you know, we basically, you have to design the entire hardware system almost yourself, like motors, like stator rotors, all the electromagnetics work, like you have to do all the battery systems work.

40:56You have to do all the actuator design, sensor design, kinematics, like structures, like which we do all in-house now here at Figure. We also manufacture the robots. So we're like, and then we also test them and we do all the AI data collection and all the AI neural net training ourselves here in-house. So basically this is a full end-to-end vertically integrated system that we now have out doing real use case work like humans do. And we can do this at human speeds. And we're doing this now for like, you know, this example, most of these shifts run like just eight hours a day. We're doing this like 24-7 just to show how reliable the systems are and how like mission ready these things are to get out of scale.

41:40So anyway, to solve this, you have to have like a truly vertically integrated approach from top to bottom. What about bottlenecks for you? Is it now money? Do you want to go public, Brett? What are you needing to get this out more broadly? Our largest two bottlenecks are data for pre-training our Helix neural net and manufacturing. We're spinning up manufacturing here. Our manufacturing facility is called BotQ. We're now at several, like thousands of run rate annually production that is continuing to scale up. I think on the data side, we're collecting and training kind of unprecedented models for our AI stack here internally that we've ever done.

42:31So I think we're like, we're, and we have well over a billion dollars of cash in the balance sheet today. So I think from a financial perspective, we're in a good spot. We're manufacturing at pretty much unprecedented volumes for ourselves. and we're building like next generation AI models that I think are, to be honest, are just completely mind-blowing. And so the goal is to solve the data problem and the manufacturing problem to get humanoid robots out of scale. And maybe come up with even more names for these robots currently getting them from online fans. I think one's called Bob and Gary.

43:02Brett Gadcock, we so appreciate your time today, founder and CEO of Figure. Now, let's turn our attention to Andy Jassy. It was once Jeff Bezos' deputy, remember? Now, five years into his tenure as CEO, Jassy is steering the company through some of its greatest changes. That's the focus of today's big take. Newberg's Matt Day joins us with more. You went to see sort of the new real focus point for Andy Jassy. It's data centers. And this is a company that is now just scaling so much in a vertically integrated manner, Matt. What did you learn from visiting the hubs and what it says about Andy? It says that there's just such sprawl to Amazon these days.

43:38You think you know Amazon from the packages showing up at your doorstep. So much of what they're spending money on, it's data centers. It's the supply chain behind data centers. That means chips. That means hardware engineering. That means software at the large language model level. They're really just all over the place, and it's kind of an unfathomable set of things they've got going on. And really the sort of single organizational principle behind it is Andy at the top of it. He's making all these calls on where they've got to shift money, what they're pulling stuff out of, what they're putting into.

44:03It's really, really an impressive machine.

44:05Caroline Hyde:So Matt, knowing that he's watching right now, Andy Jassy is glued to Bloomberg Tech. There is a good chance that's true. What do we learn about him as the Amazon CEO versus Jeff? Like you and I have talked about this in the past, but what's different about him? Does he lean hard into the AWS thing? He definitely did. And if you look at where their bets are today, you know, a lot of them are in what can Amazon do uniquely and what can they do differently when it comes to their core retail business. They've left some opportunities on the table there. That's not the case in AI. They want to be everywhere in AI.

44:35They want to sprinkle AI through all of their product lines. And that is where they're spending a ton of their CapEx right now. So he's definitely brought some of that AWS pedigree with him. We've also just learned he is an extreme detail guy. It's not that that was not a Jeff Bezos trait, but for the last few years of his leadership at Amazon, Jeff was checked out in some parts of the business. Andy hasn't let go of anything since he showed up. He's all over the details of this business.

44:59Caroline Hyde:Bloomberg's Matt Day with the big take on Andy Jassy era at AWS and Amazon. Coming up, arguments in the trial between OpenAI and Elon Musk wrapped up yesterday. We're going to get to the latest and some more of the conversation we've been having with OpenAI the past 24 hours. This is Bloomberg Tech.

45:25OpenAI's chief financial officer, Sarah Fry, talked about the demand the company is seeing and the compute needs it's up against. She sat down with me at the Cancelo Spark Summit in Napa. Take a listen. Compute itself has clearly been a bottleneck. I don't think any of us, even Sam and Greg, who I think were incredibly prescient overall in terms of the need for compute, I don't think they could have foreseen just the sheer demand that we have right now in 2026. And so that, it's the energy that sits behind it. We're seeing memory out of Southeast Asia, right? There's all of these choke points in the supply chain.

46:00And this is why it behooves us to get ahead of that, strike those partnerships earlier when people are maybe not seeing just the sheer scale. Let's talk about partnership and about some of the people you just talked about, Craig Brockman and Sam Altman, they've had a tough week in terms of being in trial, having their relationships sort of cast into the limelight. What is it like working with Sam? There has been some questioning as to how you work alongside him. Do you work well? Is it a strong bond? Is he trustworthy? It seems to have been grilled by certain lawyers of Elon Musk this week. So I think Mr.

46:36Musk is very much out to just distract. and we are just staying the course, like building our technology, putting it into customers' hands and really creating AGI for the benefit of humanity. Working with Sam is great. We get on incredibly well. I think we have a wonderful partnership. Super good yin and yang. Sam pushes, he's super curious. My job is to take that curiosity and create optionality. So just as we talked about, whether it's making sure we have enough compute, making sure we have the funds to do it, making sure we build the business strongly. and I spend an inordinate amount of time with customers, as does Sam, and we get to compare a lot of notes on that front, as well as sometimes our notes on parenting.

47:15So it goes the whole gamut, frankly.

47:19Caroline Hyde:OpenAI's CFO Sarah Fry is speaking with Caroline about her relationship with the company's CEO, Sam Altman. The relationships and choices of OpenAI's founders have been front and center of the lawsuit brought by Elon Musk over the charitable status of the company. Arguments in the trial wrapped up yesterday. today Bloomberg's Madeleine Mecklenburg has been there every step of the way and so this is where we're at closing arguments we wait for I think jury deliberation Monday give us everything that we need to know at this point that's right I think one thing that we learned from closing arguments it's really relevant to the conversation you just had with Sarah is that this case for both parties really boils down to credibility that's the message that they left jurors with on Thursday when they had closing arguments.

48:05Musk's attorneys are trying to cast Sam Altman as someone who's deceptive, who's untrustworthy. Meanwhile, lawyers for OpenAI were trying to point to the evidence that's been presented so far in the case, saying Musk's story doesn't add up with what we've seen in the documents, what you've heard from witnesses. And so now it's up to the jury to decide whose version of events they believe about this saga of the formation of OpenAI, the dissolution of this relationship, and the transition into rivalry between Musk and Altman that we see playing out today. What happens if Musk wins? That's a big question.

48:44So at this point, the jury is going to start deliberating and they're going to issue a verdict that's advisory. So it's a non-binding recommendation to the judge in this case, who's going to have the final say on whether or not Musk has done enough to prove his claims here. And Musk is asking for a lot. He's asking for$134 billion in damages that he says he's going to donate to the OpenAI Foundation. He's asking for Altman and Brockman to be removed from their jobs. And he's asking for the OpenAI company that's been formed to be transitioned back to a nonprofit. These are huge asks. The judge is also going to hear arguments on Wednesday about which one of those might be realistic.

49:25And we're just going to kind of have to wait and see how she comes down on the main question before we get to that but the stakes are huge and existential essentially for open ai bloomberg's madeline meckleberg fascinating thank you i mean we wait with bated breath for the rest of the week and and what indeed happens in that court case but right feels like there's some confidence wildest part about it is that court case happened

49:47Caroline Hyde:in the context of the week all the other news flow and it's almost kind of i don't want to say buried but we do wait for it that does it for this edition of bloomberg tech on monday speaking with the CEOs of Dell and NVIDIA, 2.30 p.m. Eastern, 11.30 a.m. Pacific. You do not want to miss it. Check out the pod for the recap. What a week. This is Bloomberg Tech.

50:11Hey, everyone, it's Cal Penn. I'm inviting you to join the best sounding book club you've ever heard with my podcast, Earsay, the Audible and iHeart Audiobook Club. Every episode, I nerd out with amazing guests and dive into the best new audiobooks available on Audible. It's the book club for your ears. Listen to Earsay, the Audible and iHeart Audiobook Club on the iHeartRadio app or wherever you get your podcasts.

50:40Ask yourself, what are your best people spending their time on right now? Expense reports, receipt chasing, month-end close that takes weeks. You become what you spend on and that's not what you're building toward. Brex is the intelligent finance platform that eliminates that work before it starts. AI agents that handle the manual stuff automatically so your team can spend their time on what actually compounds. It's time to get Brex AF. Learn more at brex.com slash AF. Owning a home is full of surprises. Some wonderful, some not so much. And when something breaks, it can feel like the whole day unravels.

51:19That's why HomeServe exists. For as little as$4.99 a month, you'll always have someone to call. A trusted professional ready to help, bringing peace of mind to 4.5 million homeowners nationwide. For plans starting at just$4.99 a month, go to homeserve.com. That's homeserve.com. Not available everywhere. Most plans range between$4.99 to$11.99 a month your first year. Terms apply on covered repairs.