SK Hynix, Micron Join $1 Trillion Market Cap Club

22:32Sure. So let's hit the point you made first about solving the world's biggest problems. The single most powerful thing we humans have is our intelligence. And we're about to see human intelligence increased by not just 10 or 100 fold, a million fold, a billion fold. It's the ability for us to discover breakthroughs across physics and chemistry and biology, material sciences. All of these things are going to be driven by the use of these AI systems. And so I don't think people understand how rapidly the economy is going to grow on the back of AI. We're going to be solving aging as a fundamental.

23:15right what is it worth if you can add 30 healthy years and then those extra 30 healthy years on your life buy you the next 50 healthy years or 100 healthy years what is that worth individuals when we get to room temperature superconducting when we get to new ways of growing food you know twice as fast five times faster healthier we're heading towards a world of abundance across everything, food, water, energy, healthcare, education, all of these elements. You know, when I interviewed Elon on my Moonshots podcast at the beginning of this year, and then again, in March, what he talked about, and I believe this, is we're going to see double and then triple digit GDP growth.

24:01And this is happening not because we're working harder or we humans are smarter. It's on the back of AI and humanoid robotics. One of the things he said was that we're entering a world where AI and robots are going to create so much product, so much availability that we could not want enough. Now, this sounds like a techno-utopian vision, but we have to realize that all the progress that we've seen in humanity, we're living lives today that are godlike compared to our parents and grandparents. Yes.

24:37Caroline Hyde:Let me jump on something you just said. Thank you. You spoke January 6th with Elon at length and then again in March. And what you just said about robots, there is broad speculation right now about the prospect of a post IPO SpaceX merging with Tesla. on January 30th. On January 30th, I reported they'd held talks prior to the XAI transaction. You say 100%. I mean, what are you learning from those two conversations? What do you know about how real that is? Why it makes sense? It makes sense because it consolidates Elon's control. Today, as reported in the IPO in the S1, there's super voting rights that he has.

25:17And of course, his inside owners, I think it's like 80 plus percent voting control. He doesn't have that in Tesla. And by combining the companies, I think he'll have that. He'll have the ability to operate across all of this infrastructure. And, you know, a fleet of cyber cabs, all of the Tesla vehicles out there that have compute capability on them, have power on them as well. We're creating a global infrastructure on the ground and in space. So it just consolidates control. It makes his ability to implement his vision a lot more efficient. So, you know, I put it as not a matter of if and only a matter of when those two companies come together.

26:03And also because they're valued public companies, you can make that merger happen a lot easier than if you're combining private companies and arguing about valuation. Peter Diamandis, ex-Prize founder fascinating to have some time with you and the vision of where SpaceX goes along with Tesla, we appreciate it now coming up, we're going to be joined by the CEO of Cognition discussing the AI startup's latest fundraise to power the first AI software engineer as they call it, Devon, or many Devons but there's a cracking big valuation on the back of this, we're excited about that conversation coming up next from San Francisco and New York and with stocks under pressure in the broader tech ecosystem This is Primark Tech.

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28:05Caroline Hyde:So there's a lot of noise about AI, but time's too tight for more promises. So let's talk about results. At IBM, we work with our employees to integrate technology right into the systems they need. Now, a global workforce of 300 ,000 can use AI to fill their HR questions, resolving 94 % of common questions. Not noise. Proof of how we can help companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM.

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29:40Welcome back to Bloomberg Tech. And we pull back from some of our record highs today. We turn our attention to what's happening with the Middle East. Will there be some sort of peace still between the U.S. and Iran? There are conflicting, well, moon music around it and news flow. And the market just sells off a little bit in that eye of the storm. We're currently off by four tenths of a percent on the Nasdaq 100, coming off of yesterday's record high. We're looking at the semiconductors, particularly under pressure. NVIDIA and the like yanking it down 2.5%. But remember, it's up 13 % prior to this on a five-day winning streak.

30:08So we take a pause, but we don't take a pause. One key name. Micron is still managing to cling into the green. We're up 7 tenths of a percent. This is as they hit a trillion dollar figure. And this is as we start to see the real focus on high bandwidth memory that saw also SK Hynix run up so far.

30:25Caroline Hyde:Let's get back to today's big number. One trillion dollars in climbing. That's the market cap. Memory chip giants, SK Hynix and Micron have reached. And as Cari just outlined, Micron still has momentum. Investors are piling into companies that are powering the AI boom. Let's get more on Micron and SK Hynix. Bloomberg's Ian King, who leads our coverage of semiconductors. You know what's so funny? You and I go to all these conferences and speak to all these people in industry. And if you do it from their perspective, none of this is a surprise. Like as Jensen Wong would put it, CEO of NVIDIA, he was trying to convince the memory makers years ago that this would happen.

31:01Caroline Hyde:Now, here we are. Why do we need so much high bandwidth memory? Yeah, I mean, if you look at the forward estimates for this company, Wall Street is bought into this massive sense of we need so much more equipment. There's going to be trillions of dollars of spending happening on this. And memory is an absolutely fundamental base layer of the technology. If you believe that the industry and the economy is changing to the extent that people like Jensen Wang are saying it will. Ian, it seems like the stereotypical oligopoly here. There's like three key players that are rushing to try and fill a hole in high bandwidth memory.

31:36Of course, Dram sort of goes to the back seat a little bit here. But are we seeing any competitive threats? Because at the moment, analysts, all the community think, keep buying these stocks. The bottlenecks are going to last through 2027. Yeah, I mean, the other way to, that's a good point, Caroline. And the other way to look at it is why there are only three companies left. The answer is because this has been a horrible market for years, right? We've had some good years, but we've had a lot of bad years as well. There's only three real providers because it's so expensive. The bets are so big and it's so difficult to make a sustained living in this business.

32:06They're survivors, not necessarily thrivers, even though that's what's going on right now.

32:11Caroline Hyde:Could you just educate the Bloomberg Tech audience a little bit on the history of memory? The idea that it was boom and bust, where memory principally went before there was this great demand from the data center space. Yeah, I mean, the key point is that this is a commodity. One chip from one company can be swapped out for another. So you effectively have a market, right? Prices go up and down, supply and demand. Like spot prices. Exactly. It's a commodity, right? And in the past, you know, the big market was PCs and then it was smartphones. And of course, these are consumer devices by and large.

32:43So long-term supply versus short-term fluctuations in demand was a recipe for disaster.

32:51Caroline Hyde:Bloomberg's Ian King, thank you very much. Cara, some more news. Yeah, it's time now for Talking Tech Ed. And first up, ByteDance is planning to sharply increase capital spending to lead the Chinese AI market. Now, the company is considering as much as$70 billion this year to build out data centers and other AI infrastructure. And it may boost CapEx to roughly$100 billion next year. Plus, an update on the Samsung strike talks. The company's union members voted in favor of a compensation deal that will hand chip workers an average bonus for$340 ,000. Now, the agreement avoids a strike that had threatened to disrupt global chip supply.

33:24And similarly, TSMC chief CeCe Wei told staff that they'll see more than a 30 % bump in profit-sharing payouts this year on average, according to a source where his comments come after some employees voiced concerns over their incentive plans online and followed the Samsung Union deal, Ed.

33:42Caroline Hyde:okay back to private markets cognition has raised over a billion dollars at a 26 billion dollar valuation lux capital general catalyst and 8vc led the new round cognition ceo scott was here to discuss the news we also give an update on the company's ai coding agent devin not just one agent like i think caroline made a good point like it's an army of agents and we'll get to that Start with some basics, Scott. A billion dollars, big valuation. Why do you do that? Yeah, yeah, absolutely. Well, look, thank you so much for having me back. A few different reasons. First of all, you know, the growth that we've seen in the business has been incredible.

34:18And I think really across the board, what we're seeing is that AI is doing real work at real companies everywhere. And, you know, every company in 2026 is a software company. And so we work with, for example, all the top five health insurers in the United States. We're seeing folks building way more tooling for all of their care providers. They're able to cut down on price and cover more people. We're working with banks on delivering software and making sure to give their customers access to what they need. We're seeing this with the Treasury and NASA as well. And so a couple reasons for the raise.

34:48I think, first of all, we want to continue to grow aggressively, and this really allows us to do that. It allows us to scale our compute. It allows us to grow the team and so on. Second of all, it allows us to stay independent and to really continue on as an independent business, which is really, really important for us.

35:03Caroline Hyde:it's going well as an independent business like what's what's interesting talking to you over let's say an aggregate over a period of a year is to track growth yeah right so when you first like coming on the show like beginning of 25 24 the revenue run rate was a few million with respect then exactly a year ago you're kind of at a run rate of about 37 million dollars where's your revenue run right now yeah so we're getting close to 500 million today as you said we've only been in business for about two years and i think a lot of what it speaks to is just how much demand there is out there for all of this.

35:36And there's about 30, 35 million software engineers in the world today. We want to make all of them 10 times more efficient. And then we think there is a lot more than 10 times more software to build. There is so much demand, Scott, but there's also a pretty crowded market when it thinks of startups. And admittedly, you've been talking about how labs are sort of buying these startups. And we think about what DealCurse has just been doing over with SpaceX. But I'm interested as to how you see the threat from the big labs in and of themselves. Yeah, yeah, absolutely. For us, it's actually the other way around.

36:04I think for us, it's, you know, being fully independent and fully neutral is actually the best way for us to be aligned with our customers. And so we work very closely with all these labs, OpenAI, Anthropic, but also Google, XAI, and so on. We have deep relationships with them. We work with them on research. And it allows us to work with our customers and provide them the best model for every different use case. And so Devon is a compound system that works with all of these different models. And because of that, we're able to be the Switzerland in the equation here. A Switzerland that sometimes makes the most of the disruption when it comes to talent and the like.

36:37I think about what happened last year, the windsurf assets, the IP, the brand, the employees after Google took, well, the key CEO and leadership of that company. Will more M &A happen? Is that where some of the new funding will come into perspective? I'm sure there will be more and there will be different things that come up. For us, what we're personally most focused on is just continuing to grow the business and serve our customers as best as we can.

37:05Caroline Hyde:You said, well, a heavy emphasis on independence. And then you called yourselves the Switzerland of this space. What do you think will happen if SpaceX doesn't acquire Cursor is the base question. But when I speak to, say, the engineering teams at NVIDIA, the reason they like Cursor was the freedom to swap in and out the underlying model. depending on what your coding objective was. I suppose that's one reason why they like Devin, right? But if Cursor becomes a part of SpaceX AI, how do you see that changing the field? Data is so critically important, right? And who you are beholden to. Yeah, absolutely.

37:44No, I mean, it's a great question. I think in practice, I think there are a lot of great teams working on code, including, of course, the labs themselves. I think what we see is that the ecosystem is broad enough and vibrant enough that it makes sense for there to be different players in different positions. And so there are going to continue to be first-party products from the labs themselves. But as we're kind of saying, to your point, I think having the ability to serve each of the different models, and not just the ability, but also the neutrality in terms of being incentivized to just serve whatever is the best model for each case rather than a single series of models,

38:16Caroline Hyde:I think is an important position in the space as well. You would say that Devon is the first AI software engineer. And we talked about the revenue run rate. Clearly, that's evidence of momentum and success. But are you able to sort of give any data on how pervasive Devin is, how it has changed the structure of different engineering orgs at software companies, at other technology companies? For sure. Yeah. I mean, we're seeing this across the board where as teams are adopting Devin and coding agents en masse, that in practice, they're able to do much more and execute much more aggressively on roadmap.

38:53Caroline Hyde:Is this new code or is it going back over old code bases? It's both. And so as you can imagine, the large majority of work is working on these existing code bases and continuing to build and add new features and so on. But even internally at Cognition, for example, more than 90 % of the code that we write is written by Devon. And so of course we're using Devon all day when we're going and building Devon itself. And even with that productivity, you've been scaling the amount of people you hire, Scott. Just reflect on what this means in terms of how many software engineers we're going to need. Like this ongoing anxiety is the disruption that AI causes in all its ways and across all these industries.

39:31Yeah, no, I think what we'll see is, of course, the job will evolve over time and we'll see some of the skill sets change, but I think we will have far more people doing this and building software and building products, not less. And, you know, my favorite side on this personally is today there's about 30 or 35 million software engineers in the world. Just 20, 25 years ago, at the start of the century, it was under 1 million. And that's clearly come with a massive rise in the amount of software that we've produced. And I think as we continue to make it more and more efficient,

39:57Caroline Hyde:we're actually just going to produce even more software, not less. Scott, very, very quick. What's the goal you've set the team for the balance of the year? One metric. Yeah, yeah. Look, I think for this year, we firmly intend to cross a billion in revenue run rate. We want to keep going further even beyond that. And from there, we just want to grow to as many of the companies in the world that we can. Cognition, CEO Scott Wu, thank you very much for joining us today. Now coming up, Salesforce, Snowflake, both reporting earnings after the closing bell. We'll discuss what to expect. How's AI disrupting their business models?

40:30This is Bloomberg Tech.

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42:57Caroline Hyde:We're watching shares of Salesforce up 1.2%, set to report quality results this afternoon. Wall Street is watching closely for signs that the company's AI offerings can help reignite revenue growth. Bloomberg's Brody Ford, who covers Salesforce, is with us. And 24 hours ago, we were talking about the idea that right now the AI agent story is more marketing than real in terms of revenues. But that will be the test this evening, right? Is that kind of what you're looking for? It's all these SaaSpocalypse fears, right? That's what everyone's been worried about for the last couple of quarters. And tonight, the only real way Salesforce can beat PAC, all that skepticism, all the pessimism is showing that revenue is accelerating.

43:41and it's coming from these new AI offerings. We haven't seen that yet. That's what folks are hoping for in the back half of this year. Yeah, we've heard that Agent Force was sort of offering, what, an$800 million revenue stream thus far, but we're also seeing not bad revenue growth from Salesforce, or at least predicted, but a lot of that's coming from Informatica, right, from inorganic growth. Yeah, that's been the classic debate with Salesforce for so long, which is how much revenue growth is from those organic products versus some of the acquisitions. That's come back with Informatica. And yeah,$800 million a year on AgentForce, nothing to scoff at.

44:17But at the end of the day right now, if you're an application company and your revenue is decelerating, the market is really going to punish you.

44:25Caroline Hyde:Ryan Blastellica and the equities team, who we're all very close buddies with, they help us out a lot with their sort of stock coverage. they frame this as actually, if this goes well, it could change the story for the stock. What has the story been? I mean, has Salesforce been one of the, I don't want to say victims, but those under pressure from the SaaSpocalypse kind of narrative? I mean, it could change the narrative for the whole sector, right? Because Salesforce is the SaaS company. So when folks think about the SaaS industry getting hurt by AI, getting displaced, the idea that innovation and technology is no longer happening at these SaaS companies like, you know, an Adobe or a Salesforce, if they can show that that's changing, that could be very meaningful.

45:08But still, they hit a three-year low on their stock last month. They haven't recovered much and they're down 30 % year to date. So is there a narrative, what anecdotal evidence to fight back at some of what you wrote, Brody, that it isn't actually working at Agent Force within compliance offices yet? They can't sign off on it, for example. The big story, I think, is that the technology is real, but it takes a long time to implement it at big corporations, right? I mean, you or I can go on ChatGPT and do some, you know, whatever workflow you might do, but as a corporation, that's very difficult to implement it widely.

45:46In many ways, that compliance stickiness, though, makes Salesforce pretty sticky. Bloomberg's pretty good. We appreciate you. It's going to be a busy evening after the bell. There's also other stocks reporting. For example, Marvell, a fascinating chip stock. Look, there's many ways about the focus on photonics, on optics, on networking. But it's also, think about that$2 billion investment NVIDIA made in March in Marvell technology. How have they been performing with NVIDIA's backing?

46:12Caroline Hyde:Yeah, it's interesting the stock's down so much, you know, ahead of the earnings print. I don't see anything on the Bloomberg that sort of directly explains that. I mean, it's up 100 % this year. Yeah, exactly. It's a high flyer. So in our conversations about custom silicon, we super focus on Broadcom principally. Marvel has XPU, exactly the same idea. Rather than selling a chip, which is it, it partners with a hyperscaler or a technology company and says, we will do this with you, custom silicon. There's also some examples that that might extend outside of the world of data centers. We can talk about that at a later date.

46:42Caroline Hyde:But yeah, if this is happening and we're in a compute deficit, Marvel's a likely winner. And we'll see whether they can live up to some of the expectations around their numbers. And there are some lofty ones out there. But all of this at the moment is around AI's obvious rapid growth. But it is actually pushing global energy demand over Skyward too, forcing electrical grids, for example, to expand and modernize. Now, companies from China to Nigeria are investing in new tech to power the future. That's the focus of Bloomberg Primer this week. Take a listen. For a long time, rich countries haven't had to think about their grids all that much.

47:15Their electricity demand has been pretty much flat since the 2000s. But times are changing.

47:22Caroline Hyde:The explosive growth of AI. The rapid build-out of data centers. They're consuming enormous amounts of energy. You have four companies now that are intending to spend over$300 billion this year. With industries like AI and EVs growing fast, the world is predicted to use twice as much electricity by 2050. That's roughly a whole new USA's worth of electricity every five years. To make all that power and get it to where it needs to go, the world's grids need to evolve. All that new infrastructure will cost billions of dollars. But so did broadband internet. And that's ended up creating trillions of dollars of value.

48:03And some countries' grids are evolving faster than others. In China, power generation has gone up seven times since 2000. The battle to build the best grid is a battle to win the future.

48:15Caroline Hyde:Hear more from the team at Bloomberg Originals on today's episode of Primer. That's tonight on Bloomberg at 6 p.m. Eastern. and on Bloomberg Originals at 8 p.m. Eastern. Okay, coming up, we hear from UBS Asia-Pacific President Iqbal Khan on how he sees AI impacting jobs. This is Bloomberg Tech.

48:47Caroline Hyde:UBS Asia-Pacific President Iqbal Khan says AI will free up capacity and improve productivity, but also have an impact on jobs. He spoke exclusively to Bloomberg's Stephen Engel on the sidelines of the firm's Asian Investment Conference in Hong Kong. I think the opportunity that we're seeing now with technology and with AI is very much around simplifying, speeding up the processes, not cutting corners, but actually fundamentally improving the process, consistency of process. Just think about documenting source of wealth of an individual. It's a pretty complex task. But if AI can help you contextualize that and help you actually do that and ensure that there's consistency, you're going to fundamentally improve the process in addition to what you're doing today.

49:32Nice segue, AI. It's in everyone's discussion book right now. Obviously, we just had Jamie Dimon of JP Morgan talking about that. We've heard some comments that he got a little bit of blowback. Bill Winters at Standard Chartered saying it's going to have a significant impact, obviously, on maybe some of the rank and files in the banking industry. How do you see AI over the next couple of years changing the way you hire and who you hire?

49:56Caroline Hyde:So let's step back, right? I mean, clearly there's a lot of focus on AI. We see high valuations around AI. There's a lot of talk around the value chain, everything from actual LLMs to data centers to the respective foundations, infrastructure. For us at UBS, we've been very focused on AI, specifically also led and driven by Sergio Armotti, our group CEO. We've implemented, for example, Copilot across the board as just one example. And I have to tell you, in the last six months, I've been using it more myself, and I've been using it personally as well as professionally. And it's actually made me more efficient, more effective.

50:32Caroline Hyde:And I think over time, everybody will become an AI native. It comes down to adoption and application, fundamentally. We look at this as something that will really enhance and increase capacity. What does that mean? As we become more productive, we can use that capacity to grow. We can use that capacity to serve our clients better. Imagine at UBS, when you come in through the door as a client, you get onboarded. And if you're eligible to getting a solution or service from a compliance and regulatory perspective, it comes down to, is that valuable to you or not? And we will serve you. Now, all of that process is curated, semi-automated, manual, people-driven.

51:13Caroline Hyde:You can AI-fy that, if that's actually a word today, right? And as you do that, you can create a lot of capacity. And that capacity can be used to serve clients even better and grow. What does it mean about top-line job growth? Do you cut back to get more efficient? How does it work? And how do you communicate that? Look, at the end of the day, as I said, I think it's more about productivity and capacity. Now, if we can use that capacity to serve our clients better, gain more share of wallet, grow faster, grow more, then the impact on costs and jobs is going to be less. Now, if we cannot, and this is an industry-wide topic, then of course it will have ramifications and implications on costs and jobs.

51:53Stephen Engel there with the UBS focus. But we now turn our attention to the White House. President Trump is now speaking as part of his cabinet meeting. Let's just take a listen. And they've really been that way for a year. 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. For more than 75 years, they've helped individuals and businesses navigate life's toughest moments with care, expertise, and personal attention.

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