taylor: i am in san francisco, this is bloomberg technology. amd reports third-quarter revenue in line with estimates. the company splashed its guidance and highlighted new products. we have the details. big talks.'s owners

what they have to say about what elon musk is doing right and wrong. facebook and apple are poised to post earnings wednesday. more on what wall street wants to hear. first to our top stories. shares of amd fluctuating in after-hours trading. earnings met analyst expectations for both the top and bottom line. that includes thousand in mind revenue forecast. suggesting the number two maker of computer processors is getting on intel. -- gaining on intel. let's talk a little bit about the share price reaction following after-hours trading. a little light. >> $50 million. the stock was down than up and down. -- down then up then down.

gross talking about 50% -- growth from a year ago. that is not bad. i hope that people hope for more when they put so much to work in the stock. >> they have put a lot of money to work. i am coming into a chart that shows the stock is already up about 14% year-to-date. how much of this was expectations early and high? how much was good news from the company we got today? it is the perfect mix of what people got. >> it is what they expected to get. the bad news is this chip division cells into microsoft xbox and the sony the station. people are not buying those machines. they are quite old. -- sony playstation. those machines are old. people want new. taylor: pc shipments have been

strong. some of the data center gpu's and cpus, did that see some strength? >> that is where amd has to show strength. it absolutely dead. higher shipments, higher average selling prices, higher revenues. the performance is buried inside of that unit we just talked about. a little hard to pass that one. they just said no in general terms. they cost so much money. >> what are the higher-margin chips? are you seeing enough sales of those? >> the stuff i just mentioned, that was the one we really wanted. if you want to see amd make out of this cycle. that is where the margin on those kind of things are absolutely enormous. andntel has had a very big

strong hold. where is amd making gains? we have been hearing they are making games for a while. intel has been holding on. are we saying enough to pivot that scale? >> in what of strength, high-end , amd has made a move there. the volume of the market is in the laptop computers. we are seeing flow again. the third factor is back to the data center, dr. supplying google. the chips are relatively recently in the market. that traditionally moves more slowly. we are seeing some progress but not massive share gains. we are nowhere near the corner of the market. they are still in the single-digit percentage points. yll's look at another chart we are showing in the terminal here. more that you typically seek around earnings and the volatility dropping off for all of these companies.

intel, amd. did you get anything from the earnings report that would either push volatility higher or not? did this feel very much in mind? >> it was very much in line. amd has been a hedge case for so long. they were a company struggling to survive. there has been a lot of showed interest. a lot of volatility in their stock. they are not traditionally are being on rest of the industry are doing. the fact that they can in mind, the fact that things were roughly where they were supposed to be, that was good for them. taylor: could we do any reapers to some of the other chipmakers? any sense that maybe the trade war has calmed down for now? >> we will have to hear what they have to say on the call. there will be questions about the general demand environment. she has really been concentrating on the look.

these are our new products. their story is very much what damage can they do? what damage can they do to nvidia and graphics? said, they had yet to start. what is the one thing? >> we want to hear where the sales came from and get some more precise numbers. >> can, thank you so much for joining me. work was to get into video gimmick despite being in a crash crush -- video gimmick despite being in a cash crunch. hired a handful of staffers. coming as it is so not some of his businesses after it's delayed ipo and restructuring. i want to get the and a baker in new york. -gaming now?

>> we were looking for different ways to make a profit and leverage all of this office space. a lot of investors have done pretty well in the e-sports space. comcast has been building a $50 million sports arena in philadelphia. we were looking to get in on this. the question is if it is too vague. e-sports have seen -- has seen a lot of growth in the last year. taylor: explain this to me. in the last month, we saw them try to sell off some of their strategies, get out of the education business, focus on office sharing. how does each aiming fit -- e-gaming fit into the core strategy >> >> -- core strategy? >> we do not know when we work started looking into this. this could be part of the old establishment of we work.

there were linked in postings, looking for more staffers in this space. until the company rolls out its plans, we won't know how serious it is about e-sports. there are a lot of companies in the sector. activision, blizzard is huge. it could be a way for we work to ofand its core business looking for tenants. that is one way to think about it and have it may -- how it may leak into the core business. -- how it plans to branch out is the core concern. taylor: there have been concerned about the weword business model. it has not been tested in the recessionary environment. if they went into the e-gaming b usiness, would that offset any concerns about what the company looks like in the recessionary environment >>? it makes sense that --

environment? is so crowded. there are many companies looking to profit off of this. it has to be seen if it was new room for a player. a key time to be expanding as a player. i'm curious what softbank say about this recent move. they put in another $9 billion to bail it out. it will be up to what softbank thinks about this venture. taylor: you are leaving me there. beenl have to ask, it has a week since they infused the company with more cash. any sense of how this is going? reported thatas>> the new chairman of we work is looking to turn this around and cut costs. he may bring in his own management. it is still early to see how this company is going to turn around. we will see what the future holds. there could be a thesis for softbank to recoup its large

investment in an ipo next year. >> the story that keeps on giving with liana banker. liana baker. rose inea shares after-hours trading. the company has been under competitive pressure. it is looking over to the release of star wars jedi:: order. tumble in theales third quarter. what it means for the electric carmaker. if you like bloomberg news, check us out on the radio. you can listen to us on the bloomberg app, bloomberg.com and in the us, sirius xm. this is bloomberg. ♪

taylor: despite reportingtaylor: surprise third-quarter profits, a new sec filing shows a 40% drop in tesla u.s. revenue. that is the largest market. their sales fall 2 billion dollars. sales in china rose almost $700 million from 409 million. now bloomberg is hearing from tesla directly. bloomberg polled almost 5000 honors.ree tesla has finally figured out how to deliver cars with your problems. here is tom randall. he covers tesla for bloomberg news.

let talk about thafcc filing. we know the story, 97,000 cars. did you learn anything new from this report in terms of the geography of the sales tom: not too much. -- sales? tom: they are expanding their geographic footprint overseas. we are comparing that to the other -- third quarter of 2018. that is when tesla figured out how to mass-produce cars. they started cranking them out and they started flooding the u.s. market to satiate two years of those that demand. after they satiated that demand, they moved in february to start selling cars overseas. the u.s. numbers drop considerably. i think some people will look at that number and say is this a warning signal that u.s. demand is dropping off a cliff? i just don't think there is a

lot of evidence to support that. if you go to tesla.com, there is a two-month wait to get a model three. that is the longest wait to have had since about this time last year. signal. it is representative of what is happening when they expand overseas and smooth out their production. it was a record quarter for unit sales and i think we will continue to see that wrap up -- ramp up as we see their shanghai factory go up. taylor: you are actually doing the work and rolling up your sleeves and questioning 5000 tesla owners. as you take a look at the first part of the survey, what is the key takeaway? tom: this is a massive survey. nothing like this has ever been conducted tesla. when we wanted to get at is that now that tesla is cranking out

500,000 cars per quarter, what is the experience of owning one? can they provide the quality and experience of volkswagen or toyota that will attract the next round of more mainstream buyers? we started looking at quality. there are two kinds of quality. it was the driving performance and high tech features that people love about tesla and people raved about those things. then there is the quality of the manufacturing quality and decision. we measure that by asking how many problems did you have with your tesla when you first received it? peaks inthat that rate q3 of last year. in that quarter you will remember, that is when tesla famously created a whole new production line in their parking lot under a tent structure. they tripled production. since then, their defect rate has dropped significantly.

down 44% in the third quarter of 2019. taylor: what was the most common complaint that has now gone down? tom: most of the complaints are superficial in nature. it is paint defects. panel gaps. dents and scratches. these sorts of things. these don't really affect your driving experience. in the automotive industry, people see that as a signal that attention and care is being paid. if you can provide a perfect paint job, you are giving that same care to what is inside the car as well. those are the things that give tesla a lot of trouble early on. of tesla model2% three honors had some sort of issue with their paint. owners had some sort of issue with their paint. they are continuing to get better. taylor: doesn't bode well for

the company that the complaints were not structural or mechanical in nature? that they were purely cosmetic? do they need to do a better job of getting the whole thing right? tom: they were not purely of cosmetic nature. we saw issues that were unique to tesla and electric cars. there were several electric motors that had to be replaced. at least one high-voltage battery had to be replaced. it is painting a picture. this is a different kind of car. they also have software defects that they had to deal with that most car manufacturers would not have to do it because they are not operate these advanced features. most owners said the software fishers -- issues were fixed with no loss of convenience of the vehicle. i think we are seeing signs that tesla is becoming better at offering the kind of quality one would expect of a mass manufactured car. overall, tesla owners truly love

the car. i think one of the indications of that is when we ask people about their favorite features of the car, 99.6% of drivers said it was a pleasure to drive. part one of four of the survey. you can drive the car until you charge it. we await part 200 series later this week. that was tom randall. have had u.s. china trade wars and the hong kong protests impacted growth? that is next. this is bloomberg. ♪

taylor: let's take a look at the top tech calls. shares tumbled after analyst from wells fargo credited bank of america and cut the price target on the stock. wells fargo cut the stock to $100 a share and competitive entrants are ramping up.

this is leading to competitive turbulence for the stock. slid. of health of that even after they were held for stability after their turbulent start of the year. analysts at j.p. morgan says that they reported no fireworks. the tech giant's performance was strong all-around. rate at 1460-1420. grubhub tumbled. they get a fourth quarter , analysts were extremely bearish with at least three grams -- firms questioning their price target. they said we struggled to find any silver lining in these developments. now, ctrip is china's leading

china agency. the company provides one-stop travel services such as accommodation and ticket reservation as well as vacation packages. it has had a rapid growth since its start in 1999. they have seen decline during the u.s. china trade work and hong kong protest. the ceo spoke to tom mackenzie in beijing. take a listen. jane: people will still probably travel but maybe instead of four times a year, they may reduce to three times a year. instead of traveling long-haul, they might travel to asia where within china. i think travel for middle to natural customers is during chinese new year? break. -- chinese new year course summer break.

tom: is it being weighed down by the weakness in the economy? jane: yes, it has a negative impact on our topline. we will see through it and make a strong investment in the long term. tom: how would you characterize the impact of the trade work on your business? jane: i am hopeful that the leaders from both countries will have the wisdom to focus on our shared interests. there is so many things we share together. we should maximize our shared interest. then, both countries will be benefiting from her collaboration. -- our collaboration. tom: we know that tourism to hong kong has been under shenanigan pressure. can you quantify how it has

played out? for the mainland tourists looking to travel and stay in hong kong? jane: the impact is on our total revenue, 5%. tom: 5%. when you expect that to turn around? will bepefully the area stabilized very soon. governmentink both and people will look into the future. .ook forward what is the best for hong kong. tom: i think our focus has been to grow in lower tier cities. smaller tier cities in china. how much success have you had there? what was your target for growth? i saw one target of an additional 50% of revenue coming

from those smaller targets. tom: we have about 8000 off-line stores. jane: -- we have about -- jane: we have about a dozen off-line stores. the growth has been tremendous. they have been in the third tier, fourth tier, 50 or cities. it has been working quite well. it is more than 50% year-over-year. tom: you expect those numbers to continue in terms of growth? our: as long as we keep education, we will be able to gain more market share. taylor: that was the ceo of c trip. electric vacation is proving extensive. one major u.s. automaker says it will be putting most of its money into ev. we discuss next, this is bloomberg. ♪

taylor: this is "bloomberg technology." i'm taylor riggs, in for emily chang, in san francisco. all eyes are on electrification. on tuesday, general motors laid out an aggressive approach to electrifying its lineup, saying the bulk of r&d will be spent on ev's and not combustion engine cars. but is demand for ev's still there? in a regulatory filing, tesla reported their u.s. sales fell 39% in the third quarter. the numbers continue to raise questions about how much incentive is needed to keep customers enthusiastic about electric cars. joining me from new york is morgan stanley analyst adam jonas.

adam covers the automotive industry. great to have you. one of your most recent notes really highlighted the connection between climate change and ev's. as you look at the landscape, how much does climate change start to really drive the shift to ev's? adam: so, taylor, first, thanks for having us on. i just got back from morgan stanley's inaugural sustainable investing summit where we had a couple of hundred clients, skewing very senior, towards cio and portfolio managers, that really focused on this topic. look, here we are 111 years after the model t, the average car emits almost five metric tons of co2. there are 40 tons per second of co2 emitted by all the cars in the united states. 40 tons a second. yet, the world's most valuable auto company, toyota, makes zero ev's today.

it is kind of a shock. and then on the flipside, you have the world's most shorted auto company, tesla, that only makes ev's. so, something has to give and investors really want to understand how to play that multitrillion-dollar shift in capital as we reinvent the industry. something has to give. taylor: how does technology play into this? i think of early days of tesla when i was not sure if tesla was a tech company or an automotive company. where is technology in this? adam: we think tesla is more of a software company, and a hardware-software fusion company that, in an ideal world, will be covered by a tech hardware analyst rather than the auto analyst community. we will take what we can get. we think the connection between tech and autos is when you see these large multitrillion dollar tech platforms like amazon, alphabet, and apple that clearly have their eyes set on the auto industry as a domain. not necessarily to make cars, but perhaps apple wants to make your car into an apple store.

and so, as they try to look at this internet of cars marketplace, it's a multitrillion dollar market, they're getting drawn in to that 40 tons per second in the u.s. ecosystem. it's happening within cities where ridesharing vehicles might emit 25 tons in a year, five times more than the average car. as tech firms get to that autonomous vehicle topic and the shared and connected car, they are being drawn in and have the resources and capital and frankly the obligation to do something about it. taylor: in your other latest report called the global electric vehicle market monitor in october of 2019, you talked about within the u.s., we are down year-over-year, but up year-to-date in terms of u.s. sales in the battery electric vehicle market. as you look towards 2020 and beyond, paint the picture for me. where are we? is there demand? adam: we think the stock market

is still defining the ev adoption through the wrong lens. they looking through the lens of wealthier people buying cheaper and cheaper teslas in a suburban community for your home, like the retail experience. personal ownership. that will grind along. i think your segment before, tom who did that survey on tesla was spot on with his observation. but we think where the stock market is moving to now in terms of analyzing ev adoption is fleets and shared vehicles. in order to make this large shift, to get to 2% ev adoption in the u.s. to 10%, 20%, it will be the regulatory purview and a -- of a dense community like a city going after logistics, taxis, shared mobility fleets. that is how you get the big chunks. that is where the money is. that is where the business model

can make use of the ev infrastructure and you software -- use software and data to fix the problem instead of relying on the 100-year-old ecosystem to do it. it's getting blood from a stone if you try to do that. taylor: as a fundamental analyst, you assume further margin compression because you have to give out discounts to lure buyers? adam: all else equal, absolutely. we think if the ev market is just a machine with software that has to perform with incredible reliability, that will get hyper commoditized over time. short term, however, you do have tesla shifting production or at least expanding production into china where labor costs are roughly 1/10 and logistics cost are a fraction. there will be some volatility. as auto companies have proven before, if you have a highly utilized factory at that cost base in china, you can do some pretty interesting things with the margins. they may not be sustainable, but i would be prepared for some interesting developments. taylor: is tesla the clear

winner? who is second and third place? where is gm, vw? adam: we think all legacy auto companies will get drawn into this even if they would like it to move very slowly or else they will not be able to sell vehicles in the state of california with the current footprint. and they certainly would not be able to sell vehicles operated in cities like new york, london, oslo, norway, most chinese cities, los angeles. it's going to move at the pace of those cities that are going to take matters into their own hands. they will all get into it. but if you ask me who is the biggest competitor to tesla, we don't think it is toyota or general motors right now. we think it is large tech firms that are worth $1 trillion, worth more than all of my auto companies combined, that generate cash, that are equal to my entire industry combined, and it is more of regular recurring cash. these are the type of companies that have the ability to attract talent and capital, and lose money if necessary to take on

someone like tesla. tesla spent $20 billion in r&d and capex over the last decade. that kind of thing will be a difficult task for a legacy auto company to replicate. they will attempt to do it, but we think the real threat is from the mega tech. taylor: who is the biggest loser and what is the problem? is it capex spending, r&d? adam: we think the biggest losers would be companies that have to defend a declining business model that is at the margin obsolete. internal combustion technology, for example, that cannot be repurposed into electric, for example. and/or does not have the backing from the state or a national policy to be able to absorb losses from flipping the business model. there may be a lot of people on your program listening who say it may sound like the average auto company, and it is. i would say the average auto company that cannot make that cultural transition would be the loser. the question and what we are

seeing depending on the board room we are engaging with, some auto companies really have a high level of urgency and have kind of accepted they need to go all in on this. but, they will require some planning and support from regulatory bodies, governments, and perhaps some creative legal structures to attract capital on a competitive basis. it is not going to be easy, unfortunately. taylor: not going to be easy. you heard it there. that was morgan stanley's adam jonas. thank you for joining. and coming up, amazon may challenge the lucrative pentagon cloud contract it lost to rival microsoft, and the company puts president trump squarely in its sights. details ahead. this is bloomberg. ♪

. taylor: amazon is signaling president trump may play a prominent role in its challenge of the pentagon's cloud contract going to microsoft. with more, it is bloomberg's matt day in seattle. we heard originally from amazon, all they originally said was they were surprised by the decision. what else are we hearing from the company? matt: that's still all they've said, but we've heard from sources they are considering their options of what to do next and they may have to move quickly. what protests they may want to file. they have 10 days from the date of an award to launch a formal protest. we know amazon is pretty busy evaluating its options at the moment. taylor: assuming they do pick a battle, what is their argument? matt: i think the most obvious one that observers on the

outside is the involvement of president trump in the award or alleged involvement at this point. earlier this year, he made the kind of precedent-shattering choice to discuss the ongoing contract in public in a way that echoes the criticisms that some tech companies had of the contract process. seeming to suggest the deck was stacked in favor of amazon. that is likely to going to feature in whatever protest, if amazon should take that route. taylor: any sense of how likely it is that they could win? matt: they face a steep challenge. amazon's rival oracle showed that earlier this year when they tried to challenge an element of the contract. they said they were unfairly excluded from it based on some ties that amazon employees had with the pentagon. that was thrown out by a judge. just showing how hard it is to prove that a contract, or that the government improperly

awarded a contract. courts tend to give a lot of deference to awarding agencies in these cases. given the amount of stuff in the public record from president trump on amazon, they are likely to make the effort. one thing contracting experts have pointed to is there a chance maybe the public hearing would force a revisiting of the contract, portions of it, but there's a long road ahead regardless of what amazon chooses. taylor: matt day, thank you for joining. now we take a look at facebook as they are set to report earnings after the closing bell on wednesday. despite regulators' greater scrutiny, facebook's ad revenues should remain robust due to consumer strength and the ongoing transition to stories. bloomberg intelligence expects third-quarter results to reflect the mobile ad environment, yet the focus will shift to spending going into the u.s. election. to continue into what we should expect to hear from the company, i'm joined by kurt wagner. let's talk about ad revenue. facebook and google dominate this space. we heard from google, really good ad numbers.

do we expect the same from facebook? kurt: analysts are optimistic this will be a strong quarter. and if you look, snap had a strong quarter. twitter was a little bit down, but they have some wonky excuses. you obviously mentioned google. typically, these companies tend to move together and the optimism for facebook is definitely high on the ad revenue front. taylor: how much more scrutiny are we going to be digging through those financial statements to figure out the money they are getting from political ads? kurt: they don't break that out and haven't historically. they admitted political ads is a very small part of the business. usually after the election or midterm, they will come out and there will be a report. a couple hundred million dollars of ad revenue. that is a drop in the bucket. there is a lot of discussion around their policies which are probably a lot more important and interesting to most people than the money they make. i don't think we will hear a lot from them from that as a

business. we may hear a little bit around the policies, but political advertisements for twitter and facebook have been historically small. taylor: we talk a lot about facebook. some of the user growth slowing. the shift to instagram has been a key driver of growth for them. what do we need to see on instagram? kurt: facebook has not broken out instagram revenue, but their -- there are estimates that others come out with that shows instagram is the biggest driver of growth for the company. that could be something incredibly interesting if facebook were to actually put that as its own line item tomorrow, kind of give us a peek as to how important instagram is to the business. more likely, we will hear a lot about how strong it is and how happy they are with no real numbers. taylor: you are not allowed to come back until you give us real numbers. just kidding. you're always allowed back. let's talk about the monetization of whatsapp. what do we need to hear? kurt: facebook, i think it was two years ago that mark came out

and said we are putting ads in messenger. we're really excited about this. people kind of lost their mind. analysts spent the whole time asking questions about messaging ads and facebook did not have a lot of answers. we still don't know how much they make from messenger. the point is these are a slow-moving part of facebook business. they continue to make most of their money in the newsfeed from instagram. and messaging is seen as something they will get right hopefully at some point in the future. i do expect them to talk about improvements they have made with whatsapp or messenger. i do not expect for them to talk specific numbers. taylor: on the analyst call, how much of a distraction will antitrust, data privacy, libra be compared to just the fundamentals of the business? kurt: i mean, the big threat here, could facebook get broken up? there are a lot of people who think that is a real, rare chance of that happening, but it

is a massive threat. it would totally dismantle the entire thing facebook built. i would expect them to answer -- ask questions. i don't know how much facebook could say given these are regulatory investigations. the last time we heard from them was the day they paid a $5 billion fine to the ftc. i think it is fair to say, hey, what is going on? do you anticipate there could be some financial penalty as part of these investigations? as far as i know, this is a way down the line. we might not hear specifics. we have heard a lot from them on this front in the past. taylor: analysts said some of the big headwinds are what is hampering the valuation and the multiples of the company. that was kurt wagner. and, still ahead, we continue our earnings preview. how the iphone 11 sales may have impacted apple's fourth quarter. that's next. this is bloomberg. ♪

taylor: apple is set to report earnings after the closing bell on wednesday. the company's september 10 launch of the iphone 11 line-up likely left many potential buyers on the sidelines in advance, leading to a soft quarter for iphone sales. at 55.6% of year to date sales, the iphone still holds sway over apple's revenue growth which consensus sees flat for last year's fourth quarter at $62.9 billion. to discuss, i'm joined by angela zino, cfra research analyst. here with me, "bloomberg technology's" mark gurman. give me the lay of the land of the iphone 11. how much of that will we see in the earnings report? mark: investors and analysts are excited about the iphone 11, even though it was not a big update.

you've seen the stock price seriously rally since the september 10 announcement, but we are looking at another year of flat or a decrease in iphone unit sales, and a drop in iphone revenues despite the higher prices. it is not really truly good news, but i guess investors do not think it is as bad as it could have been. taylor: angelo, i read your report and you're expecting better-than-expected iphone sales. in your opinion, what is driving that demand? angelo: we would agree with mark in the sense that the september quarter is not going to look that great on a year-over-year basis. i think what investors are really getting excited about here is the estimates were reset earlier this year. we are now setting up essentially a low-bar environment going into fiscal year 2020. our view is you could see a potential return to unit growth in the december quarter, partly due to the fact we saw apple kind of lower that price point, that entry price point down to $699. we think that helps a number of geographic regions.

we do see better-than-expected results or at least commentary out in china. if we get all of that, even if you get an in-line kind of number, we think that bodes well for the shares. taylor: angelo, you are ok with that even though they don't have 5g for about another 10 months or so? angelo: that is actually a positive in our view. essentially, this is a point in time right now where even if apple were to miss or to go -- guide lower over the next couple of quarters, we think investors will largely overlook it and essentially by any sort -- buy any sort of dip in anticipation of the 5g device in the fall of 2020. taylor: the problem with all of this, because they are so dependent on the moment on the very cyclical iphone sales, they need to sort of transition or continue to transition to services to help balance out the volatility. what do we expect from the services side? mark: apple really has not shown

the ability or the willingness to come out with a product that is going to add seriously high percentage points like the iphone, over 50% of the overall revenues. services will extend the life of the iphone for apple. it allows them to add new things like the apple card and apple pay. at this point, it is not seen -- it does not seem any of the services will make a dramatic jump individually, but it is that continuation of the app store that will help apple in the next few years. taylor: angelo, what is the inflection point for you, where services offset the highly-cyclical iphone sales? is it three years from now, five years? angelo: in terms of the top line, i don't think you get there anytime soon. when we start thinking about potentially, let's say, the services profit. you think about the margin profile, 2x of the hardware business. when you start looking at the margin profile of services and

actually lump in wearables, the combination of both those businesses, services and wearables, could exceed the rest of their business over the next three to five years in terms of the profits. taylor: and the integration of health care with the watch, wearables, the next key of growth in your opinion? angelo: we think health care is an enormous opportunity for the company. when we actually see some of the potential incremental service opportunities as it relates to the health care industry remains to be seen. yes, we do think health care remains an absolute critical part of the apple story long-term. it will be driven by wearables combined with potential services offerings. taylor: mark, the macro backdrop appears to have improved. we got potentially a phase one of the trade deal. any sense if that is a game changer or not yet for apple?

mark: this a lot of discussion when apple have the iphone sales slump in china which was due to the trade war. from the perspective of people not wanting to buy american products in china might have some influence, but apple's problems in china are much deeper than the presence of a trade war. or no trade war. it comes down to lots of companies really being specialized in terms of services, apps and other offerings for the chinese market, where apple has not really optimized what it is offering for that market in any specific way. taylor: quickly here, you said you are waiting on positive comments from china. how was the trade war in your opinion? angelo: at the end of the day, we think there has been somewhat of an easing in the near term for apple. we agree with mark. longer-term, i do have my concerns. we think the biggest risk for apple long-term is going to be china because of the competitive offerings out there. that being said, we think near-term, apple should be ok in terms of the china play. taylor: mark, on a similar

story, you were at a samsung developers conference. they unveiled a foldable phone. what was your takeaway? mark: that is a new look for their foldable strategy. it folded open like a book. now, it will fold open like a small makeup case. very interesting new form factor. hopefully for them, it succeeds more than the current model. taylor: a makeup case, i like that. angelo zino and mark gurman, thank you both for joining me. that does it for this edition of "bloomberg technology." "bloomberg technology" is livestreaming on twitter. check us out @technology. be sure to follow our global breaking news network, @tictoc, on twitter. this is bloomberg. ♪

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