>> i am in san francisco. this is bloomberg technology. coming up in the next hour, hitting highs, tesla stock is on a writ. does it have more room to run? you have analyst inside information. what was the most downloaded apps of the year?

we will have those numbers. lyftber andt went public. they turned 46% so far this year. the last time i saw these types of gains, 2009. when the index returned 60%. to break down what is driving this, it is mike reagan. what is feeling this massive rally? >> if you look at the main gainers in the tech index, it is mostly shift america's. you have amd more than doubled. kla almost doubling. there has been a lot of talk on wall street about this rotation out of growth into value. i think that oversize what happened. growth has not gone out of style. it was not a great year for growth.

the stock market is all about the next big thing. what are the next big things people are talking about? 5g will be a big thing. a lot of chips needed for that. the internet of things is still in the early stages. machine learning, artificial intelligence, there is a lot of optimism built around these innovations. arena hascomputing still not completely matured. i think people are really looking forward to that next big innovation that we will see in the 5g and internet of things. the chartto look at i'm showing inside my turn -- terminal. i am wondering if the tech robust.eels

it is from a technical standpoint. what are you hearing about the tech industry being over bought? >> it has been known to go over that 70 level that signals overbought. it stays there for a while. when you look at the moving average, it is about that moving average. that to hundred day moving average is still pointing higher . that is a bullish thing. even if it comes back to test that level. the long-term trend is higher. it will take a lot from high-tech -- technical perspective. i was shocked to hear that hardware is actually outperforming software. michael: that is part of it. when you look at the hardware sector, apple is the biggest

weight in those indexes. what is fascinating to me is the best standard among hardware is about 80% -- is xerox. one of the old fashion tech companies. this is a situation where you would take to ancient tech companies, combine them and basically squeeze a lot of synergy out of their and come out the other end with a company that is an similar businesses but covenanter enough that people get excited about it. it is far from being approved. a lot of that came after the announcement of that. waited to talk about tesla, set him up nicely and talk to him about what has been going on with tesla over the last few days. another day, another record, 404

for tesla. michael: when the introduced the cyber truck, it was meant to have bulletproof glass. that did not turn at be the case. we saw an initial bad reaction in the stock after that but it has rallied since then. the initial reaction from a lot of the analysts would be that this vehicle would be a niche vehicle. i kind of question that. i come from rural pennsylvania. i know a lot of pickup truck owners, people who were driving the truck around a lot incurred a very big gas bills. pickup truck owners are notoriously loyal to their brand. if they have the opportunity, the small business owners -- if they have the opportunity to save a whole bunch on gas prices, i wonder if this is maybe more than a niche product. taylor: we will find out. thank you. mike for joining

us. tesla shares are closing in on elon musk's goal of $420 per share. he sought to take tesla private. this most recent stock surge came from a report that tesla is considering cutting the price of its kind of those model three sedan. my guess joins me over the phone. -- guest joins me over the phone. what is the fair value of this company? >> we have to talk about what is going on on a mental basis. we are seeing cars pictured in the lots outside the china facility.

the company's promise is significant cross performance out of that facility. as we think about that price cut , that may be indicative of where the constructs are would check out. taylor: are you looking at this as the news on china and wouldn't raise the price target in 2020? -- what it raise the price raise in 2020 -- would it the price target in 2020? >> momentum does move in both directions. we saw the stock it oversold and rally and then preservice.

what i will say is as we get more information about volumes, there is a big push to finish off the quarter. also, what the potential earnings power is when they hit these levels of production. we will reevaluate our price target. one thing i will note is that since we published that price to be, they are going laying off 10% of management. they are going to miss the eu mission targets even after buying credits from other companies. we continue to see that tesla is -- has a two or three year lead on electric drivetrains and powertrains. we will continue to do so for the next two or three years. taylor: you talk about market share. i'm showing a chart to our audience right now. i would describe it to you over the phone, this was showing the

car market in china. car sales had been falling for a straight year over in china. as we take a look at tesla defending their market share over there in china, is cutting their prices by 20% or more or so enough to offset what looks like falling demand in china? colin: we have seen a handful of things in the china car market. incentives for electric big goals that were adjusted early on this year. even with that, we are seeing flat year-over-year ev sales. where tesla is at in the market, just introducing the smaller vehicle into that market, we see the larger addressable market for them. it has always been a niche for them in terms of the model s and the model x. them ramping model --ee production,

taylor: we know the model three was already the least profitable of all of teslas models. does cutting price by 20% or so change your profitability models and targets? colin: it depends on what the gross profit is on a per vehicle basis. done evaluation and potential cash flow analysis on tesla. we are looking at how much cash they are capturing per vehicle. we are seeing around $10,000 per vehicle. if we see that sort of number with the model three in china, the volumes that could be producing, i think that could be good for us. taylor: in 2020, how is the cash look? -- outlook?

colin: it comes down to two variables. route -- abouta $5 billion in cash. they don't need cash flow. the numbers we're looking at is volumes, the numbers of cars the gross profits. if they maintained the gross a lots, we think there is of earnings leverage. that will drive the stock market higher. -- stock higher. taylor: congress has earmarked more than $400 million to help elections security in early caucus and primary states where voting is slated to begin in february. they would use the money for upgraded voting equipment, conducting postelection audits and cybersecurity training. the intelligence chief has warned that russia and others remain interested in attempting to interfere in your selections.

-- which appsh where the most downloaded in 2019. we will find out. if you like what you are hearing, check us out on bloomberg radio. we are on sirius xm. this is bloomberg. ♪

facebook continues to 's companies in the hardware it builds its own operating system stock or. -- software. it has its own semiconductor company and a videogame company. joining us to discuss is sarah frier.

you get into this? sarah: has been focused on winning the future of hardware. they tried to be big on the mobile phone but they could not make it. since then, since the rise of the iphone and the ios operating , facebook has had to build his entire business in other people's echo system. -- ecosystem. they on four of the most popular apps of the decade but in the future generation of hardware glasses,lasses or vr facebook wants to be the one that owns the hardware. taylor: talk to me about the operating system. you send it does so much on apple's ios and google android. about a new

operative system on facebook? >> it would help them make sure they can take apart -- even if they create an operating system that does not end up becoming the dominating one, they can chart the path of the market. they can build something that other people have to compete with. that helps them determine a future that is more centered around social products. that is what is most important. after the era of mobile phones, they will have a big space for people to be connecting with each other over instagram, facebook, whatsapp, messenger and the properties they own. taylor: analysts said that someook really undervalues of the other big peers. a lot of this comes from the headwinds of regulatory scrutiny.

how has facebook continue to make all the acquisitions? sarah: facebook has really dominated in digital advertising and social media. toy were going to try acquire tictoc or another social media. it will be hard to do that. if they want to acquire a gaming company, that is less concerning to the government. they could probably get away with it. there is a lot of regulatory overhang. facebook book is going to keep trying to chug along 10 or 20 years in the future. taylor: as we wrap up 2019 and take a look at the stock, this is more than 50%. 55%. due investors not care about data privacy? antitrust? it seems like they don't.

sarah: they only care if they spoke stops growing or starts to slow down growth. they have warned about that alluded. they said they can continue to grow their revenue. these hardware investments are so much more expensive than investments in software products. they are trying to gain more territory over our free time. taylor: i will be looking for that ad revenue from facebook and google. thank you very much for joining us, sarah. our subscriptions the next big thing? according to the next -- the top downloaded app, they might be. bloomberg technology is live streaming on twitter. be sure to follow our breaking news network on quick take on twitter. this is bloomberg. ♪

2019 has been a landmark year for mobile with the rise of apps like tictoc and video streaming services like disney plus. here to discuss is the big players from the world of mobile apps. .anielle great to have you. what did you find in your big report in the 2019 app downloads? popular: the big, social and communication has continued to dominate antonio 19. -- in 2019. social apps were seven of the top 10. facebook claimed four of the top five. taylor: one of the ones that caught my eyes was tender.

how has tenders explosion changed the social media landscape? danielle: we are seeing that it is not just a video apps or music apps that have done really but we areetize seeing that dating apps are starting to make their mark. tender claimed that number one spot. this is the indication of the national social experience. it is the social component. the ability to quickly communicate. in the case of bubble, you check out who you have been matched with in a certain timeframe. you lose those matches. there are behaviors to bring people back. we are seeing more competition. tender has a huge lead but we are seeing so many other apps continue to grow. taylor: it is the ability to monetize. some of the most successful apps that were downloaded have those

recurring revenues. that subscription model that we talk about in this program, how are they able to be successful for a generation not number wanted to pay anything? >> it is matter of value. it is built into the experience. it is expected. when you look at entertainment, you may be bent watching something but you're coming back for the next show a week later. or in the case of music, people music.tening to people are using these apps really regularly over a. of time -- over periods of time. taylor: a lot of the subscription-based apps are in the gaming sector. that has taken off. the rise of this virtual online gaming. is that what you see feeling us in 2020?

danielle: gaming is an interesting one. cents ofibes about 75 every dollar consumer spend in mobile. people are buying gems or levels. the subscription just started to take off. subscription is something to take -- keep in 2020. theust started to scratch surface of games. it is one of the areas that games are behind on. it will be an opportunity for publishers to monetize games that did not lend themselves well to in app purchases. about ninetalk innings in a game. where are we in those nine in terms of apps being able to utilize engagement and monetization as you think about a wide variety of where we are? >> engagement is everything. if you start with the fact that you spend three hours a day in

apps and of that, half of it goes to social, that leaves 90 minutes with everything out. some of that might be transactional. then you have all of this entertainment. apps like snapchat take a lead in terms of sessions per user versus an app like facebook that is intimately successful in terms of time frames there. they offer a different social experience. it is important to understand which of those metrics are associated with a happy consumer. taylor: one app we have not talked about is tictoc. huge overseas. do you expect tictoc to be successful in the u.s.? danielle: it is phenomenal. millionhas reached 665

monthly active users globally. it is starting in the u.s.. gen z anes lean toward d younger viewers. yes, people are also using snapchat in gen z. i think we are also starting to see compelling adoption of tictoc year. taylor: thank you for joining us. coming up, tesla is considering a serious price cut to their china both cars next year. ?hat kind of price reduction we will have the breakdown next.

taylor: we are joined bloomberg daybreak australia. let's look at the top global >> theories of the day largest online retailer is looking for its first warehouse in ireland. amazon would have a problem if you can't does not agree on its radio that would in short the smooth movement of goods across the ever see.

we work is in talks to sell one of its businesses at a quarter of the price it paid eight months ago. bloomberg has learned that it would be valued at less than 55 million. the group of investors and tech executives are negotiating the purchase. takeaway.com just raised its bid just minutes after a process offer in last ditch attempt to claim ownership of the uk's food delivery firm. the dutch group said it has the cost of a share. prices also increased. that would leave the company with about 70 $.2 billion. taylor: tesla is considering chinag the price of its

sedans. we are joined by craig. >> how much with his help in lowering the mass market and china? especially when you consider the competition. they are already much cheaper than tesla. >> you have a lot of electric vehicles. even some premium cars are priced below where you see the tesla model three. when the price cannot for the made in china model three, it caught a lot of people of by surprise because it is not that big a difference. the whole reason for building this plant locally is the idea that they can bring the price down by a boarding import duties and so forth. there is going to be a natural goodwill of getting a plant opened, getting governments on

board, there is a lot of government purchases of electric vehicles in china. thea making a bet about initial buzz. on the chart i am showing , thereside the terminal is a macro backdrop that is slowing car sales. tothe 20% price cut enough set up this drop in demand? quite this is a really good question. >> you are a lot more nervous state.he dropsou look at the kicking in, it was around the time that tesla was getting a deal, signing on the dotted line. this was a muddy field in

january of this year. we are talking about a plant that is already opened and cranking out cars, potentially delivering them to customers in the next few days or weeks. this all happened extremely fast. we have seen some softness in the china market. the degree to which the market really deteriorated caught a lot of car companies off guard. it is a cause for concern if you are tesla. despite the fact that you have -- brand powerr and star power as a company that is on the leading edge of electric vacation -- electrification. >> what allows tesla to bring the price down? get-go, customers could just wait and hold out and not by it. they could wait until prices dropped.

craig: it will be interesting to see how long they can hold out before prices drop. tesla has made all the cars in high-cost california. does not have serious -- breadthng breath across the world. labor will come down. get special treatment in terms of incentives and support. you can see that -- and so forth. >> i want to show another chart here. i am showing inside my terminal. this is the stock price at a record 404, blowing past everyone. the median is 291. i got off the phone with colin rush. even he admitted that the 404

has long passed even his estimates. i know you focused on the company but when you look at sentiment consensus on the street, is there any sense that tesla's run has been a little bit overdone? ati think you have to look what the analysts have done with their price chart. they have been pretty stingy about taking those up. this is a company that did get a profit in the third quarter. he loaded that report with a lot of positive things. they got people excited about the china plant being before schedule. -- ahead of schedule. there are a lot of things for people to be excited about. people are pumped about the cyber truck despite the fact that initial reaction was what is that?

this is a company that is on a bit of a run right now. that being said, you look at the financials and it is a company that is not making significant money. i think the big question is you think about how much people were caught off guard in the early part of this year with tesla's inability to whether the seasonal downturn you see for cars in january and february. we are >> now seeing beijing trying to open up china's car market. -- >> we are now seeing beijing trying to open up china's car market. craig: it will be interesting to see. one of the things we have been following in this market is you have had all of the tesla skeptics saying wait until the

established carmakers get into the alleged vehicle game and tesla will be toast. that is not what has been coming to pass. you see some of the big german carmakers, gm, even hyundai and kia bring electric vehicles to market that have not hit the specs that tesla manages to hit. don't have the sort of brand power and excitement around them to where you see even the likes audi or or jaguar -- jaguar put out decent looking letter vehicles. letter to be that vehicles looked like science projects but these are still really underwhelming. you saw the porsche disappointed everyone with an underwhelming range in the u.s.. record 404 by target we got on thursday.

there is more ahead, stay with us, this is bloomberg. ♪

taylor: not to her weeklong series. rewind check rebind -- -- the big tech rewind. if we didot be 2019 not describe this as the year of the tech ipo. there was one that investors were waiting for. it was supposed to be the idea of the year. it was supposed to be the most valuable with a supposed market value of as much as $120 billion. all of that changed. it dropped nearly 11% in the first few days of trading. words like debacle were being thrown around to describe uber's

coming-out party but the ceo remained optimistic. goyou can't fix when you public but you can control how you execute a company. believe that our business can and should be profitable overtime. taylor: promising the timeframe would be 2021. people agreed. >> we'll get it pretty soon. >> i don't see it as the end of the road. i see it as an important milestone. says then, the stock price has continued to take hits, including hitting a record low. despite a licensing battle in london and a report disclosing 3000 sexual assaults on its platform, uber remains optimistic. >> the business can be quite profitable. the next 2, 3 or four years will be about growth and then we will

flip it over for demand. >> shedding 1000 jobs and rearranging visions of uber. after watching companies like looking pelaton lackluster when going public, they said thank god we went public when we did. taylor: to continue the conversation on uber's performance in 2019, we are joined by tom white. both the sameyou question. i want to show a chart on my terminal. you know the story better than anyone. since the ipo, both uber and lyf t are down 35%. what do you make of the performance year-to-date? tom: thank you for having me. it is clearly disappointing. i think what uber and lyft, they

were supposed to react to have investor expectations around demonstrating a path to profitability would be clear. shifted.expectations i think the other thing that was interesting to keep in mind is we have seen a lot of high-growth companies that went public when they were not making money. cases, the lyft's sheer magnitude of the losses is what investors struggled with. that had to do with how long these companies were private. taylor: what about your take? >> what you saw out of the market this year over the course

of the year was less of a willingness from public market investors to accept large losses and on profitability. un-profitability. and lyft led the class. all of that ipo supplied led to some technical challenges. others lyft and uber and with the trend turning to private longer. that summed up some of the demands when they became public. there were a lot of lockups. there were a lot of technical issues. uber and lyft had negative news.

there were regulatory issues and other problems that were disclosed. that had sentiment low. we was if i can flip over the course of 2020. tom, you mentioned a lot about the magnitude of losses. you will have to clarify to me. when i went to our cfa -- my cfa school, we were taught that the bottom line is important. am i being too hard on the companies? is profitability good enough? tom: i don't know if it is good enough. colleagueustry, my could attest, we see companies trying to convince you to look even farther up to things like contribution margin were gross profit. at the end of the day, it is about cash flow for me. the present value and future expected cash flows.

i think looking out into 2020, what will really be interesting managedber and lyft profit and growth. in the u.s. market, i think it will be iterated. is in a position to dictate how competitive the environment is for ridesharing when it comes to prices and promotional activity. will havee u.s., uber to make tough decisions about what is going on. they exited south korea. of eats inports india.

-- exiting eats in india. they are going to clearly weigh how the public market investors are valuing this. taylor: let's get into some of those. likeanalysts i speak to lyft are clear on ridesharing. uber has a diversification strategy. is it clear which one of those will pay off? it depends what timeframe you're looking at. >> certainly, uber is playing a big game. it has an opportunity at of it. if they can do the things it is talking about doing like rationalizing is are in places, the competitive environment,

they do have a much bigger opportunity. in the near term, international markets, the competition is remaining really challenging. it has been much harder than most people expected it to be on the food delivery side. that will stay competitive for an even longer. longer period. there is an that much clarity about how much better things can get. that is a challenge. domestic,alance lift lyfts and opportunities, 's opportunity to become profitable has become clear. lyft highlighted expected to

become profitable. it is debatable. is talking about getting there in 2021. this goes against the concept we are talking about. i think a lot of investors remain skeptical about whether they can get there in that timeframe. taylor: as you take a look at the regulatory landscape, particularly in california, do you see these ridesharing companies being able to overcome that? how must is the stock change? >> to an extent, yes. lyft have uber and some levers they can pose offset the impact of higher expenses.

whether it is related to surcharges that are levied against the businesses of cities like new york. only to some sort of an extent. is over anduestion lyft have-- uber and communicated that they will bring those popyrin costs into higher rises for consumers. to some degree, consumers will be able to withstand that. if we see a flood of additional surcharges, one of the most egregious ones we saw was what was being proposed in chicago. a tripling of the tax. see thatoint, you will have an impact on right volume. it will have an impact on just how attractive or appealing taking a ridesharing bride is for a consumer relative to what

the other alternatives for transportation are. they have leverage, they can increase- they can price. don't think it means that the businesses can't be profitable. it just means the businesses are not as big as they were pitched to investors on the roadshow or and as transformative impact. taylor: the biggest catalyst for 2020? ygal: competition. it is a huge factor. probably the most meaningful impact to profitability. each is significantly more profitable. if we are going to get to a

place where investors start to feel more comfortable with the market opportunity and profitability, i think the single biggest thing will have to be competition, without that, i don't think we will get anywhere. the regulatory environment will continue to battle. they are battling in london. if we continue to get more and more examples of that, that will be even better. taylor: teaching me all about you forility, thank joining us. still ahead, we will go through the top tech calls. that is next, this is bloomberg. ♪

taylor: let's take a look at

today's top tech cause. that plus, the price target was raised to 4.25 per-share. netflix, streaming -- the price target was raised to 4.25 per-share. netflix is well-positioned among video streaming companies. grubhub's price target was raised to $52 per share. the analyst said that while 2020 appears to be an investment year, expanding restaurant selection and loyalty programs should drive growth in the second half of next year. barclays upgraded the stock. says that cisco has a diversified revenue stream and a few key product areas should improve for cisco over the next year. that was look at your top tech

calls. that does it for this edition of bloomberg technology. bloomberg technology is livestreaming on twitter. follow our breaking news network on quicktake on twitter. this is bloomberg. ♪

the california gold rush is considered -- it has certainly had a long-lasting impression in numismatic history, as well. the people of california needed a way to standardize the value of new gold, so they set up