taylor: i am taylor riggs and this is "bloomberg technology." coming up, apples shine. the company keeps hitting records plus, a new -- the food delivery business is getting crowded. grubhub may be looking to consolidate. and, sales for in the sky. it is no news microsoft impedes

with amosite in the cloud business. a new target seems to be retail customers. first, to our top story. last year, apple ceo tim cook stunned investors when the company readjusted its forecast due to struggles in china. official government data shows the apple smartphone shipments in china grew almost 19%. that marked a big jump from previous months. it is particularly remarkable when shipments of phones of all brands were down nearly 14% in the same period in china. surprised about the amount of bullishness we seem to have on china? >> that number is a surprise. the broad push in china to focus on huawei and have consumers by huawei funds instead of iphones. that was the concern for a lot of last year.

some of the trade tension has come down. athink more to the point is device like the iphone 11 is a little bit cheaper. the battery life is very long. the photos you can take are a lot better than the previous version. when you put all those things together and combine it with a large backlog of older iphones like the iphone 6 and iphone 6 asked, which were huge hits, aose devices, there comes point where millions of people are going to upgrade. are they going to upgrade to something else? they're probably going to upgrade to a new iphone taylor: one of the other things that surprised us was the fact that the iphone 5g funds are not out yet. what is driving the big push we saw in december. >> partly, it is this upgrade wave. even if they did not produce the iphone 11 and had the same

phones from last year, if you , which ishone six s four years old, you have to upgrade at some point. jumping to an android phone nowadays is becoming a bigger step for people because a lot of your digital life is run through these devices. there are other ways that apple hoax people into bit -- apple s people- apple hook into the ecosystem. taylor: i want to touch on a company he mentioned earlier, huawei. i am surprised we have not seen more talk about nationalism in china. >> part of it is this ecosystem issue. if you already have a huawei phone, you are used to the android operating system. you will probably stick to that. is a lot lower

than two years ago, investors were investing -- were expecting growing.ny to keep after the shock last year, that reset the bar. now, if apple gets 5% growth a year, investors will be over the moon because there are other things that are coming after the growth. taylor: you mentioned the ecosystem. they really try to draws in. the services and the wearables business, where else do you see apple trying to tie us in when it comes to keeping us in the ecosystem? >> we were discussing earlier the idea there has not been a lot of bad news about apple. when you look at the stock chart, it is incredible. it keeps going up and up. another one of the stats driving performance over the holiday.

apple always puts out a number. this is app store spending by consumers. that was up 16% year-over-year. even if you have not bought a new iphone, you bite -- you might buy a new app with a subscription. taylor: i want to look at a chart inside my terminal. the apple share price is at 309 today. even the median price target on the street is a 275 or so. what is this bullish consensus you get from the street that what else could drive the stock higher? one in a quarter trillion dollar market captured > one ofr -- market cap. >> one of our colleagues who a story last week -- wrote a story last week that addresses that. apple has been seen as a hardware company. company,are a hardware

you have lower margins. all of your revenue is a bit more up and down. now, when it is adding a lot of these services to the hardware business, that is a lot of recurring revenue and new subscriptions and things like that through apple music. that revenue is steadier. are, investorsns are rereading the company. taylor: great analysis on all things apple and the one in a trillion dollar market cap. thank you for joining us. another company we are looking .t is wework leases took a dive in the fourth quarter. space in london also grew the least since the brexit vote in 2016. all of this comes as they scrapped plans for an ipo and needed. to be rescued by softbank.

i want to bring in allen who has been -- i want to bring in ellen who has been covering the company. what do we know about the slowdown? ellen: these are major drops. asically, as early september, the company was putting the brakes on signing new leases for the last quarter of the year, which is a huge change from how the company had rategrowing at a very fast before that. they had been pushing for that much more than usual in the months leading up to well with -- leading up to what they expect they would be an ipo in september. things like new leases are off. we will probably see a continued slowdown in growth going forward. taylor: is a slowdown appropriate given that the company is in the middle of trying to write size itself? what: it seems on top of

they have said is important to them. investors are looking at this and probably saying this is prudent. signing thesee very long leases. that being said, the company says they have opened a record number of offices in december. i think that is a continuation of a pattern of signing releases earlier in the year and continuing construction. we are going to continue seeing offices opening. of there still remanence eminantsowth -- r of the ultra growth period. taylor: i want to show you a chart i am showing inside my terminal. you know this story more than anyone. the bond prices have appeared to

stabilize. wey are way off of the lows so in november at $.70 a dollar. we saw the market bond price yield stabilization. as the company appearing as stable internally as the market appears to think they are? ellen: i think there are still question marks about where the company is going to go in the next six months. they have a huge leadership cap. -ceoshad these new co step in. i am sure people are thinking that these replacement ceos are not long for the position. they have a new executive leader in the form of their executive chairman who was in solved -- who was installed from softbank. i think people feel pretty shaken up as well. employees went through very serious layoffs in the last

couple of months. people probably feel their future is a little uncertain. the company seems or stable than it did in the rocky times of september and october, but the future is still probably a little unsure. taylor: thank you for joining. coming up, the food delivery business is getting crowded. grubhub may be looking to consolidate. if you like bloomberg news, check us out on the radio. you can listen on the radio app, bloomberg.com, or on sirius xm. this is bloomberg. ♪

taylor: wall street is weighing reports that grubhub is exploring strategic options in the midst of intense competition and steep discounts. gives fresh evidence

that food delivery companies have no choice but to merge or acquire. we are joined by tom and brent. brent, you have been covering grubhub. get your thoughts on grubhub being bought or buying someone else. both are logical outcomes. you have seen consolidation of space with door -- buying caviar. you are seeing other smaller players getting road up by others in the industry. i think it could go either way. there has been a lot of pressure on the revenue. doordash -- uber and doordash has come in. our thesis is grubhub is dislocated because they had great margins, but long-term, the economics can be restored. i think the ceo of grubhub has

said that consumers should not get used to the prices they are seeing right now because they are not sustainable. in any market, you see too many vendors chase the market. there is way too much competition. that will consolidate. potentially, economics will restore. there is a standalone case for grubhub or they can do very well among three big players, which they think they would be the third biggest. there is another case where you could see, would amazon want to acquire this? shuld uber or doorda consolidate some of the assets together? i think there are a lot of options where shareholders could win at this level. we do believe you could see a higher price. taylor: you mentioned uber eats. let me pose this question to you. you have been covering uber and

uber eats. do potential for uber eats to come in and take up grub? tom: i think i do. echoing the comments of my colleague, this is a space that is ripe for consolidation. we have a lot of businesses that have similar if not identical business models. they are burning cash coming chasing growth -- burning cash, chasing growth. on paper, consolidation seems to make a lot of sense. for luber, and makes a ton of sense to explore this. i think there are reasonable questions as to whether or not they could get a deal done. i think uber has a target on their back. that is an open question. with these sorts of deals when antitrust folks look at it, it depends on how they define the market. are they going to define an define itonline -- narrowly as online food delivery or just sort of restaurant

volume overall? there are some questions there. thing thatnt, one could also go against the deal is a could result in prices going up. that is not something regulators like to see when they are going to approve a large-scale injury. a deal would probably accelerate that timeline. on ar: your thoughts potential evaluation on grub. similar to a deal when you had takeaways pending purchase of just eads? ?- just eats you agree with that valuation? >> the street has a massive deceleration in growth. you could argue, is the street looking too far in terms of deceleration in the growth rate given the investments they are

making. if they could show better growth, you are looking at a multiple that is three times -- three and a half times four sales. that is below that of just eads. if you look at other industry leaders, you have seen multiples that are fetching five to six or seven times -- we do with a lot of software companies that have sold for 15 times revenue. i think the right range for tech mna, a code -- tech mergers and acquisitions, you are seeing assets trading between five and high single digits. you can get to a higher multiple assuming the revenue does not implode. you can get a higher stock price organically and in organically if they execute a little better than they have in the last year. e are obviously a lot of what if's.

taylor: talk to me a little about the organic versus inorganic growth. it has been said that uber eats would be that are served by growing organically. can they get there? i think optimally, you would be able to grow organically. anr has also put out aggressive timeline for achieving profitability. i think consolidation in online food delivery of meaningful scale would. help accelerate. the timeline i does wanted to touch on the idea of valuation. help accelerate the timeline. i does want to touch on the idea of valuation. in deals like this where you have a strategic asset that is somewhat scarce, a large online food delivery network that has a lot of potential suitors looking at it, this could be one of

those situations where the ultimate winner is the guy willing to pay what it takes to keep it out of the hands of what they view as they are serious long-term competitors. -- as their more long-term serious competitors. taylor: that was tom of da davidson. brent, you are sticking with us. we are going to discuss how we see -- how jeffries sees more room to run. this is bloomberg. ♪

spiked snap shares thursday after the social media received two upgrades. targetboosted its price to $20 from 16. the move comes on the heel of jeffries lifting its rating from a five to a hold in a note

published on january 8. print raised the own targets from the 17. hr i am showing inside my terminal -- take a look at a chart i am showing inside my terminal. your take on the path from 17 to 21. taylor: last year was a huge last year was a huge move. they put the company back on track with a rebuild of the android version. there were a lot of things they got set up. we missed part of that run. our review going forward is that, does it still have more room? the answer is yes. getting the low 20's is not as big as an ad from a single digit stock ending the following year to what happened last year.

i review is that -- our view is showingis a good story improvement in terms of users coming to the platform. financially, they are showing bottom-line support by getting towards profitability at the end of the year. we think all of these things are moving in the right direction. that is why we do not expect the stock to double from here. tohave enough room for a buy get over 15% upside from current levels. facebook is still our number one pick in social. we see a pathway to $250 a share for facebook. snap would be number two. snapr: stake with me on for a little bit -- stick with a little bit. i

if a domestic user appears to be more profitable, why the attention on the international user growth? brent: clearly, it is a global platform. there is an opportunity to get a lot more users to this. of usefully, those users are not as profitable as they are in the u.s. their goal is to get into the hands of as many of the users as they can. they are selling advertising in the broader base. that i i look at this is have kids on the platform. i asked my own kids what they use. today, they use it mainly for communication. the map tells them where their friends are. if you are a restaurant or retail owner and you want to opera something to those individuals, they know where you are on the map.

these are things they have not baked in. the international opportunity follows the same pathway that other social media companies have done. clearly, higher dollars to serve right now. there is a ton of different ways they can monetize through video games, through content, through the map, which i am most excited about when we interview teens about what they like about it. igger is a b opportunity on the map over time. there are a lot of different drivers in place. we have a healthy at market that is in place right now as evidenced by what you are seeing with google and facebook. taylor: you mentioned facebook earlier. i wondered, where does snap fit in to bigger companies like a

facebook? terms a biggern share of those advertising dollars? brent: it is a younger audience. it is the midteens to the mid-20's. we think there is a big opportunity. kany are concerned, is tik to taking shares away from snap? you can export to instagram and snap through tik tok. there are some risks this year. does the younger audience go to the audience go toe the new launch? we think ultimately, there is room for a couple apps. there is a tremendous opportunity. taylor: we will have to leave it there. thank you for joining us. coming up, we will take a look at china's information were on

onwan -- information war taiwan and why it is heating up. this is bloomberg. ♪

taylor: this is bloomberg technology global link or rejoin bloomberg daybreak australia to bring you the latest in tech news. i am taylor riggs with sophie in hong kong and haidi in sydney. sophie: apple ceo tim cook will receive an award in dublin later this month to mark 40 years in of investment -- 40 years of investment in ireland. the company has been hit by a 13 billionuros --

euros -- which is now valued at $5 billion. the deal will allow the cloud data and schmidt company to expand into new geographies. it sympathize backups for virtual machine. it also helps customers manage analytics and software and data in the club. alibaba and tencent are ranked as the second and third best environmental citizens in research by greenpeace. it cause attention to the sector's ballooning energy consumption. majoritye says the lack of public disclosure removing to -- taiwanese election nears, joseph wu says china has become more text sadly in its

alleged interference. >> we saw that china is using modern technology. the social media platforms to discussionsrupt our on the internet either through facebook or twitter or even a popular online chat mechanism called line. the fake new situation seems to be serious. haidi: let's discuss more on china's disinformation campaign. i want to bring in stephen engle who is live in taipei today. what are we seeing? tephen: we are seeing at least from the dpp, which is the incumbent ruling party here that there has been increased interference by china in the

division in sew society and control the narrative because there are divisive camps. different visions for the future of hong kong. one is more pro status quote. the other one, a longtime ruling party, but now on the outside trying to get back in to the presidential office. they want more economic integration with china. the information warfare is interesting because an institute says taiwan has the highest rate -- among the highest rates of cyberattacks in the world. get a load of this figure. the national security bureau reports approximately 30 million cyberattacks a month hit taiwan. that is about a million a day. the national bureau also saying that 60% of those attacks are coming from china. tech doingt is big

about the increased misinformation? is -- it is an interesting topic. fake news is an issue anywhere in the world if you want to use that term. what is interesting about the taking overow it is the narrative here. it is bigger and better integration with china economically a plus? if you look at the latest numbers, the taiwanese economy is doing really well with the opposition to china candidate in office. the taiwanese economy was expected to grow last year at two and a half percent. 2020. to 3% in the u.s.-china trade were has benefited taiwan. -- morenufacturers have

manufacturers have come back to taiwan. there has been lots of foreign investment as well. then, there is the uptick in the chip cycle, which is benefiting the likes of taiwan's semi conductor. hong kong is a big issue. china is. the economy playing an essential role as well. haidi: we are just getting some lines causing the bloomberg that mike pompeo is going to meet with tech companies in japan and south korea. those taking place in california from january 12 to 15th. that comes before the phase one trade deal is said to be signed. in terms of the element of tech we are talking about, we are also seeing the spreading of information in the hong kong process. taiwan hung -- in the process, how much of an impact

of watching on what is going on in hong kong is going to affect how voters are thinking at the moment? stephen: even the foreign minister conceded when i asked him these questions. he said yes, the taiwan issue has played a role in the psyche here of the voters because taiwan promotes democracy. even the challenging candidate of the kmp, which wants more economic integration with china, he told bloomberg in an interview that he supports democracy for hong kong as long as it comes with a law prohibiting independence from china. absolutely. 80% to 90% of some polls of taiwanese say they identify as taiwanese.

not necessarily chinese. obviously see, people take their democracy and their elections quite seriously here in taiwan. taylor: stephen engle, thank you for joining us. much more ahead. steak with us. this is bloomberg. ♪

taylor: one more reason for elon musk to dance. was bookingo -- ceo . the electric car maker shares row to 4%. the market cap is now more than 88 billion dollars. that is more than ford and gm combined. the all or nothing pay package would be unlocked.

that would net him $346 million. --ular viral video maybe tik video app tik tok has a big problem when it comes to politicians. the viral video maybe does not have a robot identification system to certify accounts. that has led to multiple accounts and presenting the likes of donald trump and the indian prime minister. some of those accounts have thousands of followers. joining us to discuss is uchiyama. what kind of accounts did you discover? >> on tictoc, there were many accounts claiming to be public figures and important politicians such as donald trump, orest johnson and bernie sanders. some of these accounts are parity accounts.

they take the real profile photo of donald trump. that has apparently led to users believing that account belongs to donald trump. users left comments such as, welcome to tik tok. taylor: why are there so many impersonating accounts? >> these politicians are currently not on tik tok. there is no verified account with a check mark that can tell users those are the real ones. asther issue is that tik tok well as other social media platforms are not actively going through the accounts. they only take down the part -- the impersonator accounts when they are flagged to the company. tok telling is tik you they are doing to resolve these issues?

contentare working on and verification in california. they are hiring people from other social media platforms who have been working on similar issues. the company released a new guideline this week expanding their policy on content verification and fixing some of the loopholes they had before. taylor: this plays right into the hands of u.s. politicians who have tik tok under review. they are claiming a lot of this is around national security issues. what are some of the threats they see to national security? >> yes politicians have u.s.ssed concerns about -- politicians have expressed concerns about the safety of tik tok. they are worried about potential censorship and foreign influence of government. they have said that the data is

beyond --the u.s. and in the u.s. and singapore. china denied any influence. taylor: thank you for joining us. of, turning to our coverage ces las vegas. ship with viacom distributing content to the screen in their cars. it is not going to production until later this year. ceo is alreadyhe thinking about making money going in and out. we have formed a tie. our role in the car is changing. now, we go from a to b.

it is a tough time. the technology we are bringing -- it becomes a living space. you will be able to work. you will be able to entertain and bring in content. -- in a normal driving scenario, you might want to watch something great. it is such a big screen. >> what is the customer getting? it is basically video content straight into the car. >> cbs including paramount pictures. having the olympics in 2020. they are a global player. will custom make a package

for our users. make tailor-made packages based on customers. what is the revenue split? how does that agreement work? >> of course there is a revenue share. by selling a great car, -- they bring in great content. to payrs will be willing for great content. >> how do you see the revenue split in the future? you get revenue from the sale of the car, the leasing of the car? the contribution of data? >> it will become a major source of revenue in the mobility industry.

being on the move and connected in the move -- on the move. if you asked me about how perfect of an idea it is going to be, i'm going to say no. getting an experience in a car that in a traditional car you would never be able to get. initially, we are not over focusing on the revenue generation. >> i have been in it. it has a large console that spans the dash of the car. it has a cellular connection, which one day should carry a 5g connection. you looked at bringing health

data said the car. could we see buyer metrics go in? but other items will we see -- what other items will we see? >> 40 inch display, which gives you a great experience. the steering wheel is the world's first. we will bring in an attainment. on the health -- bring in entertainment. health data from other devices. the smart car could tell you you are 15 minutes early for your meeting and ask you if you want to park two miles away and take a walk to come up with your personal health target. that is pretty unique. baiten ceo. was the still ahead, the battle of the

cloud wars are heating up as microsoft continues to try to gain market share from amazon's aws. this is bloomberg. ♪

taylor: it is no news that microsoft competes with amazon in the cloud, but a new target seems to be its retail customers. dina and to bring in greg moscowitz. what do we know about microsoft's retail strategy to

take on amazon? >> we are talking about this because the microsoft cao is curating a retail show on sunday. retail is one of their most important sectors. amazon web services dominates the market. and of those retailers want to work with amazon, which is one of their biggest competitors. you do not want to line amazon's pockets with cloud revenue. microsoft is working with customers like kroger and walgreens and now ikea owned store of the future concept -- on store of the future concept. things that will help these retailers do a better job of competing with amazon's consumer business. these relationships help microsoft's cloud business compete with amazon's cloud business.

taylor: where do you see them being able to explain their cloud offerings to go toe to toe with amazon? about, i would say to take a step back. amazon is going to get a lot larger over time. we have barely consistently seen microsoft narrow the gap in aws. of size vis-a-vis they are doing a better job getting more enterprise business. a $10 billionwon project with the dod. they have the retail aspect. i would say it was last year in 2019 when we first began to hear about microsoft pitching to customers that they are the more logical cloud provider as it relates to those retail companies where they are not in the crosshairs so to speak as that might be the case with aws. that is where we are seeing

microsoft gain momentum. taylor: you mentioned the dod contract. you take a look at the jedi contrite and some of the other public cloud contracts, is that a key area of growth for microsoft? >> we think it is. this unquestionably validates that microsoft is an enterprise grade solution. this is a contrite were microsoft is the -- it is a contrite were microsoft is the sole software provider. it is hard to get a better testament than that. we do think this is going to serve as a foray into more government deals. not just within u.s. federal agencies but also international governments we think it can be -- but also international governments. we take it to be a facilitator for larger enterprise deals, which they do not already have.

some of your reporting was talking about a revamp of microsoft teams to more directly take on slack. what do we know about those two as they go toe to toe? >> this is a different part of microsoft's cloud business. they are the incumbent in the larger vendor. the portion where they have not been the leader is the enterprise chat market worst like created the market and microsoft has been responding. what microsoft has done to catch up is a more standard strategy of putting their team's product in the office cloud product for free. they are trying to leverage the strength they have in different enterprise verticals. we talked about retail. they are also looking at banking and health care. today, they announced a future for retails for store employees

or you can press a button on your team's chat to turn your personal mobile phone into a walkie-talkie. that would allow store employees to talk to each other. they are looking at similar features like that in manufacturing and finance and a couple of other industries were microsoft has been strong with their cloud product as a way to grow faster. taylor: if you take a look at theaccra soft team -- at microsoft team business, is like competition? view, slack has a best in class product. they have created a category. microsoft has made significant functional improvements to microsoft teams over the past year. we are very confident in saying they are not going to let up. we expect them to invest substantially in teams.

ago we said, other than azure, teams is the best product they have introduced in the past decade. taylor: just about 30 seconds or so, cowan had up graded micro data -- had upgraded microsoft. where is the relationship as a whole? had business is is frankly small as a piece of the pie. this is a company that is going do 140nto 40 -- to billion dollars. it is a consistent double-digit grower. they have done a nice stub executing versus a few years ago. taylor: dena bass and greg moscowitz. thank you both for joining. that does it for this edition of bloomberg technology.

bloomberg technology is livestreaming on twitter. sure to follow our global breaking news network at quick take on twitter. this is bloomberg. ♪

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