taylor: i'm taylor riggs. this is the best of bloomberg technology where we bring you all of our top interviews from this week in tech. we bring you the latest from apple, amazon, facebook, tesla and microsoft. new evidence raises fears the coronavirus could spread undetected. we'll head to a biolab where researchers are working on anti-bodies.

and we'll show you the hot new video sharing app that has sky rocketed to the top of the app store. but it is tech earnings season this week with results from industries biggest names. let's start with one of the top performing giants. apple. they reported their highest quarterly revenue ever thanks to strong iphone sales. this looks to be the second highest ever iphone's quarterly revenue. to get perspective, paul allen and i were joined by analysts. >> i view this as a game changer quarter. it is fueling -- look at guidance.

look at the psych. i think the stock is going to go -- continue to go up. not view this as a best case scenario. taylor: let me come to you on this. it seems like the iphone revenue was all that we really cared about this quarter, make sure it was so dependent on the iphone revenue coming in strong. your take? >> that is always going to be the case when you have one product that is as dominant as part of their portfolio. >> julie, look at the iphone though. the rever knew was very impressive for quarter. forhis really a sustainable apple? >> i don't know if apple would call them incremental upgrades.

one of the things is we look forward. a lot of the upgrades you will see in hardware will appear to be incremental. there is only so far you can go with cameras and displace whfment when you're depending on acquisitions and r dnch, when they continue to make a new acquisition every two to three weeks, i think we'll continue to see improvements where it may be hard for consumers to articulate why they like it better. just that so many little things work so much better. taylor: now facebook earnings came out wednesday. total rev newspaper 25% year over year which appears to be the strongest growth ever. last quarter facebook revenue grew 29% year over year. we spoke to a -- an analyst in seattle. > facebook grew at exactly the rate we thoukt it was going to

grow in 2019. in that ot worried racket. everything is slowing because of some of the issues that facebook has been dealing with on a quarter after quarter basis regarding privacy and regulation, content moderation, political advertising, all of these things are still weighing on the company, but overall, i mean i think things are still growing and on another note, the users are ahead of where we thought they were going to be for 2019. this is a company that is continuing to chug on. and perform quarter after quarter. taylor: every analyst on the street was excited about facebook in 2020. you have the political ads. olympics. a very strong backdrop of an ad environment. is this more of a later 2020 story when we could see a pickup in revenue then? >> we're seeing it throughout the year.

we don't forecast on a quarterly basis. we look at a year-end total. we think ad revenue is going to increase by 22% on a worldwide basis this year. you're right. advertising is a part of that. certainly things like the olympics will add a boost. it is your average advertiser who is continuing to spend on facebook because over the accurate targeting, because the audience is still there and because its sister property instagram is also still growing. >> overall, these results don't ok too bad but we do have it down 7% after hours now. i get the sense we're all groping around to find reasons for that. what is your theory? >> any marketer we follow revenue and usage for at facebook, the market, the stock market is not something we directly comment on. all i can say is that we really believe that facebook has proven

itself, at least according to our forecasts, on the revenues. it has beaten our forecast for numbers in terms of number of users this year. this is a when a where even though it has had problem after problem, it is continuing to outperform the estimates that are put out for it. so it is hard to say exactly why the market is down at that point. taylor: thanks to deborah ofemarketer. now to tesla reporting better than expected revenue and the accelerated arrival of its next electric vehicle, the model w. its other vehicle, the model 3 brought in almost $7 billion in sales beating estimates. this leading the company to its second consecutive quarterly profits. 500,000 vehicle deliver police in 2020. new street research's pierre

joins us to discuss. >> it is so impressive to see -- it generated a billion more than twice what wall street was expecting. stfs still like 30% higher than what we were -- where we were ticipating and so that means tesla can start a new factory in the quarter. eep growing. the second thing i find absolutely amazing in what we learned today is that tesla ramp new factory with stable growth margins. it has continued to expand in the fourth quarter. of how it is doing in terms

margins to doing better than that in just three months. >> let's talk about the new factory in shanghai. one thing that is bound to come up in the analyst call when it gets underway in about 45 minutes is cost discipline and specifically the cost of that new china plant doesn't appear to show up in the financials. what is your opinion of that? >> so as you can imagine it is that y the one question will ask on the call in 45 minutes. the e know is that dimension of it affecting the gross margin. we know it is there in some shape or form. in the first quarter, like getting into the numbers, in the order of $150 million. that might be the kind of --

where it is exactly, the team is working on it. taylor: what question are you asking on the call? >> well, i think we just got probably the one that comes irst to mind which is -- the ramp to have shanghai factory so that we can evaluate growth margin of the company. that is what is going to give you the best indication where the growth market is heading toward the end of this year. taylor: that was pierre of new street research. come up, more on earnings. we'll take a look at amazon's fourth quarter results next. if you like bloomberg news, check us out on the radio, you app,isten on the bloomberg bloomberg.com and exiryuss xm.

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taylor: the latest to report earnings was amazon. theecommerce giant's cloud revenue was taking a bite of the of its robust holiday earnings. aws is spending heavily on new data centers and hiring thousands of salespeople and engineers. e spoke with an analyst. >> i think there were several positive takeabase in the quarter. the revenue number was above expectations and guidance. more importantly, the operating number really blew away all analyst expectations, including ours. even more remarkable, the fact that they were going into the holiday season really spending heavily on the one-day shipping. that was really remarkable

against those odds. and i think the amazon web rvices business continues to -- in the face of competition maker soft cloud offering. we know microsoft has been getting market share. i think it has gotten investors' attention in terms of growth but i think this quarter they really answered all doubts coming at 34% growth in a top line and 6.5% operating margin. you'll get a chens sense that the holiday season was a major catalyst for that with the one-day shipping. a lot of positive takeaways across the board. >> amazon web serviceses was the one that was going to be watched closely. expectations were firmly managed

there to say the least. still surprising. what does it need to do to remain competitive against microsoft and google without spending unsustainbly? >> i think they are actually doing what is within their control. the biggest upside that i see is the international market. some of these fast-growing emerging markets like india being a notable callout there. losing the cloud structure contract to microsoft was a big blow. this is a huge addressable market that will be big enough for the three major players of which amazon is still the dominant player in that space. despite the competition from microsoft and google cloud. this is a business that i think is going to hit probably around

$40 billion revenue pretty soon and you can envision a.w.s. as being a huge chunk. potentially apple and the equity evaluation of amazon stock. the milestone over a trillion really says a lot about the potential upside that we see here. taylor: i want to take a look at a chart i'm seeing in my terminal. why are wome growing at 33% year over year when microsoft is at 39%, 40%, 60%? >> that is a question we get a lot from investors. i think a simple answer here is the law of large numbers. the magnitude, the size of microsoft cloud, that really answers the question. that being said, there is a lot to be said about how microsoft's cloud zurich offering has

reineventsed this area. they are doing a lot of things right. also amazon's kind of quivelss with the trump administration and the pentagon did not help its -- the perception. the all, it is still, market is still in the fifth inning of growth. there is a pie there that i think should serve its three dominant players very well, especially the early movers like a.w.s. and microsoft. taylor: finally, i want you to ce take ooa look at another chart i'm showing in my terminal. this is as of close on thursday. it is not yet reflecting the post-market movement. if it were, this would be a frillon dollar company. is that evaluation justified? >> you know, i think so. that is why we kept our buyer recommendation, in the face of all the chatter with the

anti-trust and government investigations. i think keep in mind this is likely to be a volatile stock in the year ahead as we head into the presidential election year with all the potential chatter about the anti-trust. this is a name that you know what you're getting into. but the core of business remains intact. the shift to, you know, enterprise cloud and you see the cutting edge of some of these innovations with learning and intelligence. 40 million active users as of this past quarter. you get a sense it is building a big ecosystem. and alexa and echo. also it doesn't hurt they just got seven or eight golden globe nominations. they are getting some action with the prime video business. going head to head with

microsoft and google. c.f. analyst.as a cloud demand is continuing to dominate. we spoke to an analyst from orester in new york. microsoft is the fastest growing in the cloud. microsoft come off very strongly. a clear number two player behind a.w.s. and everybody else bringing up the rear. 62% growth with azure. pretty astounding with cloud computing. we don't see that slowing down at all for the near future. >> in terms of that enormous

contract, $10 billion, is there now an expectation that microsoft will continue to deliver big deals like this? how much more upside is there? >> a lot of it is derivative off that. when you run a big deal like that, everybody wakes up and says there must be something going on there. let's check it out. indeed that has happened. there are a number of sectors that have gone, that pretty strongly with microsoft as a cloud provider. will there be more big deals like that? we doubt that there will be gigantic deals in cloud. it tends to be a bunch of really small deals adding up. occasionally you get something like this. that jedi contract with the government, $10 billion over a certain amount of time is a lot of money but mostly i think so it is just raising awareness that microsoft is a real serious player here and indeed it is. taylor: personal computing

revenue also coming in better. is there something specific microsoft is doing or are we just in the midst of a bull market with personal computers? >> there has been a lot of refresh from computers lately. the older systems are slowing down and people want to get new computers. most of those are running windows. the growth there is probably attributed mostly to that. at the end of windows 7 support, a lot of people were sort of forced into going with a new machine to support windows 10. so that is probably part of it there. taylor: thanks to glen o'donnell. analyst at forester. later nations around the world are taking drastic measures to stop the spread to have deadly coronavirus. we'll go inside one biotech firm next plus a reboots of an old favorite app. vine. we'll take a closer look at it

next. this is bloomberg. ♪

taylor: online retailer casper is seek an i.p.o. valuation just over $744 million. $1.1 its heyday of billion. in a filing monday, the start-up plans to sell 8.53 million shares for $17-$19 each. this makes it short of the $1 billion needed to be a unicorn company.

founded in 2014 it popularized the bed in a box industry. i was joined by lee anna baker in new york to discuss the first closely watched i.p.o. of the year. >> it is about a 30% drop and it is all about the timing. at $1.1 billion evaluation that casper had came in march 2019 that was before the debacle and the after market performance of uber, lyf around the pell on the. -- pelaton. it makes sense advisors are trying to tell the company why don't you have a more conservative valuation to appease investor who is have more scrutiny for these companies? taylor: is this being seen for who arenternet startups trying public as well? >> it is the first consumer brand name.

we have seen the advertise yaments. it is everywhere. if it performs well, it could mean companies like post mates and door dash and other uncroftable names known by consumers on advertiser lots will see whether it is warm out there in the market for them to also go public. taylor: the biggest issue is everyone thinks they have a web site. now they are a tem tech company. now they want the evaluation of a tech company. is this a tech company or a mattress kean? >> it is a good question. you see it is a tech enabled business. there is an r & d center sn san francisco and they are trying to develop new prucks besides mattresses like special lights you put by your bedside. the company is investing in technology. at the end of the day they make mattresses and open retail stores across the country. it is one of those companies over the hybrid. it is in the eye over the beholder whether it is valued like a tech company or a

consumer company. it harkins back to the male kit craze. blue apron. it is hard to say. taylor: should we be comforted by the fact that revenue grew 20% in losses only 5% in the same time period? >> there were some highlights in the i.p.o. filing in the financials. it has pretty good mar zins high 40% range. it does make money off of these mattresses. its retail locations are very profitable so it is making money. it is just right now not able to turn a profit and it may never turn a profit which is something pretty common in a lot of these i.p.o.'s. taylor: have they given us any hint, could they be profitable if they wanted to? wantere is no -- you might to look at purple. that company is profitable. i'm sure casper would like investors to look at that as ale

for them. taylor: we only have about 30 seconds. the roll back of the volcker rule means you can be more lenient within a venture capital world. do you assume more money flowing into v.c.'s and startups and creating more private lofty evaluations? >> banks have been investing in startups for a long time ps this is a new avenue. it has been in works a long time. we'll see goldman sachs investing in softbank and venture capital , probably not but something to watch. taylor: that was lee anna baker. is the u.k. setting itself up for conflict giving huawei ack to 5 g network? and we're live streaming on twitter. checks out.

at quick takes on twitter. this is bloomberg. ♪

taylor: welcome back to the best of bloomberg technology. i am taylor riggs. as the coronavirus continues to spread around the world, companies are taking steps to safeguard workers from the outbreak. my colleague and i spoke to a doctor from a biotechnology company in san francisco on wednesday. development ofed a potential vaccine. powerful andvery productive platform to identify anti-bodies. anti-bodies are proteins that

circulate in your blood and protect from viral infections and can help overcome viral infections. we are able to isolate antibodies from patients who have recovered from infection, manufacture them and make them available to other patients. this technology has been quite fruitful. one of the earliest examples is an anti-body against the ebola called mab114. congo by tests in the the nih. we feel very good about that one. interesting that you bring up some of these viruses. we talk a lot about sars back in 2003. what have you learned from those viruses that can help you with

this strain of coronavirus and how to get a vaccine out of it? >> we have a number of antibodies we have isolated against sars. those are both coronavirus's. scientists anticipated it was only a matter of time until the next coronavirus outbreak. we have been testing those anti-bodies for their ability to neutralize other strains of coronavirus. toe of them have the ability neutralize strains of coronavirus isolated from bats. there is the possibility they could also neutralize a new coronavirus. we are testing the possibility now with a number of anti-bodies. we don't know the answer yet but our hope is one or more of those anti-bodies will be effective. simultaneously going back and isolating new anti-bodies specifically against the wuhan virus and we are

pretty confident we will be able to generate those antibodies. it might take longer but we will get there one way or another. learned what you have about the coronavirus so far, what can you say about its potential for getting worse, or can we end up in the situation like sars were ineffectively disappeared? it behaves like sars and will eventually disappear. it isrly data suggests considerably more effective -- infective than sars, perhaps less lethal but more infectious. there are already more cases of wuhan virush the then there were sars. we are hopeful that this like many viral outbreaks will be self-limiting, which would be

great. we are working really hard to bring anti-bodies forward in case that is not the path that follows. >> it is important to keep perspective because they do generate a lot of fear. flus worth remembering the killed over 500,000 people. goodthink that is a really point. in the u.s. right now, you have a higher chance of dying from flu then the coronavirus. diseasecan be a fatal for many people. it kills thousands of people in the u.s. every year. for that reason, we have an anti-body also that is capable of neutralizing all strains of influenza a since the pandemic that we are currently testing in humans. we hope to be able -- as early

as this year to determine to what extent we can limit flu infections. it is a paradigm for what we hope to be able to do with the coronavirus, as well. taylor: the cdc confirmed the first person-to-person contraction of the coronavirus. what does that tell you? what information does that give you as you work on potential vaccine? >> we are a vaccine company. u.s. is certainly an important priority. we know this is transmissible and a dozen really respect borders. much like what we see with the flu every year. >> why would a vaccine be different than an antibiotic? >> that is a really good question. they are related, of course. the anti-bodies that would be

manufactured originally came from and a response. the anti-bodies will mostly be deployed if someone is sick. that can be quite challenging. it is not necessarily a given that would work. said if the, it is cows are out of the barn, it can be difficult to get them back in. depending on how sick, how far into the illness someone is, anti-bodies may or may not be helpful, especially for respiratory diseases. i think it is something that should be developed. --is not really clear vaccines have a good track record. miracles in almost terms of being able to prevent serious disease. i think that is a very desirable outcome.

or challenge is timing. can we develop one in time to be relevant? i think we can. that is yet to be seen and we are working very, very hard to see if we can achieve a good vaccine within the timeframe that it could be used. that was a doctor from biotechnology and a doctor from novavax. tiktok faces competition as fans tend to download a new name this week. later, a review of all of the big tech earnings this week. this is bloomberg. ♪

taylor: u.k. prime minister boris johnson risks a clash with

u.s. president donald trump after giving huawei the green light to help build britain's 5g network. it is a blow to the trump administration that wanted johnson to ban the tech giant. alex webb has more on the news from london. >> after a year of back-and-forth, britain has decided it will let huawei to provide telecom equipment for its 5g networks. boris johnson encountered strong opposition from the u.s., where huawei is already banned. johnson is imposing major limitations. the telecom operators will not be allowed to use huawei products in the core network. in the other network, huawei will be restricted to 35% market share. it is a simple compromise. they believed the reduced

competition would lead to price gouging. the u.k. approach will mean operators can still pick from three main suppliers for the network that accounts for more than three quarters of their equipment costs. it caught arises the most sensitive part of the network from huawei. no evidence has been presented it provides backdoors for actors, -- espionage efforts. this is a deal the u.s. should be able to get behind in private, if not public. of markets andr services is expected to unveil similar guidelines. taylor: that was alex webb. a new rival of tiktok has emerged and its predecessor is no stranger to fans of video

sharing gaps. it was created by the person who in 2012 anded vine sold it to twitter. abs andong the top iphones app store in the u.s. this week. bloombergo our opinion columnist in new york. ,> that is the thing with vine or bought it in less than one year. twitter tried to run it but it did not quite work out. one reason it is considered that vine was shut down by twitter is because they could not monetize it. kind of died just a slow, painful death. it is still strong in people's minds. there is a nostalgia for vine. he decided it would be brought up. it was called v2 before being delayed and now it is hit the

streets so to speak under the interesting name of byte. tiktok, its biggest rival. that is not a coincidental man. >> talk to me more about that. the name could not be a coincidence. are they trying to be a competitor through the name alone? their fact we mention almost the same name is the kind of thing they are looking for. they are looking for people to remember vine with nostalgia but also think of tiktok. it is one of those few examples of a chinese company having a big impact overseas, especially in north america. the name, well maybe it acquisitive, people are talking about it. andformat between byte tiktok are different but there are a lot of similarities. consumers will be using both of

the same time. over time they will have a preference for one or the other, in the same way some people had a preference for snap over instagram. one thing to remember about the new product, byte, is the are trying to get influencers. the battle for tiktok and byte to get key creators will be intense. >> what is in aim for bringing this back? they keep emphasizing they have a mod assist -- modest budget. >> i think he is trying to make money. there was a feeling vine was great and when it went away people were heartbroken. the people are really big on tiktok now probably don't remember the vine era.

very similar age. in terms of demographic of tiktok, it is very young. >> what are the implications for tiktok in the u.s.? they are trying to search for a new u.s. ceo. they are trying to revamp their image, not be seen as a company owned by another company based in beijing. his tiktok nervous about the new competition? >> there is a counterintuitive way to look at this. as tiktok comes under the microscope about being so dominant in america and having so much control over user data, they can turn around and look at byte and say we are not the only ones in the game. quite often would you look at it from a legal standpoint or from a regulatory standpoint, it helps to have a solid competitor out there. they might still some appetizer money and pressure them to -- some advertiser money, this

might be a good thing for byte and tiktok. >> is the older demographic of byte one of the reasons its interface is so simple compared to tiktok? >> it is too early to know what it will be for byte. there is probably room in the older demographic. 25 andtalking about above as an old demographic. there is room for both. they will probably find the demographic that works for them. coming up, what did we learn from all of the earnings from u.s. tech giants this week? that is our conversation, next. this is bloomberg. ♪

taylor: wrapping up big tech's big week in reporting results. one common theme was china.

said tuesday cook the company has closed more stores in china as the coronavirus spreads. tesla is expecting a production delay in the country. we spoke to the ceo of a company. >> the overall numbers are starting to get incredibly large here. the total addressable market for basically cloud services is being completely underestimated by basically the entire market, which is why you continue to see investors chase stocks like microsoft up here. it is growing like a weed. understandnk people how large the addressable market is for all of these services is going to be. when you look at broad macroeconomic trends such as capex spending in the u.s., it is being replaced by spending on software and what drives all

that software? cloud services. >> if the total addressable market is high, why are the not seeing higher than 34% growth rates? >> they are dealing with two competitors in google cloud. they are good competitors. that growth rate is going to largethe growth rate of productivity software packages. some of those big companies are seeing growth rates in the 30% to 40% range year-over-year on the top lines. there are smaller productivity software and enterprise software names that are growing 70% year-over-year and we will continue to see start ups that make it big that continue to come to market with $6 billion ipo's and above.

we just saw data dog come to market with a successful ipo. there will be a wave of these that come out. the really big players like salesforce and others, these are businesses but we can be happy they are growing 30% year-over-year. >> plenty of highlights in the earnings report from amazon but i want to focus on a low light, the international aspect of the business. in australia, amazon was expected to arrive on the retail seemed like godzilla and pre-much sang without a trace. >> the funny thing about amazon is from quarter to quarter, the bottom line numbers tended to matter to investors here. but in any given quarter, it is hard to tell what they are spending money on and how much they will spend, which obviously impacts the bottom line. when it comes to international,

it has not been a massive part of the business to date but they will continue to invest in all of these attempts and that is why at the end of the day, amazon continues to have long-term success. hard toshort-term it is call those numbers, while the revenue they blew out of the water again. delivery has been a big thing for amazon. can the spending on that continue? >> the market is telling you it can and basically giving them a long lease to spend whatever they want. from quarter to quarter, it is important to note the market does care about bottom line numbers. if you are an investor here, are you going to dig into the on how and prod bezos much he is spending on that attempt? he has proven long-term he is

enough to make enough of these big bets into winners. he admits if you are not losing big on some of these, you are not going fast enough or bedding -- betting big enough. some of these businesses are seeing rising costs. .age growth will eat in it is hard to get on his case. >> in terms of exposure to the coronavirus, how does it shape up? say, itpple, i have to is horrible this is happening, it is better it happens now then five months from now, when apple will be seriously ramping up the 5g pipeline. it is better to get it over with now because it won't disrupt their ability to put product in the market at that point. more broadly on a macroeconomic

scale, this will have a significant impact, given how much everything is leveraged to chinese growth, which will come down significantly. for tesla, it might be a bit more acute, but we don't know exactly what it will look like yet. it does not look, based on the way tesla is trading, that they are discounting deliveries, especially in china as the stock continues to rocket. expectations for delivery and revenue for this coming quarter continue to tick up for tesla. everything looks good there. enjoyed once again yesterday, going ahead with these concerns about the coronavirus and over tesla the shortsn, could have the last laugh? >> here is how i see the last

couple years of tesla and it bleeds into going forward. muskally must faked -- faked it until he made it. he got through that. he put up the numbers that were needed to get the company to profitability. the company is seeing tremendous momentum right now in the product pipeline. if that gets disrupted, if the growth its root -- gets disrupted, i don't think investors will ding him too much for that because he seems to have proven he can make the business profitable and the demand for the car is there. taylor: that does it for this edition of the best of bloomberg technology. we will bring you all of the latest in tech throughout the week. tune in each day at 5:00 in new york and 2:00 in san francisco.

be sure to follow our global breaking news network on twitter. this is bloomberg. ♪ sometimes your small screen is your big screen.

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download the xfinity stream app and watch all the shows you love. jonathan: bloomberg real yield starts right now. coming up, global growth worries in china. pull cashvestors to from junk-bond funds. >> we have seen this risk off tear. >> the treasury market railing. >> look at where we are in 10 year yields. >> yields are incredibly low.