>> this is bloomberg technology with emily chang. emily: this is bloomberg technology. coming up, and attempt to lure drivers back costs uber heavily. a second-quarter loss for the ride-hailer sending shares plummeting.

we dive into the numbers ahead. wall street delivery. upstart instacart naps another top executive from facebook. this after products signed on as ceo. my extended sit down coming up. flying higher. robinhood gets the retail treatment as it surges past. up about 125%. is robinhood officially a meme stock? we will discuss what is behind the move. let's get a look at the markets. a lot to watch today. what are you following? >> ultimately, a risk off day. when you start to see a survey number, all about jobs coming less than expected. of course you are going to see some risk off behavior.

that tapering timeline might come soon, so how do you play it? apparently you go to big tech and say the stocks up 7%. yield sitting as low as 112 basis points before coming up and ending flat on the day. this is not the only kind of dip you are seeing right now. you have actually seen this happen. it has not been as deep as 2020. you can see the red swatches below. since the start of the year, many pullbacks. none that would really register below this line. no major correction yet. doesn't mean the rally can keep going? it means retail traders can power through. it brings me to robinhood. a surprise turnaround for the stock, surging as much is 82%

today. retail traders are behind. it was the sixth most purchased stock in the 11th most traded security. can this continue? does it make it a meme stock? emily: thanks so much. we will talk about that a little more. let's get straight to ed. >> the tech earnings come thick and fast. big moves in after hours. at sea down more than 14%. fighting covid uncertainty. it will give costly guidance until further notice. a sign that covid is still present. the bright spot was electronic arts at a really strong quarter. raised its guidance going forward. there is some staying power in video games. basically not giving the guidance the street was looking for, saying the easing of

restrictions means that tv viewership is down and their numbers were not as strong. i want to focus on uber. it is the corporate story of the day. down in after hours trading. a wider than expected loss. it is pumping money into bringing drivers back in. it is under year to date despite a more diversified business. emily: thank you so much. talking about uber now more. i want to bring in an analyst. for your analysis on what is happening here. anyone who has tried to taken over there lately -- take an uber there lately, driver supply is an issue. what is your take on how this impacted results? >> consumer demand was there. they had to spend a significant amount of money. ultimately when we look forward even into 2022, this will still be an issue.

drivers might not be able to have company in their car. they have more options than ever. grocery delivery is bigger than ever. many drivers can switch and pick between various gig economy services. driving and having people in your car is a better source of income than some of the other services. but there are major risks. those risks are still very much there. emily: uber posting its first net profit as a public company. in the second quarter. yesterday, we reported on lyft's profit. driven by a stake in didi. do you consider this sustainable?

>> the rideshare business has been profitable for a while. on an adjusted metric. at the same time, they are investing significantly in delivery. there is a massive opportunity there. as they pull back some of the promotional spending, these become better for them over time. emily: uber obviously has the twin businesses. ridesharing is tough in a pandemic and with the delta variant searching. you look at uber eats. it is good for that business. which business ultimately wins out? >> uber is a twin business between rideshare and delivery. the most important thing is this is not just becoming a

restaurant delivery company but a delivery company in general. which is exactly what doordash is doing. they control 80% of the market for the third-party restaurant delivery apps. there is a huge consumer base. these are big thanks for uber. we should start looking at this competition as really competitive. we should start looking at the competition between uber, doordash, and instacart on the delivery side. that is not even mentioning amazon and walmart and kroger who have their own large grocery businesses. emily: thank you so much for joining us. thursday, you do not want to

miss it. my live conversation with the ceo of uber. also the lyft president will be joining us. we will get both of their perspectives on the results. sticking with earnings, rare quarterly earnings. the carmaker hurt by the $800 million cost of the recall. following chevy volt battery fires. mary barra telling the company they are dealing with a semiconductor shortage. take a listen. >> we will be very fluid. right now we work daily for the team. we are looking at making sure we understand the semiconductor situation. we are allocating chips to our highest demand. to take care of our customers and also the vehicles that are in plants and have capacity

constrained. you will see us continue to do that. emily: gm raised its guidance for the full year. coming up getting a major , upgrade. the hope of ensuring faster transactions and more transparency. we will take a look at the update and how it could shakeup the already volatile market. earlier on bloomberg television, senator elizabeth warren shared her take on crypto regulation and how to better protect investors. take a listen. this is bloomberg. >> if people are going to be trading in it, there needs to be a cop on the beat. when there is not a cop on the beat, than it is the small traders who get cheated and that is what always worries me. ♪

emily: the network is about to get a major upgrade. it will reduce the pace at which the supply of ether tokens grows. this could potentially boost the point price and lead to more adoption. you follow this closely. this is around the six year anniversary of ethereum. what is so significant about this? >> this is one step along the road map of ethereum. there is much more of an openness toward changing the rules from time to time area the entire network has to upgrade. this could potentially create a burn effect.

the amount could go down. you get this hope that it is less inflationary. that that will put up upward pressure on the price of it. that is what many in the community believe. emily: they are totally different but investors treat them as similar assets. are we seeing any price fluctuations leading up to this? joe: it is a little hard. bitcoin talks about every four years the halving. maybe that is a price catalyst. it is hard to say. we have seen so much decentralized finance. they have different use cases. things people are using ethereum for has created a lot of upward price pressure for a theory them bitcoin. all of crypto has generally gone wild.

emily: stay with me. i spoke with the guy who wrote the original white paper leading to the creation of ethereum about what the upgrade really means. take a listen to what he has to say. >> there will not be any more mining. that cerium's energy consumption will go down by a factor of more than 1000. it will go from being a big problem to not being a problem at all. emily: i want to bring in a cofounder and consensus of -- and a cofounder of ethereum. a lot to unpack. there will be no more mining. energy consumption will go down by a factor of 1000. will that actually happened? >> that is correct. that is one step along a long road. we think of it is a paradigm shift in how the world architects itself.

it is essentially the next step. one step is the democratization of the trust layer, where up until now, it has been very centralized. it is the democratization of the global decentralized finance system and in this step it is the introduction of ultrasound money, so where it takes the gold on the planet and it represents sound money to certain people with $13 billion worth of ether locked up and 70 billion locked up in decentralized finance. we have enormous demand for the token and now we are burning the token with the introduction of the london. joe: obviously one of the upward

drivers has been the extraordinary rise of decentralized finance. they can lock that up. this represents equity. it is called a governance token. a lot of these things, if they look like equity, they might be treated like equity. is that a risk? that there is a lot of activity on the network that differ echo equity, but not currently complying by any sort of recognizable sec regulations? >> i think it is certainly the case. there are projects out there that would be considered unregistered securities. from the perspective of exchanges, who are already looking at their listings. some of those can be delisted.

there was a notion that the sec introduced that of sufficient decentralization, so many of these projects. the ether token was deemed to be not a security. many of these projects are moving really rapidly and have had on the roadmap for a long time decentralizing themselves. i think we will see an orderly cleanup of some projects that look more like securities, but many projects are indeed decentralized already in their governance. emily: it is not a digital currency. it is more like an entire operating system empowered by blockchain. but it is still just as volatile as bitcoin. do you see ethereum surpassing bitcoin someday? do you see less volatility after this upgrade? >> the ether token we think of

as a crypto tool. it is used to pay for transactions and storage on the network. it surpassed the bitcoin ecosystem a long time ago. in terms of the amount of developer activity, in terms of transaction numbers per day, in terms of transaction value, in terms of the number of tokens. bitcoin is a brilliant use case, i think of it as a fraction allies to nft in its own right that many people can own. if there is a platform for decentralized applications, i think you are basically asking, will the next-generation

internet for the next generation economy be bigger than a narrow money system? i would argue that it will be orders of magnitude bigger. >> the sound money or the digital sound money meme originally pushed by bitcoin. now you are saying that ether will have similar characteristics. your influential consensus is influential within ethereum. bitcoin does not have that. there are no individuals or companies that can say we will do that. if you do not upgrade, your coins are not going to work. does that get in the way of being a universal sound money when there are individuals like yourself and others who can change the rules? >> bitcoin's mission is to be a narrowly focused sound money system.

the people, the developers in that ecosystem, the major users of that ecosystem say things like, it is already found product market fit and it is substantially complete. it may get a little better. around the edges over time. people are trying to build a layer or two on top of it. but that is not easy. it is doing well for what it wants to be. the ethereum ecosystem is akin to the internet ecosystem. there will have so many different kinds of actors. building out a very diverse ecosystem. there already are many more voices. emily: what will be possible that is not possible now? how will it change the internet as we know it? facebook, twitter, google, will they be obsolete?

centralized social networks? >> it enables us to keep doing what we are doing. the transaction will be smooth. you will not have to do anything to keep using applications that you like. ethereum 2.0 will bring a 1000 reduction in the energy utilization footprint. much cheaper transactions layered to technologies that are building on top of it right now. they are already bringing hundreds and thousands of transactions per second of increased scalability to our ecosystem. that is already reducing the cost of transaction. many of these technologies need available data. what it will bring is an enormous amount of reliably

available data. it will bring scalability and cost savings. emily: we will have to see if transaction fees come down. if this impacts front running, as well. jill lubin -- joe lubin, thank you so much. joe weisenthal. really interesting conversation. much more to come. stay with us. this is bloomberg. ♪

emily: chinese media including a flagship newspaper toning down their criticism of the games industry. this helping tencent and its peers recoup some of their losses. instead of calling video games spiritual opium, they published an editorial stressing the need

for government, schools, families, and societies to work together to better protect children from excessive gaming. a slight change in the messaging. meantime the ceo of instacart is , reuniting with an old, faithful colleague. the grocery upstart announced today that the former facebook global ad's chief is joining the company as president. i had an extended interview where we talked about the new hire and her top priorities as the delta variant takes off and mask mandates return. i also asked whether instacart will mandate vaccinations for them ways and shoppers -- employees and shoppers. take a listen. >> we are providing them with free telemedicine appointments. free supplies like masks to protect themselves. and stipends for vaccination. this is something that we take very seriously. emily: they are debating whether

to mandate vaccines now. we will have more coming up later this hour. up next, elon musk, now he is the highest-paid ceo in history. we will talk about his pay package, next. this is bloomberg. ♪

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emily: welcome back to "bloomberg technology." a phenomenal pay day for elon musk, he's the highest paid u.s. executive for the third straight year, according to the 2021 bloomberg pay index. the scale of his pay premium has skyrocketed. last year it was four times higher than number two, tim cook. this year it is 11 times higher. how does the math add up? >> first of all, it keeps going

up and the pay package is now worth a lot more. it is a trend that just keeps on going for musk. awards get bigger and pay just keeps going up. emily: are we accounting for tesla and spacex in these numbers? >> this is just tesla. emily: how much of it is actual salary and how much is just because tesla stock has gone up? anders: he gets paid only in stock options that grow in share if the price goes up. so this package has become worth quite a bit of money. it is largely the case for most of the executives we see on the bloomberg pay index, really hefty and chunky equity awards that just skyrocketed last year as equity markets soared.

salary is a small part of this, even though the figures are not negligible to a normal person. but for these guys, it's a different magnitude. emily: and they are all guys, no women in the top 10, as you see there, which is a shame. do investors approve? anders: investors largely think this is ok. some are a bit uncomfortable with big numbers, but generally the line that investors stick to is, if there's a lot of performance, it's ok if there is a lot of pay. tesla just kind of drew that to the extreme a few years ago and said, what if we pay this guy $50 million if the share price goes up more than tenfold or the market cap rises? investors by and large said, we are fine with that.

we are now seeing that spreading to many other companies with big awards with really lofty targets. in an up market, that really works. emily: much more to that pay index, check it out at bloomberg.com. meantime, grocery delivery upstart instacart is shaking up its executive team with yet another facebook veteran. carolyn emerson will serve as the president. i sat down with the ceo who recently joined the company from facebook to talk about emerson joining the team, and how demand for grocery delivery is evolving as the pandemic drags on, and what the business looks like ahead of a highly anticipated ipo. take a listen. >> carolyn and i have been working together for 10 years, and i've always admired her. we thought she would be a fantastic president.

i had not made my decision to join as ceo. we had long conversations about where we wanted to take the business and realized it was an incredible opportunity. we were both excited at a chance of working together again. emily: a facebook spokesperson told me, we wish carolyn the best as she moves into this new chapter. i know you both were important to the two people at the top. what did market shareholders say when you delivered the news? >> after a tough 10 years for both carolyn and i, it's not surprising for leaders to want to explore things outside the company. i'm grateful to facebook for allowing me to have that and very excited about the next venture.

emily: instacart's business model is multifaceted, not just advertising but grocery delivery. how is the composition of revenue right now and how does that evolve? >> we think that advertising is going to continue to grow as part of our profitability. we are growing triple digits year-over-year, and we are seeing a lot of brands are placing ads with us. emily: more people are vaccinated, so folks are going back to grocery stores, but obviously the delta variant is rising, and i'm curious how this is impacting your mid- to post-pandemic demand. is instacart speeding up or slowing down?

>> we are starting to see demand pick up for the kinds of products you would expect, hand sanitizers, masks. we are really standing ready to help people during this time. we grew about four times during the pandemic and now we have a new resting heart rate, very much stabilized at these levels. so we are seeing many years of growth pulled forward by the pandemic. now it is really a matter of continuing to build great products so the online penetration of grocery buying continues to grow. emily: i know you have worked hard to institute safety protocols throughout the pandemic. now things are changing, google and facebook have ordered vaccine mandates. will you mandate that your corporate workers and that your shoppers get vaccinated? >> it is something we are still

in the process of debating, things change every day and we want to remain extremely flexible, but safety is of the utmost importance to us. we have done a lot to make sure it is safe, we are providing them with free appointments, free supplies like masks to protect themselves, so this is something we take very seriously. emily: the founder of instacart has said it will be profitable through the end of the year. how does that profitability continue into next year? how profitable without the pandemic tailwinds behind you? >> what we want to do is reinvest a lot of it into growth and continuing to capture our share of the markets, but the company is profitable and will continue to be profitable.

we will just try to reinvest a lot of our profits into continued growth. emily: you and caroline have both experienced the challenges and problems that come with big growth. what are the lessons you learned and mistakes you made at facebook that you want to bring with you? >> i think a lot of what we have learned is to get ahead of issues and really be paranoid about the different ways in which what you're building could potentially go wrong and lead to harm. that is something we will definitely take to heart at instacart. that's why i am so focused on safety and product, making sure that we really take care of consumers and our shoppers. that is definitely paramount for us. on the good side, there are so

many things that are great about facebook. in particular, how facebook takes care of its employees in a very generous way, which is something we absolutely want to make sure instacart is known for, and has a great culture. as well as the ability to scale to other products for the needs of billions of people. emily: what are some things you want to combat before they get bigger? >> a lot of it has to do with just making sure our shoppers and customers are safe. if a shopper or customer has a bad interaction with each other, we make sure they are never matched to the same person again. obviously if someone is on the -- is abusive, we take actions to remove them from the service.

emily: women dominate your executive team, and the majority of your customers and shoppers are women. though i should say my husband puts in his fair share of instacart orders himself, i should give him credit. how do you think having so many women at the top will impact the product and the culture of the company and the culture of the product? >> i think it is critical to have a production team that represents the people you're trying to sell. 80% of our consumers are women, 70% of our shoppers are women. so product is very much geared toward the needs of a female audience. i think a leadership team that reflects that all the way throughout the company, people make decisions with that

customer in mind, and i fundamentally believe that i make better decisions when i hear many different points of view. i know that carolyn very much shares that leadership philosophy with me. so we want to create a culture where diverse voices are heard and it is safe to express your opinion. emily: you are going head to head with walmart and grocery delivery. there is a burgeoning group of smaller folks like joker or guerrilla. how are you thinking about the competition, and would you be open to an acquisition? >> the grocery market is so big that obviously there's a lot of different segments of the market. we will always be looking for small acquisitions and we will always be open to that.

we are focused on building right now because we have a lot of momentum. but if there are some interesting targets that would complement our strategy we will look into that. emily: we are still in a period of uncertainty with the pandemic. where do you see instacart a year from now, or five years from now? paint the picture for me. >> we are in a period where people are fundamentally rethinking their relationship with food. they're going to want faster deliveries, more selection of products. there's a lot more inspiration round what to eat. for consumers, instacart can be the place that delivers on all of that. the retailer side, fundamentally this is an industry that is much less penetrating than any other commercial industry.

25% of grocery orders over the next five years will move online. we present our partners with solutions that help them move their businesses online in ways that are profitable for them. we think we have a very ambitious journey ahead of us. emily: the instacart ceo there, you can catch the full interview at bloomberg.com. meanwhile, an app that will fight your parking tickets. a look at what the future holds for so-called robo lawyers, next. this is bloomberg. ♪

emily: parking tickets, we all hate them. 24-year-old josh set out to fight them when he built donotpay.com, a so-called robo lawyer, aiming to make the legal system a bit more transparent and cheaper for the everyday person. since 2015 the company has about 250,000 customers and charges a subscription fee of $144 a year. it was just valued at $210 million. josh, great to have you here in the studio. i have gotten my fair share of parking tickets that i think are totally unfair. how could you help me? josh: do not pay empowers the little guy to fight back. we fight companies and the

government across 200 areas of the law. emily: what is your success rate with parking tickets? josh: around 65%. a lot of the time it's 100% successful because we are just jumping through a hoop, like canceling a gym membership or ones that make you send a letter to a po box just to get out of it. emily: in your terms of service, you say you are not a law firm. are there actual lawyers working on these issues, or is it just technology? josh: we have lawyers who help us, but this stuff isn't rocket science. we are expanding the legal system in an underserved way. emily: clearly there is a bigger opportunity than fighting parking tickets. how can you make such big

promises? josh: below $10,000, these big companies know they can get away with ripping people off because no one will fight back. so technology is perfect at doing that because these disputes are very clear-cut. if you want to cancel your gym membership, you should just be able to do that. emily: where do you see most of the growth coming from? josh: the world is changing so much with helping people claim government benefits. these big corporations are not treating people fairly. landlord-tenant disputes. it's like an etf for the world's problems, and unfortunately there are a lot of problems. emily: one of your top features is how to fake a phone number, which might help you get around verification on some platforms. those companies are doing those things to maintain the authenticity of the platform. why shouldn't we think that is a

little shady? josh: when you give up your phone number, you are also giving up your privacy. there are data brokers, you can ask for someone's information just by giving the data broker your phone number. a lot of people don't want to give out the real phone number because they don't want to give up their information. emily: does this mean these companies are not using the right kind of process to verify their own users? josh: 10% is well-intentioned, but 90% is for advertising and targeting. emily: what about when they figure out what you are doing? we talked to the match cfo about users faking their location to meet people at the olympics. they have all kinds of stuff in place to prevent people from doing that. how do you stay one step ahead of technology? josh: we are a lot more

motivated. we are 14 people and a big company will never move as fast as we do. emily: can you end robo calls for good? josh: hopefully there will be a disincentive for robo calls to call a lot of people. emily: some breaking news, a startup car leasing company is preparing a bankruptcy restructuring filing, potentially wiping out equity, according to bloomberg sources. softbank, which holds one third of equity and serves as the senior secured lender, would retain control of the company through that bankruptcy filing. we will continue to follow this developing story. coming up, robinhood catching the meme stock spotlight with the surge in trading post ipo.

we will look at what is driving the latest frenzy, next. this is bloomberg. ♪

emily: shares of trading at robinhood searching for a second day as investors piled in, halting at least three times for volatility. paring those gains to a mere 50% up, bringing its two-day gain to 87%. this is after a lukewarm reception from day traders to the ipo last week. joining us is ed ludlow. is robinhood officially a meme stock now? ed: it's evident that retail

traders are driving it, but it's complicated. if you think about gamestop, a lot of that was in the options market. we have some posts on it. emily: you have been scouring the reddit boards. ed: they are regularly citing the robinhood app, but they are reminding us that in some cases they are selling amc and gamestop to buy this. maybe robinhood will ban them to -- a reference to earlier this year when robinhood restricted trading on some of the meme stocks. emily: why did these folks not buy on ipo day? there was not a lot of volatility. ed: there was a lukewarm reception, to say the least. one reason was that restriction, these day traders, reddit warriors, whatever you want to call them, they felt aggravated by what robinhood had done

earlier in the year. what institutional investors are saying, this is herd mentality. they are seeing what others are talking about on twitter and other social media and getting in on the act. emily: certainly there are institutional investors as well. what is it in the psyche of these retail traders that is convincing folks to still buy now at this price? ed: the fundamentals of the company are not that strong, according to bloomberg intelligence. what made robinhood popular? it was the pandemic. people stuck at home, buying these apps through their phone. but that is going away, and restrictions are being eased. the expectation from bloomberg intelligence is that the fundamentals are there, while the share price is significantly

more than it was 24 hours ago, so it is hard to track that. emily: they're adding more features and crypto features and moving beyond just trading. ed: there is skepticism about their business model. they make their money not through fees but directing transactions through other brokers. it ties directly to, if the user base is there, is it really there if people just go back to their desk? these are the big questions that institutional investors have. emily: we will be following every step of the way. thanks so much, ed ludlow. that does it for this edition of "bloomberg technology." a big show tomorrow with a live interview of the uber ceo. and the lyft president, john zimmer, will follow that up at 5:00 eastern, right here on bloomberg television.

this is bloomberg. ♪

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