>> from the heart of where innovation, money, and power collide, in silicon valley and belonged -- beyond, this is "bloomberg technology." emily: i'm emily chang in san francisco and this is "bloomberg technology." tech earnings season in full swing. apple's new restriction on data collection is hitting hard.

and a lackluster forecast. second time is a charm. wework makes its debut after a disaster in 2019. the company has changed dramatically but one thing stays the same, it is still losing money. we will dive into it. it's been 20 years since the ipod, a device that ignited a wave of apple imitations. we'll talk about apple today and what the next big thing might be . first let's get a look at the markets, u.s. stocks rising to an all-time high, the seventh day of games. kriti gupta is standing by to tell us why. kriti: it was big tech under the hood, a little defensive positioning today. you can see that bolstered by

the idea that some of the riskier gauges or the bloomberg crypto index down on the day. cross asset trade was defensive, not just in the stock market but the bond market too. showing me this chart of my terminal, where you do start to see one of the biggest highlights of the day which is five year breakevens pricing -- pricing and more and more inflation. it matters for tech because the question is do you start to use tech as an inflation hedge, or do you pull out of those docs because of the effect those higher rates might have on the company? let's get to the news he is the event after hours, the earnings wrap up. the company trimmed its fourth-quarter outlet, it's a huge deal because we know the ceo is trying to ramp up the

company, but at what cost? that's a concern weighing on the stock after hours. just eight minutes after reporting its fourth-quarter earnings, snapchat reported a weaker fourth-quarter forecast, losing .25 of its value. they are at a disadvantage but they're also dealing with advertisers. they are also dealing with supply chain concerns and may not want to be getting new customers. a lot going on for both intel and snapchat. emily: thank you for that roundup. let's stick with intel, shares following. the forecast not what analysts had expected. what is the headline take away here? >> it means not enough pcs are getting made, and it's not our fault.

that's kind of consistent with what other companies are saying. but you look behind the numbers and what investors are really concerned about, how much is the market and how much is you losing market share? emily: the investments he's making and manufacturing are starting to be seen. is it just going to take a longer time than analysts had expected to see the benefit? ian: that's an excellent question. if you look at the numbers compared to a year ago, they are down 6.5 percentage points. for manufacturing company, that's really indicative that you're struggling either with competitiveness or your costs. the abiding concern is to make a new chip may take 18 months to design new products.

anything done in february want materialize until at least next year. then has to take a foothold in the market. there is no easy solution here. emily: he still sees enormous opportunity ahead. the question is, how much market share is lost while intel is making the transition? ian: this is where intel reports and a week later amd reports. if amd comes out like it has done for the last four or five quarters and shows tremendous growth, the conclusions are there to be drawn, and they are pretty ugly ones for intel. emily: you been coupled -- covering this business for 20 years. from your perspective, is it a good thing? ian: all i can say is, they tried it before and it didn't work. this time he saying we are serious, we are going to put a

lot of money behind it and do it. the length of time, the inner should that exist in this business, to go from zero to leadership, it's taken so long to get there. intel is a powerful company with loads of resources, but it's not going to be easy and it's not going to happen overnight, if it ever does. emily: ian king, i will let you get back to reporting those results and listening in on the call. catcher interview friday at 1038 -- catch the interview and we will put those questions to pat himself. we want to touch now on snapped, shares tumbling as much as 28% on concerns about companies and business and apple software update, limiting targeted advertising. what is your take on what's happening with snap?

>> all of us in the investment community, probably a little bit of headwinds from supply chain and other macro issues. i think it has amplified as the quarter has progressed. the big question is reaction to snap, is it because of snap or is it because of the entire industry? we will know more after the report next week. right now it seems to be not just snap standing alone on an island. it's across the industry. emily: other companies like facebook have indicated they will be feeling the same pain as well. facebook is facing a slew of negative press. i wonder how much of facebook's pain could beat snaps gain?

>> i feel that facebook has gained over the near term. over the last probably six months, given some of the issues people are dealing with, snap has been increasing at a pace we haven't seen from other companies. alternate reality, social commerce, the speed of different innovations. snap is positioned next year, the reaction feels a bit overblown. emily: evan spiegel at the wall street journal conference earlier this week through some shade at mark zuckerberg's vision for the meta-verse, saying he thinks it is a -- it is dystopian. he would argue is trying to connect people more to the real

world, not trying to send them into a virtual world. what do you make of those two visions and how they are at odds, and who is making the better bet? >> what i feel is the new content is being concerned -- there is a media pitch that feels more interesting and more realistic. what the vision is going to look like over the longer term over the next 12 months, it's being a little more realistic in this augmented reality world. emily: paypal has explored buying pinterest. do you like this or not?

>> it feels like a blast from the past and is missing ebay. pinterest is a unique asset. it has staying power that some of the other platforms don't have. over the next several years, paypal probably needs pinterest more than pinterest needs paypal. emily: is it pinterest, instagram? >> i think instagram with all the shopping elements they have, it seems to have a better handle. social commerce as a value proposition seems to be evolving.

we don't know if they can sell that. instagram seems to have the edge but pinterest has the tools and intent. people are going to pinterest with an idea to findethiatld bel shopping as such. emily: thank you so much, we appreciate your insight there. we will have a lot more coming up with tech earnings next week, including most of the banks, plus a whole lot more. monday we will get results from facebook, tuesday, alphabet, microsoft, twitter, and later, amazon, apple, and pinterest. we will bring you all the details right here on bloomberg television. coming up, back to wework, shares spike after finally hitting the new york stock exchange. all the details on that one,

next. this is bloomberg. ♪

>> one of the first things we teach our members is to treat everybody the way you want to be treated. investors give you money, it's your job to make a tremendous return. we are doing quite a good job at that, and a plan to keep doing that. emily: that was the we work founder, adam neumann in a trip back to 2015. while he is no longer with the company, he is walking away with a pretty company, a $2.3 billion fortune, to be exact. it wasn't just a good day for

the founder, it was a good day for the company and employees too. i reporter has meticulously documented its tumultuous journey to now. how does the wework that went public today compared to wework before the drama? ellen: it's been two years of a culture change for wework. thousands of employees lost their job, the ipo they originally wanted to do that year completely failed and fast-forward two years, they are trying to do it again. they have a different ceo, the company is much smaller and has decided to cut off many side businesses and investments at adam neumann made that made a lot of onlookers scratch their

head. the company is repositioning itself is leaner, much more serious and sober, as far away as possible from the adam neumann era of 2019. also they have been through covid. emily: so looking at a $9 million market cap, not what was projected in the earlier days. the pandemic accelerated the trend toward more flexible work which is paying off for wework and has been a huge tailwind. what do you see as prospects for the business from now going forward? ellen: they saw their offices completely empty out at the beginning of 2020. a lot of people may have still had contracts. people describe floors and floors of empty offices. at the same time, now that we are starting to think about going back to the office,

there's a huge advantage for wework. maybe in the past you might've known how much office space you need more clearly. wework's offering looks a little more attractive. that's a story it's trying to tell us investors, saying that covid may have knocked us down but it is also the reason we might be a lot better than thought. people will be turning to us to figure out uncertainties about returning back to the office. emily: it is certainly a new chapter, and one without adam neumann. ellen, thank you for helping us chart that journey. we do have some breaking news, a panel of cvc advisors has unanimously backed modernity's booster shot as well as j&j's booster shot for single shot

recipients 18 years and up. huge news, pfizer the only one that had been approved until now. the panel of cvc advisors unanimously backing moderna and johnson & johnson. coming up, my interview with christian klein. talk about whether the company shifts to the cloud and if it's paid out and how it has been impacted by supply-chain issues. mumble, match and spotify, all three popular subscription apps rallied after google announced it is slashing fees it takes from services like these on the app store. it will charge third-party subscription apps of 50% commission. previously they were charged 30% the first year and 15% beyond that. in app purchases are separate from subscriptions.

there is more to come there. this is bloomberg. ♪

emily: customers hoping to get their hands on the latest apple products may need to wait a bit longer. orders for the iphone 13 and other products won't be for sale until november or even december. bloomberg is reporting that some apple store employees say the supply situation is the weakest in years. apple is expected to break sales records during the final three months of the year. a year ago sap shares plunged in the company cut its forecast and announced a dramatic move away from software to the cloud. so far sap has raised his forecast multiple times and cloud revenue jumped last

quarter. ceo christian klein joins us from germany to talk about whether he sees this as a victory, or if there is more work to do. >> you look at three key metrics, significantly it celebrated, up 20% year-over-year. we also recorded our highest performance in six years and are cloud backlog which has been an important indicator just past $8 million, also up 22%. there is always more you can do, but we are clearly ahead of the plan. emily: i remember the day when we spoke a year ago and it was a difficult day for sap in the market. shares have plunged more than 20%. there was a lot of skepticism about that plan. looking back now, would you have done anything differently? >> trust me, i remember this day

also really well. for me it's very important that we follow the needs of the requirements of our customers, especially during the pandemic. they asked us to help create solutions in the supply chain and help us to become a more sustainable enterprise. that's why the shift to the cloud was without any alternative, that was one part. also, let's use the power of sap , the best practices of over 400,000 customers. now we are helping our customers more proactively to change their business model, and as we are watching manufacturing around the globe, i would do it exactly the same way.

the success in the last 12 months proves that the strategy is working. emily: you have larry ellison out there continuing to mock the sap transition to the cloud. what would you say to him, and what else do you plan to do to increase brand awareness, especially in the united states? >> good question. first of all, i also hear his claims about market shares back and forth and earnings. first of all, i take it as a credit, when one of our largest competitors talks about sap so much, i take it as a positive sign. revenue is up 46%. we are the fastest growing solution in our portfolio. we also just closed a quarter where we had over 50% of our customers net new, so we are winning market share. when i talk to customers who are

not running sap, they come to us because they say i am a product company, i want to move to pay-as-you-go. this is what sap can do best, fully automated into in. at the end of the day, it's best to let the customer talk and go with numbers and figures. emily: you have a unique view into the supply chain turmoil and also intertribal. how much more pain will we see in the supply chain and the travel business, and when will things return to normal? >> that is a good question. you are right, in the public we hear a lot about the shortages on the semiconductor side. we also hear about the container ships who cannot come into the harbor anymore. there are many more out there where supply chains are heavily disrupted.

more important, with a business network, a lot of customers come to us and say i want to join the business network. i want to be connected real time with all my suppliers and manufacturers to manage real-time the supply chain. and to in, not only within the four walls. -- end-to-end. from what we are seeing, this will be the case in the next quarter for semiconductors. emily: when do you see a return to normal? how far out is that? >> when i look at the travel business, we saw concur back to growth. we definitely see signs of recovery. people are traveling between europe and the u.s., or it is picking up. of course, not everywhere in the world. we foresee that next year, q1 and q2, i hope we can get more

back to normal. it will not be what we saw before the pandemic, but definitely we will see higher activities in our travel bitten -- in our travel business already now and in the quarters to come. emily: the inventor of the ipod is next. ♪

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♪ emily: welcome back. this week marks 20 years since the introduction of the ipod. the device kicked off one of the biggest waves of innovation at not just apple, but technology history. when the ipod wasn't veiled, apple had a $7.7 billion market cap. now the company is worth $2.5 trillion. a lot has happened over the decades, including the death of steve jobs. who better to talk about it all

then the inventor of the ipod himself. he is nope and swill at the global investment firm future shape. -- to celebrate the ipod anniversary and the anniversary of net. when you invented the ipod, where did you think it would lead in your wildest dreams? did you see a found tablet, watch? >> absolutely not. where i was coming off was 10 years of failure from general magic and all kinds of personal handheld devices. the only thing that was successful was home. -- palm. apple called and said, we have itunes and we are trained to hook up mp3 players. that is where it came about. emily: they launched their biggest improvement to the mac in years. how good is it? how does it change the direction

going forward? >> quake question -- great question. it has been stuck. now you're going to see incredible innovation. you have seen it in just a year from the first mac, now m1 pro. there will be dramatic changes because they can change so many things in the hardware. you can put other features you have never seen before. i haven't even bought one. emily: do you buy everything within minutes? >> no. but that when i did. -- that one i did. done. it is over. emily: permanently? >> not going back. emily: what does that mean for innovation? is more possible because that is in-house? >> apple schedules were dictated when intel could release processors. all of the macs would have to be

in lock with intel. in all the margins they had to pay intel, when you have to pay $400 per mac, what does that mean? now they can take that money and drop the prices and innovate. emily: the supply chain crunch is impacting everyone. even apple. they might have to slash production. employees say this is the bleakest they have seen in terms of wait times. how bad is it? >> it is not good, but remember apple has gone down allocation. ipod was on allocation for two to three years because we could not get enough fixed. apple has some of the strongest silica and contracts in the world. maybe the other companies can't get what they need, but apple has priority allocation.

if there is silica and to be made, apple is going to get it because they are strict on how they work with suppliers. emily: as innovative as apple has been, there are those who complain apple has not innovated as much as it did under steve jobs. i am curious how you respond to that. >> apple is a much bigger place. i still think it is innovating. just because you want to see a new hardware platform or a new thing, that's not the only place where you innovate. you innovate software services, that is great and wonderful. we will see new hardware from time to time, look at the m1 max. they might not seem like a product category, but it is going to grow market share tremendously and their margins as well. emily: people wanted new product category. >> they always do. emily: what will it be? glasses? our car? are those things apple should be

working on? >> it is one person's opinion. we have looked at ar for some time and it is all about the display technology. hopefully apple has something. one of our companies has helped with all of the many led displays. the next is about the car. we have heard about change of leadership three to five times, so maybe there is something there, maybe not. it is a great space to go in, but time will tell. emily: what is your expectation for the next chapter of apple? it has been 10 years since steve -- >> which 10 years. emily: what is going to be the next chapter? >> there will be more software and services on the platforms they have. we will probably see one more big hardware product category.

you will see a lot more accessories. airpods, and things of that nature which are huge. those could be fortune 500 of themselves. maybe you're not going to see tremendous stuff like an iphone, but there are so many things you can do around the ecosystem. you got to look at software and services as where apple will be headed. emily: the meta-verse, is it a good thing? >> i heard about meta-verse in 1988 when we were doing vr glasses. i for that stuff go up and down. we see vr happening, then not happening, so i am still skeptical it is going to be a big thing. it is going to be big in industrial because there will be specific focus, but to get the emotional aspect from consumers who want to be in at all the time, that's tough. emily: do you think it will be a

dystocia -- dystopian thing more place that will thrive? >> we didn't want the smartphone to become the refrigerator for all of this dystopia. i hope it doesn't happen there. we have learned a lot of what the unintended consequences of these devices, so let's hope this is not going to come with that. we are seeing dystopia a little bit with self driving cars we have to maintain. we are going to have to be careful as we move forward inking about societal impacts. emily: do you think that comes down to regulation or choices made? >> it is always down to the executives. when we were selecting the types of content we would put on the music and video store, there was a clear discussion about, why don't we sell poured? -- porn? it is very profitable.

steve said, is this the society we want to live in? absolutely not. yes it can make money, but it's not the right thing. it goes down to the executive teams in these companies to make sure they are self-regulating because the government is not going to be able to regulate. when you see this dystopian world, they must regulate themselves. i do want to hear the doubletalk we are seeing out of facebook and other companies. i'm sorry, it is bill -- emily: do you have confidence in mark zuckerberg? >> next question. [laughter] emily: let's move onto google. obviously, they have come out this new pixel phone. some people will say this will be their first smartphone hit. do you think? >> i hope so. they have been trying for years. in the android world, there are a lot of different ways to sell

products. there is tough competition. maybe it will work but it requires more than hardware. it requires the customer support, the retail, all of those things. it takes more than a product and google is mostly software driven. we will see if they get it right. emily: what you think about their decarbonization plans? what are google and apple doing to try to minimize the impact they have on the environment? >> it is wonderful. we have to do everything we can around our operations of companies and how we de-carbonized, but we have to de-carbonized around products and supply chain. when we look at the products, where are they being manufactured? where are those suppliers? are they decarbonizing? it is great to have headquarters

to it, but you need the whole chain to do it. i hope we will hear more from these large companies about that. and how they are pushing their suppliers to make sure they are doing more than just labor. emily: amazon came out with a -- at a relatively low price point. is it any good? >> honeywell is involved, so i doubt it. [laughter] emily: you don't mince words. >> i have a bone to pick. emily: the connecting of our homes, they have rolled out this indoor flying drone, do we need that? is it exciting? is it terrifying? >> there's a lot of things you can make, doesn't mean you should. you have to look at what you are trying to do and to me, less is more. what are you going to say no to? dave tried microwaves and all kinds of other crocs, they need

to focus and say these are the things that matter. when you throw the spaghetti at the wall, it doesn't really work from a marketing point of view. emily: should amazon say no to the robot? >> i don't know enough about the robot. the drone, come on, really? it is a flying camera. maybe it will be successful. i don't know. i haven't tried it. we will see. emily: talk to us about your work at future shape. there is this big question about how will all of these products ultimately be sustainable. will they be? what is the big innovation you are most excited about? >> for me, in a lot of cases we do a lot of investment. we have 200 companies around the world. we are taking technology and

bringing it to bear in various developing countries. whether it is southeast asia or latin america, and helping small businesses, medium-sized businesses being able to get access to technology so that they are able to raise himself up. a lot of that stuff we are doing is to help these communities and individual proprietors, not just big business. when we look at stuff, we are looking at aquaculture, agriculture, fintech, new materials, we are looking across the board. and we also do more traditional stuff with bio, drugs, drug platforms, there's a lot of cool stuff we are working on and i am excited about micro. remember the transistor moved from the vacuum tube to the transistor.

we are going to replace all of these energy inefficient relays and things in the 5g world and we will have a new micromechanical switch that is as important as a transistor. emily: you spend most of your time outside the u.s. i'm curious with this global perspective on silicon valley, what do you see? the silica and bally doing right by the world? >> silken valley needs to invest more in climate change directives. we are seeing too much on buy now pay later. we are investing and we are finding stuff not in silicon valley for the most part. we are finding it all over the country and the u.s. but also europe, southeast asia, india, i am bullish in seeing that this industrial revolution is happening and it is happening everywhere and there are many companies outside silicon valley doing it. it is not just going to come

from silicon valley. we need to do it everywhere and make sure it is local for the communities and what they need. emily: congrats on the ipod anniversary. 20 years. 10 years since nest and continuing your work at future shape. it is grad -- great to have you here in person. coming up, and fts pushing for more representation. we talk about the new minority own crypto investment firm metaphor next. this is bloomberg. ♪

emily: let's put the focus on

cryptocurrencies. >> i've decided to go macro. you want to look at how that coin is performing relative to other asset classes and right now you're seeing stocks outperform bonds once again. that is the blue line you are seeing. the white line is bitcoin. bitcoin really serving as a sentiment gauge of essentially whether or not you want to make riskier investments. i want to show you how the crypto changes this year have actually translated. i've put together a chart here of robinhood, which is exposed crypto, you've got a minor. microstrategy major investor in bitcoin. you can see it is actually microstrategy that has made the most return. a lot of it coming from bitcoin, but the minor is exposed. robinhood is not catching up when it comes to bitcoin trade

which brings me to another way you could possibly play that big bitcoin move. that is the futures etf on its third day of trading and making a round trip to where it started. two days of gains. nasdaq tracking bitcoin futures price in particular, but not making a ton of leeway in the last three days. emily: thanks so much for the roundup. a new crypto focused investment management firm is on a mission to help create more ownership opportunities for minorities in and fts. that have four fund management has launched a new fund to invest in rare specimens of and fts specifically. the ceo joins us now from miami. what exactly counts as a rare specimen in and fts? >> i think rare specimens, we categorize it as -- that are less than 1% of a collection.

that is specifically for what we determine as -- projects, which are avatars, but there are one on ones that are obviously super rare. once that are older from an og perspective, i guess is the terminology, as well. emily: what prompted you to start the fund? what is the end goal? >> the end goal for this vehicle is to acquire the rare specimen and fts. for us, we look at this like an address in time when we are shifting to web 3.0. the assets we are acquiring have historical significance. there is an antiquity aspect to it that we really like. emily: how do you see this as helping artists have more ownership of their creations? >> this traces back to the idea

of web 2.0 and web three. using big tech as an example. all of our data is getting repackaged and sold whether it be by facebook, google or whoever. in web three, we have a decentralized system that allows the creator to benefit off the activity they are doing on the web. from that aspect, the value actually goes to the creator or the participant. that is where the world is shifting. emily: you had a 1.1 million-dollar dollar pilot fund this year. you actually bought 31 and fts yourself. what is the goal? i know you want to raise $100 million. >> the pilot fund was designed to show investors what the asset class was to begin with.

for a lot of investors, particularly institutional investors, cryptocurrencies are regarded as risky. when you look at and fts, that is a subsection of that. we wanted to put something on the table that allowed investors to see what it was we were doing. whether it was investing in and fts, buying them themselves, minting, so that was the goal of the pilot fund. you look at the new vehicle, i think we are in an historical time as it relates to the internet. for us, the goal is to require the wares specimens that exist on the web. that is the ambition. emily: there are thousands of nft projects. how will you cut through the hype and rise above? >> there are your typical risks you would see from any sort of venture capital fund. whether they are tracking how

many twitter users or folks on discord or what the demand is like when -- when there is an actual drop. we look at data points like that but really, there is more art than science. this is arch to some degree and beauty is in the eye of the beholder. thinking back to sneaker culture where your traditional collectibles, or whether you collected baseball cards or beanie babies, there is certainly some aspect of that here. there is something for everybody, which i think is so attractive about and fts. there is something for everyone. once you do start collecting, and once groups like coinbase who are doing their own marketplaces make it easy for someone to acquire these, i think you will start to see it proliferating even more. emily: we will keep our eye on you.

brandon buchanan, thank you for joining us. we've got plenty more coming up. let's take a look at tesla, which closed at a record high. investors renewing their rush into tesla shares thursday after elon musk posted its ninth straight quarter of profits. gross margins widened by almost 30% in the latest quarter. investors had already been piling in after tesla reported blockbuster deliveries for the third quarter. this is bloomberg. [inaudible]

emily: other headlines we are following, chip shortages and supply chains continued to cap truck making. the company says the disruptions and shortages in the production

of trucks and other parts will continue, but volvo reported a third quarter adjusted operating profit of $1.1 billion, beating estimates. south korea successfully launched a home developed rocket. that -- the 200 ton liquid fuel rocket lifting off the southern coast, then released a dummy satellite into orbit. south korea sees its rocket project as boosting competitiveness in six g communication while attracting attention from neighboring north korea as to its missile arsenal. that does it for this edition of bloomberg technology. tune in tomorrow, we are here with intel ceo pascal sutter to talk about -- i love talking to mark. i am emily chang. this is bloomberg. ♪

paul: good morning welcome to "daybreak australia." we are counting down to major market opens. shery: the top stories this hour, u.s. stocks hit a record high. tech takes a hit and extended trading. paul: a make or break we