globally and that's before the bigger investments we are making in kentucky and tennessee, both for batteries and assembly coming online. they don't come online until about 2025. ♪ >> from the heart of where innovation, money, and power collide. in silicon valley and beyond. this is "bloomberg technology," with emily chang. emily: i'm emily chang in san francisco and this is "bloomberg technology." another record for apple despite supply chain issues, we will break down their quarterly report. robinhood results are out one

year out from the gamestop fiasco. coupled with regulators on the trading platform? we will discuss. breaking up, not so hard to do on -- for softbank. the ceo is in top stew split after asking for $1 billion in compensation. we will get to that in a moment but first let's look at the markets. ed ludlow is here looking at the big picture. give us that snapshot. ed: spoiler, they had a great first quarter but the markets first, the nasdaq 100, closing that tech heavy index swinging from gains to losses. i bring up apple. is the big beat going to change the psychology of the market that has been so focused on the outlook for rates and what will happen to those stretch valuation bank stocks with chinese adr under pressure? tesla is down, 108 billion

dollars in market cap shares with its biggest post-earnings drop since july of 2009 with semi conductors down. risk off sentiment in the market, the bloomberg crypto index is largely bitcoin and a theory him with other larger market values, let's get to those after hours earnings with robinhood, having a tough time of it in the final quarter of 2021 with equities trading revenue down 35% and the top line comes in with sales below expectations. i heard you talking about those meme stocks but november and december of last year there was volatility so it's interesting to see them struggling after hours. the thing about apple, it was a big eat. the big beat on the top line, record revenue, almost 100 when he $4 billion of revenue for apple way above expectations. strengthening the new products they are talking about. christmas, the holidays, their

fiscal first quarter, look like constrained. you and i were chatting a moment ago. why was the ipad not as strong? something to listen for in the call. but did they circumvent supply chain issues? it certainly seems so. julie -- emily: julie, got to ask you about this. what do you think given the chip crisis that everyone else seems to be dealing with? julie: they continue to stun and from our side we see consumer demand very strong with 19% of consumers purchasing a laptop in the past six months and 17% of consumers using streaming audio and another 50% with streaming video. the demand is strong. consumers to -- expect to be home, in and out of office environments. the demand for apple products continues to be strong.

folks who purchased us smartphone in the past six months, 47% in the u.s. purchased an iphone and we had demand with the bundles that was strong. they like to save money over the complexity of choosing. emily: we saw the ipad make assert -- resurgence through pandemic. what you make of the relative weakness, is it kids going back to school and us moving into a relative new phase of the pandemic? julie: it could be a new phase of the pandemic. it certainly has become the laptop placement that some thought it would be. it certainly is a tool for those who are creative and on the go and i think the strength of the media offerings helps the ipad, but i think that one of the things we look at, too, looking at the christmas season, we look at things like 3g, consumers forced to upgrade their smartphones, and it could be a question of priorities during

the holiday quarter rather than flat demand for the new product. emily: we are getting headlines from the call and tim cook says that ipad revenues were lower due to supply constraints, clearly something apple is still feeling and it is impacting the ipad specifically. what you make of that? julie: i don't know that there is more analysis that i could offer. it is tough. i looked at the ipad pro at the upper end of the line. airpods, smart phones, smart watches. there were not many products i couldn't get within side of a week. from what i read it didn't seem like there was a supply chain impact on the consumers in the last quarter of last year. emily: every region was strong except for the relative weakness in japan but the iphone once

again getting that top spot in china after six years. julie: certainly iphone and ios is in the dominant operating system in china, but huawei has struggled, they have not brought out that killer product that everyone wants and i think it's a good sign. you know, overall. the other thing looking forward is it's not just about smart phones, tablets, or watches, it's about the ecosystem in the services that go around it in their isn't really a company with a stronger or more cohesive experience algorithm that works throughout the ecosystem like apple does and so the more devices they buy, the more services or service bundles that they buy, the more likely they are to be attracted to the apple ecosystem and the second thing i look at, you know, the biggest hype or buzz word in the industry is the metaverse. as we look forward we think about what it will create two --

take to create experiences. what kind of headset, what kind of ecosystem. who has developers and services and it will be fun to watch apple on that dimension. emily: tim cook saying that supply constraints were worse in q1 then q4 and that makes you wonder if it's going to continue to get worse, is there no relief ahead? moved onto talking about the iphone on the call. asked line-up ever. having onto services and apple tv plus and this business that tim cook himself that on so many years ago and has almost surpassed just about everyone's expectation. anything particular on the services side that you will be watching over the next year? julie: a few things. there is certainly a difference who can consumers using one of these services and paying for it. we are seeing more consumers pay . second, we are seeing consumers

drawn towards the bundle that apple offers that has fitness and music and video in it. they are looking for deals. capitalists want to save money. second on the list, easy. third on the list, they want to feel like they are getting a deal. the breath of the offerings are in their favor as well. 19% to 20% of their revenue is in services. of an apple number, that's a very big number. emily: they obviously need people to keep buying that higher -- that hardware and get getting those services. the chips, part of why he saying there's new services across the board in high -- and hardware. julie, always appreciate your instant analysis, thank you for joining us. apple, developing a feature that lets iphone except payments with a tap of a credit card. currently emergence -- merchants need to use terminals to do this. they have been working on this

feature since 2020 when they purchased a canadian startup developing that technology. coming up, a year since the gamestop chaos. tracking robinhood results and reflecting on the meme stock phenomenon that put the trading platform in the hot seat. this is bloomberg. ♪

emily: a year ago this week thousands of retail investors went all in on a few failing stocks, including gamestop and amc following the advice from the reddit thread wall street bets. it upended many hedge fund plans and put robinhood in the

spotlight and at the center of sec scrutiny. i want to talk about all of this and more with david chase, a former sec prosecutor. before we dive in, i'm looking at robinhood now, the shares are plunging after hours. they missed on revenue. they missed on monthly active users and there are certainly questions surrounding some of the regulatory issues here. what do you make of robinhood one year later after the mania that was gamestop? david: i would just say, how things have changed in the last amount of time since it filed and went public, with all of the anticipation about its revenues and profitability. clearly, the market has punished robinhood's stock, given its performance to date. and certainly, apparently, continues even after the announcement on earnings.

it, it, it creates a situation where a company in the financial services industry can deal with regulatory problems and certainly it makes it easier to do so when revenues are good and things are going well for the company and it is profitable and the market is, you know, rewarding it. here, though, you've got a tremendous decline in stock price as the volume of activity in meme stocks have dwindled. prior hosts indicated that equity streaming is down 35% or so. so, with that line in trading activity, you know, you get the consequent decline in revenues. the regulatory problems of robinhood have not gone away.

there is still apparently an intense sec interest in the whole notion of game a fixation of the markets generally. including particularly the robinhood role in that. you still have ongoing class action litigation with respect to their decision to restrict trading during the meme stock trading frenzy, while that was going full force. in fact just in the last week or two, an individual investor won an award against robinhood in a finra arbitration that may potentially be significant as it being an indication of things to come based upon an arbitrator or arbitration panel's finding that they improperly or wrongfully evidently restricted his ability to trade. for example, pinging the border flow, which robinhood has relied upon as a source of revenue over time, subject to continued

regulatory and even congressional scrutiny. so even though the stock price has gone down and things are tough financially for the company, the regulatory landscape has not changed and is perhaps even getting a bit worse. emily: in the meantime, the robinhood ceo launching new products. they intend to add more crypto services to the platform. talk to us a bit about the nuances of regulating a trading platform that is itself also a publicly traded company and the target of retail investors. david: yeah, it gets complicated real fast. the move to expand further into crypto, that might be important for the company to generate revenues to make up for the loss of equity trading and volume.

that will inevitably make it clear the view that they think the cryptocurrency and digital assets, depending on the facts and circumstances, can be securities and should be subject to sec regulation. so, you have that as an overlay on the trading platform, you know, of a publicly traded company that has disclosure obligations given the reporting requirements and it, you know, like i said, it becomes complicated very fast. robinhood will have to continue to make periodic filings discussing obligations regarding business stock prices and it is running as a platform that is

going to be, particularly if they advance further into crypto, treading into new territory for sure. emily: obviously this phenomenon is not going away. more broadly, how big of a task does the sec have when dealing with this avalanche of individual investors who want to say? david: yep. this is the big issue. the sec has a job. one of its main goals is investor protection but it has to balance that against the need to have fair and efficient markets. so, that delicate balance between protecting the individual investor and providing liquidity and efficiency and also, you know, allowing financial services to conduct business profitably, kind of a light touch for regulation, is also important.

so that all also has to be sorted out. emily: david chase, lots of potential platforms to watch out for. thanks much. meantime, another story that we are watching, stephen breyer made it official, he will retire this summer. the 83-year-old justice joined the president at the white house, who praised him for his years of service and promised he would have a historic nominee by the end of february. emily: i have been studying the backgrounds and writings of candidates and i have made no decision except one. the person i will nominate will be someone with extraordinary qualifications, character, experience, and integrity in that person will be the first black woman ever nominated to the united states supreme court. emily: silicon valley watching the nomination closely. justice breyer had a strong background in antitrust, meaning

the court could be less likely to take up those kinds of cases, depending on who the nominee is. coming up, intel plunges on the back-and-forth quarter results. investors are jittery over the ambitious plans to turn around the chipmaker, including a $20 billion manufacturing hub in ohio. will it pay off and when? we will talk to him, next, on bloomberg. global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. -- bloomberg. ♪ ♪

emily: nasa announced choosing 12 companies to provide space services. virgin shares rising on the deal. but that 300 million dollars will be split across all companies in an effort to foster a growing u.s. commercial launch market. moving on to chips, i cut up with pat gelsinger along with

guy johnson one day after the company reported fourth to results and i asked about concerns tied to how much intel is spending, including a potential hub for a new factory in ohio. how guaranteed is the return? take a listen. >> we feel that the overall industry is expected to double and most of that is leading edge technology and intel is only one of three companies on the planet able to build at that scale and we feel very strong that the demand signals in the long-termer going to make great investments and there was a time when we underinvested incapacity around supply limitations. what i wouldn't do to have more of that capacity today. taken together, this is exactly the plan we have laid out read we are going to aggress -- invest aggressively in the capital buildout and last week's

investments around silicon heartland? my gosh, the president, the governor. i will just tell you, even though it was in ohio, everyone of the midwest states was so excited about us bringing this new capacity into the heartland of america. silicon valley, silica and forest, silicon dallas or, now the silicon heartland. emily: the ceo of ford says that he sees no relief ahead when it comes to the chip rices. elon musk yesterday said that they are going to continue to be chip limited going forward. what was your message to the president? what more can the government do to bring that relief? pat: we see the shortage persisting with incremental

improvements throughout the year but these are still challenging times and these notes that we have shortages on various components, they aren't going to go away overnight. we think that we are going to be collectively fighting through the supply challenges as we go through the year. that said, idm, manufacturing a lot of this myself, part of the strength of the model is that we have more tools to be able to respond to the shortages than other companies and that was a big piece of our q4 results. >> to the point that emily made, investing huge amounts of money, the community they're looking at this and saying that this is something you have to do but i think what they are wondering is when do we start to see margins improving as you make this investment? when do we see a return coming back to more normal rock -- normal margins? when is that?

pat: we had a five-year picture of 51 to 53 that starts improving as they go to the back half of those five years and i guided it to 52%, right in the middle of the range for q1. overall i would say it's happening just exactly like we planned it to be. we are seeing revenue growth rates in the business areas that i laid out, everything is happening exactly like we planned it. yep, this is a big investment cycle for us as a company. it's the right one for intel and a critical one for the industry and for the nation. i am proud of the fact that we are making these investments and you know, at some point the street is going to see that we are doing exactly what we say. we are a say do company and this leadership team is so fired up because we are eing everything that we said. process and product leadership, manufacturing capacity, it's being done on track to deliver

exactly what we said we would. ice first -- >> in terms of integrating higher and getting even bigger, do you think that capital investment could be greater than you are suggesting right now? pat: when we announce the site we said we can see more. that it could be a $100 billion investment over the decade. part of the site was a big area that we could just grow and expand in overtime and i will tell you that the new area of ohio is just pershing -- perfect. a warm embrace, support from the governor, the local community. the entire midwest. if the chip act gets past the statement is to go bigger and faster.

emily: coming up, more apple results. record sales this quarter and what it signals about what's happening in the global supply chain. that is next, this is bloomberg. ♪

emily: welcome back to bloomberg to knology. i want to get back to the apple results. what is tim cook saying? >> it was such a blockbuster quarter. shocked by 100 billion dollars of revenue in a quarter, now they are pushing toward $125 billion. record retail sales during a pandemic. services revenue outperforming. supply chain a mixed picture.

>> we set all-time records for developed and emerging markets and so revenue growth across all of our product categories except for ipad we said would be supply constraint. as expected, we experienced supply constraints that were higher than the september quarter. ed: he's talking about strong year on year growth going into the fiscal second quarter for the quarter we are curtain -- currently in. dan, does the s&p 500 and nasdaq 100 turn a corner now? apple seems to have defied the odds of the supply chain although it has impacted the ipad. they seem to have pulled a rabbit out of a hat. emily: i found it interesting that it was worse in q1 than q4. let's get to dan.

he is also listening in on this apple call. saying a major statement on iphone services highlighting cupertino's ability to navigate. give us your headline takeaway about the supply chain issues and how apple has managed them. dan: the most important piece in terms of the supply chain, is hard as the highs -- as hard as the supply chain to navigate, i would say the damages been contained. the iphone was not even on the radar to have a number like this given the supply chain issues. to ed's question, the supply chain improving in march, that is going to be big for every tech investor and in the food chain, that contrast the fears

that we are seeing from tesla and others that supply chain issues are lasting throughout all of 2022. that is key. emily: why is apple managing it so much better than everyone else? we heard elon musk yesterday on the tesla call saying they would continue to be limited. dan: nine months ago, apple over ordered 20 million to 30 million iphones. they saw this happening and they have continued to do that the last few quarters. what's important is that they are proactive. in china with foxconn, they have the unique ability in terms of sourcing as well as the amount the apple orders, they are at the front of the line. they get dibs when it comes to getting chips. that's why cupertino continues to navigate, but it's tim cook. his balancing act and what he

has been able to do over his last year in the chip shortage is nothing short of remarkable. emily: he was the coo of apple for all of those years and his job was to master that supply chain. we are still listening into him on the call, you said he believes they are gaining market share in iphone looking ahead. certainly, more optimistic than the other calls we have heard. what are the flashpoints for apple going to continue to be especially since this is a global issue even though apple seems to be managing it better than everyone else? dan: you aren't going to call it out specifically, but we think 250 bits per share in china. they were the number one smartphone maker in china for the first time in six years. that's important, because that is a key market for them. you look at overall supply chain, this is the strongest product cycle in a decade.

in this market, we can talk about valuations all we want but if you look at what is happening on services, that is worth 1.5 trillion. this is going to believe -- it's going to be what i believe is a turnaround in the tech sector. from microsoft a key to a reversal in tech. emily: what is your take on the ipad weakness? dan: supply chain constraint. if it wasn't for supply chain, i think they would be great. i think that is something that will start to improve going into q2. that is the one area we sought pull forward from work from home unlike services and iphone where that pulls ahead. emily: let's talk about tesla and the big move down on the date. you are very bullish on elon musk and what this company has been able to pull off even in

the midst of the supply chain issues. at some point, they don't have a choice they can only work with what they have. what is your outlook tesla in the year ahead as these issues persist? dan: i ultimately think it's a company that could be up from a growth perspective 70%. they had to be conservative coming out of the gate. they don't have a demand issue, the have a supply issue. the most important news that many lost over is in terms of the austin buildout. you're starting to manufacture cars with 4680 which is so important and i think they will be the 2 million run rate, we will be buying the selloff in terms of supply chain. we will look at this and they proved to be conservative. emily: tesla has gm and ford on its heels. the competitive ev makers.

in china, how do you think tesla manages to stay ahead? >> -- dan: 3% of ev's today -- of autos today are ev. what tesla has, the battery technology and is to be should, that's why austin -- the big differentiator in 2022. emily: continuing to listen to the apple call, tim cook is saying the supply chain is doing very well despite the shortage is. no need for fundamental changes to the supply chain.

what are you watching to see in terms of apple tesla and all of these companies manage this continuing issue? dan: i probably got about 10 email from investors on those comments. that is the wind change. apple is going to be the best barometer for the supply chain. tim cook's viewpoint is key for the broader supply across technology. we are starting to see some improvement that i think right now the street is going to allow us through 2022 cook saying not so fast. very important in terms of broader tech and apple. emily: we always appreciate your insights. another story we are following, spotify down for a fifth day with the stock at its lowest level since may 2020. at the same time, the company announced it is removing the music of neil young.

the singer raise concerns that joe rogan is spreading vaccine misinformation writing in a letter to the company that they can have rogan or young, not both. spotify struck a deal with joe rogan in 2020 with more than $100 million. coming up, he wanted a billion but softbank said note. the likely departure of the cfo and what is next. this is bloomberg. ♪

emily: the softbank coo is in

negotiations to leave the company after clashes with the founder over how much he is paid. he wanted as much is $1 billion in compensation. vermont -- for more on what this means is our next guest. what happened here? >> they could not come to terms. he has played a significant role in a lot of things at softbank. a lot of key developments over the last several years. there was the turnaround was sprint for they sold that. there was getting we work back on track. remember what a nightmare that was for quite a long time. a real decline in the investment in terms of the value of that investment for softbank.

he played a key role in that. he also developed their latin american investing fund up to $8 billion. he has played a significant role in some big events and bailing out softbank and keyways. there was compensation to the tune of $1 million or more. there was also wanting a spinoff of the latin american funds again $8 billion. him wanting to have more independence there. he is from bolivia. he has an affinity for the region. really wanting to have more independence. emily: what do you make of yet another high-profile executive leaving softbank? his predecessor was also a big personality. then you have these folks in the vision fund, many partners who have left. what do you make of the revolving door?

tom: as you said, very big personalities at softbank and they are running lots of money. they have a lot of responsibilities and there are some big egos. i don't think i am seeing anything controversial in that. when you get those people around the table together, you are inevitably going to have disagreements. add -- to the mix. it's not an environment where they are sitting around singing kumbaya. strong personalities, lots of responsibility managing lots of money making big decisions and they haven't been able to create an environment where these big personalities consider around the table and get along well. it's the kind of thing that he is going to have to get his arms around eventually. you have to think, if they're going to continue to make these monumental decisions, these big investments in big companies and

working to turn them around. emily: any ideas what he's good to be up to next? tom: he is been pushing for a long time for this independent investment fund. you go and work for another one, do you take the latin american funds with you? the sense is he wants to have his own shop, to be the guy in charge. he wants to manage big amounts of money possibly in latin america. we don't know exactly where he's going to land. we know he's planning to leave, we don't know exactly when that is going to happen. we understand there are still negotiations underway. we are going to be working really hard to be the first to report it here on bloomberg. emily: thank you for the update. coming, shares of netflix jumping after the announcement of a huge new stake.

netflix looks globally for new subscribers. that's next, this is bloomberg. ♪

emily: in the race to global streaming domination, netflix has invested more than $1 billion to create original korean content with the hope of re-creating the success of squid game. the ultimate goal is to win over the rest of asia including thailand and taiwan. >> netflix is korean shows are

hugely popular around the world. the popularity of the shows helps netflix generate 366 million u.s. dollars in 2020 which is a huge increase from the level 2019. some of the shows include kingdom which is the first korean original for netflix and remains one of the most popular shows around the world and of course we have squid game which became netflix's biggest show ever in just a month after its release in september. it generated about 900 million u.s. dollars in value and attracted over 111 million viewers around the world. then, there is hell bound which is widely popular. it figured in netflix is top 10 show list and over 19 countries.

netflix started pretty small in korea. there was a time in 2016 one netflix just entered korea. mainstream broadcasters are unwilling to license shows to netflix, but at that time there were many opportunities for mainstream broadcasters who were bound by taboos and rules on what can be shown and what cannot be shown on tv. there were a lot of good things lying around in the market and that allowed for netflix zoning in these scripts and they often feature violets, sex, and unconventional topics like politics and social inequality. netflix has invested over one billion u.s. dollars in creating korea original content and they are creating more original create -- korean shows in 2022. netflix strategy is really go

original and local. they have to hold down their investment in other asian countries for example thailand and taiwan and india where they are creating a lot of local language shows. they're also utilizing some of the universally popular content for example korean content and japanese anime. they have invested a lot in these types of content as well because they have attracted a lot of viewers across asia no matter what culture and what country. emily: i want to stay on netflix which got a big boost thanks to the hedge fund pershing square purchasing 3 million shares of the streaming service. confirming he is now among netflix's tohareers. for more i am joined by lucas shaw. what do you think about this investment and how much input

will he have? lucas: it amounted to a big vote of confidence from an investor. his letter made it clear that he believes in the company, in the streaming business model. after a week of netflix shares getting stranded on the market, you saw them pop back up today. i don't sense he will have a ton of say. he is a top 20 investor, not a top 10 or top five. when i reached out to netflix, it didn't seem like there had been a lot of conversation between him and leadership. that may change in the future. emily: how does netflix whether this bumper in the -- bump in the road and is asia going to be the savior? lucas: the message from the

company and from everyone i have spoken with is to continue what we are doing. they issued a forecast for the quarter that was not received favorably, but they continue to believe in the long-term strategy. netflix leaders don't get swayed much by the stock prices going up or down. navy to slow down lasts for many months or years, they will start to change, i think they will continue making shows that people want to watch. asia is clothing the most region -- important region for that. it has been europe, middle east, africa, then asia-pacific that have been the important regions. they have had a lot of success in south korea and to some extent in japan. a lot of the markets left for them tend to be poorer and don't have the same local content industries so i'll be curious how netflix does in a place like india where they said they are

frustrated with their performance thus far. emily: i have to ask you about the spotify story. the neil young joe rogan debacle. spotify elected to keep joe rogan on the platform. how serious is this? lucas: i have yet to see any evidence that this is a real problem for spotify. neil young has been in iconoclast. a few years ago, he took his music off because he didn't think his -- their music was high enough quality. if you see a bunch of artists line up behind him and expressed concern, then it becomes a real crisis. as far as the #delete spotify, i haven't heard anything from people at the company to suggest it has had a massive impact just yet. emily: even before this, spotify

shares were in the process of taking a leg down. why is that? lucas: i think there's a growing concern that their big bet on podcasting isn't going to pan out as well as people had hoped. spotify spent all this money buying podcast studios shows and the reason it is standing behind joe rogan is because he is far and away the best investment they have made. the studios they have bought have not produced a lot of new hits and it hasn't led to a material change in new customers which is why you have seen the cut -- the company change its strategy. when they started in podcasting, they thought it might bring in new subscribers. they thought it might help make them more profitable. now, they are talking a lot about advertising which is a different model. emily: we will be watching to see how this plays out. thank you as always for your insight. coming up, tomorrow on bloomberg

technology it is an anniversary robinhood does not want to remember. one year on from the gamestop drama. that does it for this edition of bloomberg technology. stay tuned for more coverage of apple and robinhood coming up next on bloomberg television. ♪

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paul: good morning. shery: asian stocks look to recover losses. treasury steady while the dollar jumps. trouble at the top of