>> from the heart of where innovation, money, and power collide in silicon valley and beyond, this is "bloomberg technology" with caroline hyde and ed ludlow. ♪ caroline: live from new york, i'm caroline hyde. >> i'm jackie davalos in san francisco. this is "bloomberg technology ." caroline: apple in the geopolitical crosshairs. alphabet shares tumble after posting slower growth in its cloud business, and a $75 billion expenditure commitment. amd falls on a disappointing outlook for its chip growth.

that and so many more earnings coming up but first we check on the markets. perhaps a macro perspective on the nasdaq but more broadly tech earnings off a 10th of a percent after yesterday's rally. i want to shine a light of what is happening with alphabet. 75 billion dollars to expand ai and data centers but still people want to see the return on ai. amd, we need return on ai here too. down 9%. apple off by 1.3%. a key issue here is china and the u.s. and a potential antitrust probe coming from china regarding its app store. let's get to it. the timing here is of course amid this tit for tat with u.s. and china and tariffs, but this started before trump came to office. >> that is exactly right. what we heard from sources is that beijing regulators are looking at apple and

specifically the policies around its app store. it takes a 30% cut of apple revenue like it does in other countries -- app revenue like it does in other countries and it locks down payment systems because it wanted to make the payments through the apple system. they have called it executives from the company and other executives to find out more information. now the ball is in apple's court to respond in some sort of way and see whether they are able to address this or regulators will have to take more action. to be fair, this is the same kind of action apple has faced in other countries where there are concerns about the app store, how much money it takes away from developers, and whether that is actually a level playing field for other companies. jackie: one of the outstanding questions is, is this a bit more bark than bite? what is the time horizon? a lot of these probes take time to play out. do you have a sense of how long it will take to play out?

peter: that is a very good question. this is coming of course in the middle of this geopolitical tit for tat between the united states and china. the u.s. levied 10% tariffs on chinese imports and china has responded with more careful targeted things including an investigation into google, which has a similar app store issue. does not have that many operations in the country beyond that. i think politics will play a role here. we will see how that plays into the negotiations with these companies. beijing has a very forceful regulatory arm if they decide to take action against apple, google. they are investigating nvidia as well. it can be punitive for those companies but it may have to do with the image between the two countries rather than the companies themselves. jackie: we thank you. off a -- alphabet shares dropping after earnings yesterday. for more on this, we are joined

by our guest from jeffries. brent, what we look at google, alphabets cloud sales lag by 2%. this was behind estimates -- sales lagged by 2%. this was behind estimates. what is driving the decline for google specifically? because the microsoft store i was a little bit different there. >> the common thread is google and microsoft are indicating slower growth. now, i want to be clear, growth went to 35. this last quarter, everyone is concerned about the magnets. growth in q4 is still up for the front half of the year so it is not like things are falling out of the sky. even for microsoft, they had below 30% growth. they wanted to see mid-30's and

did not see that acceleration and took it off the table. we are still talking 30% growth across both companies. and we are at the beginning of the ai change. i would be careful to look at one quarter and say it is a massive trend. the trend has actually been pretty healthy. i think the other thing is you kind of have this bug zapper light with ai. everyone gets attracted to this light over here and says ai and then they forget about the core workloads. microsoft highlighted their ai piece was strong. the non-ai piece was a little weaker. i think part of this is we are on a journey. we are at the beginning of the journey. there will be some barking dogs that cross the path on the way you have to navigate. it is not like a straight line up. but ultimately, it is pretty good. caroline: but just on the pretty good thing, can i ask about the $75 billion capex?

brent: 100%, you should be committing. the question everybody is asking every company, when you ask the companies this question, microsoft will say, do you want us to get 5% market share or 50%? one of the biggest tectonic shifts. every board in america globally. we are talking about china taking down $1 trillion in market cap last monday. do you want to be involved or not? it is a price to admission. so this is very clear that the time to spend is now and not in 4, 5, six quarters. caroline: to your point, what happened last monday, the takedown, and we heard about deepseek. >> there has been a lot of observations on deepseek. first of all, tremendous team.

i think they have done very good work. i would say both are 2.0 flash models or flash thinking models. they are some of the most efficient models out there, including comparing to deepseek. caroline: from your perspective, this alphabet -- is alphabet able to compete? brent: yeah. the china training thing is nonsense. it is nonsense. we have to get that off the table. the technology is there but the train running $6 million is nonsense. we have software companies using 25 llm's. intuit using 10. these will be commoditized and deepseek will have a place. you open a garage door with one button and your iphone with another button. there will be multiple buttons. it is not just one. we think ultimately the blick

platforms with the users and n data win. google has a lot of data and great technology. this is why meta is doing so well and will perform well with llama. we are a believer that better ai efficiency will come, but it is not coming at the pace that the market thinks with deepseek. it is not. look at the capex numbers. they raised it by $25 billion. these are smart companies. they don't want to waste shareholder money. they have a lot of employees that work there because they get paid in stock. they would not do this if they felt like it is so efficient. why would you jack up the numbers as much as they have? i think everyone is being misled by one comment from a chinese firm that you can validate the spend. jackie: i'm curious if you can

speak to maybe shifting back to google's bread and butter, search, youtube, and bring in the artificial intelligence picture. while we are seeing some of this still come out on the cloud side, what sort of benefit are the investors pricing in on the youtube and search side? what ai mused are you expecting there in the next couple quarters? brent: no one is pressing in anything today, so obviously stocks are big on this minor miss if you will, but ultimately, we think ai will have a huge role. you look at gemini. i have been using it every day, and over time, gemini will get smarter, and i think there is a role of course search. i looking for a restaurant, the hours of a local small business i need to visit, to i need to get an answer of what the population is of iceland. i want to ask gemini and get a

quick response from gemini. these things will effectively melt together so it will be a seamless experience. i think google can do this. there will be times when you see an ad. sometimes you won't. well that -- will that force users to run away? i don't think so. look at youtube. capex is up massively. meta, microsoft, everyone else is doing the same thing. you have to do it right now. this ai journey will take time. it will be a long journey, and we are at the beginning of it. caroline: well said. alphabet coming down from record highs yesterday as well. so good to catch up with you. thank you very much. coming up, amd disappointing with its earnings outlook.

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caroline: shares of amd tumbling today after the chipmaker left investors with a disappointing outlook for its ai data center business, saying they see strong double-digit growth. investors don't just want double-digit growth, they want a doubling of ai business, right?

>> they want a lot, caroline, that is for sure. and what they overlook is what is going on with the rest of the business. look at how much share amd has taken from intel. the data center business has nearly doubled 2024 over 2023. the pc client business is up 50% for the whole year. they have done a tremendous job of taking advantage of intel's problems, but doing it by being able to develop superior chips of its own. jackie: you are right. they are not getting a ton of credit for that revenue beat, doubling their other unit. i am curious if you can speak to what they said about that estimate miss on the data center unit, and what does it say about amd's standing in the ai ecosystem broadly? joanne: the problem they had with their report is their entry into the ai side of data centers

is something that is a little bit slower to rollout than people were hoping, and expectations were high heading into the corridor, so this new chip that is expected to really push amd into this business more securely, and they have only just started rolling out this whole line of chips, that new chip, the 350 is not expected to ramp in the second half of this year. consequently, their guidance was softer than expected for the data center. that is not take anything away from the core data center business, which continues to grow, but we are in a seasonally weekly quarter for pc's and with a less of a ramp on the new chips scum of gross margin takes a bit of a hip. the gross margin is everything so whatever you see a decline in the gross margin, expectations or outlook relative to expectations, typically stocks go down, but more importantly, their second-half outlook for this ramp remains intact. it has just become a little bit

of a wait and see game. shorter term investors don't anticipate that well and get out of the stock and say they will get back in later. for long-term investors, it becomes a ride this out woman. you don't know when sentiment is going to change. look and say it is coming in the second half. that is july. abi should start buying it in march or maybe i better get ahead of that and buy it later this month so it is hard to time this thing. we have to rely on the fundamentals that are good. jackie: speaking of the short-term disruptions, deepseek came up on the earnings call. was surprised to hear the ceo projected a tone of confidence that they could benefit from some of these algorithmic breakthroughs. i am curious if you can explain how amd and perhaps even qualcomm's foothold in edge devices like phones make it better positioned perhaps to handle some of the disruptions coming from a deepseek or models like it as opposed to a nvidia

that really saw its shares tangk in the way of that. joanne: the deepseek innovation news was surprising because they were able to achieve efficiency potentially more quickly than folks had imagined, but efficiency is always something that comes to this space. chips get smaller, faster, cheaper over time but that never led folks to buy fewer chips. same thing here. the models become cheaper and more efficient over time but that does not mean folks will step away from buying the best chips they can. amd, qualcomm have more of a focus on the inference side of this. that is the use of the models, and that is where greater efficiency will be more use and that is what they are focused on. more use is good for them. it will mean more chips will be needed to rollout is applications. so if the market shifts from training chips where you absolutely have to have the highest quality most powerful nvidia chips over to the side where there are different

components like memory and speed , that plays into their strengths. caroline: and we have qualcomm after the bell today. joanne: absolutely. arm is more diversified, more diffuse in their exposure. certainly play a role in a lot of the chips that go into the ai infrastructure but also are more heavily leading to smart phones a broadway. qualcomm more smartphone oriented but fortunately for them, the smartphones they go into tend to go to the higher end consumer and that is an area that continues to be strong, so we own qualcomm and have owned it for a long time for clients. we like their growth potential and the income with their pretty solid dividend. jackie: lots to see today after the bell. thank you. coming up we will tell you what video game maker electronic arts says it plans to do to get its revenue back on track. this is bloomberg. ♪

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jackie: electronic arts cut its full-year revenue outlook yesterday following a decline in the company's third-quarter sales. for more on what we learned, we are joined by jason fryer. jason, this stirred up concerns among investors that ea games can continue to squeeze growth from its tentpole soccer franchise games. it accounts for a big slice of its overall revenues. what did you learn from the earnings call about how the company plans to turn this around? >> yeah, so it was an interesting call last night. ea had already reported preliminary results a few weeks ago and taking a bath in the stock for good a result, they are down 20%.

they had a slight gain overnight partially because they said they were buying back $1 billion in stock. yeah, they are looking at the soccer franchise that is their big money maker, i believe something like 74%, 75% of ea's revenue in their business is now from live service, meaning not just selling a game on a store shelf but also recurring revenue, getting players to buy stuff with in the game after it launches. the soccer game is a big part of that. this disappointing quarter is with the soccer game not having the long-term revenues they hoped for. caroline: bloomberg user acquisition, and then they turned their attention to battlefield. and a calendar date there. jason: looks like they are planning on releasing the new battlefield at some point this coming fiscal year so before april of next year.

this one has been a little while in the making. it has been a wild since ea's most recent battlefield game. battlefield has never been able to keep up with the biggest rival call of duty from activision blizzard, so it will be interesting to see how they perform this time. they i believe for the first time have four different studios within the eea organization working on this single battlefield game so it is a humongous bet for them. jackie: one of the company's challenges right now is to get users to play the updated version of the game but they are still interested in playing the older version of the game. how does the company typically deal with something like that? jason: this is the eternal videogame industry problem right now, which as you have so many people who do not feel compelled to buy new games every year when they can have a good time playing older games, playing fortnite or a previous iteration of the sports game. traditionally a company like ea has been able to get people to

keep buying new releases because of roster updates and slight feature enhancements. in the case of the soccer games formerly called fifa and now ea sports fc, one of the biggest investments is this ultimate team mode where players have to buy these loot boxes or card packs that give them randomly generated players and it is this whole big ecosystem a lot of people criticized for feeling a whole lot like gambling. ea has said the most recent entry is a little bit unbalanced. players did not like a lot of things about it. they are helping a big update they just released a couple weeks ago will fix things and get people back on track. caroline: jason, thank you so much for the update on ea. uber shares falling. mandeep singh is in the house. you are more worried about

broader deceleration from ultimately monthly use growth. mandeep: i think when you look at their three-year target of mid to high teens, what could kind of get them there? it has to be the mobility segment. that is the core business. the delivery side is not that profitable still when you compare them to doordash. all the mobility side, everyone is worried about waymo rolling out to 10 more cities. granted, the number of rides is a fraction. only in two cities is there a relationship good it is not a relationship that spreads across all the cities and that is what investors are worried about getting if tesla is to come this year and get all the regulatory approvals they need, you can make the case that mobility growth will slow down. doordash has partnered with lyft now so i will say lyft should benefit. all of those factors weigh on

the user growth. it is hard to make a case that the right frequency will grow given waymo is expanding in all of these cities. jackie: uber shredded at self-driving car business years ago. what is the strategy today? mandeep: they mentioned they will be looking for the right acquisitions, and they don't want to spend too much in terms of making an acquisition, but it is pretty obvious they will be looking to add their own technology. jackie: bloomberg intelligence analyst mandeep singh, we thank you. business stock gets an f from its streaming strength. we hear from cfo hugh johnston next. this is bloomberg. ♪

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caroline: welcome back to "bloomberg technology." i am caroline hyde in new york. quick check on these markets first. some news on the political front. pam bondi is being sworn in as attorney general. the market is trying to digest implications of service numbers and big tech on deck with the earnings not living up to expectations. we are up to a quarter of a percent. digging into individual stories, i want to shine a light on a slightly political story which is tesla. the numbers out of germany, horrific. down 60% in terms of january. we are seeing similar trends we saw in france in january as well. all of this pointing as to whether or not there is an implication of a slower rollout

of new models or what elon musk means to the brand. disney did particularly well in streaming. they're still seeing the mona 2 effect building up what is happening. entertainment was flat. let's look at what the c.f.o. was talking about. we sates down with the c.f.o. earlier this morning. here is what he said about streaming strength. >> the streaming business is doing extremely well. this is a business we invested pretty heavily in a couple of years ago. what you are seeing now is the benefit of those investments. our expectation is we will continue to grow, subs will improve margins. we should make more than $1 million this year and next year double digit margins in that business. serge a ton of positive momentum. you get into the question of why a lot of it is the great content that's coming from the studio side of the house. both on the tv and the movie side of our entertainment

business. moana2, inside out 2, dead pool, on the tv side the combination of abbott elementary, shogun and high potential causing viewership to grow. we are seeing higher engagement, seeing turn coming down. we feel like the streaming business will be one of the big drivers for our company going forward. >> you know how much i love shogun. lisa, i loved moana2 as well. i did want to talk about the cost issue. i appreciate the explanation. conversation we have had over the last few days or so is if we get tariffs, can companies pass on the cost? i would like to know from your perspective, the additional tariffs gone on to china how that could impact your business. how are you thinking about things? >> right now based on what's been proposed -- obviously this is a rapidly evolving environment so we will react as we learn things -- the impact

would be imperial material to us. the walt disney company will be fine based on what is on the table. caroline: that was the disney c.f.o. hugh johnston. >> joining us now is ross gerber, c.e.o. of gerber kawasaki. one of the things that stood out is not just the quarterly profits beat but that positive performance might have a few drivers here and the thing that stood out to me is that price hike from the fall. i want to know how much of that profit came from that hike price or versus organic customer growth? what are you seeing? ross: we didn't see a huge amount of organic growth in customers and that was part of the strategy making streaming profitable by charging the right amount for the content. but what they proved is that they could jam a big price hike into the system and not lose subscribers by a meaningful amount. and therefore increase profitability. when you look at exactly what

the c.f.o. said, enormous amount of money they've invested in streaming to now see it become a very profitable business with double digit margins that was always our hope for disney. disney is a top holding in my fund, g.k., and the stock is wildly undervalued when you compare it to netflix which is the top holding in my fund. netflix is killing it, but it's really a two-horse streaming race between disney and netflix. caroline: bob iger is talking about how he is pleased with the numbers, the fact you didn't see more churn, but what about the growth story to the likes of entertainment. you want to see streaming being a real pillar but we have broader entertainment, tv and cable. ross: well, the big thing about linear tv dying and that's not going to change, but what it really is about is good content. that's the iger effect is real and we are seeing the benefits

of having iger back at the helm. the content has improved dramatically. that drives results. it drives it in the theater and on to the streamer. i am waiting for it to drop on disney+. people want to watch these successful movies on the streamers for the next 10 years. so disney's experiences division, the parks and they made a lot of investments and they have the storm, that hurt earnings a little bit. but with the new cruiseships coming out, this business is a gold mine. if you look at disney's cash flow, it's a wonderful business at a really decent price. we are very bullish on disney's future. caroline: what about the future of the c.e.o.? ross: well, iger is a young 70-year-old, whatever, i hope he stays forever and disney has a long history of having c.e.o.'s that keep saying they're going to retire and don't retire.

ultimately they should drive the industry toward the digital part of the business or maybe a co-c.e.o. where you have like what netflix has done. the businesses are huge and different. we need somebody who can really drive creativity because that's what drives disney's earnings. >> ross, let's pivot, shift gears to another game or another name that you cover, tesla. no pun intended there. gerber kawasaki holdings peaked in 2018. they've come down quite a bit. what do you make of elon musk's growing side project with doge and role in government? at what point do you think you'll pare back if his attention continues to be diverted there? ross: there are a lot of things to unpack with tesla. his full-time job is at the government. so we all know he doesn't really work at tesla. that's not so bad because many of the people at tesla are fine

with that because he is quite disruptive. that said, the goals for tesla are quite immense and they have very little time to achieve them based off the timelines they've set out. tesla has a lot of issues that they have to deal with especially from a marketing perspective as well because the numbers in europe, so we have been a seller of tesla over the years because we had such an overweight position because we made so much money in tesla from 2018 to today. so we still own tesla because it's the most impactful company for climate change in the world and that's a theme that we very much believe in. they make the best e.v.'s and if they focus on their core business and really stopped all the political noise, i think tesla would be fine. it's a really difficult stock to own and we still own it. it's not a big position, but it doubled in value. so we have been taking profits again. >> ross, to your point about the

climate change opportunity, does that still exist in a trump administration where perhaps it's not as prioritized as it was previously? ross: well, i can tell you because i just fought the fires myself in the palisades, when you are looking at 70-foot flames burning up a city in one night or hurricanes in florida horry dick will yously cold weather or whatever you want to look at, climate change is not a political issue. it's a real issue that all of us in the world are facing whether we like it or not. i have seen a firsthand. mother nature does not want us here anymore. we need solutions, real badly. tesla is the best solution for climate change between battery storage, charging and the e.v. business. people will buy e.v.'s because they're better cars, they're a bitter -- better value and it's good for the environment. in business is growing globally and every carmaker is making great e.v.'s. that was the goal of tesla. we have been successful but this trend towards e.v.'s is not going away because of politics.

caroline: for what you have been fighting over the course of the month in l.a. i want to go back to what you said in europe because i mentioned earlier the numbers out of germany are astonishing down 60% in terms of sales. france down 60%. is europe feeling the impact of elon more than the u.s. or is this a lack of a lineup? ross: no, this is 100% politics. when you go into germany and you start supporting the right wing almost like nazi party of germany, you will get a lot of germans not -- remember, europeans are very conscious people. they pay a lot of attention to things that are important, whether it be the quality of their food or water. and also they care about climate. but win push comes to shove, elon's agenda is a direct affront to the direction of europe. europeans are voting with their dollars. they're not going to buy teslas because they know they can buy other e.v.'s that are just as

good. we are just starting to see this. it's happening in california as well. this is a big problem for tesla long term and i am really concerned they're going to be unable to grow sales moving forward with the current, i would say, anti-marketing campaign of elon. caroline: you mening the far right party in germany which in many ways musk has led to support to. bringing it back to what the company needs to do fundamentally, it doesn't matter, the numbers didn't live up to expectations. we have got following robo tacks on the ground but the market still pushed the stock higher. is it completely disassociated with fundamentals at this point? ross: well, we look at it as the fundamentals of the business to work about $200 and the rest of the stock price is hope premium based off robotics and a.i. which are legitimate opportunities for tesla. so i don't want to pooh-pooh them but i live in santa monica and every day i drive there's

wamo's doing well. they're driving perfectly, taking rides from uber. we will see this in uber's numbers which we now don't own uber because i think waymo is a wonderful opportunity for investors and it's way better driving than tesla. i would say with the decline in google today, that's an opportunity for investors because that's a reasonably priced stock with things like waymo that could be worth a ton of money in the future. they're launching in austin, it's almost like spitting in musk's face as he is pitching a robo taxi that doesn't work and waymo is successfully rolling out robo-taxis. this is a real competitor. caroline: we getting outlines frommal fa alphabet over how many rides. ross, great to catch up with you. thank you. coming up we will be joined by sarah guo of conviction. we will be discussing the state of a.i. investing. that's coming up next. this is "bloomberg technology."

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caroline: this is "bloomberg technology." you are looking at a little shot of the principal room. find it online on apple and spotify. this is bloomberg. caroline: time now for talking tech. first up, work day is cutting 8% of its work force. in a note to employees, the c.e.o. said workers will be let go as the company focuses on durable growth. he goes on to say the company intends it hire for areas such as a.i. and plans to take on more people overseas. plus, oklahoma set to become the first republican state to challenge corporate america's d.e.i. poll is sis as an investor. the oklahoma treasurer plans to submit proposals to six

companies including amazon in an effort to promote "political neutrality and challenge corporate donations to organizations that advocate for leggett leggett -- lgbtq rights. sam hartman called india the most important market. the comments come as altman makes a stop in new delhi meeting with officials. it's the latest pitch on his worldwide tour, that included japan, south korea. >> keep talking about the global a.i. race with sarah guo, the founder of conviction, a venture firm focused on a.i. native companies. sarah, it's been over two years since you founded conviction. just a month before chat gpt really took the world by storm and you wasted no time getting to the table in some of the most promising a.i. start-ups. but i want to know what's changed in the a.i. landscape from your perspective as a venture capital investor since

you launched? a.i. has come a long way. sarah: yeah. when we launched, we had this very strong belief that a.i. would be a decade-plus shift, the most important shift in technology we were likely to see in our lifetimes. we made early bets that application companies and companies that invested vertically up add down the stack would create a lot of value. i think that is even more true now and the myth of the g.p.t. wrapper has been brushed away. one of the major developments over the last few weeks that everyone has been paying attention to is of course a more and more competitive foundation model landscape. >> that's right. you were tweeting about deepseek in december before the world freaked out just last month. but we also had another venture capital investor on the show last week, who called it a grave national security threat. i would love to get your thoughts on the strength of that

model, what it means for a.i. start-ups competing in this space, and do you agree with that statement? is it a national security threat? sarah: let's take the first part first. it's an incredibly useful model, and considered on many capability tests as state-of-the-art. i think what was really interesting about it is that deepseek as a company released a base model, which you can think of as pretraining. then an instruction tuned model, which is a set of work that allows the model to be more helpful to respond in a chat interface. and a reasoning model which is parallel to, for example, open a.i.'s 01 model. you have an open option albeit one from a chinese hedge funds. i think that was quite surprising to the word and quite democratizing to have that force of open source from meta, from

deepseek now. whether it serves as a push for the u.s. to get more competitive on this incredibly important industry front of being first in the race to a.i. -- stronger a.i. technologies remains to be seen, but it is clear that export controls are not proof and no country has a monopoly on a.i. talent. caroline: let's go into how it changes the game in terms of the valuation stack because you are in the large model layer with a small occasion towards a trial but you are in the application lair of the models. how do you think the money will flow ultimately? sarah: one of our core beliefs is that a.i. makes the pie bigger and you can think about it as the stack, as you describe. infrastructure, tooling, model companies, application companies and those that are verticalized. but we are much more interested in application companies and

verticalized companies to date, and part of it is seeing the landscape play out. it's been a very expensive game to play despite deepseek's claims around a $6 million training run, that vastly underprices the cost of experimentation. and all of the infrastructure that was used in for example post-training as well. it's still a very expensive game to play. i think in terps of economic -- terms of economic opportunity of sort of the traditional venture capital gain being capital efficient growth, we think that is going to be most concentrated in the application layer. caroline: agents before that and brett taylor leading that business. taking on a sales force. is it going to come in the next year or so? sarah: it's a hard thing to define. one thing we are really excited about with companies like sierra and others is the more -- very

simply the more a.i. does for you, the more people will be willing to pay for it. so something like sierra it improves the customer experience especially for people are high value customers. so think of finance subscription, travel, etc. and i think as we see a.i. models get more capable beyond answering simple questions to completing tasks which is something that will take a lot of vertical specific work, we should expect these companies to be able to capture a lot of that value too. caroline: always great to have you on. you can tell you are a podcaster with your setup. we love it, sarah guo from conviction. coming up tech layoffs are back. we dive into amazon's work force and the effect it's having on morale. this is "bloomberg technology."

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>> amazon's effort to cut out middle management bloat is sending ripples throughout the company. with many employees fearing uncertainty and a lack of promotions. for more, bloomberg's spencer joins us now. amazon veterans are used to periods of belt tightening. what did you glean from employees about how the tactics this time around are different?

>> well, a lot of it is a sign of the times. employees historically within amazon when jeff bezos was c.e.o. would maybe try to figure out what he was excited about because they figured that was going to get a lot of money and investment and that would be a nice career path for them. the big difference with the new c.e.o., he is more disciplined. he doesn't chase as many moon shot projects. the money is less free flowing so the career plans for advancement are narrower. you layer on top of that, that amazon is trying out with the old, in with the new in terms of a reduction in management, replace more senior workers with lower level employees, and it's kind of rippling through morale. >> particularly at a time where other giants in tech are laying off, sales force, it's a difficult market. but investors want to see this belt tightening. we look at the earnings for shares expectations for

thursday. >> yes, so they've had the past six quarters i believe of increasing profits, and they're expecting the same when they report tomorrow. that's the thing. he has been pleasing wall street, but making the work force unhappy. that's a calculatedded move. like you mentioned with the layoffs, you can work your work force higher, make promotions more scant when they have fewer opportunities with other companies elsewhere. so that's the calculated gamble they have is we can lean on folks a little harder for the sake that they have less opportunities to leave us. caroline: we build into these earnings later in the week. thank you. meanwhile that does it for this edition of "bloomberg technology." don't forget to check out our podcast you can find online on apple and spotify. don't forget about the earnings coming after the ball, qualcomm, throughout the afternoon. from new york, from san francisco, where it's a little rainy, this is "bloomberg technology." ♪

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scarlet: welcome to bloomberg markets. coming up, and exclusive conversation with jim chanos. we will discuss trumponomics and shortselling. first, a quick check on her markets are trading. isabel: the nasdaq has just rebounded after spending most of the day languishing in the red. the reason is the bloomberg magnificent seven index, the biggest top seven index in the nasdaq 100. they were floundering, down by 0.2 percent. look at ishares. this is a blackrock etf i am looking at.