Chapter 1: What is the main topic discussed in this episode?
Hello, I'm Stephen Carroll. I'm in Brussels, where many of Europe's biggest decisions get made.
And I'm Caroline Hepke in London. We're the hosts of the Bloomberg Daybreak Europe podcast.
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Chapter 2: What are the concerns raised by Anthropic's new AI model?
And, you know, the stock obviously started pretty weak on some of the AI concerns. But I think what we've seen is they continue to sign the A-list talent in AI. Meta, Anthropic, they have Microsoft, Google. They are the luxury AI builder to the stars.
Luxury. Luxury being that they offer NVIDIA compute in particular, Bren, or how are we seeing that being diversified at this moment?
Yeah, they're the luxury builder, and they basically help assemble what is required for these systems to work. It doesn't matter the ingredients. They'll take whatever you want, whether you want a steak dinner, salmon dinner, vegan, whatever. They will assemble according to your needs.
And when you have the best data center builders in the world turning to CoreWeave, it's a pretty strong signal.
And what I'd say is that none of these companies can build the infrastructure on their own. Microsoft said in their last earnings call, they don't have enough physical buildings to put the compute in.
And everyone is saying this from the AI conference this week in San Francisco. There's not enough compute. And that's why semis are going straight up and software is going straight down because CapEx continues to explode. Yeah, is the ROI pushed out? Perhaps, but Corweave's going to be caught up into this in the next few years.
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Chapter 3: What is the significance of the Artemis II mission?
And you say it's been volatile and it hasn't been straight up and the volatility has come about how it affords. At the moment, we saw some volatile trading just yesterday because when they announced the Meta deal, they also talked about selling more convertible debt and the idea that they have to finance the revenue growth. How are you getting comfortable with that with Corweave?
Well, in our math, they have something like $90 billion of backlog. And these customers are minimum five-year deals. They commit a certain amount up front. They just raise capital at a lower cost of capital than they've raised because they're getting these from some of the best companies in the world.
They're not signing up Sally or Joe's data center infrastructure down the road. They're signing up metagoogle.com. You know, Microsoft, the top companies in the world that have ginormous cash flow and have no funding concerns.
And again, I think the CEO has said this repeatedly, Michael, which is, you know, these are contracted, committed contracts that are legally stamped that they can't turn back on. And so, you know, look, the long term question of what does the margin look like and can they produce an incredible software like business like what Amazon and Azure did at Microsoft? That's the real question.
I think they're leaning that way. And if they do this. The stock could even go a lot higher. And right now we don't have proof that like that is completely off the ground and is flying with no turbulence. I think that's the direction. And if they pull this off, which is today, they build the infrastructure and then tomorrow they're building and capturing the software.
These workloads will not move and they will stay with them for a long time. So that's the real question. So I'd say tactically, in a really good spot, I think long term, we all have questions about what the model, what the business looks like. But when you have CapEx going up 70% for the industry, we're going to spend $700 billion.
And this company has, you know, a $50 to $60 billion market cap, and they have $90 billion contracted backlog. Plus, like, I think it pretty much tells you a signal like the stock's going higher. Yeah.
Talk to us about how Anthropic started the week, and it felt like a very long week, but if I cast our minds back, they were part of the Google and Broadcom announcement, and the idea that they're going to be using ever more TPUs, perhaps coming from Google, which are, of course, formed by Broadcom. How much of a need is there for Anthropic to get the compute right now?
Do you have any idea of which of the customers that are most in the need and know right now? Because there's some reporting out there that maybe Mythos is being rolled out slowly, because these new models have to be rolled out slowly. because there isn't the compute to satisfy all our needs. Well, Anthropic, we've never seen a company get to $30 billion this fast, right?
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Chapter 4: Why were Wall Street CEOs summoned for an urgent meeting?
They keep throttling users. They keep trying to get you to pay more. They've told you you've reached... We've heard repeatedly that, you know, again, there was a big article that you guys wrote on Amy Hood stalling data center build out at Microsoft and how, you know, she hasn't publicly said this, but how they regret it.
And they wish they had built more and they just the last quarter, they don't have enough physical buildings. Right now, the demand is so great, and it's coming from all angles. You look at Meta, Microsoft, OpenAI, Anthropic, even Oracle.
We've heard they aren't as price aggressive, and they're not price aggressive because they don't have to be because there's really no demand, and so they can charge whatever they want. You're seeing signals everywhere.
Again, I think this is why my group I cover is software is going straight down and why hardware and semis, memory, look at SanDisk, look at Bloom Energy, look at what's going on on all the picks and shovels of AI. We are nowhere near built out.
And if you believe the CEO of SoftBank that we're going to have half a trillion dollar data centers for AI, but we might have trillion dollar robotics data centers in the future. I mean, this... Again, I don't want to be like, these are big, big numbers, and we're really, really early in the build-out. I think the CEO at CoreWeave has been saying this.
I mean, I don't think Microsoft has said this repeatedly. They sit down and their hair is on fire, and literally they cannot keep up with what they're doing every single day because the customers are demanding this.
And you see it in the revenue numbers from all the AI stories that we're covering.
Brent, thank you. You always spell it out so clearly for us. Have a good weekend. Brent Thill of Jefferies there. And stay with Bloomberg Tech. We've got CallWeave coming on. Michael and Trader joins in less than 30 minutes time in New York. Coming up, plenty more to dig in on the AI trade. TSMC sales surging 35%. That's even as Middle East tensions persist.
However, Asian stocks today extend their slide and that's a software issue. Brent was just talking about it. This is Bloomberg Tech. AI remains a tale of two markets. Let's talk about that. With TSMC, for example, hardware, defying Middle East volatility with a 35% revenue increase.
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Chapter 5: How is CoreWeave collaborating with Anthropic and Meta?
That's what our role is we do. Michael, I'm fascinated by the global perspective you have here, because the geopolitical environment that we live in at the moment means that energy prices are driving up, particularly over in Europe and the UK.
OpenAI, we have reporting that they're pulling back on their Stargate project in the UK because energy is getting too expensive, and yet they're going out to their investors and saying, look, we're ahead of the game, we're ahead of Anthropic because of our compute that we have. What are you seeing in terms of people trying to rearrange where their compute is accessed from?
Yeah, look, you know, the way I kind of view it, my background really is within the commodity space, is that people are going to be very thoughtful about managing the cost of delivering infrastructure. And some of that is going to come from the energy side.
It's going to be, hey, where can we get electrons that are effectively priced so that we can continue to drive our company?
But it's also going to come from places like CoreWeave, where our software and the yield on the compute that we build is just higher than other alternatives because of the quality of the software environment that we built. And so you're seeing both sides of that coin really being driven and you're seeing the success
of our infrastructure and the adoption of our infrastructure because of the part that we can impact. And so we look at the different energy markets, we place our infrastructure in lots of different places in order to mitigate localized risks, such as what's happening in Europe at the moment.
But we really do think that the part that we can directly control is the quality of the infrastructure we deliver. Would you pull back from the UK, Michael? No, no, we have no intention of pulling back from the UK. We are well positioned there. We have a great relationship with the energy companies, with the data centers, and with the broader economy over there.
And we absolutely will continue to build and expand our footprint in those jurisdictions. Michael and Treta, I always wish we had more time with you. Thank you. It's been a busy week. You need some rest. We appreciate it. CoreWeave CEO coming up. It's been a busy week for four NASA astronauts. They flew around the moon. Returning home may be the most dangerous part.
We'll discuss the expectations for Artemis 2, Splashdown. That's next. This is Bloomberg Tech.
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Chapter 6: How does the AI compute demand affect CoreWeave's growth?
But now it's going to go faster. So Artemis 3, we hope to launch in next year. So I expect you're going to hear very soon an announcement of crew, more specifics about the mission, which we've changed the mission profile from what was expected previously, in order in part to accelerate this and hopefully accelerate getting boots on the moon, which we hope will happen in 2028 on Artemis 4.
You're back in academia. What does these moments, I mean, I just think about my kids coming home from school every day at the moment with various art projects and things they've been doing around Artemis II. What has it done in terms of inspiring those that are studying under you, those that are now going to study under you? I think it's a great moment.
Apollo inspired a generation around the world to pursue innovation, to pursue technology, to ask hard questions and do things that we thought were impossible. I really hope we're going to have the same impact on this generation, the Artemis generation, and we're really seeing massive amounts of excitement. Not only from space geeks like us, but from from everybody that we talk to.
And so it's a great moment of opportunity for us in this country to continue to drive STEM learning and innovation. And Jared Eisenman, of course, the administrator, how important has NASA's focus been on this, to be bold, but also what about the money and what more is needed right now from the government? Right.
I do think Jared has been a real breath of fresh air coming in and trying to drive the agency to move faster, but do so smartly. I also know that he understands, based on personal experience, the risks involved in human spaceflight. And so we're going to fly when we're ready, but we need to... start moving things out of the way.
When I was director of JPL, I had this group I called the Snowplow Team, which is, can we get stuff out of the way for the technical folks who are trying to get us further, faster, and get things done? We've got to be the people that clear out that clutter. And I know that he's really committed to that. And it's great because NASA needs that. It's become a bit bureaucratic.
And it's great to have that breath of fresh air in Jared. Marge, your tenure, you were launching several new NASA missions. Laurie Leshin, it's always so great to have you on. Thank you so much. Former director of NASA Jet Propulsion Lab, currently the professor of Space Futures at Arizona State University. Now coming up, Apple.
It's permanently closing its first unionized store in the United States. We're on the next. This is Bloomberg Tech. Time now for Talking Tech, and first up, shares of China's ShareTronic data. They plummeted 20%. It's following US charges against Supermicro co-founder for allegedly smuggling Nvidia chips.
The company denies a relationship with Supermicro, but records show ShareTronic procured $92 million worth of Nvidia H100 and H200 processors, which have been banned from sale to and within China. Meanwhile, Nvidia-backed Lumentum said demand from the biggest US tech companies for its optical components is accelerating and would be sold out through all of 2028, later this year.
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