Broadcom Hits $1T Valuation, Bezos Looks For Trump Help | Bloomberg Technology

Broadcom's Trillion-Dollar Valuation and AI Boom

• Broadcom's valuation has surpassed $1 trillion after posting better-than-expected results, with shares up 19% near session highs (1m17s).
• Investors are optimistic about Broadcom's AI business, which is expected to grow 65% in the first part of the quarter, with the AI components market potentially reaching $90 billion by 2027 (1m41s).
• Broadcom's AI revenue grew 220% during the year, driven by demand for processors and components, while demand for non-AI chips is expected to decline in the first quarter (3m15s).
• Analysts believe that Broadcom's non-AI business will continue to shrink, with the AI business becoming the majority, and that investors should focus on the growth rates of the AI business (3m33s).

Broadcom's Acquisition Strategy and Intel's Potential Spin-off

• Broadcom has built its business through acquisitions, but the company has stated that it will focus on bringing down debt, although it is still looking for potential acquisition targets (4m20s).
• The company has acquired franchises and undervalued parts of the industry, making them lean and mean again, with recent acquisitions including VM, and potentially looking at companies like Intel (4m45s).
• Intel's CFO has stated that a formal separation of the factory and product development divisions is an open question, which may lead to a potential spin-off or acquisition, with Broadcom potentially being interested (5m29s).
• The manufacturing side of Intel is piling on losses, making an IPO unlikely, while the product side is healthier and may be of interest to companies like Qualcomm or Broadcom (6m45s).

The Impact of AI on the Chip Industry and Big Tech

• The growth of Broadcom's AI business justifies the extension of the rally, with the company announcing revenue growth of 220% for the AI business and looking for 65% growth revenue (7m53s).
• A boom in the AI business is projected in the next few years, with big tech companies building their own custom AI chips, which could lead to a change in scenery by 2025 (8m26s).
• Big tech companies, such as Amazon, are trying to build their own chips for cost efficiency, which could negatively impact NVIDIA's revenue, as they will have to replace these big tech companies with other customers (8m58s).
• Despite this, NVIDIA's worries about big tech companies slowing spending have not materialized yet, with TSMC's November numbers showing a 34% growth in sales, backing the narrative of robust AI demand for NVIDIA chips (9m57s).
• Broadcom is seen as a winner in this scenario, and AMD is also bullish due to its cost-efficient and affordable chips that could be used by sectors and companies that don't want premium chips but still want good chips for day-to-day tasks with AI (10m30s).

Beyond Chips: Other Potential Winners in the AI Revolution

• The exuberance around AI has focused on chip companies, but other winners could include clients who will get important efficiency and cost efficiency, as well as the energy sector, which may benefit from AI (11m21s).
• However, the energy sector's ability to benefit from AI is unclear, given the exponentially rising energy demand and the limitations of alternative energy sources, making nuclear power a potentially plausible option (11m33s).

Jeff Bezos and Project Kuiper's Challenges

• Jeff Bezos is looking to the Trump administration for help with his space ambitions, specifically with Project Kuiper, which aims to compete with Elon Musk's Starlink, despite past feuds (13m23s).
• Amazon's Project Kuiper has encountered delays in launching operational satellites, with a deadline to have over 1600 satellites operating by the middle of 2026, and is seeking an extension from the FCC (15m7s).
• Amazon is looking to new rockets from Blue Origin, Jeff Bezos' company, as well as United Launch Alliance, the joint venture between Boeing and Lockheed Martin, in addition to their contract with SpaceX to launch on three SpaceX rockets, which is a tiny part of their total launch needs (15m32s).
• The new rockets from Blue Origin, United Launch Alliance, and other companies have launched only three times and don't have a track record, making it a big challenge to get rockets up and going to a frequent launch schedule (16m9s).
• Elon Musk and President-elect Trump are close, with Musk spending $200 million to help get Trump elected, which could be bad for Bezos due to the history of run-ins between Trump and Bezos, who owns the Washington Post (16m45s).
• Recently, Bezos has made upbeat comments about the new administration, despite the past criticism from Trump and Amazon's allegations of unfair treatment by the DOD (17m17s).

Elon Musk's Starbase Ambitions

• Elon Musk is looking to transform Starbase into a new city, which is currently the location for building Starship rockets and has created 3000 jobs, but several steps need to occur before Starbase can be created as a new city, including permission from local authorities (17m28s).

Viam's AI-Powered Fan Experience Solution

• The New York Islanders are using AI from Viam to improve the fan experience, allowing fans to use an app to see how long it will take to get to the restroom and which bathroom has the shortest line (18m24s).
• Viam's technology uses existing security cameras and AI to analyze the feeds in real-time and push data to the app, requiring almost no additional hardware installation (20m5s).
• Viam's CEO and founder, Elliott Horowitz, aims to make it 10 times easier to bring physical devices to life and is focused on short-term wins and making practical things better every day (19m0s).
• Horowitz envisions a future where physical devices in the home, such as air conditioners, are smart and can be monitored and maintained more efficiently, with the potential to prevent breakdowns and improve user experiences (21m38s).
• Viam has raised $90 million and is always talking about raising more, with a focus on ambitious projects, including improving fan experiences, cleaning the oceans, and more (20m40s).

Tesla's Stock Surge and the Trump Administration's Influence

• Broadcom has reached a $1 trillion market cap for the first time, driven by a predicted boom in demand for its AI chip, with sales of AI expected to gain 65% and the addressable market for AI components reaching $90 billion by fiscal 2027 (23m33s).
• Shares of Tesla have almost doubled in value since the election, and the company's stock has reached a record high, with the Trump administration transition team considering scrapping an order that requires farm agents to report crashes involving self-driving systems (24m9s).
• Elon Musk has seen a significant increase in his net worth, surpassing $400 million, and remains the world's wealthiest person, with his influence looming large, including heading the newly created Department of Government Efficiency (27m4s).
• Funds that have placed big bets on Elon Musk, such as Roan Baron, have seen significant gains, with some funds soaring more than 500% since the election, driven by the price of the underlying assets and high demand from retail traders (25m14s).
• The rally in Tesla's stock is partly due to speculation about the company's close relationship with the President and the potential for favorable government contracts, with SpaceX having received several government contracts (26m7s).
• Tesla has added over $500 billion in value since the election, with the company continuing to score gains despite big companies struggling, and the rally is expected to continue if the Trump administration delivers on its promises of lenient regulations (26m50s).

The Crypto Market's Regulatory Landscape Under Trump

• The crypto market, particularly Bitcoin, has seen a significant run-up in recent months, driven by hopes of the Trump administration being more lenient on regulations, and the administration now needs to deliver on these expectations (27m37s).
• The Trump administration aims to make the United States the number one leader in cryptocurrency, which is a different narrative from the past four years, and this could be positive for crypto companies, especially centralized ones (27m45s).
• Paul Atkins is expected to become the SEC Chairman and Commissioner, which could bring clear guidelines for crypto companies, although it's still unclear what this means for decentralized finance, especially regarding kerosene sanctions (28m15s).
• The momentum in ETF influence is increasing, and there is a need for clear guidelines and regulations for the crypto industry (28m36s).
• David Sachs is spearheading the effort to create rules and regulations for the crypto industry, but there is a potential conflict of interest since he has invested in several crypto companies (28m51s).
• Some states, such as Texas, are considering making Bitcoin a reserve currency, and there will likely be checks and balances on the state and federal level to regulate the industry (29m23s).
• Brian is a top contender to lead the CFTC under President Trump, and he is expected to play a significant role in shaping crypto policy, with a focus on decentralized exchange platforms (29m48s).
• There is a risk that clear winners and losers could emerge in the crypto industry, depending on the guidelines and rules established, and access to the President's ear could be a factor (30m20s).
• In the event of a meltdown in the crypto industry, similar to the FTX collapse, it's possible that consumers could get burned, but this could also be due to personal and people management issues, rather than a lax regulatory environment (31m0s).
• The failure of many crypto firms and traditional financial companies, such as Credit Suisse, highlights the need for clear guidelines on operations, people management, and funds in financial companies, regardless of the industry (31m52s).
• The lack of clear guidelines creates confusion, but with clear guidelines, companies can operate effectively, even with less regulation, and hire the right people for compliance and operations (32m27s).
• Volumes in the crypto market have spiked, with yields over 5% on Bitcoin, 11% for majors, and 25% for altcoins, and lending rates for stablecoins averaging 16% (32m44s).

Archer's Expansion into the Defense Industry with Anduril

• Archer, an electric aircraft maker, has partnered with Anduril, a defense tech company, to expand its capabilities into the defense side of the industry (34m27s).
• The partnership aims to build a hybrid electric urban takeoff and landing aircraft with capabilities similar to those on the commercial side, but with lower costs and low coup stick signatures (34m42s).
• The US Department of Defense is looking for new capabilities, and Archer's affordable autonomous aircraft can bring new capabilities while dramatically lowering costs (35m7s).
• Archer has been working with the Department of Defense since 2021, but is now creating a separate defense division, which is partly due to the new administration and the opportunity to expand its business (35m25s).
• The company's platform allows it to build variants of its aircraft that can be useful across different applications, and the new administration provides an opportunity to dramatically expand its business (35m40s).
• The opportunity for Archer in the defense side is impressive, with new needs that the company can fill, and the company is looking to build the necessary infrastructure to support its defense business (35m59s).
• Adam discusses the benefits of vertical takeoff and landing aircraft, which do not require runways and can be utilized across many different applications, with limited infrastructure needed (36m18s).
• The air taxis will come to the U.S. as soon as the regulatory pathway is clear, and the new administration is expected to make it easier to get through some of the regulatory pathways (36m51s).
• Archer's goal is to have aircraft commercial by next year, with the starting point being the UAE, which has created a framework for them to get to market by the fourth quarter of next year (37m17s).
• The company is working closely with regulators and expects to see an increasing amount of excitement coming from the FAA as these products get a lot of hours under them and flight tests and really advance in certification programs (37m35s).
• Adam predicts that it will be a short time after the UAE launch that they will see aircraft come to market in the U.S., with key markets including L.A., New York, and Miami (37m59s).
• L.A. is a fantastic market, with over 5 million daily trips that take greater than an hour by car that are less than 20 miles, making the city of L.A. alone potentially bigger than the entire aviation industry globally (38m5s).

San Francisco's Focus on AI and Economic Revival

• San Francisco Mayor-elect Daniel Lurie discusses the city's AI industry, stating that they are committed to leaning into the home of AI and continuing to invest in the sector (39m16s).
• Lurie also emphasizes the importance of bringing arts and culture back to San Francisco, making it a place where people can think of culture and where everything starts (40m3s).
• He mentions that he wants to cultivate various industries, including financial services and sports, and make San Francisco the epicenter for business again (40m30s).
• Daniel Lurie believes that when business leaders return to San Francisco, small businesses will also return and thrive again, indicating a positive outlook for the city's economy (40m49s).

Liquid AI's Funding and Innovative Brain-Inspired Technology

• Liquid AI, an AI company from Boston, is set to raise $250 million in funding at a valuation of $2.3 billion (41m20s).
• The company's technology is modeled after the human brain, but also explores other models, such as the worm brain, which could be simpler and more intuitive to study (41m36s).
• The worm brain model is experimental technology that could potentially be used to steer self-driving cars, showing big potential for AI innovation (42m27s).
• Publicly traded firms, including AMD as the lead investor, are betting on this technology, reflecting interest in going beyond traditional transformer-based models (43m1s).
• The test for the technology's success will be its ability to provide value on a larger scale, beyond internal benchmarks and lab tests (43m49s).