Reach. And the u. S. Government says russia, china, and iran will seek to meddle in elections going forward. How vulnerable are we . We get to opinions from ethical hackers. It was a week of reckoning for uber. They posed selling restrictions for early investors lifted wednesday, making it one of the most actively traded stocks shares some record lows, not a good look. The stock is down 40 from its debut. For some perspective, i caught up with guests. A lot of people are just sick of waiting around for it to get better. We saw the stocks fall. Again, there are some questions around when this could continue, considering a number of early investors are not underwater and could see potential upside. Taylor walter, the volatility today, is this a day issue, weeks issue or a months issue . The average daily volume is 15 million shares. As lizette was saying, you are talking about one billion shares coming off of lockup. Some of those shares are probably not going to trade. I dont think softbank, who owns about 2 million or so of the shares, are selling any time soon. They are pretty bullish on rideshare and have a number of investments. But the founders of the company, we will see what they are doing. There are early Venture Investors and a host of other investors. It could take more than a couple days to digest through this. Taylor i want to take a look at a chart for the bloomberg audiences inside the terminal. It is the bearish sentiment around this stock. 1. 4 for every call, showing more bearish sentiment into the into this. Put that into perspective for us. We knew that day was going to come. Do we expect more Downside Risk ahead . What are investors saying . Investors are taking their cue from the results of uber who reported monday. At that time, it was mixed, noisy. And the upshot were a couple of things. One of them was that growth was the slowest at 29 of quarter a quarter than has ever been reported since the Company Began sharing that number. Thats not a good thing. This is a company that has always sold investors on its Growth Potential as it went to 60 plus countries and entered things outside of the core ridehailing into grocery delivery, autonomous driving, helicopters, gig worker matching, etc. So thats one thing. You know, whether it will continue or not, anyones guess. I know that a lot of people focused on the fact that it projected to even be profitable by q4 2021. That is a projection that has never been shared before. It was supposedly to reassure investors, but it doesnt seem like it worked. Taylor walter, does the bearish sentiment line up with the fundamentals we got from the company this week . Part of it, the selloff in these types of stocks, is not happening in the last couple days or weeks. It has been going on for months now. Whether you call it growth or momentum, this has been a disfavor. There is no positive catalyst on the horizon for the company. The incremental competition they are feeling which resulted in a deceleration of growth, which is an incremental negative, that doesnt seem like it would stop anytime soon. I think the catalyst of saying we will reach profitability in 2021 was probably wasted ahead of one billion shares coming off of lockup. It is still questionable whether they can actually hit that target. In the meantime, you have a competitive eats business, you dont have autonomy coming as a potential catalyst anytime soon. Its just hard for investors to own these when you are relying on things like revenue multiples to base your valuation. Taylor i have a little bit of a bone to pick. When we talk about adjusted, meaning the company is profitable, and to be clear we are not talking about net income or bottomline profitability, are you ok with adjusted positive by 2021 or would you see it translate into net income . Im fine with it. Im sure most investors will be fine with it. I know it makes for better headlines to focus on a net income number, but the reality is it is closely associated with the cash in the company. You also have to look if it is a capitalintensive business, which this business is not. If they can get to that positive, you will find a Broader Group of investors willing to invest in this name and put multiples on it rather than relying on a multiple revenue or bookings. Emily that was my chat with bloombergs Lizette Chapman and walter piecyk. We stuck around to talk about softbank, where things are not much better. They reported an Earnings Loss in Companies Like uber and we work. Softbank chairman messier she son Masayoshi Son remained defiant, saying they will make it profitable. He is still up on the vision fund. They have booked up to 15 billion of unrealized gains. This is a big setback that the that went right down in the vision fund and aggregate was 9 billion. It was more than just what was happening at wework. There were a couple of other billion that occurred. Overall, he is still up on the vision fund. He looked at this and said, look, we will have 15 massive winners, 15 awful losers like wework and the rest of them are doing soso. His investment style is more about having massive winners like alibaba, putting in 20 million and its worth however many billion now, in order to drive returns. While they talk about more conservative investments, what he is sticking to what he really wants to do, finding really big winners to find returns. The bigger issue for the company, which is kind of a sideshow, they have a big deal out there right now getting challenged by state ags. Tmobile is trying to bribe ash bride buy sprint, tmobile is burning cash. They have to go to court. If they lose that, they are kind of stuck with sprint. If that deal can get approved, if tmobile can buy sprint and get that off of his back, it removes the debt from the balance sheet. Hes got a great asset in tmobile that he can borrow against and invest in the vision fund. I think it gets softbank back on track. A lot of what softbank investors should be looking at right now is how the sprint court case is going to go with state ags. That can be a catalyst for the stock. Taylor rightfully so, second sentence of your note hot off the press says the sprinttmobile deal is the biggest catalyst for the stock this year. Is that what you need to see to sort of, not save the company, that sounds too drastic, but to at least get the stock to move to the next leg higher . Softbank has a lot of things going for it in terms of investment. Other things can help. Two thirds of the investments in the portfolio, they were the last guy that invested in it. If through an ipo or another round of investing in the private markets, you can get thirdparty validation for investments, i think it would also help softbank. Maybe if uber, like we talked about in the last segment, if gene uber can stabilize the eats business, that would provide more credibility. Right now, they are losing a couple billion dollars. Any validation of investments, any validation of the evaluations set on investments, or a favorable turnout in terms of tmobile being able to buy sprint, either of those things i think would be a positive catalyst for a stock that is really still trading at probably a discount. No matter how conservative you are, probably still trading at a discount. Lets not forget alibaba is still a massive investment that softbank has and supports the overall valuation of the company. Taylor your general thoughts on softbank and the vision fund sort of decision to put more money at wework some people have called it putting more money at other bad money. Your take . Masa was insistent today that it was not a bailout to save a bad investment, but it certainly looks like that. You took a Company Valued at 47 billion and put new money in at less than 8 billion. To me, that sounds like a company that was pretty desperate. I dont think its a good sign in terms of the investment. It was softbank making the investment as opposed to the vision fund. That tells you the vision fund partners, which they are hoping to sign up to the second vision fund, were not willing to come in as the investor to effectively bailout wework. They were effectively willing to let the investment kind of go. This money came from softbank. The question is lets say sprint faces the same issue. Lets say the tmobilesprint deal fails. Is softbank going to come into sprint and have to write another 10 billion check . Sprint is a company burning money that needs to invest in the network. Should we expect more . Thats a slippery slope for a company. You dont want putting more want to be putting more money into bad companies. You want them to put that into new Growth Companies that can be among the 10 or 15 names he thinks can be huge winners five or 15 years from now. Taylor coming up, choose your spin. Peloton beats estimates but there are questions about the cut about the path to profitability. They say it is part of the plan and hopes wall street can look to the long game. Check us out on the radio and in the u. S. On sirius xm. This is bloomberg. Taylor peloton posted a loss with higher than expected subscribers and revenue growth. Still, concern exists over how fast the company is trying to expand. John foley spoke to us after the report. John it will be profitable over the next couple of years in the u. K. And canada. We dont need to launch more to get to profitability. We may choose to invest in those things over time but it not needed for profitability. Taylor did his comments and vince analysts . Convince analysts . I got an analyst on the phone. The company did report an impressive quarter. Objectively speaking about the numbers tell a good story. They are growing year on year five quarters in a row. They have a stable growth margins on the subscription side of things. Things are trending in the right direction, make no mistake. But given Investor Sentiment, as we talked about with uber, investors want a pathway to profitability and what they are telling investors is that they will invest heavily this year, bear with us, and year, we will show real progression. I think it is just about patience, how patient investors are willing to be in willing to accept the story today. On top of that, you are selling a very expensive product. We dont know how large the market is. A year goes by, and if we are in a macroeconomic slowdown, then what happens to the pathway to profitability . That is the worry investors have and are unwilling to stick around with the patients john is asking them to have. Emily are you sticking around . The ceo did say we could be profitable tomorrow, if we wanted to, we just want to invest in growth. Are you comfortable knowing that . Over the longerterm, i feel we would be comfortable. But today, given Investor Sentiment and heavy losses and that the company just acquired manufacturer in taiwan, they are overburdening their cost structure. Investing in a lot of things and we will wait on the sidelines. Taylor does it come for you that comfort you that the ceo said they dont have a lot of competition . I would take the other side of that. From a competitive stand point, there is nothing like the bike on the market with the integrated ecosystem content, bells and whistles. But when you look to where can i work out today, where am i willing to spend hundreds a month, there are a lot of options. Also, there are a lot of platforms. So i think if you take a broader view of the options that consumers have commit it is getting more and more saturated have, it is getting more and more saturated. We have not seen longterm delivery of that yet. Maybe peloton will show that pathway, but we have not seen that yet. Emily that was m km partners rohit. Lackluster performances mixed with the implosion of we work all make for examples of investors shunning moneylosing startups. The Banking Sector is feeling the sting as David Solomon made clear this week. Goldman sachs has investments in we work and uber. He spoke to matt miller in berlin on tuesday. Is important you have a Business Model that can generate profitability and there is more market discipline coming into play and i think that is healthy. Emily i asked our correspondent about the notion that markets are becoming more adept at discerning whether companies have a clear path to profit ability. I think the markets have been really irrational for a number of years. Frankly, this irrational type behavior that is driving these skyhigh valuations has to come to a reckoning. Guess what, everyone is not amazon. Finally, people are starting to tighten the reins. It only took one major flop for people to turn around quickly. We have had the head of Investment Banking and citigroup at citigroup tell us that for Bloomberg Television as well. People are already starting to tighten the reins earlier this summer. The talk is getting a lot louder for banks like goldman sachs, j. P. Morgan, that stuck with a lot of these companies through very tough times. Taylor talk to be more about jamie dimons comments, saying private markets are not real valuations because you dont have a price discovery, you just have an investor telling you what it is worth. Sonali jamie dimon is saying something similar to David Solomon, that one investor does not set a valuation. A market of investors sets a valuation, so things can be volatile until then. Jamie dimon also said something that softbank is also addressing, which is changes in corporate governance. That is something we have been waiting for forever here. Softbank, right now, according to the financial times, is thinking about tighten the reins tightening the reins in terms of corporate governance. That is something you heard jamie dimon also address. Taylor you know, another story that caught our attention here as we look at the tech landscape has been robin hood markets. There was a story coming out that said basically, put down a little bit of a deposit on margin and you get infinite leverage. There is a glitch in the system. What is it . Sonali basically, you have a certain set of robin hood users who are selling calls and that money is being counted in that users capital. And so, this is such a timely story. A week away from money 2020, thousands of people were meeting about the future of fintech. Once we are borrowing from a firm, youre becoming a bank and a personal hedge fund. You are sitting here and having to deal with issues as you scale and grow. Robin hood, as we know, is trying to not only grow but has considered a banking charter. This Never Looks Good in between, but they do say it is isolated. That said, the users that have been doing this say they have levered a 4000 investment into a Million Dollar investment. They are pretty insane trades we are seeing that a lot of people are bragging about. Taylor coming up, chipmaker qualcomm reports earnings as details looking up even as trade tensions continue. We explain. This is bloomberg. Taylor qualcomm gave a strong forecast when they reported earnings wednesday. They indicated smartphone demand maybe picking up after a prolonged slump, also projecting Strong Revenue growth with 5g technology which debuts later this year with samsung headsets. Theres also wall street optimism over a renewed relationship with apple for future versions of the iphone and 5g. Ian king filled us in. The whole conversation was about their outlook for Smartphone Markets year. They are saying it will return to growth again, as much as 1. 8 5 billion devices being sold. More importantly, 5g devices will be shipped next year. Taylor we also know they are looking could be looking at another year of declines. Is that due to the Smartphone Market and could we start to see top and bottom line growth . They could be back to growth year on year as early as next quarter, but it has been rough for them. There has been this hideous dispute with apple that took away big customer and a dispute with huawei that has not been solved. And on top of that, you have people getting bored with their smartphones and not seeing anything exciting to the point that they did. They are saying that phase of the Smartphone Market for them is over and things are going to come back. We spoke to an analyst who says that is maybe optimistic. So far, people like what they see. Taylor how much of a tailwind is apple . It means on getting paid on licensing already. Even though they are not in the iphone at the moment, they are getting paid because their technology is, right . They already won that one, but it really wont cut it in terms of a chip unit until some point next year. Probably this Time Next Year when apple comes up with the next version of the iphone. Taylor a Morgan Stanley analyst coming into the call said the Fourth Quarter, which is what they reported, looked good, but it was really next quarter that might have been too optimistic, but if shares are rising, do you get a feeling maybe they were not too optimistic . Are investors pretty happy that maybe that next quarter is right in line . I think theyre getting some credit for having been conservative about the quarter they just reported and proved through their own execution they actually did better, so that buys them credibility when they go out and say things are getting incrementally better again. Obviously, people like that. People want this company to go back to growth. Taylor finally, management naming a new cfo. How big of news is this . This guy has been with them a long time. He has been in the chip division, basically the head of finance for that chip division. On the call, he answered a lot of questions. He was very entrenched in the company. He understands the Business Model. Theyre not getting an outside model. Theyre not getting an outside perspective, they are getting somebody who knows this company. Taylor coming up, disney gets ready to unleash its streaming service but its earnings were on the radar this week. We get perspective on a global scale next. Bloomberg technology is livestreaming on twitter. Check us out and be sure to follow our global breaking news network at tictoc on twitter. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone