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Intel to Sell $15 Billion in Stock After AI Boosts Demand · Bloomberg Intelligence

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  Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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  Speaker 2: Let's get a little techie before you. The nasdas up
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  Speaker 2: fourteen points today. Not much going on out there, but
• 0:29
  Speaker 2: there's a lot of news flow out there in the
• 0:31
  Speaker 2: tech spaces, or typically is. And for that we like
• 0:33
  Speaker 2: to check in with our buddy, Matthew Bloxam, Bloomberg Intelligence
• 0:36
  Speaker 2: Senior technology Analysty covers a bunch of stuff and he
• 0:38
  Speaker 2: does it from London.
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  Speaker 3: Hey Matt, thanks for joining us here. I mean Intel
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  Speaker 3: coming to the market.
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  Speaker 2: Here's another big tech company coming with a big equity raise.
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  Speaker 2: It seems like these guys have an a safeable need
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  Speaker 2: for capital.
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  Speaker 4: Yeah, I do, that's right. So what's fifteen billion dollars?
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  Speaker 4: Roughly three percent of the market cap, So it's not
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  Speaker 4: that big, but you know, I think still always a
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  Speaker 4: little bit surprising when these companies come to market for equity.
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  Speaker 4: You know, they raised I think six and a half
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  Speaker 4: billion dollars in debt earlier this year, fairly expensive coup
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  Speaker 4: points kind of four point sixty five percent through just
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  Speaker 4: six point two percent. So I guess you know they're
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  Speaker 4: looking to balance their capital needs across different parts of
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  Speaker 4: the balance sheet structure. Yeah, the valuation is pretty full
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  Speaker 4: right now, and if you look forward a couple of years,
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  Speaker 4: it's on fifty times earning. So I guess you're the
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  Speaker 4: management team take in the view that if there was
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  Speaker 4: ever a time to raise some equity, this is a
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  Speaker 4: relatively quote unquote cheap, cheap time.
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  Speaker 5: To do it.
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  Speaker 4: You know that they, along with everybody else, have quite
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  Speaker 4: substantial investment needs compared to some other big tech names.
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  Speaker 4: Their capex is pretty low, you know, probably about twenty
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  Speaker 4: billion dollars this year, maybe rising to twenty six billion
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  Speaker 4: dollars next year. But this gives them a good cash
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  Speaker 4: cushion to pursue the current projects, and who knows, perhaps
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  Speaker 4: even consider some acceleration of what they're doing.
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  Speaker 6: What about Meta This morning, they've just introduced a new
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  Speaker 6: AI model called news Glimmer. I guess it's an open
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  Speaker 6: source AI model meant to compete with the Chinese model
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  Speaker 6: deep Seek. It's up this morning. How do you feel
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  Speaker 6: about it?
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  Speaker 4: Yeah, you know, I think we're at a fairly early
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  Speaker 4: stage of how the whole AI foundational model play is
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  Speaker 4: going to evolve. Yeah, this is quite a different position
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  Speaker 4: to the likes of open AI and anthropic who work
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  Speaker 4: with closed models. Gemini at Google with geminis a little
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  Speaker 4: bit kind of mixed. Some open source models and some
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  Speaker 4: closed models have met a very much kind of penance
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  Speaker 4: fortunes to the flag of the open model, and you know,
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  Speaker 4: really trying to kind of make a big difference in
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  Speaker 4: markverg today in an essay being somewhat critical of some
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  Speaker 4: of its competitors, you're saying that really we should be
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  Speaker 4: democratizing AI and putting it in the hands.
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  Speaker 3: Of the user.
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  Speaker 4: So I think you're open to see how why you
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  Speaker 4: adopted this will be what it means for the kind
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  Speaker 4: of longer term economics. Both matter in the industry, but
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  Speaker 4: it's certainly an interesting move, and I think as much
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  Speaker 4: as anything, the language and the rhetoric that Zuckerberg is
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  Speaker 4: using around this push Matt.
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  Speaker 2: You know, it's as being in these markets for forty years,
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  Speaker 2: it's always surprised me in a negative sense. How Europe
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  Speaker 2: written large basically missed the whole technology revolution. All the
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  Speaker 2: tech is in the US and Asia and things like that.
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  Speaker 2: Is the same thing happening with AI. Well, Europe just
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  Speaker 2: kind of outsource it to other people and not participate.
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  Speaker 4: It does, unfortunately seem that way. You know, we have
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  Speaker 4: mistrale As I guess the most well known European AI model,
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  Speaker 4: but it sits in the shadows of the US and
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  Speaker 4: the Chinese alternatives. So yeah, you know, it's a perennial
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  Speaker 4: problem for the regional So there's a kind of big,
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  Speaker 4: really big introspective process going on right now about Europe
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  Speaker 4: twenty thirty five and what funding is needed to kind
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  Speaker 4: of really close the gap and genuinely make Europe competitive enough.
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  Speaker 4: The numbers are eyewatering, and even if the money was there,
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  Speaker 4: I think there's so many kind of structural and cultural
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  Speaker 4: issues about the way Europe works that are very serious
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  Speaker 4: obstacles have to get around, and all the time they're
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  Speaker 4: trying to figure those issues out, the US and China
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  Speaker 4: are running full steam ahead. So it does. I would
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  Speaker 4: think the base case scenario would be that Europe continues
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  Speaker 4: to be a taker of technology from other parts of
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  Speaker 4: the world.
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  Speaker 3: Stay with us.
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  Speaker 2: More from Bloomberg Intelligence coming up after this.
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  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us Live
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  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 5:11
  Speaker 3: I'm looking at Microsoft.
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  Speaker 2: This is a name Stacy, Tom and I, Tom Keen
• 5:15
  Speaker 2: and I.
• 5:16
  Speaker 3: For the longest time, we're saying just.
• 5:17
  Speaker 2: You know, as of a week or two ago, why
• 5:19
  Speaker 2: is this stock down twenty five percent year to date?
• 5:22
  Speaker 3: This is Microsoft.
• 5:23
  Speaker 2: I guess you was thrown out with a lot of
• 5:24
  Speaker 2: those software stocks. I thought AI was going to put
• 5:26
  Speaker 2: them out of business.
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  Speaker 3: But this is.
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  Speaker 6: Microsoft and Microsoft and it's one of the Magnificent seven.
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  Speaker 2: Yeah, I mean you know, so sure enough, they put
• 5:35
  Speaker 2: up a good print last week, good earnings, stocks erased,
• 5:39
  Speaker 2: all those losses now up three or four percent on
• 5:41
  Speaker 2: the year, five percent for the year.
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  Speaker 3: So how about that.
• 5:45
  Speaker 2: More news out on Microsoft today. They're going to raise
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  Speaker 2: next gen AI chip production next year.
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  Speaker 3: It's pretty interesting. Let's according to the information.
• 5:53
  Speaker 2: Anurag Rana joins this senior technost for Bloomberg Intelligence on Ron.
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  Speaker 2: It's really amazing how the market has kind of got
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  Speaker 2: a new appreciation I view for the Microsoft story that
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  Speaker 2: I think was really people were questioning and is Microsoft
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  Speaker 2: at risk from AI? How do you think about it?
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  Speaker 7: Yeah, I mean you're absolutely right. There was that risk
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  Speaker 7: of disruption from some of its product from AI. But
• 6:16
  Speaker 7: there was another risk. There was another narrative that when
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  Speaker 7: you look at the three hyper scale clout providers, Google,
• 6:23
  Speaker 7: Amazon and Microsoft, Google's chip has just taken off. I
• 6:27
  Speaker 7: mean their TPUs are all the rage in the market,
• 6:30
  Speaker 7: and Amazon's actually come out with their own print that
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  Speaker 7: you know, they're making tens of billions of dollars with
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  Speaker 7: their own chip as well. So what happens is when
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  Speaker 7: you are looking at this fight of everybody expanding into
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  Speaker 7: AI data centers, they do need chips. They're all running
• 6:48
  Speaker 7: to Nvidia, but two of the three providers talked about
• 6:51
  Speaker 7: having their own chips. Now Microsoft was not in that
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  Speaker 7: game at that point. They have their own chip, but
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  Speaker 7: it's not widely embraced. But today's report when it talks
• 6:59
  Speaker 7: about that they're going to go out and increase the
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  Speaker 7: production of their own chips, which means customers may be
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  Speaker 7: ready to use those and if that's the case, their
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  Speaker 7: cost of spending into that capital expenditure, you know, boom
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  Speaker 7: will start to go down in a sense, down on
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  Speaker 7: a relative basis or per token basis. So it's a
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  Speaker 7: very good news for them in the long run.
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  Speaker 6: Well Microsoft might be having a very good day, but
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  Speaker 6: Apple is having a pretty rotten day. What's going on
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  Speaker 6: with them? Apparently it has something to do with hardware
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  Speaker 6: not coming out the way that they're hoping.
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  Speaker 7: Uh no, I don't. I mean, I think that's a
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  Speaker 7: different somebody's downgrade. That's a different story. But when you
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  Speaker 7: look at Apple, and let's go back to that time
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  Speaker 7: period when when Paul talked about when Microsoft was down
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  Speaker 7: you know, twenty five percent or so over the year
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  Speaker 7: or you know, at that time, what was happening was
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  Speaker 7: everybody was worried about ROI on AI trade. This is
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  Speaker 7: before earning season. You know, you saw Google you So
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  Speaker 7: everybody was worried about them. But at the same time,
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  Speaker 7: everybody loved Apple because they were not spending that much money.
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  Speaker 7: But after the result, what has happened is people are
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  Speaker 7: relatively more comfortable going back to the AI trade or
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  Speaker 7: going after the risky assets. And given Apple's valuation where
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  Speaker 7: it was at that point, it was well in the thirties.
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  Speaker 7: We are seeing sums sell off on that and people
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  Speaker 7: buying more of you know, the AI trade. So I
• 8:16
  Speaker 7: think there's a little bit of factor shifting there, not
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  Speaker 7: so much about one product or the other.
• 8:22
  Speaker 2: To your clients, your investors in big tech companies do
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  Speaker 2: they like free cash flow and they upset if they
• 8:27
  Speaker 2: don't get free cash flow.
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  Speaker 7: So two different things once that are looking at this
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  Speaker 7: massive capex going in, they're seeing what is the benefit
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  Speaker 7: of that for these companies. So if Microsoft was able
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  Speaker 7: to show you know, sequel chain improvement in as your
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  Speaker 7: sales growth, Amazon was able to show that. Google was
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  Speaker 7: able to show that, So I think they're getting a
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  Speaker 7: little more comfortable that these companies know what they're doing
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  Speaker 7: when they're spending you know, hundreds of billions of dollars
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  Speaker 7: at that time. The second group is somebody who doesn't
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  Speaker 7: want to be at part of this trade and say,
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  Speaker 7: you know what, I like Apple, I have plus billion
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  Speaker 7: dollars in free cash flow. Over there, they're buying back
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  Speaker 7: that stock. iPhone's doing well, it's gaining share in China.
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  Speaker 7: So there are I mean, you could say there are
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  Speaker 7: a couple of buckets of people who are looking at
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  Speaker 7: this trade from different lenses.
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  Speaker 6: What about in the hardware sector. Apparently there's a big
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  Speaker 6: smart watch lineup that's that's getting ready to be released.
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  Speaker 6: Obviously there's the folding phone everyone has been waiting for.
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  Speaker 6: How is that Apple looking in the in the hardware sector.
• 9:25
  Speaker 7: So when you look at the watch itself, it doesn't
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  Speaker 7: move the needle for Apple. It's an accessity that goes
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  Speaker 7: with the phone along with it. I mean, you're not
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  Speaker 7: going to just buy a small a watch without being
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  Speaker 7: in the Apple ecosystem. That's a very unlikely thing. But
• 9:39
  Speaker 7: one of the things Mark Erman's talked about it when
• 9:41
  Speaker 7: you look at some of the other variables you look
• 9:43
  Speaker 7: at you know, the Aura ring, which is just a
• 9:47
  Speaker 7: phenomenal product right now for a lot of people to
• 9:49
  Speaker 7: track their sleep. You're looking at products that are coming
• 9:52
  Speaker 7: out in the market without a screen. Garment just launched one.
• 9:56
  Speaker 7: I mean I've ordered it, but it's on backlock for me.
• 9:59
  Speaker 7: When you you look at a woop, these are all
• 10:01
  Speaker 7: bands that you could use to track a lot of
• 10:04
  Speaker 7: these you know, sleeping and you know, just your normal
• 10:07
  Speaker 7: vitals without the need of a screen oriented product, and
• 10:12
  Speaker 7: that's what I think you're going to see down the road.
• 10:14
  Speaker 7: But that, to be honest with you, does not move
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  Speaker 7: the needle. The foldable does. Because Apple's been behind. They
• 10:19
  Speaker 7: don't have a foldable phone right now, and iPhone accounts
• 10:22
  Speaker 7: for over fifty percent of Apple sales. So if they
• 10:25
  Speaker 7: are able to come out with a foldable device, I
• 10:27
  Speaker 7: think it's going to create a lot of buzz next year,
• 10:30
  Speaker 7: especially in emerging markets where if people are not worried
• 10:33
  Speaker 7: about the price of it, which Margoman thinks is going
• 10:35
  Speaker 7: to be around twenty five hundred dollars. I think that's
• 10:38
  Speaker 7: going to be a very very cool factor that we'll
• 10:41
  Speaker 7: see within the next one month.
• 10:43
  Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
• 10:50
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 10:54
  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
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  Speaker 1: Auto with the Bloomberg Business app, and on demand wherever
• 11:01
  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 11:05
  Speaker 2: It seems like that's a quiet day, but there's a
• 11:07
  Speaker 2: lot going on out there in the equity capital markets.
• 11:10
  Speaker 3: Intel we started this morning. They're going to do sell
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  Speaker 3: fifteen billion dollars in common.
• 11:14
  Speaker 2: Stock to fuel some of their AI demand. Boom got
• 11:17
  Speaker 2: some IPO filings, We got some stocks I thought were
• 11:20
  Speaker 2: meme stocks. I'm not sure if they still are, but
• 11:22
  Speaker 2: we had Billy Lipschultz and to kind of explain it
• 11:24
  Speaker 2: all to us, Billy Lipschutz, Bloomberg.
• 11:25
  Speaker 3: News senior equities reporter.
• 11:27
  Speaker 2: First was game Stop's potential bid was fifty six billion
• 11:32
  Speaker 2: dollars for eBay?
• 11:32
  Speaker 3: Was that ever considered real legit?
• 11:35
  Speaker 5: It was always kind of laughed at, really speaking what
• 11:37
  Speaker 5: I was doing. It was. It was It was a
• 11:39
  Speaker 5: market I don't want to matter too much, but it
• 11:42
  Speaker 5: was basically seen by most on Wall Street is kind
• 11:43
  Speaker 5: of a marketing campaign from Ryan Cohen, who is the
• 11:46
  Speaker 5: now head of game Stop. He was a big driver
• 11:48
  Speaker 5: between behind that twenty twenty one memestock Mania round game Stop,
• 11:53
  Speaker 5: becoming the largest shareholder, one of the larger shareholders leading
• 11:56
  Speaker 5: the company. He was a co founder of Chewy, made
• 11:58
  Speaker 5: his name through that. So I was broadly seen as
• 12:02
  Speaker 5: kind of a interesting thought, but resoundingly rejected by eBay
• 12:08
  Speaker 5: back in May. He said he was going to come
• 12:10
  Speaker 5: for him one way or another, and ultimately, according to
• 12:13
  Speaker 5: our reporting, now considering pulling that bid.
• 12:16
  Speaker 6: Why does game stop want eBay? I mean, the market
• 12:18
  Speaker 6: seem quite disappointed this didn't happen or isn't going to
• 12:21
  Speaker 6: happen potentially.
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  Speaker 5: Well, the big debate always was, you want to make
• 12:25
  Speaker 5: a fifty six billion dollar takeover when you have a
• 12:27
  Speaker 5: market value of eight billion dollars and you have cash
• 12:30
  Speaker 5: and equivalents of eight billion dollars. So there's a huge
• 12:32
  Speaker 5: gap you have to bridge at some point. Yeah, yeah,
• 12:35
  Speaker 5: you know, if you work on Wall Street, there there
• 12:37
  Speaker 5: are levers you can pull. But the reason I think
• 12:40
  Speaker 5: we're seeing eBay shares down a little bit again is
• 12:44
  Speaker 5: just given kind of that option, the call option potential
• 12:47
  Speaker 5: of this being something that could work out. Cohen basically
• 12:51
  Speaker 5: has really been vocal and bashing eBay management, talking up
• 12:55
  Speaker 5: the potential synergies that they could see. Again eBay downplayed
• 12:58
  Speaker 5: those banker or analysts were really like two billion dollars
• 13:01
  Speaker 5: in propose, Energy still feels like a bridge too far
• 13:04
  Speaker 5: on the potential merger. This is a company that Cohen
• 13:07
  Speaker 5: has been either publicly leading or behind the scenes leading
• 13:10
  Speaker 5: for quite some time, and the big question has been
• 13:13
  Speaker 5: what does it actually look like? What do you look
• 13:15
  Speaker 5: like if you're a game retailer in an era where
• 13:17
  Speaker 5: people download games.
• 13:19
  Speaker 3: All right?
• 13:19
  Speaker 2: Data center company Switch good name filed confidentially for a USIPO.
• 13:25
  Speaker 3: What do we know about Switch?
• 13:27
  Speaker 5: Data center rates are hot? Anything around data center's hot.
• 13:31
  Speaker 5: We had reported back in July early July the company
• 13:35
  Speaker 5: was kicking off a private funding round led by Anderson
• 13:39
  Speaker 5: Horowitz that would raise two billion dollars equity value or
• 13:42
  Speaker 5: enterprise value excuse me, approaching fifty billion dollars. So our
• 13:46
  Speaker 5: reporting that they filed confidentially on Friday working with BAA City,
• 13:50
  Speaker 5: Goldman JP, and Morgan Stanley the who's who, and that
• 13:53
  Speaker 5: that funding round was either complete or near complete, and
• 13:56
  Speaker 5: that Ben Horowitz, co founder of Anderson Horowitz, would be
• 13:59
  Speaker 5: joining the board. So now the big question is, as
• 14:01
  Speaker 5: we reported targeting in November IPO, how quickly does that
• 14:05
  Speaker 5: come together? Will the market's still be there? And if
• 14:07
  Speaker 5: you're doing a two billion dollar private raise, IPO is
• 14:10
  Speaker 5: probably going to be much larger, all right?
• 14:12
  Speaker 6: Well, apparently a Form Labs, which makes three D printers,
• 14:15
  Speaker 6: is also in early talks with potential advisors for an IPO.
• 14:19
  Speaker 6: Talk about that business. The three D printer business is
• 14:22
  Speaker 6: that A is that like a big is that the
• 14:25
  Speaker 6: next big thing?
• 14:26
  Speaker 5: Three D printing was all the rage, and I want
• 14:28
  Speaker 5: to say in twenty and twenty one, everyone.
• 14:30
  Speaker 3: My public old son was doing probably still is doing,
• 14:34
  Speaker 3: and that was.
• 14:34
  Speaker 5: That was the big push. You just look at three
• 14:36
  Speaker 5: D Systems trades under the ticker GDD. It hit its
• 14:40
  Speaker 5: peak at fifty five bucks if you have trades for
• 14:42
  Speaker 5: less than four right now. So the time had been
• 14:45
  Speaker 5: much hotter in twenty and twenty one. But form Labs
• 14:47
  Speaker 5: backed by soft Bank did have bankers come in for
• 14:50
  Speaker 5: a bake off. We have at least one person saying
• 14:53
  Speaker 5: they should target a raise of about five hundred million dollars.
• 14:56
  Speaker 5: The big question comes back to they are profitable and
• 14:59
  Speaker 5: they are soft bank company, is so what problems are
• 15:01
  Speaker 5: you solving for?
• 15:02
  Speaker 3: Why are you going public?
• 15:03
  Speaker 5: SoftBank has a number of needs and if you're a
• 15:06
  Speaker 5: three D printer company, could be interesting to just see
• 15:09
  Speaker 5: if you want to scale. They did announce that they
• 15:10
  Speaker 5: had annual revenue north of two hundred and fifty million dollars.
• 15:14
  Speaker 2: Tom from the Upper East Side writes in and asks
• 15:16
  Speaker 2: for a space X quote, one hundred and thirty three
• 15:20
  Speaker 2: bucks are getting close back to that IPO price a
• 15:22
  Speaker 2: one thirty five. What does that mean for kind of
• 15:25
  Speaker 2: the IPO market in general?
• 15:27
  Speaker 5: The broader sentiment has become mixed, partly because SpaceX traded blow,
• 15:33
  Speaker 5: partly because ske Highnix, the largest non US company listing
• 15:36
  Speaker 5: here with their record fundraising, trays a lot like an EKG.
• 15:41
  Speaker 5: The big question now is we are expecting Anthropic to
• 15:43
  Speaker 5: go public September October timeframe. How can the market digest
• 15:47
  Speaker 5: and write down another you know, large ipo open AI
• 15:51
  Speaker 5: kind of waiting in the wings potentially early next year.
• 15:53
  Speaker 5: We're an IPO market that still is hot but very
• 15:57
  Speaker 5: much can be touch and go, and SpaceX kind of
• 15:59
  Speaker 5: is emblematic of that. Again one point thirty three now
• 16:01
  Speaker 5: just south of one thirty five, but popped up like
• 16:04
  Speaker 5: fifty percent.
• 16:05
  Speaker 3: Do we have any sense of that?
• 16:06
  Speaker 2: Insider shares that were eligible to be sold last week?
• 16:10
  Speaker 2: Do we know what happened with those? Did anybody actually
• 16:13
  Speaker 2: sell their shares?
• 16:14
  Speaker 3: Or do we know?
• 16:15
  Speaker 5: Well, we won't know because normally you would know if
• 16:18
  Speaker 5: a if an investor owns more than five percent, they
• 16:20
  Speaker 5: have to file elon Musk is the main one, and
• 16:23
  Speaker 5: then valor who's taken on their own Share Sale Project
• 16:27
  Speaker 5: and then Google are the only three according to our
• 16:29
  Speaker 5: data who would have to file for that. So a
• 16:31
  Speaker 5: lot of this could be happening behind the scenes. But
• 16:33
  Speaker 5: when you see a stock rally like it has after
• 16:36
  Speaker 5: the lock up expired, it's broadly seen as either a
• 16:39
  Speaker 5: short covering investors were hoping for more of a kind
• 16:42
  Speaker 5: of dash to the exits, or be just simply insiders
• 16:45
  Speaker 5: not rushing to sell.
• 16:47
  Speaker 2: Stay with us more from Bloomberg Intelligence coming up after this.
• 16:54
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us Live
• 16:58
  Speaker 1: weekdays at ten am Eastern Apple Coarclay and Android Auto
• 17:01
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• 17:04
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• 17:09
  Speaker 3: Or Sure Hathaway.
• 17:09
  Speaker 2: They had their investor kind of meeting. Yes story, they
• 17:13
  Speaker 2: reported some earnings over the weekend. They tend to do
• 17:16
  Speaker 2: for some reason. Matthew Palasoll it's his job to figure
• 17:18
  Speaker 2: all this stuff out for Sea's Insurance, sent once for
• 17:20
  Speaker 2: Bloomberg Intelligence. So the headline Matt I'm seeing on the
• 17:24
  Speaker 2: Bloomberg terminal is new CEO Greg Abel, You're spending some
• 17:28
  Speaker 2: money here. So what he's doing and how that may
• 17:32
  Speaker 2: be a little bit different from mister Buffett.
• 17:34
  Speaker 8: So yeah, he's opening up the checkbook a little bit.
• 17:37
  Speaker 8: Berkshire still has incredible amounts of cash that is still undeployed,
• 17:41
  Speaker 8: but we expected them to buy back some shares in
• 17:45
  Speaker 8: the quarter. There was some disclosures made by Buffett around
• 17:48
  Speaker 8: his ownership that gave us a clue. We thought it
• 17:52
  Speaker 8: would be more, but essentially what happened is some of
• 17:55
  Speaker 8: that was pushed through to the third quarter, so it
• 17:58
  Speaker 8: was about four and a half billion of buybacks. We
• 18:00
  Speaker 8: thought it was a wide range, but we thought it
• 18:02
  Speaker 8: could be anywhere from five to twelve or thinking maybe
• 18:04
  Speaker 8: it was like eight. Turns out, they did four and
• 18:07
  Speaker 8: a half in the quarter and then at least another
• 18:09
  Speaker 8: three in July, so kind of close to what we thought,
• 18:12
  Speaker 8: but it's just more spread out through the quarters. Couple
• 18:15
  Speaker 8: with that, Bertie was a net buyer of stocks for
• 18:18
  Speaker 8: the first time in several years. They might have been
• 18:22
  Speaker 8: a net buyer of stocks in the first quarter as well,
• 18:24
  Speaker 8: but what they had done was they unwound a bunch
• 18:27
  Speaker 8: of positions by one of the former managers investment managers
• 18:30
  Speaker 8: who had left, so they sold a lot of his
• 18:32
  Speaker 8: positions and they bought some, but it ended that they
• 18:35
  Speaker 8: sold more than they bought. But in the second quarter
• 18:38
  Speaker 8: they bought more than they sold. And there's about twelve
• 18:41
  Speaker 8: billion dollars worth of stock or stocks that they bought
• 18:45
  Speaker 8: that we don't know what it is yet. They'll be
• 18:47
  Speaker 8: a thirteen f next week that will perhaps see Sometimes
• 18:50
  Speaker 8: they hold things confidential, but if not, we'll get some
• 18:55
  Speaker 8: more color on what if it was new positions or
• 18:58
  Speaker 8: added to existing ones.
• 19:00
  Speaker 6: I mean, they have such a legendary reputation for knowing
• 19:03
  Speaker 6: where things are headed, especially knowing positions that other people
• 19:07
  Speaker 6: don't necessarily take. Do we have any idea of what
• 19:10
  Speaker 6: they're buying or what they're bullish on?
• 19:12
  Speaker 8: So I could say this. In the first quarter they
• 19:14
  Speaker 8: started a new position in Delta. Really so yes, and
• 19:18
  Speaker 8: Buffett has had a history with the airlines, and the
• 19:20
  Speaker 8: first quarter they did Delta. Their airline related businesses that
• 19:24
  Speaker 8: they own have been showing some acceleration.
• 19:28
  Speaker 3: So I don't know.
• 19:29
  Speaker 8: I can't say if I agree or disagree with them
• 19:31
  Speaker 8: doing that, but you know, perhaps that's something to think about.
• 19:35
  Speaker 8: They also made an acquisition. We didn't talk about an
• 19:37
  Speaker 8: acquisition in the first quarter that will pay in the
• 19:40
  Speaker 8: third for Tyler home business that is a compliment to
• 19:47
  Speaker 8: their existing business. So they own a business that builds
• 19:50
  Speaker 8: manufactured homes. So they build a home and then they
• 19:53
  Speaker 8: bring it to you. This company they bought six point
• 19:56
  Speaker 8: eight billion I believe was the number. They build homes
• 19:59
  Speaker 8: on site, and it's more higher end than the business
• 20:02
  Speaker 8: they own. So they like to be in these essential businesses.
• 20:07
  Speaker 8: So home building homes, you know, we're going to need homes,
• 20:09
  Speaker 8: is home demand. Airlines going to need airline demand. Energy
• 20:14
  Speaker 8: always energy demand. So those would be maybe three places
• 20:17
  Speaker 8: that I would say would be potential clues.
• 20:19
  Speaker 2: And speaking of Delta, I'm just looking at the holder's
• 20:21
  Speaker 2: page for Delta. They bought a forty million share block.
• 20:26
  Speaker 2: They're now the number three shareholder in the company, six
• 20:28
  Speaker 2: percent position, So they got in there in a big way.
• 20:31
  Speaker 2: I say, if they want to deploy capital, just invest
• 20:34
  Speaker 2: in AI data centers and stuff. Well, the people spending
• 20:37
  Speaker 2: tens of billions you know at a clip here.
• 20:40
  Speaker 8: They also made this year two investments in Google so
• 20:44
  Speaker 8: or Alphabet that was initiated by Buffett apparently, so he's
• 20:51
  Speaker 8: still working. He's still the chairman, he's still working with
• 20:53
  Speaker 8: greg Abel. That position was initiated by Buffett. They bought
• 20:57
  Speaker 8: Open Market, and then they did as part of Google's
• 21:00
  Speaker 8: equity raise, they did ten billion dollars in that as well.
• 21:04
  Speaker 8: So that's a place in the quarter.
• 21:05
  Speaker 2: Is there any reason to believe greg Abel's going to
• 21:07
  Speaker 2: purely change the cash return policies? Let's just say the
• 21:11
  Speaker 2: day after Warren passes, should we expect to see a
• 21:15
  Speaker 2: policy shift.
• 21:16
  Speaker 3: Maybe so.
• 21:18
  Speaker 8: I think Abel is much more Buffett was older, getting old,
• 21:26
  Speaker 8: stepping away. I don't think he was up for any
• 21:29
  Speaker 8: material changes. He was never a fan of dividends. Greg
• 21:33
  Speaker 8: is very much cognizant of keeping the the ethos of
• 21:39
  Speaker 8: Berkshire alive. So I don't think he wants to do
• 21:41
  Speaker 8: anything that directly contradicts Buffett immediately. I do think over time, though,
• 21:46
  Speaker 8: with so much extra capital, maybe a special dividend every
• 21:49
  Speaker 8: once in a while or something like that. I think
• 21:50
  Speaker 8: it's possible.
• 21:53
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• 22:01
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