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Welcome to the Daybreak Asia podcast.

I'm Doug Krner. Much of the price action

that we are seeing in global equity

markets is being driven [music] by big

tech earnings. After the bell in the

states, Intel delivered a surprisingly

strong forecast for revenue in the

current quarter. This would seem to

underscore the gains Intel has been

making with data center customers. Now,

for the last quarter, sales for the data

center segment soared 59%.

Intel's central processing units are

clearly in high demand for AI computing.

Here is Bloomberg's Ed Lello. The

>> the market is a situation where CPU

specifically is taking off for Intel. a

lot of their topline performance uh is

answered by that and in the quarter gone

you know that unit's growing 59% double

what it the rest of the business is

growing at. So they have found their

place in that market but what they're

battling to do is improve their own

operations their own foundaries and

their own processes so they can get the

CPU product that people actually want

out there into the real world.

>> That was Bloomberg's Ed Ledllo. Now

shares in Intel had been up by as much

as 12% in late US trading. The stock

closed higher by 3% at the end of the

late US session. Now in regular trading

in the states, there were some concerns

about overspending on capex. That was

after Alphabet and Tesla raised their

spending forecast. Some analysts were

saying there are still nagging questions

about what the return on investment will

be. Shares in Alphabet were down 7%.

Tesla tumbled 14%. For an overall look

at tech, we had the chance to catch up

with Dan Ies. Dan is a partner and

senior managing director at Yorkville

Ives. He spoke with Bloomberg TV host

Heidi Strad Watson. Cherion.

>> So, does this give enough of that

catalyst that we'll continue to see the

justification for how much spending is

being poured into the space?

>> Yeah. I mean, look, it's validation. I

mean, if you look at what we saw with

Alphabet in terms of the capex and now

you look at Intel, you piece it

together, this is showing this AI

revolution and we're just starting in

terms of this next growth frontier. I

think that's what investors want to see

across the board and you're starting to

see it now from Intel.

This is a market that given the amount

of volatility that we've seen, clearly

investors are chasing for that next

catalyst, the next justification, the

next support level, right? Do we

continue to see the volatility play out?

>> You're going to continue to see the

volatility play out. But when you think

about where the data center build is and

in terms of what's ultimately going to

be physical AI and just more and more of

a data center spending, I mean, you're

going to have what call three to four

trillion dollars being spent. You're

only about 15% through and that's how

you have names like Intel doing what

they're doing. But you piece it together

with what we see from Alphabet, with

what we see across tech. And I think

this is it sets the tone for what we're

going to see in earning season over the

next few weeks.

>> Which ones are you watching closely

right now?

>> I think look, it's the rest of the

hyperscalers because you got to see how

Microsoft and Amazon ultimately in terms

of that cloud growth. I think that's one

of the best barometers

relative to that. what we see, look, we

saw it in Alphabet, but now you got to

see it in Microsoft as well as Amazon

because that pieces together what we're

ultimately going to see across tech.

Look, it it speaks to our view. This is

a true fourth industrial revolution

playing out and we're just in the early

stages of it and the earning season just

further validates what we're seeing

across the board where the enterprise

spend is.

>> Expectations are so high though. I mean

the way that Alphabet is trading despite

the results, what sort of metrics will

you be watching to see how stocks also

move and is that a clear reflection or

the appropriate reflection of their

strength?

>> You know, it's a great question. I think

right now the issue is you're in between

capex and monetization stage, but if you

saw Alphabet, I mean that the cloud

growth was phenomenal. And now it all

comes down to investors. Where's the

patience? You see that with a name like

Tesla versus do you start to see the

monetization in Meta, in Microsoft, in

the rest of software earnings, in

infrastructure. I think that's what

investors are focused on because what

Intel is showing you the spending is

there and that's that's ultimately I

think when you look at names like

Nvidia, you go down the semifood chain,

it's a positive for broader tech. Now it

comes down to your between the capbacks

and the monetization. Patience is

obviously an issue for investors, but

when you put up the numbers, investors

are going to reward it.

>> We're going to see more reward when it

comes to the AI names outside of these

top markets. Are you perhaps more

compelled by the opportunities in China

given the developments in Moonshot and

what looks like a pretty rapid closing

of that AI gap?

>> Yeah, look, this is a two- horse race

between the US and China. And the

reality is when it comes to robotics,

China's leading. When it comes to power,

they're leading. When you see on the on

when it comes to open source, what we

see on the models, that gap's going to

continue to narrow. I think for China

now, it's really what you want to see in

terms of the use cases relative to big

tech playing out within China. But it's

our view. You can't just play the US

China market. You you you have to also

think about where this is. What's the

ripple effect? It's going to be Middle

East. It's going to be India. But right

now, it's US and China that are at the

top of the mountain. And you're seeing

continued competition, which is good for

ultimately for investors.

>> How difficult might the regulatory

environment become? We've had another

case this week of uh potentially AI

going ary, right? When it comes to open

AI,

is this going to become more of an issue

for politicians worldwide? and will we

see these sort of regulatory curbs when

it comes to the technology and and the

scale?

>> I think that's going to be front and

center. It's going to be a clear

political issue when it comes to the

midterms data center buildout. You see

the moratorum in New York, you know,

from from Hokll, some of the stuff that

we're seeing across the United States.

You'll see it in China as well in terms

on the models. This is going to be a

tugof- warar. But again, the problem is

when politicians get involved in

technology, that's not a good formula

because you stop innovation. And I think

that's this is going to be the balance

that will continue to play out across

tech, whether it's in the US or China.

When it comes to politicians getting

involved, we've seen sort of a different

picture across Asia where governments

are really putting very heavy investment

sort of an industrial policy towards

artificial intelligence toward

semiconductors as well especially across

South Korea for example. Um what does

this mean in terms of competition among

economies and some of these players as

well? A lot of these government uh

related projects are to do with Samsung

SKH Highix for example.

>> Look, I mean Korea I think is almost the

poster child. What you see there, you

see it from the government down to

obviously the memory boom. Go back a few

years ago. I mean the Korean market was

you was not going to be front and center

relative to where it is today. You're

going to see other countries I think

take that lead. the the private public

partnerships are going to be extremely

important because this is an arms race

that's happening globally. It's US,

China. But when it comes to memory, you

look what Korea's done. And I think many

other countries are looking to say,

okay, how did they No country wants to

watch the AI revolution from the stands.

They don't want to watch it from the

outside in. And I think that right now

is sort of the balance that we're seeing

play out across time. That was Dan Ies,

partner and senior managing director at

Yorkville Ives, speaking with Bloomberg

TV host Heidi Strad Watts and Sheron,

bringing you their conversation here on

the Daybreak Asia [music] podcast.

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Welcome back to the Daybreak Asia

podcast. I'm Doug Krer. It has been

frequently stated that energy is the

biggest constraint to the buildout of

global AI. Many countries are turning to

nuclear power as a way of addressing it.

Perhaps nowhere better reflects that

push than in Asia and especially Japan.

We had a chance to speak with Nouo

Tanaka. Nabouo is executive director

emmeritus at the International Energy

Agency. He spoke with Bloomberg's

Sherion. We were talking a little bit

about the difference on how much nuclear

energy proliferation has accelerated or

that push across Asia. How does this

differ from the western countries?

>> Well, thank [snorts] you for inviting me

Sherry. Uh the Asian countries need

energy and electricity to make the

economic growth and Asia is a growth

center. So certainly Asian needs the

very sustainable model of of the uh

electricity and for that sake nuclear

will be a very important part of the

their portfolio. Uh electrification is a

key element of reducing dependency of

oil and gas from Middle East. So they

are urged to do this electrification and

nuclear small module reactor

particularly will play a very important

role but they have to learn from Japan's

mistaken Fukushima for example.

>> I want to get there but first of all let

me ask about what's happening globally

as well when it comes to this awareness

of the need of nuclear [clears throat]

power in the energy mix given of course

all of the geopolitical upheavalss that

we've seen the past few years. Yeah,

because thanks to the you know current

uh climate change mitigation, current

economic issue, energy security issue,

nuclear focus is very much uh in the

center of the discussion of the energy

policy. Germany may change their policy

against nuclear tomorrow in favor. The

prime minister decid I mean announced

that and Asia it needs the kind of

policy of very safe nuclear as well as

affordable nuclear for that I am

strongly urging Asian country particular

Assean should take a coordinated

position of the nuclear model if they

have the similar model and standardized

model of the nuclear the cost will be

smaller because you can you can make a

coalition or purchase and procurement

will push the provider to reduce the

price and at the same time regulatory

framework could be similar right if all

the countries of Asan has the same

reactor the regulatory framework should

be same so then you can keep the safer

model of the nuclear power so I urge

Assean countries has now connecting each

other by Asian super grid and by that

that you have to make a kind of sense of

where to locate a nuclear plant in the

best mix of the nuc energy sources and I

think this is a great opportunity the

asan can make a difference

>> you mentioned small modular reactors

SMRs how big of a game changer are they

>> ah this is going to be interesting

because small modular reactor can be a

dedicated power for the data center or

AI generation so it's not connected to

the grid but used for particularly to

the industry for the heat or

particularly for the data centers. So I

think and also the small mod reactors

best point is that it's the safety and

the reduce the risk of accident and

emergency planning zone of SML can be

contained within the plant that means

you don't have the evacuation plan for

the surrounding population. This will

give a much better public acceptance of

the reactor and the design of the small

module reactor could can fit to the

local needs right data center needs or

more backup to the renewables or

security issues. So I think public local

people can accept small modular reactor

much better than the large reactor which

serve to the urban areas but not

themselves. They're only sharing the

risk. That is the reason why the

negative reaction happens to the from

the host community.

>> I mean you mentioned what happened in

Fukushima. We have three mile islands as

well. We have Chernobyl as well and we

have nuclear generation electricity

actually having since the 1990s or so.

>> Um are we seeing that change mentality

now given the need? Yeah, I think

because of uh the accident certainly the

caution about the safety increases but

at the same time if the data center

needs such amount of huge electricity

sustain I mean in a way uh the

decarbonized power nuclear is the only

answer. So public acceptance to the

nuclear especially the Middle East

situation Ukraine situation it increase

dramatically. So this is a great

opportunity if the governments put the

right incentives or right regulatory

framework or collaboration among the

countries then I think nuclear may have

a very good future.

>> Are you seeing any moves towards that? I

think so because the governments are

talking about the nuclear collaboration.

For example, Korea wants to do more

collaboration with Japan for developing

the sustainable nuclear model for the

future and selling together to the

global community. I think US has a very

interesting model of sustainable nuclear

which I promote integral fast react. can

take care of the waste radioactive waste

and safety uh uh requirement is very

good and also proliferation resistant

because of the nuclear war threat is

everywhere. We have to have a technology

which is resistant for the proliferation

risk

>> when it comes to building that sort of

nuclear ecosystem. Who do you think

across Asia is doing it? Well, Asia is

the best place to test that kind of

model because Asia is a very growth

center of economy and they have

experienced a very risk of the energy

security from the Middle East oil, gas

etc. And also it can be a very good

peaceful arrangement of the Assean can

show that the nuclear can play a very

important role of their alliance and

coalition and the peaceful use of the

energy for the future. So I really want

that asan will carefully take close look

what kind of models of SMLS available.

It is growing in many countries not yet

established but there are many different

types. So I think Assean should take a

good uh study of uh the models as well

as I think asan country should learn

from our mistakes in Fukushima. It is a

human error.

>> Human error you can learn from our

mistakes and then avoid the risks of

accident. That kind of you know

wellprepared

policy of ASEAN can make an AEAN Asia as

a center of the future sustainable

nuclear.

>> That was Nibouot Tanaka executive

director ammeritus at the international

energy agency speaking with Bloomberg TV

host Sheran bringing you their

conversation here on the Daybreak Asia

podcast.

Thanks for listening to today's episode

of the Bloomberg Daybreak Asia Edition

podcast. Each weekday, we look at the

stories shaping markets, [music]

finance, and geopolitics in the

Asia-Pacific. You can find us on Apple,

Spotify, the Bloomberg Podcast YouTube

channel, or anywhere else you listen.

[music] Join us again tomorrow for

insight on the market moves from Hong

Kong to Singapore and Australia. I'm

Doug Krissner [music] and this is

Bloomberg.