# Alphabet, Amazon Outpace Meta in AI During Earnings Bonanza

An episode of [Bloomberg Intelligence](https://invisiblenetwork.ai/podcast/326301337), 30 Apr 2026, 19 min.

Audio: https://podtrac.com/pts/redirect.mp3/tracking.swap.fm/track/UVBrz8bN8aM2Xe47PEPu/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/7f534b8c-9e91-429a-b102-ae3c00090c6d/aafe0bfa-f0ff-48ba-b367-b43c011d00f2/audio.mp3?utm_source=Podcast&in_playlist=0ad812bf-fd15-4012-a18c-ae3c00090c76

Watch Paul and Scarlet LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg Intelligence hosted by Paul Sweeney and Scarlet Fu -Mandeep Singh, Global Tech Research Head at Bloomberg Intelligence, recaps earnings from Meta and Alphabet. Meta Platforms shares plunged after the company raised its spending outlook for the year, driven by its AI strategy and higher component pricing and data center costs. Alphabet shares jumped after the company reported strong demand for its cloud and artificial intelligence offerings. -Anurag Rana, Bloomberg Intelligence Technology Analyst, recaps earnings from Microsoft and Amazon. Microsoft said cloud computing revenue and spending on AI infrastructure will accelerate this year, with Azure cloud unit sales expected to increase about 40% in the current quarter. Amazon.com is spending at a rapid rate to expand data center capacity to meet the intense demand for artificial intelligence computing power, fueling the fastest quarterly sales growth for its cloud unit in more than three years. - Sam Fazeli, Bloomberg Intelligence, Director of Research for Global Industries and Senior Pharmaceuticals Analyst, discusses earnings from Eli Lilly and Merck. Eli Lilly raised its annual sales and profit forecast due to high demand for obesity medications and its new weight-loss pill. Merck & Co. reported first-quarter sales that beat Wall Street estimates as demand ramps up for newer products like Winrevair and an injectable version of cancer blockbuster Keytruda. -Christopher Ciolino, Bloomberg Intelligence Senior US Machinery Analyst, discusses Caterpillar earnings. Caterpillar's shares surged after the company delivered stronger-than-expected quarterly earnings and raised its long-term revenue outlook, supported by fast-growing sales from construction and power generation equipment. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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[0:21] Speaker 1: or watch us live on YouTube.
[0:23] Speaker 2: Yesterday after the close, a lot of the big tech
[0:25] Speaker 2: names reporting, and it's kind of the market's kind of
[0:28] Speaker 2: trying to suss out some winners and losers. Google, I
[0:31] Speaker 2: guess on the plus side Meta, Yeah, not so Mindsight.
[0:34] Speaker 2: So let's check in with man Deep Singh. He does
[0:36] Speaker 2: all the technology stuff for Bloomberg Intelligence. Man Deep metatrating
[0:39] Speaker 2: down ten percent. Let's start there. What's the market reacting to?
[0:44] Speaker 3: Oh, the market is reacting to the capex increase when
[0:47] Speaker 3: they don't have much to show, unlike their hyperschol Cloud peers,
[0:53] Speaker 3: who clearly have seen that top line benefit. I mean,
[0:57] Speaker 3: Metta's top line growth is very strong, you know, thirty
[1:01] Speaker 3: three percent at the two hundred million dollar run rate
[1:04] Speaker 3: is very impressive. It's just that when you look for
[1:07] Speaker 3: that extra line item where AI is categorized separately, they
[1:13] Speaker 3: don't have much to show for it. And right now,
[1:15] Speaker 3: the growth in AI is around coding agents. So Meta
[1:20] Speaker 3: has a model, they've released it, but it's not something
[1:24] Speaker 3: that specializes in coding agent. They are targeting more of
[1:28] Speaker 3: the personalized superintelligence personal assystem that kind of a use case,
[1:33] Speaker 3: and they just haven't given us enough in terms of
[1:36] Speaker 3: our timeline when they will start monetizing that use case. So,
[1:40] Speaker 3: all in all, CAPEX increase tied to memory components, not
[1:45] Speaker 3: really tied to additional capacity, but it was enough to
[1:49] Speaker 3: cause this, you know, ten percent drawdown in the stock.
[1:52] Speaker 3: Overall fundamentals were still strong when they reported the quarter
[1:56] Speaker 3: for their core business.
[1:57] Speaker 4: Yeah, I guess investors don't like it to year when
[2:00] Speaker 4: the CEO is saying there isn't a very precise plan
[2:03] Speaker 4: for how each AI product will be cultivated sounds too
[2:06] Speaker 4: generic for their liking. We should mention as well. Meta
[2:09] Speaker 4: is now looking to sell up to twenty five billion
[2:11] Speaker 4: dollars in investment grade bonds to kind of fund out
[2:14] Speaker 4: all those spending plans they have. Speaking of spending plans,
[2:17] Speaker 4: alphabet is increasing its spending plans by I think about
[2:21] Speaker 4: another ten billion dollars.
[2:24] Speaker 3: Yeah, and look when you compare the magnitude of increases
[2:28] Speaker 3: from Microsoft, which raised almost you know, by thirty five
[2:31] Speaker 3: forty billion dollars in capex. Meta raised it by over
[2:36] Speaker 3: almost twenty billion, and that was mostly attributed to memory
[2:40] Speaker 3: price increases. So the question is why was Alphabet increased
[2:44] Speaker 3: not of the same magnitude. Yes, they raised, but it
[2:47] Speaker 3: was a very slight increase. And that kind of goes
[2:50] Speaker 3: to show that Alphabet, out of all the hyperscalers, has
[2:55] Speaker 3: the best capex efficiency. They are able to use their
[2:59] Speaker 3: commute across their apps so that it's searched YouTube. Also,
[3:05] Speaker 3: the cloud business is growing at the fastest rate compared
[3:08] Speaker 3: to other hyperscalers, so that capex efficiency is what's driving
[3:12] Speaker 3: a lot of the margin upside, and it's reflected, you know,
[3:15] Speaker 3: in their numbers and guidance. So even though it was
[3:18] Speaker 3: a bet and race from everyone, Alphabet's beaten race was
[3:21] Speaker 3: the most impressive and hence the stock reaction.
[3:25] Speaker 2: Mandy, where do you think we are in this hyper
[3:28] Speaker 2: investment phase for AI? Is are we going to do
[3:32] Speaker 2: this for another quarter or two or is this going
[3:34] Speaker 2: to be a couple three years.
[3:37] Speaker 3: I mean, this definitely has the makings of a super cycle.
[3:40] Speaker 3: Almost everyone you know on the call yesterday from the
[3:44] Speaker 3: management teams talked about how you know demand far exceeds supply,
[3:50] Speaker 3: and look, the compute usage is showing up in the
[3:54] Speaker 3: cloud numbers. When you think about even Amazon one hundred
[3:58] Speaker 3: and fifty billion dollar business growing at twenty eight percent
[4:02] Speaker 3: and Google eighty billion dollars cloud business growing at sixty
[4:06] Speaker 3: three percent. So you are seeing that ROI with these
[4:09] Speaker 3: AI investments. There's no reason to curtail that investment when
[4:14] Speaker 3: you're seeing this kind of a top line lift. The
[4:16] Speaker 3: only thing is, you know, component pricing a memory notably,
[4:21] Speaker 3: is eating up a lot of this CAPEX increase. That's
[4:25] Speaker 3: just again a function of demand being much higher than
[4:28] Speaker 3: what these companies can supply in terms of components.
[4:32] Speaker 4: Stay with us more from Bloomberg Intelligence coming up after this.
[4:38] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[4:42] Speaker 1: weekdays at ten am Eastern on Apple Corplay and Android
[4:45] Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
[4:49] Speaker 1: you get your podcasts, or watch us live on YouTube.
[4:52] Speaker 4: Doing some of the big earnings. Meta and Microsoft are
[4:56] Speaker 4: big drags on the Nasdaq one hundred, while you have
[4:58] Speaker 4: Alphabet going off basically to the moon right now because
[5:02] Speaker 4: it's seen as the winner, and it's seen as the
[5:04] Speaker 4: most efficient user of capex. It's been able to turn
[5:09] Speaker 4: around investments and returns on that Capex. Let's bring in
[5:13] Speaker 4: on rog Rana of Bloomberg Intelligence. He is our tech
[5:16] Speaker 4: analyst joining us from Chicago. Onrag walk us through the
[5:20] Speaker 4: results from Microsoft. First of all, Alexis mentioned how the
[5:24] Speaker 4: cop business saw good growth, but perhaps not good enough
[5:27] Speaker 4: for investors.
[5:29] Speaker 5: You know, again, it's a question of relative growth compared
[5:32] Speaker 5: to their peers. So for Microsoft, growth accelerated one hundred
[5:36] Speaker 5: one percentage points from thirty eight percent to thirty nine
[5:39] Speaker 5: in constant currency, But when you look at Google it
[5:41] Speaker 5: went from forty eight percent to sixty three. So I
[5:44] Speaker 5: think it's all it's a relative game. Even in the
[5:47] Speaker 5: case of Amazon Web Services last quarter they grew at
[5:50] Speaker 5: twenty four percent this quarter twenty eight, So we are
[5:53] Speaker 5: really splitting hairs. But I think that's what's really happening
[5:55] Speaker 5: at this point.
[5:57] Speaker 2: There's no scenario where Microsoft's not a huge winner in
[5:59] Speaker 2: a is there on a roun.
[6:02] Speaker 6: No, No, absolutely, you're right about it.
[6:04] Speaker 5: But again it's a matter of One of the things
[6:06] Speaker 5: we discussed even yesterday was if you go back in
[6:08] Speaker 5: the history of Microsoft, they were the first company to
[6:12] Speaker 5: showcase AI revenue and they saw a lot of benefit
[6:16] Speaker 5: for that one one and a half years when everybody
[6:18] Speaker 5: thought Amazon and Google is behind. Now it's slightly on
[6:22] Speaker 5: the other side. They are seeing the benefit of AI
[6:25] Speaker 5: which they didn't see, which means relative growth rates a
[6:28] Speaker 5: higher for them. But in the case of Microsoft, they
[6:30] Speaker 5: have a very successful AI business. Their AI round rate
[6:33] Speaker 5: is much higher than anybody at this point. They have
[6:36] Speaker 5: Copilot adoption very fast paced. Azure is doing well, and
[6:40] Speaker 5: the funny thing is Azure is now one hundred plus
[6:43] Speaker 5: billion dollar business. I think we think it's somewhere around
[6:45] Speaker 5: one hundred and ten billion, growing at forty percent. I mean,
[6:48] Speaker 5: I think that's very impressive. But again it's a question
[6:51] Speaker 5: of if Google can beat by such a big margin, well,
[6:54] Speaker 5: why why couldn't you.
[6:55] Speaker 4: I'm glad you bring up copilot because isn't there some
[6:58] Speaker 4: concern that there's only a small percentage of Microsoft Office
[7:02] Speaker 4: users who are paying for Copilot AI tools. I mean,
[7:05] Speaker 4: everyone has access to it, but not everyone wants to
[7:07] Speaker 4: pay for it.
[7:09] Speaker 5: That is the biggest growth opportunity for them. Frankly, if
[7:11] Speaker 5: you see they have about four hundred plus million users.
[7:14] Speaker 5: Out of those four hundred million users, we think about
[7:17] Speaker 5: two hundred of them are power users people like you
[7:20] Speaker 5: and Paul, and then within that cohote, only twenty million
[7:24] Speaker 5: of them are paying right now.
[7:25] Speaker 6: So the penetration rate is let's say about ten percent.
[7:28] Speaker 5: Over time, that's going to increase, and that's where the
[7:31] Speaker 5: art to increase is going to be. And see a
[7:34] Speaker 5: much rapid growth rate both in terms of the number
[7:38] Speaker 5: of users going up and then you know, taking up
[7:40] Speaker 5: dollars a long with it.
[7:41] Speaker 2: So get them hooked first, right, Paul, yep, this is
[7:44] Speaker 2: a milestone day for AI Universe.
[7:47] Speaker 7: You know why why I downloaded the chat gpt today
[7:54] Speaker 7: for the first time ever, first time? What was your
[7:56] Speaker 7: first question to chat gpt?
[7:57] Speaker 2: Well, Sarah Livesey, one of our producers, show me. She
[8:00] Speaker 2: went in said, hey, give me a picture of traders
[8:04] Speaker 2: looking for direction, you know, like in the market, and
[8:07] Speaker 2: it gave her like a great image. So I did
[8:09] Speaker 2: the same thing and it wasn't as good an image,
[8:11] Speaker 2: but it was a pretty good good image. So Sara
[8:12] Speaker 2: is much better than that than I am. But Fursing,
[8:16] Speaker 2: I'm getting there an rock. How about Amazon here their
[8:19] Speaker 2: cloud that business seems to be big and again another
[8:21] Speaker 2: one of these companies thrown a lot of money at
[8:24] Speaker 2: this business.
[8:25] Speaker 5: Now, Amazon Web Services over one hundred and fifty billion
[8:28] Speaker 5: dollars run rate. Business grew twenty eight percent. We think
[8:32] Speaker 5: that rate of growth actually improves in the next few
[8:34] Speaker 5: quarters because of the massive backlock. Imagine just a few
[8:38] Speaker 5: days ago they added open EI models into their entire ecosystem,
[8:42] Speaker 5: which they didn't have access to before. That's going to
[8:45] Speaker 5: you know, spur even more enterprise AI adoption. One of
[8:48] Speaker 5: the things people don't realize is when it comes to
[8:51] Speaker 5: Fortune two thousands, who are the biggest spenders of money,
[8:55] Speaker 5: bulk of their data is in Amazon Web Services. That's
[8:58] Speaker 5: all the cloud transition that get happening for the last
[9:01] Speaker 5: fifteen twenty years. So they are actually at the center
[9:04] Speaker 5: of this agentic shift for enterprises going from you know,
[9:08] Speaker 5: the legacy way of doing stuff towards agents.
[9:11] Speaker 7: Stay with us more from Bloomberg Intelligence coming up after this.
[9:18] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[9:22] Speaker 1: weekdays at ten am Eastern on Applecarplay and Android Auto
[9:25] Speaker 1: with the Bloomberg Business app. Listen on demand wherever you
[9:29] Speaker 1: get your podcasts. Or watch us live on YouTube.
[9:32] Speaker 7: Let's head over to London.
[9:33] Speaker 2: Sam Fizzelli, director of Research for Global Industries, senior pharmer Analysts.
[9:37] Speaker 7: I have no idea where he is. He could be London,
[9:38] Speaker 7: convenientingwhere in the world.
[9:39] Speaker 2: That's how this guy rolls, but he covers all the
[9:41] Speaker 2: pharmer for Bloomberg Intelligence. Sam, I assume you and your
[9:44] Speaker 2: team have been kind of busy here. We've got some
[9:46] Speaker 2: earnings coming out of the farmer companies here Eli Lilly
[9:50] Speaker 2: raising its annual sales and profit forecast to high demand
[9:54] Speaker 2: forro BC medications, where that's just like perfect for this
[9:57] Speaker 2: market and a stocks up nine percent today.
[9:59] Speaker 7: What did you hear from Lill Yeah.
[10:01] Speaker 6: So, Paul.
[10:02] Speaker 8: I mean, the interesting thing here is that there's been
[10:06] Speaker 8: quite a lot of skipts.
[10:07] Speaker 6: Particularly everybody was so focused on this oral drug, you know.
[10:11] Speaker 8: The pill that they've got launched in the US, YEP,
[10:14] Speaker 8: and so focused on that and tracking the weekly prescriptions
[10:17] Speaker 8: that they forgot. Actually there's an en homeost Jugger note
[10:19] Speaker 8: of a business behind it and was driven this two
[10:22] Speaker 8: billion dollar increase from eighty to eighty two. On the
[10:25] Speaker 8: little side of the guidance for twenty twenty six in
[10:29] Speaker 8: sales is x US sales. So that's actually quite good
[10:34] Speaker 8: because a lot of people always just keep thinking that
[10:38] Speaker 8: everything is all US based and everything's.
[10:39] Speaker 6: Going to be driven by US.
[10:40] Speaker 8: But of course here we've got that increase and that's
[10:43] Speaker 8: what's driving it. High quality beat nine percent, nine point
[10:47] Speaker 8: one percent up this minute.
[10:49] Speaker 4: All right, so good news for those who are investors
[10:51] Speaker 4: in Eli Lilly. That's a massive move nine percent up
[10:54] Speaker 4: for the company.
[10:56] Speaker 8: It had been suffering Scarlett because of the issues people
[11:00] Speaker 8: worrying about that pill.
[11:01] Speaker 4: Ah, so maybe a little bit of catch up there
[11:03] Speaker 4: as well. Mark also reported results and it beat its
[11:06] Speaker 4: sales estimates. Demand for newer drugs remind me, does Mark
[11:10] Speaker 4: have a weight loss drug on the market or is
[11:12] Speaker 4: it developing any weight.
[11:13] Speaker 6: Loss drug they are developing.
[11:15] Speaker 8: They're developing one, yes, there, I think everybody is kind
[11:18] Speaker 8: of they've got one that they've licensed. Pretty much everybody's
[11:21] Speaker 8: got their finger in that pie. I can't say absolutely everybody.
[11:25] Speaker 8: Most people have got their finger in the pie trying
[11:27] Speaker 8: to get a something on the market. And rash AstraZeneca
[11:32] Speaker 8: and time will tell whether they can compete in this.
[11:35] Speaker 8: Clearly these guys are sewing up the market. Between themselves
[11:37] Speaker 8: and Nova Noor Disk. So Mark's results were a little
[11:40] Speaker 8: bit more I would say, meh, and as a sure
[11:43] Speaker 8: price suggested pointy six percent up, there was a beat.
[11:46] Speaker 8: But then of course that much of that was driven
[11:48] Speaker 8: by inventory build, which is not something that the market
[11:52] Speaker 8: gets too excited by because it's one off. And then
[11:55] Speaker 8: of course one of the reasons I think they've been
[11:57] Speaker 8: able to guide to a higher EPIS is because they're
[12:00] Speaker 8: going to have lower charges associated with an ideal they've
[12:05] Speaker 8: done and that's not really that's not a quigh quality beat.
[12:09] Speaker 6: So business steady issue.
[12:12] Speaker 7: Goes Mark based in Rahway, New Jersey station stop Rahway.
[12:17] Speaker 3: There you go.
[12:17] Speaker 7: That's how I know Rahway station stop Rahway, Like I
[12:20] Speaker 7: never get off. That's where k is is big farmer land.
[12:24] Speaker 7: It is Jersey that you can just have an that's
[12:26] Speaker 7: the entire state practically.
[12:29] Speaker 2: Mark so sam for these oral obesity drugs. To what
[12:34] Speaker 2: degree do you think that's going to expand the market.
[12:38] Speaker 6: Yeah, so I think cann get down these expectations.
[12:41] Speaker 8: Folks are looking for one and a half billion dollars
[12:43] Speaker 8: from a Lily's pill this year and it's only.
[12:46] Speaker 6: Been on the market for a couple of a couple of.
[12:48] Speaker 8: Weeks to or three weeks, right, so, and that might
[12:53] Speaker 8: be a tough number to get to, especially listening to
[12:55] Speaker 8: what the management were saying a little bit about the
[12:57] Speaker 8: fact that they need to activate a whole bunch of
[13:00] Speaker 8: et cetera. And there is a question that comes to mind.
[13:03] Speaker 8: We know that there we go VW pill. Although it's
[13:06] Speaker 8: a bit more of a cumbersome thing. You have to
[13:07] Speaker 8: take it half an hour before eating breakfast, et cetera.
[13:12] Speaker 8: It gives you a better weight loss in terms of
[13:14] Speaker 8: the average weight loss, say fourteen percent versus twelve Let's
[13:17] Speaker 8: say let's say that's about the delta between them and we.
[13:21] Speaker 8: So what are you going to do? You're going to
[13:24] Speaker 8: worry so much about your breakfast. I mean, nobody gets
[13:28] Speaker 8: up and eats straight away, right, so they're going to
[13:31] Speaker 8: take their job, potentially, shower, get ready, et cetera. So
[13:35] Speaker 8: maybe it's a bit more likely that people will continue
[13:38] Speaker 8: on that and that really will have a tough time
[13:41] Speaker 8: gaining momentum with its aural pill, which is an aural
[13:43] Speaker 8: pill literally an oral pill. You just pop it, nothing
[13:46] Speaker 8: to do with its fasting or anything. And then of
[13:50] Speaker 8: course you go to twenty thirty, you get to twenty
[13:52] Speaker 8: eight billion dollars. So look, they have the better obesity
[13:58] Speaker 8: injection today in terms of efficacy.
[14:02] Speaker 6: Nova has the better pill in terms of efficacy.
[14:05] Speaker 8: So it's just going to be both of them are
[14:07] Speaker 8: going to be finding for that market share, and Nova's
[14:09] Speaker 8: kind of corrected quite a lot.
[14:12] Speaker 7: Stay with us.
[14:13] Speaker 4: More from Bloomberg Intelligence.
[14:14] Speaker 7: Coming up after this.
[14:18] Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live
[14:22] Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
[14:25] Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever
[14:28] Speaker 1: you get your podcasts, or watch us live on YouTube.
[14:32] Speaker 2: All right, let's get back to some of these earnings here.
[14:36] Speaker 2: Caterpillar some really strong numbers here, and when we want
[14:38] Speaker 2: to talk all that big machinery stuff, we go to
[14:40] Speaker 2: Chris Giolino. He's a Bloomberg Intelligence follows all those big
[14:44] Speaker 2: engineering companies and construction companies.
[14:47] Speaker 7: Chris talked to us about Caterpillar here and their quarter.
[14:51] Speaker 9: Yeah, you know, kat continues to deliver against pretty lofty
[14:54] Speaker 9: expectations with another top and bottom line beat this quarter,
[14:58] Speaker 9: really solid across the highlighted by better than expected performance
[15:02] Speaker 9: in their construction business and sustain momentum power and energy.
[15:06] Speaker 9: But I think really more importantly here, their record backlog
[15:10] Speaker 9: continues to grow significantly quarter over quarter, and management raised
[15:15] Speaker 9: their long term twenty thirty growth targets. They also announced
[15:19] Speaker 9: that they're going to invest in some additional large engine
[15:22] Speaker 9: capacity expansion. So the long term visibility just continues to improve,
[15:27] Speaker 9: which we think, you know, should continue to drive these
[15:30] Speaker 9: upward earning cycle revision.
[15:32] Speaker 4: And this is something that Matt Griffin of Bloomberg News
[15:35] Speaker 4: has highlighted. He came on to talk to us about
[15:37] Speaker 4: how Caterpillar was another way to play the AI boom.
[15:40] Speaker 4: How much of this backlog and the growth that Caterpillar
[15:45] Speaker 4: is seeing is directly tied to AI build out.
[15:49] Speaker 9: So it's a large portion, right, It's you know, now
[15:52] Speaker 9: power and energy is approaching, you know, roughly half the
[15:55] Speaker 9: size of the business. But I think one of the
[15:58] Speaker 9: takeaways I took from this COO was that the backlog
[16:01] Speaker 9: was really up across all businesses, and it's kind of
[16:05] Speaker 9: at a unique time for Caterpillar, and that not only
[16:08] Speaker 9: do we have all these secular tailwinds on the power
[16:11] Speaker 9: generation side, but now we're starting to see that the
[16:14] Speaker 9: cyclical tailwinds start to kick in in terms of construction
[16:17] Speaker 9: and mining, So all three businesses really starting to contribute
[16:21] Speaker 9: to the overall enterprise.
[16:23] Speaker 2: And shares a Caterpillar today are up eight point eight
[16:26] Speaker 2: percent of fifty three percent this year, up one hundred
[16:29] Speaker 2: and eighty four percent on a trailing twelve month basis. Wow,
[16:32] Speaker 2: fifty two week high, an all time high for the
[16:35] Speaker 2: stock eight hundred and eighty dollars a share.
[16:37] Speaker 7: They need a ten for.
[16:38] Speaker 2: One split badly. I think so it is just because
[16:42] Speaker 2: of the power business matter. When I think it, you know,
[16:45] Speaker 2: company like Caterpillar, I think of a cyclical business.
[16:48] Speaker 7: Is this making this business less cyclical?
[16:52] Speaker 9: You know, it may help mitigate some of the cyclicality
[16:56] Speaker 9: At the end of the day, I don't think it
[16:58] Speaker 9: changes the underlying fundam mentals of the business. This is
[17:01] Speaker 9: still ultimately going to be a cyclical business over time.
[17:06] Speaker 9: But you're certainly seeing that, you know, the power gen
[17:10] Speaker 9: power energy business, that backlog just continues to grow. So
[17:14] Speaker 9: we have that additional production visibility which has really helped,
[17:19] Speaker 9: you know, provide a little bit of a floor at
[17:21] Speaker 9: least during this downturn. As construction and mining were quite
[17:25] Speaker 9: soft over the past few years. So yeah, short answer,
[17:29] Speaker 9: it helps mitigate it, but longer term it's still it's
[17:32] Speaker 9: going to be a cyclical business.
[17:34] Speaker 4: Okay, I'm still kind of stunned by some of the
[17:36] Speaker 4: numbers that Paul just rattled off. Who is Caterpillar's biggest competitor,
[17:40] Speaker 4: who picks up some of the slack that Caterpillar can't
[17:42] Speaker 4: get to.
[17:44] Speaker 9: Yeah, I mean, as Paul alluded to, I mean, the
[17:46] Speaker 9: numbers are quite staggering, and really if you look at
[17:49] Speaker 9: the valuations, it's quite hard to digest as well. But
[17:54] Speaker 9: you know, they continue to deliver and exceed expectations. It
[17:58] Speaker 9: seems like quarter and in quoter out In terms of competition,
[18:02] Speaker 9: you know, if you think about some of the more
[18:04] Speaker 9: traditional equipment, particularly in the dirt or mining, it's Comatsu.
[18:09] Speaker 9: They are the largest competitor to cat particularly on some
[18:13] Speaker 9: of the equipment businesses. You also have Deer who's trying to,
[18:17] Speaker 9: you know, make bigger inroads into construction equipment. They're launching
[18:20] Speaker 9: a whole new excavator lineup, and then there's a number
[18:24] Speaker 9: of other regional players. The hatachis Volvos of the world,
[18:28] Speaker 9: and then on the power gen side, it's pretty diverse.
[18:32] Speaker 9: You know where Cat plays, it still tends to be
[18:33] Speaker 9: kind of at the smaller end of the spectrum, right,
[18:36] Speaker 9: So think you know companies like Cummins who also have
[18:39] Speaker 9: the standby your backup power capacity.
[18:43] Speaker 1: This is the Bloomberg Intelligence podcast, available on Apple, Spotify,
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[19:08] Speaker 3: M

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