By the end of the year. Now, the Train Safety Technology will not be installed until 2020. The ntsb says it could have prevented sundays amtrak collision in south carolina. Another reason derailment near a yeah, washington. In all, five people were killed and dozens more injured in two new crashes. We have live pictures we would like to bring you from the house floor. Nancy pelosi is setting a record for the longest continuous house speech. The house historian says pelosi talked the record speech of five hours, 15 minutes. We will stay on top of that and much more. This is bloomberg news. Emily i am emily chang, and this is bloomberg technology. Electric carmaker still sees its model three meeting weekly goals. We will break down the results. Our exclusive conversation with Sheryl Sandberg and why she says Metoo Movement has not gone far enough. Travis kalanick once again takes the stand. Tesla jumping around in afterhours trading after reporting fourthquarter results in revenue that the analyst expectations. The electric carmaker burned through cash at a slower clip after making progress building more model three sedans. Tesla reported negative Free Cash Flow in the fourth quarter. The least in more than one year. Joining us now to further break down a result, nomura managing director and senior director. Cory johnson. Corey, break it all down. What do you see . Y i see a company that has been taking a lot of customer deposits for cars they cannot build. We knew was the numbers were, but it is striking that accompanied that was once a 70 g and had yearoveryear clip is less than 1 growth in terms of the number of cars it can build. What we are hearing from the model three i posted this on my a twitter page. Real car guys are looking over the car, the engineering of the model three, and finding real issues. They could put their thumb right through on one side and could barely see through the other side. It just looks really uneven. There are attachments of pieces of felt and things. The door does not close quite right. Legally, they are struggling with the production of this model three. It is more than they can handle right now. We see in the Earnings Release is much more promises about production, as we always see from tesla, and lots more borrowing and poor Free Cash Flow numbers, which is what we always see from tesla. Emily shares not changed much right now. What do you think . Are the things that cory is talking about here a concern . At thean, if you look results, what youre seeing is real progress. They built 220 model three cars in the third quarter. They built over 1500 model three cars in the fourth quarter, and based on their Production Guidance for the first quarter, they are going to build probably north of 15,000 vehicles. If they can continue on this wasectory, and i thought it important they reiterated their Production Guidance from the start of the year, then you have got a company that is going to grow their revenues roughly 100 , we think, to 25 billion dollars. Very hard to find a multibillion Dollar Company growing at this rate. A lookcory, lets take at g btv 2341. Production. Tesla cars produced each quarter over the last several orders. We are seeing it holding steady. What does that tell you . They are producing 1500 cars in the quarter, a couple hundred the previous quarter, and that is not what investors thought they were getting involved in it. I would be surprised if rmit believesthe romit the production guidelines since they keep missing their estimates over and over. World wants this company to be a great success. The cars look cool, safe, fun to drive. Problem is, tesla cannot build them. Emily do you believe it . Romit just look at the numbers. Productionsed their of the model three by a factor of 10 in the fourth quarter, and they are targeting to increase it by another factor of 10 in the first quarter. Cory do you believe those numbers, romit . Are you going to say they will put the numbers in . Romit we have these production numbers and our model. If you look at our price target of 500, it is predicated on growing revenues 100 this year. Emily what makes you so confident . Andknow, this is a company ceo that has admitted, you know, ell, and hasction h missed many targets. Romit its true, but you have to think about it this way. The world is moving towards electric vehicles. And tesla is really the only game in town, and will be for the next two years. To 4000whether they get units by the end of q2 or 5000 units misses the point. You have a multibillion Dollar Company that is growing at a very significant rate. If you look at the reviews, the customer reviews of the model three, and we have given ourselves, they are phenomenal. For most people, it will probably be the best car they will ever drive, and you see that in the backlog. They have got a backlog of over 500,000 reservations that continues to grow, so it is a premium car in the right segment of the automotive market, and you know, all they need to is get a couple percent game 2 market share in the automobile industry, and they are going to be doing, you know, they are going to be doing more than 100 billion in revenue, and i think the stock will be quite a bit higher. Emily cory, i know you have been digging into the cash flow situation here. What do you think . Cory here is why this matters. The company is going to run out of money if it does not get access to more money, and if it cannot build the cars and sell not gettinghat are built are only going to last so long. Free cash flow never got better this year. I have a chart. G something. It was on the screen here. This tesla Free Cash Flow number looks better. Better. Ow looks they are interestingly spending a little bit less in Capital Expenditures in terms of their factory and so on. They have positive cash flow from operations. If they only improve the performance of these new cars a little bit, what happened . You have got to dig into the numbers. Tesla does not tell us. One of the great things on the bloomberg terminal is you can hitantly hit kiev on the cf. And so, the question is, how do they do that . What was the change in deposits . The number has been negative most of the recent quarters. They do not give us the full cash flow savings so we can see what those changes are, but they had a 500 million improvement in positive cash flow operations, and virtually all of this comes from likely noncash changes in operating assets and my abilities. That is why a Free Cash Flow looks better. Emily cory johnson, editor at large. G btv 2434. Thank you. , thank you. Thank you for joining us. Snapck we are watching, shares soaring 50 after reporting its first earnings beat as a company. Sales rose to a better than expected 72 , and the number of daily active users rose 18 . These q4 result prompted at least five analyst upgrades. Vping up, former Google Megan Smith joins us to talk about improving diversity in the workforce. Check us out on the radio. Bloomberg. Com. In the u. S. On sirius xm. This is bloomberg. Emily the winklevoss brothers are not giving up on cryptocurrency despite bitcoin plunging below the 6000 mark to the lowest since midnovember. We are long on the space. We dont sit there and watch the price daytoday. Were in this for the long haul whether it is a decade or many decades. Like i said earlier, we remember when bitcoin was 8. As far as we are concerned, it is all gravy from here. Emily the twins were early bitcoin investors ,and at one point, their value was 1 billion each. They also say increasing regulation is good for the cryptocurrency space. Well over the last few years, big tech firms and startups have this the gender and racial makeup of their workforces, but for many companies, the numbers remain stagnant with no signs of improvement. I covered the topic in my book, brotopia breaking up the boys club of Silicon Valley, and my next guest has also championed diversity. Under president obama and as a Vice President as google before that, megan smith joins us now from washington. Great to have you back on the show. You have been out over the last few months on a tech job tour to get more people into technology. Im curious of what you are seeing in terms of diversity of the people who want to come into this industry and how it compares to the diversity of people who are already a. Megan yeah, we have been all over the country in appalachia, milwaukee. We were just in oakland. We had lines out the door and there were people that would love to be part of the tech sector. When we are coming into town cheyenne, denver, atlanta we , get the word out and running an evening career fair. The companies are showing up, and people are showing up for the speed mentoring we are doing. A lot of people want in on these better higherpaying jobs, that pay 50 more than the average american salary. Theres hundreds of thousands of jobs up in america. All companies are Software Tech companies at this point. Megan and yet emily and yet, gender representation in computing women make up 25 of , computing jobs. The statistics for blacks and latinos are downright depressing. And womenled companies are getting just 2 of funding. Why do you think that is still . Megan extraordinary sexism and racism, ageism. All of this. And we have kind of really we really have to evolve out of this culture. Your book is wonderful, emily. I am halfway through. I know so many people in there. It is just full of we got ourselves into this lets patternmap the person and profile the vcs were funding. It is a huge challenge. Over 90 of money from the venture world is going to men. 75 earn the tech jobs, and it is really going to Silicon Valley, new york, and boston. A lot of the country we were in columbus, and ohio is getting in one year what Silicon Valley is getting in a week. Services diversity of location, so this is diversity of location, of people. We have so much talent in america. Im encouraged because i saw also many entrepreneurs from all backgrounds that we really need to get behind and lift this country. Emily i am not sure if you have got through the google chapter yet, but i write in the book that google founders larry page and really focus on hiring strong women in the early days. Lots of incredible women like Sheryl Sandberg and yourself. If you look at the numbers today, googles numbers are simply average and facing this big lawsuit from the department of labor about pay disparity between men and women. What do you think went wrong or what is the lesson . Megan it is in all the companies. We just have extraordinary bias built in. Leadership really has to just make this a very top priority. The leaders of all the Tech Companies like all companies , care about diversity, but it needs to move from number 20 to number one. Diverse units make better products, so it is shareholder value opportunity and important for everybody. We really need to do this work. There is lots of stuff that most companies are not doing. We wrote a piece in the white house called raise the floor, and we listed all the things that leaders, and practices could do to make a huge difference if most people would pick them up. They just own up. We have a reckoning. This is part of times up. Plenty of time. Lets go. We have tons of history that brought us to this place, but none of us created this problem. But once we know about it, lets go. Emily you mentioned the times up movement, an outgrowth of the me too movement. I just spoke with Sheryl Sandberg. We will hear more from her later about the Metoo Movement. I asked her if metoo has gone too far. Sheryl i think the question is not if metoo has gone too far , but if metoo has gone far enough. Because it cannot just be a moment in time where people raise their voice. These brave women who have raised their voices, they want longstanding change. Change that is not just for the day or with a month but for the years and the decades. That means we have to have the right institutional policies and those policies have to include due process, investigation. Things need to be investigated and swift action needs to be taken. And importantly, we need to end the culture of complicity. We need to end the practice of looking the other way and it is not your responsibility, because it is all of our responsibility. Emily megan, discrimination is one thing. Sexual harassment is another. What do you think about the criticism of the Metoo Movement that it has crossed a line . Megan Sexual Harassment is rampant. And it is very clear from the brave people speaking up, many men are in shock learning how rampant it is. We really need women and men to come together and push forward. My sisterinlaw, when she was a young engineer in the 1970s, used to have a hustler centerfold above her lab. She was doing chip design. That was normal. You open your book with the photograph that was, you know this is the photograph , people were using to bench test all the different screens and it was a picture of a woman, but actually it was a , completely naked woman from playboy. When i was at google a story that you dont know i found out about this and i asked don eustis, who was head of engineering if we can stop using it, and he said of course. Men and women can work together. None of us created that problem, but it is longstanding. You also write about ada lovelace. She was not even allowed to write a proper paper. The founder of algorithms. So she took a piece that she was 20 page piece she was translating and added a 55 , page thesis of what modern computing was. She is the founder of what has become Computer Programming and coding, and we did not even know about her. I had never even heard of her until i was at 10 downing street sometime and saw her portrait. Emily i am so glad to here about that story and how receptive management was at google. You mentioned Things Companies can do. Im curious, your work at shift7, what are the top three things that people want to make this a priority can do whether the companies are big or small . Megan yeah, i think what is exciting is there are very good things to do. For example, leaders, just talking about it. One of the greatest moves was lou gerstner at ibm prioritized this transition in the 1990s. He took those employee Resource Groups the lgbt groups, the , womens groups, the veterans group, africanamericans, hispanics all these different , groups of talented employees and he connected his executive , team, which was not as thers, and he added it to agenda of the weekly executive meeting. A voice of many more employees was coming up. And then he asked those people , very specifically how to get more employees, more customers, and more suppliers from your community and how i can make you thrive at ibm . It really made a huge difference. I think the move is a structured, broad conversation , and then look for what is working and share that and make that broader. Emily i appreciate sharing what you have learned with us. Megan smith of shift seven, former cto of the usa. Thank you for joining us and stopping by. Megan congrats. Your book is fabulous. Emily coming up, day three of through,sus uber is and so is kalanick. We take a look at what went down in the courthouse and what is yet to come. This is bloomberg. Emily Travis Kalanicks time on the witness stand during the uberwaymo trade secrets trial has come to an end. During the second day the former , ceo of ubers testimony, waymos lawyers went after him, painting a picture of someone obsessed with winning the race for self driving supremacy. Joel rosenblatt has been in the courtroom for the last several days. Joel give us the playbyplay of , kalanicks testimony. Joel this is his second day. Waymos lawyers came at him kind of hard. Not as hard as you might expect. And then of course on cross , examination, ubers own lawyers were asking him questions which were clearly, he was very wellprepared for. Waymo, the big surprise was that waymo did not come at him very hard. They really there were a lot of details that waymo dug up over the course of this litigation that are very troublesome for uber. And they really did not ask Travis Kalanick about very many of those, and that was a bit of a surprise to me. Emily does that make you think waymo does not have that strong of a case . Joel initially i was kind of , wondering that, and then as i state in the courtroom after Travis Kalanick left, you saw what was going on. Travis kalanick offered a lot of kind of i dont knows, i dont remember about a lot of the more difficult pieces that they asked about, as you predicted, emily. I should have taken a better cue from you. After he left i think waymo has just kind of figured out that is what they will get from him. And then after he left, a , forensic expert, a computer forensic expert that evaluated the case and the most damning evidence, came in and offered testimony about all kinds of data and the technical issues, technical kind of problems that uber had. It got very damning, very problematic, very quickly. It was kind of an interesting contrast in Travis Kalanicks testimony. Emily so what is next . , hopefully, fewer i do not recalls. Joel yeah, there will be fewer of those. It will be interesting. Larry page is still up. It will be interesting. He is a very quiet person. He is a very quiet person. He has been a bit awkward. I think he has to kind of show up and be better in court that we have seen him, as a result of kalanicks good performance. It was a good performance for uber. Now, we are going to see some very difficult evidence, and technical evidence, and we are going to learn just how deep into the weeds this jury is willing to get. I think that is the real question. It is always kind of a dicey proposition to guess what juries are going to do or what they are thinking. Emily right. Joel in my experience, juries have taken the effort to dig into stuff. If they do that, waymo is still very much alive. Emily ok. Ok. Joel rosenblatt, im larry page i am sure im larry page is preparing for this. Tha