creating a streaming sports alliance wednesday, february 7th, 2024. "squawk box" begins right now. ♪ good morning and welcome to "squawk box" right here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. here we go let's take a look at what's happening with u.s. equity futures. yesterday markets closed higher, so they've been up three out of the last four days dow futures down s&p down by close to 3 and nasdaq down by ten treasury yields came down.

the 10-year is sitting at 4.12%. also a programming note for you, we're going to be talking interest rates, the fed's inflation battle, and the state of the economy with minneapolis fed president neel kashkari. that's coming up at 8:00 a.m. eastern time we'll get all the latest from him jo meantime let's get right to the alliance. it could change the way viewers watch sports they're all teaming up to launch a sports streaming package all three partners have one third ownership. the big question for ownership, how much will it cost? no details on it just yet, but subscribers will be able to bundle the new service with disney+, hulu, and max they'll try to capture those who don't subscribe to pay tv. disney and warner are

negotiating packages with the nba. how the leagues will team up will be critical the nba already out with a statement, something we're going to to hear about later this hour take a look at how investors are reacting to the players in the game right now disney, which was sort of the prime mover in putting this package and deal together down about 1%, fox up about 4%, 3.5%. warner brothers up about 3%. also i wanted to talk about some of the other sports media players that also have big stakes in live sports. looking at apple, paramount global of course, our paramount company, nbc and nbc sports not part of this transaction, at least at the moment. pair mouth global, cbs, which has the nfl rights for some evenings, aen now they have amazon and apple it raises all sorts of questions. we're going to hear more about all of this and also talk about disney after the company reports

its plan today bob iger will be on and we'll talk with disney ceo hue johnston on "squawk box" in his first interview since taking that role as cfo boy, has his new job gotten pretty interesting given all of the challenges disney is facing, nelson peltz there's going to be a lot, a lot to talk about. >> no more doritos. >> that's on you. as they're paying to buy comcast out of the hulu deal, e guess the question is this more successful because it comes out of the sports sued of things

>> it could be the same headache they have with hulu right now. the perfect world is where i can watch every single game i want to see and i still don't have that i still don't understand why i can't -- i guess i could do red zone. >> this gets you much closer, and that's where we're headed. i think this is the beginning of the end of the bundle. to me -- >> the cable bundle, the beginning of the streaming bundle. >> the danger is for paramount, nbcu, and others who are not part of this, depending how you think the competitive landscape shakes out and if people decide to buy one thing other another, that's to me where it gets super complicated super, super quick i also think this package may ultimately get sold in with amazon, which may get interesting. so amazon can get its own piece. >> wait. you think amazon partners are up with this? >> amazon has become a hub for selling everything so they're selling showtime,

they're selling paramount, hbomax what happens if you're a prime subscriber and you live in that orbit, you're then being upsold all of these other products. this product is one i imagine you can get upsold. >> if you have three partners, what are the financial implications. >> i've done a lot of research on this. it's not going to be a cheap product. >> 100 bucks. >> no. around 40, 50. >> a month. >> 40, 35. whatever it is, it's not going to be $10. but the piece that's most important is all of these networks -- we're talking warner, disney, fox, have carriage deals on traditional cable and they have what's called favored nation status clauses in all of them

so if comcast is paying espn per month, they can't charge less than that as part of this next package. sports is an interesting business it's not just catering to the wealthy. that's the other piece of this this could become a very expensive package. having said that, they're also saying they're going to package up other parts of their own products. >> like fs1 and all the other ones. >> i'm saying you may end up getting cnn as part of this, depending how warner wants to do this. >> i hope so because right now it's going to be a -- i'm going to keep everything and i'd have to pay for this on top of everything i can't get rid of everything and just have this that's the goal down the road, i guess. it's not saving me any money. >> the goal is -- >> the saving of the money -- >> it's not going to save you any money. >> to add this. >> there's two markets for this. this is for people who have

already cut the cord and don't have access to sports or this is to try to capture people who are about to cut the cord and they want to try to keep them the question is whether this accelerates to me the cutting of the cord that to me is the big question now the other -- >> people who cut it don't care. >> you have this -- i don't want to call it a three-headed monster. three companies own the business equally, however, the economics of the business are completely unequal. so espn, which is going to be the lion's share of the business, could be 60, 70% of the business, means 60 or 70% of the revenue. it a is going to be what you contribute in is what you contribute out if espn is 60 or 70% of the business and by the way let's say warner brothers doesn't get the nba guess what their share of this whole thing on an economic basis becomes smaller. it's like an accordion or if they buy the rights to

something else, they can make it bigger. >> this works well with hulu, not, the idea how you keep three parties happy through all of this i think what you mentioned before, how do the league reese act to this? >> the nba seems to be relatively happy about it, it seems like to me i'm still wondering what lina khan is thinking this morning. this is a strategic partnership. she's starting to look at strategic partnerships in different ways. >> including ai and microsoft deal. >> i would think if you're lina khan, this is a bad case to bring because the truth is all three of these companies are going to have to act completely independently in terms of buying up sports rights these to me are the sort of big issues, and i imagine we'll have a chance to talk to hugh johnston about this. >> you've taken great pains to point out all of espn's other

plans, tie-ups, have not been talkin' off the table. it's going to be more complicated. >> there's still the opportunity or disney would like there to be an opportunity to be a deal with some of the leagues or some technology companies and that there could be a separate dtc play, direct to consumer play, for espn two last things. all of these things, even though they're the same price, meaning they have to charge the same price, in the short term are going to be lower margin products for ought of these companies because they have to charge -- they have to charge for the marketing and they have to build the systems to do all of this. so even if they're getting -- if they're get 10g a month from the cable carrier, the $10 a month direct to coconsumer is less money. maybe over the long term it's a better relationship. you can upsell other things and things like that that's the rub. >> it also, you know, to finally make some money doing this, they've got to pull their

resources too. the only people who are really going to do well or at least some people will, the athletes this is going -- this is going to make everyone more valuable they used to say don't have your kid only playing hoops i think you should go back and make sure your -- >> you can't make it on a high school team if you're not playing sports 11 months out of the year. >> the nba is going to with worth triple the last deke, $78 billion for ten years. back to my original point, because of betting which also plays into all of this, and we've -- >> i'm so mad about that. >> because of betting, i would like to be able to watch every game. >> you're going to pay through the nose. >> that's fine. >> by the way, if you're willing to lose 20 or 30 bucks on a game betting on it, you should be

willing to spend 60 or 70 bucks a month to watch them. >> no, i don't lose 20 or 30. >> i think that's the calculus. >> i had a $5 bet last night i almost won $1 200 bucks. >> the weird thing is the stock reaction this morning, the idea that disney is down 1% obviously they're doing this as a way to try to -- >> under 100 too. >> it's well below it was. >> fox and warner brothers up. >> when iger came back, it was well above. we're not going to be able to talk about snap it's down 307 this morning. >> we'll talk about that in just a moment. when we come back, we have heard from meta, alpha betts, and amazon for the earning season, three tech giants covered by influential internet

analyst mark mahaney we'll get his reaction to snap results. as joe mentioned, the stocks down very significantly under extreme pressure. also later uber is expected to report quarterly results. and we'll talk with the ceo dara khosrowshahi "squawk box" will be right back. billy idol? i mean where's the skin-tight leather? my shoes are leather. where's the unnecessary zippers? that thing! billy, rock star is just how doug feels when he uses workday. thanks, rory. i'll show you rock star! be a finance and hr rock star. workday. for a changing world. billy idol just stole your golf cart! (grunting) at morgan stanley, old school hard work meets bold new thinking. (laughter)

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welcome back to "squawk box," everybody. ford shares are a little higher, up by almost 6%, 5.8%. it's providing better than expected guidance for this year. it announced a special dividend of 18 recents a share. that comes on top of the regular first quarter dividend of 15 cents a share. as for electric vehicles, that still remains a challenge. it experienced a loss of $4.7 billion. investors ordering up chipotle in a big way. they posted a better than expected profit. sales grew by more than 15%. they're attributing the strong sales in part to the return of -- i don't know who that is, but a very important individual. >> very tasty individual. >> tasty individual. foot traffic up, bucking industry trends. and snap shares getting crushed

after the company reported a fourth quarter revenue miss. the company missed fourth quarter revenues, in other words. also issued weaker than expected guidance snap struggling to rebound from the downturn inned a market, but it seems more specific that snap and other companies did quite a bit better, companies also saying the war in the middle east remains a headwind for it. >> why >> they needed something. >> i heard that from mcdonald's and starbucks. >> i heard that. are they protesting snap too >> i don't know. >> we'll get more answers coming up on "moving movers" with ebb evan spiegel at 11:00 a.m. eastern time. joining us now to talk about this and so much more, mark mahaney, head of internet research do you want to weigh in on the snap of it all >> you just had google, amazon,

and meta report accelerating revenue growth that's the real tell snap is the second tier ad platform without a lot of innovation a lot of innovation on the user side but they've always been bereft on that side and it's coming back to haunt them i don't know i think there was some poor communication on the part of the country. expectations were high and they just got smashed. >> what's the middle east thing? >> a couple of companies have called out brand advertising softness that's back in october it probably was a point or two for most companies who have exposure to brand advertising. i think that's a legitimate concern. a lot of companies raised it in november and december. they should. be calling it out now as an excuse. >> the magnificent seven is now the magnificent four three? what's your list at this point >> well, let's see you know, i only look at google,

meta, and amazon but you have to put microsoft and nvidia so there's five. >> is apple out? is tesla gone from the list? >> if you look at where the preem yu78 growth is you want companies that give you premium growth, 10%, 20% it's much smaller number apple is a product cycle company and it's not showing much growth these days the other companies, the four i focus on the most, they're great derivatives off gen ai, artificial intelligence. >> is it four or five? >> make the list and differentiate the list. >> is it a fancy five? do we need a different fancy for our fancy five >> we'll have to come up with a new acronym. >> that's because you're fancy. >> how do you think about who's on the list, who you take off the list >> well -- >> if there's only one on the list, who would it be be

>> our top pick to get to it is amazon that's because you've only started to see a real turn in fundamentals they're going to give you three fundamental catalysts. you're going to have accelerating growth, record high retaymar gins and cash flow margins as a whole the stock can still rerate them. they can catch up a little bit most of the other stocks have gone through the rerating. they've got the most juice to the upside. >> whoo's got the least juice to the upside of your fancy 4 >> probably google and the big thing there is cost. the big catalyst across the space is companies that have shown the ability to really rein in costs the one company that sticks out as not having bitten down on costs is google. if you do that and your revenue growth isn't accelerating dramatically, it's kind of a double negative.

there's a huge opportunity for google to change all this, but they haven't done it yet. >> how many employees are we talking? if you were really going in there, if you called pincay and said how are we doing -- >> i don't know, but they've got 30,000 people in their ad sales business it's a lot of people when you had an vunlt where people aggressively hiring -- >> 30,000 in the ad sales business and so much of the ad sales itself is automatic. are these engineers? >> oh, it's a mixture of a lot of things. you saw companies across the board. zuckerberg to his credit was the big turn that's when somebody went from it's growth at all costs to responsible growth. >> e he was forced to. >> he was forced to. wall street forced him to do that, and he listened. you got that reaction from some of the leaders spotify was another. >> this will only happen when

wall street insists? >> maybe i don't know why google has to wait for wall street there's another great example here all the major tech companies are paying the dividend except for google they've got twice as much cash on their balance sheet as meta they should be out paying a dividend, managing their costs much more aggressively if they do that -- >> there are special projects that they've chased after and done things, but not necessarily ai. >> i think investors do. google is more valuable at making bets and things like autonomous vehicles. >> here's the meta question. it's not a meta question, but it's a question about meta everybody's running around now with these vision progoggl goggs on how much does this benefit, or not, what meta's done with the oc oculus that product price point is, you

know, 500 bucks. this other thing is at $3,500. it's still at version 1. when christmas comes, do all sorts of kids say, you know, daddy, daddy, mommy, mo. y, i want a headset, and the parents say, i'm not get yog u the apple headset because it's just too pricing right now, but i will get you this, or is that a misnomer >> no, no. you set it up right. we've got a proof of concept problem here it's not convincing to enough people that they need to have one of these devices the prices have been a lot lower on oculus for a couple of years, and you don't see people -- you haven't got millions and millions of people to buy them the product needs to improve you're probably talking a couple of generations you can get that three or four years. every one will get better than the last one, cheaper, faster, more apps. it will still take four, five-plus years.

>> what was your reaction when you put the vision pro goggles on versus meta's goggles >> the graphics display was amazing. whether i want to put that on to watch video content as opposed to sitting back and watching it on my screen, that, i don't know i think most people are going to use their smart pros unless the head mounted devices have a huge amount of apps associated with them i'm probably going to stick with my phone it's very entertaining. >> mark, good to see you you with your fancy four. are you up on some of the articles being written on how people feel after using these for a while, that there's some hangover effects do you know about that >> dizziness >> i don't know about that. >> joanna stern wrote it she wore it for literally 24 hours straight and felt it. >> i felt a little bit in the forehead i will say. >> i really cranked it like a

helmet there's like a -- you know you can crank it -- >> isn't it possible you can -- >> patel and joanna did some long extended versions that not to mention social interaction for kids if they do that all the time it's like, what are you? you're even further connected to the world. >> get off my lawn get off my digital lawn. >> in davos, you said poor people will never travel again you take it to that crazy level. >> can i say something >> can i say that? >> what you did -- he picked up a video that's gone bizarrely viral. >> i listened to what you were saying you were predicting the future or the income equality -- >> no, i said the opportunity is to make life so much better for

people. >> by putting headset on >> i remember this this was a few years ago mark, thankings for comie thank. i remember the conversation a few years ago. >> "squawk box" will be right back tailor-made for trader minds. go deeper with thinkorswim: our award-wining trading platforms. unlock support from the schwab trade desk, our team of passionate traders who live and breathe trading. and sharpen your skills with an immersive online education crafted just for traders. all so you can trade brilliantly.

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from the fda for large dogs. that's the problem it will pave the way for life-extending drugs for humans or not it will be tested on a thousand dogs over 10 years old and weighing in at at least 14 pounds and the dogs will be monitored over four years and lifespan and quality of life will begiven those compared to a placebo. that i hope it will extend a dog's life by at least a year. i have a dog named upongo who is heading toward 19, but he's a smaller dog. >> how does it work? >> it said something about metabolic processes. to me it didn't sound like it gets into the genetic aspects of it there are things you can do that are not at that fancy. >> if you're really going to extend life, you're going to have to have a system that helps

identify cancer cells, roots it out. >> your body has a system that does that. >> it gets worse with age. >> it does it gets worse with age i think right now you stick with red wine reversetol. >> bertha coombs knows something about that. i want to get over to bertha coombs to get the numbers and maybe you can give us some insight on a glass of wine a day. >> cvs health, no red wine there. they posted an earning of 13 increments above consensus of revenues of $93.8 billion, which

also beat. cvs says due to high medical costs, it is cutting its full year earnings outlook to $8.30 from at least $8.50 per share. and here's why it's the trends they saw during the fourth quarter like everyone el that i brought in $6.27 billion. that was up 16% on the year, but a little light compared to consensus while the medical benefits ratio of 88.5% was higher than expected still less than that 90% per premium dollar that we've been seeing humana spend on medical costs. but like its peers it was driven by increasing medicare advantage as well as supplemental benefit plans. much better when it comes to the others $19 billion in revenue which includes caremark, oak street, and signify health

that was up from a yearing a ago and -- $49 billion i should say. $3 billion above the estimates driven by special pharmacy and drug prices. consumer wellness beat expectations with same store sales growth of 11.3%. that was driven by the back of the store strong pharmacy volumes. that upset negative in the front of the store now cvs has been very aggressive adding 800,000 new member this year we should get an update on open enrollment results and i'm sure there will be a lot of information, a lot of questions about the full year medical cost outlook. becky, back over to you. >> bertha, 11.3% same store sales increase for the store or pharmacy, that's pretty impressive what drives gains like that?

>> part of it was they just had greater volumes at the pharmacies i remember cvs has been closing stores all along they expect to close up to 900 by the end of this year from where they were a couple of years ago. so that builds up volumes potentially at some of the stores where people transfer store by store. >> yeah. >> but the front of store definitely ujds performing those counts were off by 3%. the street was looking for a slightly lower decline so they're still having problems, all of these drugstores, at the front of the store. >> at the front. be bertha, thank you very much. when we come back, some economic challenges facing china, also how it impacts our economy. former u.s. trade representative michael froman will break down the big issues facing both countries. right now as we head to a break, let's take a look at s&p 500's winners and losers

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reporting authoritying have removed the head of its securities regulatory communication. the new regulator wu chipping is

a banging veteran who earned the reputation as broker butcher when he led a crackdown on traders in the mid-2000s the united states and china held a third meeting group to talk about economic challenges facing both countries. our next guest says the u.s. needs to figure out exactly what it wants from china economically joining us now is michael froman he's a former u.s. trade representative michael, thanks for coming in today. >> thanks for having me. >> you're probably right i don't know that we know entirely what we want from china. i'm not sure that china knows what it wants from us either. >> i think that's right. in the short run both countries want a stable relationship they want to get through this year, past our elections, their elections without any major blowouts over time when we get

past this year, what are we wanting to resolve they're billing over capacity. >> i think there are a lot of deeper issues pluspost-covid there were trade wars already taking place before. then you add on this idea that we suddenly realized we were a little too reliant in our supply chain on china even if we say we're not decup pling, we're actively pulling back it's not just the united states but others who are looking and saying we need to diversify. what kind of pressure does that put on the relationship as well? >> there's effort to be diversifying your -- >> very good risk management, but how do the chinese see it? >> the chinese aren't happy about it they're trying to get companies to come back into china. on the other hand they're sending quite schizophrenic

messages they're retaining foreign executives, raiding offices, and a lot of people are concerned. >> when we heard president xi say -- we've had obviously issues recently with china, but when he said, listen, guys, gals, to world is a are really big place and there's enough room for more than one superpower and we really aren't harboring any ill-intent toward the united states, and we can both co-exist going decades into the future and kumbaya and we'll sell to each other and our consumers will both benefit. can we believe -- is that true do you think there's some version of that that's true, or should we just really have a much -- take off the rose-colored glasses and know that china would like to subplant us? >> i don't think we should have rose-colored glasses on. i think president xi has been quite explicit

he wants to dominate certain key sectors. >> can't there be a nice competitiveness where both benefit, or do they -- covid, they closed down flights within their own country. allowed flights out. was that intensal? was that as devious as it seems? >> i'm not sure i would comment on their deviousness what we see in covid is the weakness of autocracy. they're not able to make good decisions. >> let me ask you a delicate and political question which is in china, president xi, do you think he would prefer, as he looks at this presidential election and what happens next year -- maybe this year they're not wanting to do anything but that you're watching the election in the u.s. carefully what do you think his preference would be for who the next president is and is his preference, whatever it is, a good thing for america, or does

that mean it's bad for america, and how should we think about that >> let me answer it this way when we talk to allies and partners around the world and our adversaries and competitors, they're concerned about two things in our lives. one is the rise of isolationism. it's across the american people. there's a theme of isolation ou there. many people are unhappy. it geshs them more runway to expand and expand their power. >> what does that mean >> which is it >> are you suggesting -- are you saying trump is more isolationist and dysfunctional and you think they would like that. >> chinese officials over time say they would be happy to have president trump in office because they think it would create tension with our allies and we would be focused in ward and that would give them room.

but i think trump and biden have pursued quite similar policies. >> here's the thing i can't understand, which is the argument the republicans have made is we've now had a number of true geopolitical problems emerge on biden's watch, whether it's idiosyncratic on biden or not. we can debate. there's a view where there's a power volume or something else and we saw what happened in israel and putin's taken advantage of ukraine, i thinks like that. do you think that's the same case, meaning if we put this year aside on the taiwan issue and put taiwan back on the table in '25, what president of the united states keeps china in a box and which president doesn't? >> well -- >> or do they both or do neither? >> i have faith that the u.s. will pursue the strongest policies regardless of who's in the office there. >> do you?

do you have faith it's skbagtly the same >> no, but i think what president biden has done is strengthened the alliance. if you look at asia-pacific, what's happened with the alliance with uk, the trilateral quads, japan, those are all important contributions this administration's made to strengthening security across the region and standing up to china. i think though is are very important innovations. >> nato should pay more though. >> they should, they should. some countries are paying up to 2% that they're supposed to spend on defense and there's a longer way to go. >> before we go, i've got to ask. i don't know if you're going to answer he's on the board of disney, nelson pejts if he was on your board, would it change the tie naming of your back court in a materially bad way? >> all i can say is disney has

gone through one of the most difficult periods in history i think we're incredibly fortunate to have bob i gore back at the center of it, who's cut costs. i think the management team is there, the board has more confidence there and i think we're on the right track. >> you learned a lot inform washington that's a good answer. >> michael, thank you. "squawk box" will be right back you've been a real rock star. rock star? what do you know about rock stars? billy idol? i mean where's the skin-tight leather? my shoes are leather. where's the unnecessary zippers? that thing! billy, rock star is just how doug feels when he uses workday. thanks, rory. i'll show you rock star! be a finance and hr rock star. workday. for a changing world. billy idol just stole your golf cart! shopify's point of sale system helps you sell at every stage of your business. with fast and secure payment. card

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coming up, a major amme-changer, espn, and fox teing up winners and losers when and if it happens next on "squawk box."

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disney's espn, fox and warner bros. discovery are teaming up to launch a joint sports streaming service later this year. joining us now is puck's matt b bellany. offensive, defensive, it helps to pull resources with an uncertain future. >> absolutely. a lot of uncertainty and a lot of questions still remaining i think bob iger is going to have a lot of those questions on the earnings today because this is a massive gamble here this is the same as when the studios teamed up to launch hulu more than a decade ago it is basically hulu for sports, which is a, you know, a bet that by pulling their resources in streaming, they can get the customer to pay a big price for

sports year round. and that's the big question here, what is the price of this service, because we don't know yet, and it is probably going to be pretty hefty. >> well, other bundles can run 100 bucks. i thought it would be 100. everybody tells me more like 30 or 40. what do you think? >> my bet is in the 30 rarnge. 30 to 40 i think that it is going to be substantial and, listen, fox does not want to kill the cable bundle here because that is the big question sports has been holding the cable bundle together, even though it is going down. it is still being held together and profitable for these companies, not forever, but for now. if you price this too low, all those cable subscribers are going to quickly switch over and you're going to be left with not much it is also damaging, remember, this is not all the sports, the nbc universal and cbs sports

packages are not included in this, they have football and it is potentially very damaging to those companies if this is priced low and everyone goes over and out of the bundle. there is a lot left to -- also logistics. who is going to run this who is going to -- there is going to be margin between this new entity and these owners. and they're all still competing against each other for the sports rights. the nba is coming up and disney and warner are competing against each other for these nba packages now they're also potentially here partners. >> so, if comcast, cbs, nbc, if they get -- call a meeting today amongst themselves, what do you think, if you're a fly on the wall what is brian roberts saying, what is going on in those meetings, what's the answer here? >> he's asking a version of what you just asked, what's the price? that's the key question here

they low ball this and the price is very low, that's a scary proposition. >> but, matt, i think what -- at least from my reporting, it is impossible for the price to be lower than what they're selling those channels on our sort of a la carte or group basis. some of these are still packages, if you will, to the cable operators. because of the favored nation clauses in the carriage agreements, it can't be that low. >> it is not going to be super low. but the question is how much above that and keep in mind, that these channels are coming as they are, meaning there is other programming available here beyond sports, even though sports is the goal and, you know, the split amongst these three companies is also important because they're saying this is going to be a one-third, one-third, one-third proposition, but if you look at what each is bringing to the table, disney in particular with

espn is bringing a lot more to the table than, say, turner sports, which really has the nba and it has some major league baseball, march madness, couple of other things, disney has big nfl packages, they have monday night football and, you know, the fox has sunday night or sunday afternoon football so, those are much more alluring how are they going to split that up disney set they're going to get more ad revenue out of this, but it is a very complicated line they're going to have to walk here to make this fair to everyone, while also representing what each is bringing to the table. >> matt, it should be the golden age of sports, with the way betting is coming in to all of this, and engagement and fan engagement i want to see every single game. it is just weird that it is being squeezed it is the same digital nickel story that the pipes are -- i don't know, why -- everybody should be benefiting, but that's not the way it is going to be.

there is going to be -- >> no, because of the price. it is so expensive to buy these rights and you are renting them. that's what netflix said in the beginning, the reason they're not in live sports is because you're renting the rights. >> travis kelce, you're happy, i think. >> yeah, but that's the thing. players in the league are happy. >> the trojan horse to capture the other channels, that's the point that matt is making, super important to think about >> matt, thanks. >> we got a lot more coming up in moments uber releasing quaerrtly results. we'll have those numbers and then we have dara khosrowshahi joining us next when "squawk box" comes right back

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keep up with meta. we'll break down what it means for the company and other social media stocks. plus, uber delivering quarterly results. we will speak to ceo dara khosrowshahi, the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen with becky quick and andrew ross sorkin here are the futures you have to be somewhat impressed with the beach ball tendency of the futures. looks like the fed definitely not going to be as accommodative as the market was thinking six weeks ago. and yet the sell-off seen in the last day, happened on monday, but came back -- came right back

yesterday. this morning, you're seeing a little bit of weakness in the dow. down 32 points or so nasdaq, though, is trading higher, a lot has to do with yields and we have seen a little bit of backup in the ten-year now. back above 4.13% >> ride sharing app uber beating on both the top and bottom lines, earnings of 66 cents a share, easily topping estimates of 17 cents. that's on revenue of $9.9 billion. uber now seeing gross bookings in the range of 37 billion to 38.5 billion, compared to estimates of 37.4 billion and joining us right now first on cnbc uber ceo dara khosrowshahi. first of the year gap profitable earnings, congratulations. if there is any question about the health of the consumer, it seems like it is pretty healthy. is that just one slice of the world or is that everywhere? >> whether n you're talking abot uber with over 2.6 billion trips, and 28 million trips every single day, it really is

everywhere we're a global company, as you know we're a leader both in mobility and delivery around the world. and we continue to see consumer strength and especially consumer strength as it relates to services. people are going out to dinner, they're going out to concerts, sports events, et cetera and when people go out, and they spend money, or when they want anything delivered to their home, uber benefits, which is why you've seen gross books of $37.6 billion, up 22%, which is an acceleration over the last quarter. so we see a lot of consumer health and certainly we see health in the system as far as spending on the uber services. >> do you see any shift in terms of how people are using the service, meaning on mobility, for example, going from x to -- are they upgrading, downgrading? and what kind of -- when you think about the uber consumer, if you will, what strata,

economic strata do those people live in? is this a luxury good, do you think, or much broader than that 26 million trips is enormous. >> it is broader than that and what we do is we target different demographics and we build different services for different income strata. for example, one of our fastest growing products is uber reserve. and you pay more for greater reliability, the driver shows up early, and you have that comfort to know that the uber is going to be there. a lot of people take it for travel and that's a product that is targeted for a higher demographic. at the same time, we introduced uber x share as well and we continue to expand uber x share across markets where you share a -- you potentially share a car with someone else and get a discount when you're matched up with someone else that's for someone who wants more affordable travel and actually, the consumers who take our most affordable

options, uber x share or high capacity vehicles, they have the highest frequency on the platform, because we become a necessary part of their everyday life so to speak on top of that, we have our uber one membership program, which is if you're an uber one member, you get discounts both on mobility and on delivery we have got 19 million members now and that's another way of bringing prices down as some consumers feel the pinch of inflation. >> on the share business, is that a lower margin business with the goal of eventually upselling those folks? is that a higher margin business because you're packing a whole bunch of people into the same car? how do the economics of that work >> it is definitely lower margin business we essentially are investing we think it is good for the world in terms of the environment and congestion for two people to share a car. we think it is a significant growth vector for us as we continue to look for ways to grow the business. and we want to reach out to that younger demographic who may be

looking for a more lower price transportation option that is still on demand and still safe so, it is an investment that we're making in the long-term, absolutely >> so, we just talked about mobility, that's folks getting in a car, whether it is an uber black or uber x or uber share, whatever let's talk about uber eats and some other services. and the competition both the doordash and increasingly it seems like given some of the grocery business with instacart. >> absolutely. so, we're very pleased with the progress that we made with uber eats uber eats has been accelerating its growth, up 17% in terms of gross bookings this quarter and really has been accelerating throughout the year. and it is a reflection of the breadth of eats now. it is not just about food. we got a great super bowl ad that talks about that. it is now about grocery as well, anything you want, you can get on eats.

one really interesting innovation we're pushing now, when you order your food, we may say do you want a bottle of wine with that, that comes from a local liquor store or do you want some dessert with that, et cetera we're augmenting your restaurant order with the grocery order to show you what we got, and then we got a ton of consumers coming back and saying, well, if there is grocers on uber eats, you know me, you know where i live, why don't i order groceries on uber eats, that's running at 7 billion, growing more than 40% on a year on year basis, a new initiative we're very excited about. >> i asked you about margin on the different cars now when i ask about margin on delivery what does that look like right now? >> well, margin is improving in delivery so we're solidly profitable. we had record profitable year, but mobility business has higher margins than delivery. but we're quite confident that delivery margins are going to continue to expand some of that is augmented by our advertising business our ads business now is over

$900 million annual run rate advertising is close to pure margin and we bring a huge audience to both uber eats and uber rides and advertisers are more and more interested in targeting those eaters and those riders. >> we talked about california. there is new rules put in place that impact minimum wage and we had this debate with you and it has been a question about gig workers for a very long time now a minimum wage in california set to go to $20 an hour in april. 25% increase is that some of restaurants and the like how does this impact what you're doing? >> we don't think it is really going to impact what we're doing. as you know, in california, we have prop 22 that similarly does provide earnings benefits ands along wie benefits we think that's what uber is

about. so we actually -- i think things are moving in the right direction in california. certainly for uber, we'll see what happens in terms of this minimum wage for the restaurants. >> do you have a super bowl commercial >> yeah, absolutely. >> how much does it cost you this year? >> i'm not going to comment on the cost because it would alarm you too much we have some great stars in there. we got david schwimmer and jennifer aniston coming together and i'm a huge soccer fan, we have the beckhams as stars as well it is highlighting, again, you can get anything that you want on uber eats, including groceries and including alcohol. and it is a lot of fun can't wait >> let me ask you this way then, is it more expensive to produce the commercial, to pay all the celebrities and everybody who is in the physical commercial, to make a commercial, or is it more expensive to buy the air time

during the game? >> the air time during and around the game, i think is the great expense. and what we do too, it is not just about the game time commercial, this commercial is going to spawn a campaign that you're going to see over the next three to six months so, it is just the start some brands kind of do one campaign and that's it for us, it is a campaign that carries on it is stories with various stars that we think make it well worth the investment that we're making >> this is kind of tangential, we have been talking about sports rights with this new deal that disney is putting together with some other partners for espn and the sports rights why is it so valuable to advertise on a premium sports event like the super bowl? why does that make sense >> it is one of the few times when you have broad cross sections of populations coming together, with very, very wide

demos, men, women, from all over the country. and those moments are few and far in between and, again, if you're just vying for that moment, the price isn't worth it but the buzz that comes in, all the attention in terms of your brand, and your ads, and then the campaigns that follow on in addition to the stars themselves, amplifying your advertising with, you know, on their own social media, that actually is a new feature of these advertisements used to have stars, but now the stars themselves are very, very strong media vehicles. when you get the stars, actually using their own brands, you get return for your money. >> right by the way, how big a day is the super bowl for uber itself meaning folks going through each other's homes to watch the game. is this 5% of your year in one day? >> no, no. our business is way too broad for that but it is a top ten day for us

in the u.s it is big both for riding, people want to be safe, and they go to the super bowl, eat and drink and have fun so, certainly at the end of the game our rides business has a big boost. and then during the game, certainly our eats business has a boost as people order wings and everything else that you have in the super bowl >> and for those analysts who follow uber, is there a taylor swift effect can you describe the taylor swift effect of the past year? >> oh, yeah, i mean her concerts were events in and of themselves and when she came into town, we have our local teams planning specifically for what is not just happening at the event itself, but the surrounding hotels, et cetera. uber ups its game for taylor. >> should analysts then make that like a one-time earnings situation or give you a multiple for that >> it is, again, what you're

talking about billions of trips, we're almost at 10 billion trips, you know, taylor swift is a positive, but it is not enough to show in the overall trends. >> good news is you still have her concerts coming up the rest of this year, so -- >> looking forward to that >> dara, thank you very much great to see you congratulations on the numbers and we'll look forward to seeing you again soon. >> thank you, see you soon when we come back, renewable energy company avangrid making the top 100 list for the second year in a row. the ceo will join us right after this break to talk about the business and the issues that matter most to investors this thing, it's making me get an ice bath agai snap plunging on the revenue list struggling to get the ad business back on track we'll talk about it in a few minutes. "squawk box" will be right back. . and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like...

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earlier this week just capital announced its annual just 100 list of america's best corporate citizens sustainable energy company avangrid achieved the top spot among utilities and placed 12th overall. joining us right now is pedro azagra, the ceo. welcome. thank you for being here with us today. what do you think puts this in the just 100 list? >> thank you very much pleasure to be here. and it is the work of our women and men. without them, we not be here we were in 224 two years ago now we are number 12 we are the number one utility. women and men doing their job is what brings us here. thank you to cnbc and just capital because you saw the rankings that we are not used to but very important for our society. >> when we talk about the business and what you all are doing just in terms of

renewables, renewables is a place a lot of money is funneling into these days. but a lot of it is driven by government initiatives and government funding how important is that government funding and what happens if governments change and decide they are no longer going to pursue those same initiatives? >> well, we know there are many i was of helping renewables development. in different countries, different approaches i think in the u.s. there is a tax driven mechanism you have production tax credits, investment tax credits that is important. the history right now is that there has never been an issue for any of the two major -- in the u.s. you are okay with this but there other things as long as that remains there, the industry will continue in our case, we're on the way to achieving -- in the u.s. in renewable energy we're in excess of 9,000 right now. and globally being part of the growth with leadership, we're approaching more than 40,000 i think we're already contributing to the world.

>> your point is that if the government funding wasn't there, this would not be a booming business it has to be supported by governments at this point. >> part of the development has to be helped to make sure that happens. but also part of the assets you already do ppas, straight to the market, you have customers, big customers, people you interview quite often. we have ppas with them as well you have a combination of just market, but also, you know, some help from production point of view from the major projects we are doing. >> where are the biggest hurdles right now? most of the time when you talk to people about trying to change things and it is the grid that is the underlying issue, trying to get power from where the wind blows to where it doesn't, trying to get power from where the sun shines to where it doesn't. >> i think in the federal government and many states, i can tell you they are very, very focused on this issues

the first one is permitting. the amount of permitting you need, it takes years it takes probably five, eight years to do an offshore wind park the permitting is critical that's one of the issues the second one is also, you know, what i call litigation in the u.s., everybody litigates. it is normal to have litigation for everything that also delays the projects. so from our point of view, it is not access to capital. it is just predictability and permitting regulation is key. if you change regulation every year, it means more work if you have a predictable framework, things will be invested and you'll have the reality in the assets. >> you're talking about billions of dollars in investments. those are not things that companies do lightly and having stability over time makes a big deal pedro, just last month, you all ended a merger deal that you had put through and planned with p&m resources, a deal in the works since i think october of 2020.

so years in the making p&m wanted to extend the deadline for the deal to get done you all chose not to go that route. why is that? you think this was something that was never going to get past regulators >> i think there are moments in life that you just need to move on we have been three years we have 23 out of 24 parties either supporting or not opposing the deal and still we have negative reaction by public commission the public commission changed, but after three careers we're still working here, we are still waiting for the power commission after the supreme court that we were waiting so it is basically a moment that after, you know, so many delays, we didn't have certainty on the timeline and that was the decision. but last year, we were very successful, we have our rate case, we actually put more than 9 billion with both renewables and networks off additional investments for the years to come 9 billion is a lot of money. there is a moment i think when you don't have certainty in timelines, you need to move on.

>> does that give you any sort of fear factor in terms of attempting another deal? >> i think when you have organic investments for more than 20 billion for the five years ahead of us, in networks and renewables, that is more than enough to focus on maybe we think about something else. >> pedro, thank you very much for joining us again today pedro azagra, the head of avangrid, the ceo there. we appreciate your time. >> thank you. coming up, snap struggling to get its ad business back on track. the stock plunging following its latest report. we're going to talk about that when we return the futures right now have worsened a little bit. down about 52 points now on the dow. nasdaq remains higher. we'll be right back. >> announcer: time now for today's aflac trivia question. in honor of national women in sports day, who is the first long distance woman swimmer to cross the english channel in

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>> announcer: now the answer to today's aflac trivia question. in honor of national women in sports day, who was first long

distance woman swimmer to cross the english channel in both directions the answer, florence may chadwick, the california native swam across the channel in record-breaking time in 1950 and in 1951. espn, fox, and warner bros. discovery are launching a sports streaming service this fall. it is going to include offerings from at least 15 networks and all four major professional sports the name and pricing will be announced at a later date. you know, expensive to name something. we made fun of people that spend a lot and then they just do like a combination of the two there is no combo. >> or a brand-new word >> it has to be a brand-new -- >> venator or verazon. you can't do a warners, espn, fox. it has to be new

i can see paying a lot for this. it is important. got any ideas? >> no. >> it is hard. it is hard work. it is hard work being a decider. >> something that already exists on espn. >> it is going to be hard. how much -- >> it is going to upset the others >> you got to pay how much how much do you got to pay and who do you go to for that? >> i think it is $39.99. >> who do you go for the name? who do you pay to come up with the name >> consultants. >> a consultant. and how much does it cost? >> $19.99, go on to chatgpt. >> why don't you try that? what would you name -- the streaming -- no, no, no. now i'm -- what's your problem, greco? i was going to read it all right. we're not going to say anything about -- tell you anything about the actual service, in case you don't know, but we will tell you

iger is going to be on "closing bell" tonight after the company reports results. and hugh johnston, the cfo, new cfo, relatively new cfo, old friend was at pepsi, he'll be on tomorrow, disney's cfo at 7:00 a.m. eastern time. when do you have an answer for me is it going to take a while, sorkin >> hold on here you go. ready? >> you know what i was thinking was a great name uber, whoever came up with that. >> hold the fort the triple play sports bundle they're offering, all-star sports pass, champions league package, ultimate fans, end zone >> you know what >> victory lap, cable collections. mvp sports sweep arena access pass. primetime -- >> this is amazing

this this is amazing. >> goal line you could call it the goal line. >> that's pretty good. >> that's ten for now. if you're listening -- >> $20 million worth of ridiculous mackenzie -- >> in one minute and i think i paid $19.99 a month for chatgpt. there you have it. >> there is one in there that's going to work. it is as good as what they're going to come up with. >> now i can't wait. the pressure is on if somebody gets paid to come up with something, it has to be better than that. >> better than andrew's. >> in the meantime, ali grbaba reporting fourth quarter results moments ago. you can see alibaba shares up by about .8%. coming up, snap's advertising business struggling again. again. and minneapoli

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check out the futures this morning, looking at a mixed picture now, dough w futures ofy over 30 points >> really looking forward to the name now >> well, andrew has more >> time out. i think, you know, bob iger listens and watches the program. the other names that are on offer, thrillix, which i kind of like it is its own word, super unique you've not seen that before. sportify x. >> fanatics is good. michael rubin won't go for that. it shows you how good fanatics was. >> scorestream, one word scorestream. >> hard to say, kind of. >> scorestream. >> what about sportsstream. >> vortexa, rally route, win

wave athlet athletaverse. >> that sounds like the clothing company, owned by gap. >> moving on moving on. how about get to the next segment? >> this is going to be -- i'm looking forward to what the name is now not just saying that >> i hope it is something you just said. >> i'm sure we have some great "squawk" viewers who are playing on x now, might send in their own. >> which, by the way, is a really crappy name. >> x >> yes >> snap revenues missing the mark shares plunging on the news. the company struggled to navigate a slowing digital advertising business joining us now with more on the ad landscape, todd jacobson, ceo of perrian we were shaking our heads. i'm interested in your view on exactly what is happening here company specific the war in the middle east

the weather? what do you attribute this to? they had trouble quarter after quarter, trying to grow digital ad sales other companies haven't had quite as much of an issue it doesn'tseem like >> right right. thanks for having me, first of all. i think social platforms such as snap, tiktok, especially within -- are becoming new for advertisers to advertise there with all the negative content, you know, it is just becoming harder and harder i think -- i think that was a big thing in q4 for them but, you know, they did grow they did grow their user base. the content wasn't the right content for advertisers to be associated with. brand safety is a big thing. >> the stock had been trying to

make a stand and rebound from stratospheric levels we saw from the pandemic $70 or $80, almost a $100 billion company at one point itas making a comeback, giving it all back today. what do you think that management needs to do to get this back on track what would you be doing? you have your own company. >> right so i think, you know, what they're doing now is laying off 10% of their employees it is first step to be efficient. they're probably going to go public this year i think they'll have the same issue. telling advertisers they are ready to be brand safe i think that's the bigger issue. once they have that, they have the demographics, right? they have gen z, they have millennials, the user base is actually growing just need to have better communication with advertisers

>> who would you say and as far as digital ad revenue, who knows -- who is the best who should they emulate at this point? give me the top three companies that are leading here. >> right so, obviously google showed a great growth meta shared a great growth and meta knows how to deal with sensitive content around it. i think, you know, i would look at how meta sold that and tackle that >> as far as an overall environment now, on a scale of 1 to 10, what is the rebound that we have seen in digital advertising? if not digital, where is it going right now? the super bowl >> well, obviously super bowl is a very interesting time. 2024 is big on all those events that will attract a lot more budgets. super bowl is the main thing

also have march madness, we're going to have the olympics, we're going to have the political budgets, which are expected to be about $17 billion. so, yeah, and i think, you know, it is interesting to see how the super bowl actually changed in demographics within the past few decades. it is a lot more female oriented, like, half of the viewers are going to be female and with anything going on with taylor swift, you know, cosmetic companies are going to advertise there. so it is very interesting. obviously out of home is becoming very, very big. the las vegas sphere which is now charting a million dollars for a spot, you know, all of those are growing. so i think 2024 with digital advertising is a good year. >> it did bring in obviously the ads themselves bring in a lot of cross section of society for the

super bowl but this year, even just talking about it in passing, you brought up taylor swift. the whole -- the female demo and i'm not saying that there is not male taylor swift fans, but just in my family, i cannot believe how interested people that didn't used to be that interested in football, i can't believe how much they're looking forward to this game because of the taylor swift effect. >> look, think about it, 20 years ago, budweiser was a big advertiser for the super bowl. now it is cosmetic companies so, that shows you the shift, the huge shift and at the end of the day, it is entertainment event. and it is being treated that way. which is good. i think it is good 46% females and a lot of millennials and gen z. i'm guessing taylor swift had

something do with that and, yeah. >> yeah, should be record ratings and 7 million for 30-second spot we're still debating a "squawk" ad what have we raised? >> $12.60. >> sorkin, can you -- should we do a "squawk" spot, $7 million for the super bowl how much can you help with >> i'm going to lose >> tal, thank you. squawk sports will not be in the name. >> twitter has come up with some good proposals for the sports streaming. >> what do you got >> trifecta. >> not bad. >> fusion sports score with an exclamation point at the end of it >> score is not going to be trademarkable. >> maybe not the control room came up with one too. >> what's that >> athletic supporter.

>> that's not bad. that's not bad but totally not surprise ing that they would come up with that >> anyway, keep the suggestions coming we would like to prove that, yes, we too can do the work of consultants. when we come back, new york community bank under some pressure again this morning and janet yellen making some comments we'll bring those to you we'll be right back. my maternal grandmother was one of six sisters and they came from columbia, south carolina, and we called them the lewis girls and they were fiercely independent women. and i really, because of them, grew up believing that i could be anything that i wteand to be. so having that foundation was really incredibly important.

look at that beautiful shot of new york city this morning. more concerns about the future

of new york community bancorp. downgrading its credit rating on the bank to junk status, saying the commercial real estate lending, multifamily properties could create potential confidence sensitivity that's in quotes the tumbling stock now is down, well, this morning, up again, but in the meantime the company reported larger than expected losses from real estate lending and nycb's ceo responding saying the downgrade isn't expected to have material impact and the deposit ratings are still investment grade as of monday, nycb has about $17 billion in cash on its balance sheet and $83 billion in deposits treasury secretary janet yellen was asked about the troubled lender and she commented on the situation without mentioning the bank's name. >> we are monitoring current banking stresses carefully commercial real estate is an

area that we have long been aware could create financial stability risks or losses in the banking system >> new york community bancorp is the seventh largest originator of mortgages and the fifth largest subservicer of mortgage loans. when we come back, a cnbc investigation looking into whether investor owned utility companies are properly assessing the risks that wildfires pose to their operations cnbc's brian sullivan will join us next with that story and so much more. "squawk box" rolls on. (♪♪) (♪♪) (♪♪) book in the hotels.com app to find your perfect somewhere.

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now a cnbc investigation it has been nearly six months since the devastating wildfire in hawaii. that fire, along with pg&e's fire in 2018 is raising more fears that utility companies are not properly assessing the risks that wildfires pose to their operations also, that investors in those

companies are doing the same brian sullivan is here and he has more brian? >> yeah, thank you very much, becky. hawaiian electric, the investor owned utility company, is facing allegations that itswildfire ri been priced into many utility company's stocks here's our report. >> reporter: michelle remembers november 8, 2018 >> it completely went up in flames. >> reporter: the day her childhood home and much of paradise, california, were destroyed with a wildfire caused by utility giant pg&e's infrastructure. >> so quickly and past. >> running, terrified. >> reporter: for bret jones, the day august 8, 2023 the day his aunt ran through a burning field to try to escape

the deadly lahaina wildfire. >> hawaii officials are fearing the worst as the sun comes up in maui. >> reporter: your aunt the 98th person to pass away from the lahaina fire and i imagine 53 days in the hospital, 70% of her body burned. >> a lot of days really very difficult. she was in extreme amounts of pain. >> reporter: the cause of the wildfire is yet to be determined but a lawsuit filed by maui county alleges the electric company kept their lines powered during the fire. a separate lawsuit alleges misleading statement calling safety calls inadequate. hawaii electric is not alone a cnbc investigation finds some utility companies are not properly assessing the risk climate change poses to their operations. >> i think there's a failure to fully understand the risk. >> reporter: michael, director of climate and energy program of

stanford university studied wildfire mitigation plans says hawaii electric lacked basic efforts like a power shutoff plan when a utility intentionally cuts off electricity when certain conditions like strong winds occur preventing power lines from sparking a fire they publicly stated it did not turn off power causing lines to fall and start the morning fire august 8th saying this fire was contained. the second afternoon fire later that same day, cause of which unknown, is what devastated lahaina. >> are your investors porperly discounting utility risk >> not right now we don't see that discounting happen except in cases the utility already cause add fire. >> reporter: hawaiian electric saw shares crash after the fire. pg&e stock price also plummeted after a 2017 fire and dropped again after the one in 2018,

that destroyed this childhood home the fire resulted in the company filing for bankruptcy in 2019 settles a $13.5 billion lawsuit. in a statement a spokesperson said hawaii electric's power lines were degenrized more than six hours in the fire that spread to lahaina broke out and the company has been executing on a wildfire mitigation and grid resilience program for years evaluatating wildfire defense strategies including whether to implement a power shut off as a tool of last resort pg&e declined an interview for this story but in a statement wrote that since 2017, pg&e has reduced wildfire risk from its equipment by 94%, measures like varying power lines, vegetation

and implementing a public safety shutoff program. >> taking some of that money using it to fund their political machine. >> reporter: this is the executive director of the energy and policy institute, a watchdog for utility companies which is funded by philanthropic foundations that support climate actions, environment conservation and environmental justice saying the failure to assess boils down to one thing money. >> bottom line utilities trying to boost earnings. >> reporter: he said utility companies make money through capital expenditures which involve building new infrastructure like putting power lines underground. the cost of this plus an additional percentage of profit determined by regulators all get baked into customer's bills over time on the other hand, operational expenses, things like trimming trees, clearing grass don't may money for companies and shareholders he says this is why utilities

might be less motivated to spend on expenses, because the more they spend on operational costs the more their profits shrink. now, global bank's parents in california were lucky they had fire insurance on their home able toll rebuild. many victims are still waiting on payouts from the trust that was created to compensate the victims. guys, gets worse right now under federal law any money you get from the payout can be taxed in fact, even the money spent on the lawyers that represent you can be used as imputed income. unbelievable. >> why doesn't make sense to pay you back for something lost that's not income. >> the government considers it income there is a bill right now that is in the house, part of -- it's tucked in to the broader tax package that would change this fire victims trust compensation act, something likes this. you're taxed on the lawyers fees they made over $1 billion. and then if they represented

you, represented almost everybody, they consider that imputed income trying to change that. >> how long did the government -- not only did the government not do anything to help they're going to come and take >> of course e are thp people running the trust make a lot of money. lawyers made a lot of money. some people didn't have insurance. say, well, it's dumb if their house is paid off, nerve her a problem in the past and insurance costs have gone up, some people are left penniness. >> pg&e is now -- doing what it needs to do? in your view i mean, i heard 94% not sure how they arrived at that number. the mitigation, better infrastructure, enforcement clean out the stuff that -- >> that costs money. >> they haven't learned their lesson what really costs money >> they turned down an interview with me. no idea, they did come on cnbc about earnings talked about wildfire mitigation efforts and

not defend pg&e but say if we do everything to make it fire-proof, it's going to jack your electricity rates up so high because it's so expensive. >> and pay me now, or pay me later? >> many view it that way, joe. thanks. >> thanks, brian. >> you're welcome. a long -- no >> how long? 4:20. >> don't -- 4:20 was it how those fires are started. still to come, a in sports platform what it means for your living room. no name yesterday. good ideas and in the uk, what about joe? just call it -- >> yeah. >> plus minneapolis fed president -- >> morning joe. >> your morning joe. me and neel here to talk the economy and much more.

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good morning a big day for earnings new results out from cvs health uber and alibaba snap deep in the red after its latest numbers released. let the games begin! three media giants teaming up

for a new sports service that could disrupt the entire streaming industry. and is a margin interest rate cut completely off the table for the fed? we'll have minneapolis fed president neel kashkari. all that as the final hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen along with becky quick and andrew ross sorkin and u.s. equity futures, at least the s&p at this point, looked over, positive. so is the dow. made up some of the -- never anything that substantial. down about 50 on the dow and nasdaq added to gains almost 60

points a quick look at treasury yields. ten year 412 413. >> meantime one of the day's key stock movers this morning the company reported fourth quarter earnings far above analysts estimates but stock down on the news 2% more than marginally joining us last hour gave his view on the state of spending. >> we continue to see consumer strength, and especially consumer strength as relates to services people are going out to dinner they're going out to concerts, sports events, et cetera and when people go out and they spend money or when they want anything delivered to their home uber benefits which is why you've seen gross bookings of 37.6 billion dollars, up 22% which is actually an acceleration over the last quarter. >> uber saying it expects gross booking 37 and $38 billion above

analysts estimates seeing adjusted ebitda 1.6 billion, consensus 1.26 billion. that stock off one half% up 98%, 99% year on year. >> valuation over the last year. >> yeah. shares of snap have not fared so well plunging in the pre-market revenue fell short in the fourth quarter and social media company's first quarter saelds guidance slightly below the consensus. investors questioning whether snap can effectively compete against larger rivals like meta for ad dollars that stock this morning down by 30%. make sure you don't miss an exclusive interview coming up with snap ceo evan spiegel later this morning on cnbc. and a big media story of the day today. disney's espn as well as fox an planning to launch a joint

streaming service. each company own a one-third stake in the venture which doesn't have a name or set price. subscribers probably have ability to bundle the product with companies existing streaming platforms like hulu and disney+. talk more about this story a little later this hour, but the news ahead of disney's earnings scheduled for this afternoon right now disney shares off 0.8% but fox shares up by 3.5% and wanner brothers discovery shares up 2.75% don't miss a cnbc interview coming up, exclusive with bob iger today on "closing bell" after numbers hit. and disney's cfo hugh johnston details from him tomorrow morning right here on "squawk box." time to look at shares of a company reporting fourth quarter results. lost 52 cents a share. expectations revenue $1.13

billion. that topped expectations daily ad producers $7.15 million. ahead of the street's consensus. first quarter roblox seeing bookings in range of $940 million better than $903 expected by analysts stock up big on that news. 16%. speaking with the ceo of roblox tomorrow on a first on cnbc interview right here. talk more about eninarningsn the broader market joining us, a global market strategist and london civ chief investment officer and lately made the point that earnings might even be more important, because, perhaps we're not going to get the same number or -- or timing on the fed rate cuts. so earnings, the baton has kind

of been passed maybe we keep the same multiple. that doesn't get -- we don't see multiple expanse from a drop in rates, but things a stronger economy can be good in its own right because earnings are good? >> that's right. there's been a lot of focus on earnings primarily how they're managed. very well. that's why i'd say we see reaction in the stocks you mentioned. a strong number, ultimately maybe always priced in and focus on earnings. at 43% earnings in double digits increase surprising on the upside no earnings recession in evidence seeing inflation down, companying retain pricing power. every company talking about resilience of the consumer especially discretion issues what's not to like around the earnings picture right now >> is there a, an actual

demonstrable linkage between a strong economy and inflation strong labor and inflation or can we actually have a strong economy and continue to see inflation moderate, which it would almost be too good to be true is that a pipe dream or is that actually what we're seeing >> doesn't fit with the economic models but this is an extraordinary economy that's not fitting with much precedent or models of course, how much do wage increases contribute to inflation? look back what's contributing to inflation right now and remember it's very much proceeding, it is the service sector like insurance, shelter. it's not generally cost of labor. cost of labor up slightly but failing. i suggest we're getting close to the end of some of that frothiness around labor. definitely softer indicators around the economy less of the great referring nation, seeing more layoffs taking hold a lagging as i said.

so the thing about the employment market is it's stable keeping the consumer in jobs and stable and spending. i do think we can see recession continuing to fall, sorry. inflation continuing to fall as the jobs number stays solid. >> so the pandemic-related stimulus that was going to run out and eventually show up with consumers, you know, that weren't going to be able to keep consuming? did that not happen? or did once again another baton. the labor, the strong labor market is actually giving consumers a second wind? or there's no reason to think that the end of the, of all of this support we saw during the pandemic, that's not something we need to deal with that was a -- we shouldn't have been worried about that all along? >> well, the support is going to, it has run out, but remember, still in money market funds. over $6 trillion in money markets today. all-time high. that's sitting there or already

spent and seeing the fruit of that in earnings we hear about now. a lot of money there still not there in excess. certainly not in terms of handouts we can see with the fed, why lower rates ace this point inside there's a compelling need we see perils of overshooting in that respect not worrying about stimulus. still there and ready to be spent but on the labor side, what that does, take some of the uncertainty, some of the worry out of the consumer. although we can still see sentiment is fairly depr depresseddoesn't reflect the economic numbers we see. heard about a session because of the cumulus. a higher grocery basket continuing to sting. why the sentiment is depressed. >> tell me about the -- do people think 2024 will be a good year as election years are

often, more often than not for the stock market last year -- you could cut the negativity with a knife, right from, all through the first quarter. probably second quarter. now we know what happened. seems different this year. certainly not as negative that, do we need a wall of worry to climb, or can we continue to sort of just drift higher? >> certain political narratives ben friefit from a wall of worr. i say that in terms of the national political landscape clean up that uncertainty. once the election is in full swing rhetoric charged on either side likely to lead to sparking some uncertainty pip overall there's a strong market in election years especially once the uncertainty of which candidate is likely to prevail is removed i don't think that uncertainty will be removed until right to the end, but definitely a strong rally after that so, of course, remember.

both parties benefit to really drum things up and not have a recession of any kind. that bodes well in terms of incentives much of the economy is about incentives. >> how many rate cuts, and when the first one? and does it matter >> definitely matters, because that's going to be a sign that fed is seeing reason to cut. either have been asewered around inflation it's in the rearview mirror, achieved targets data is right. or suffice what we saw with regional banks momentous whenever it comes. not the first half already seeing expectations coming down significantly around that look at second half of the year, one or two again, very data dependent we have to be satisfied with the economy as it is ticking along without needing that rate cut. >> really unbelievable. the number of people that were sure we would have had at least

a slowdown by now. nowhere to be seen thank you. good to have you on this morning. thanks. when we come back, minneapolis fed president neel kashkari joins us for an exclusive interview. don't miss that. next, fighting a.i. misinformation getting closer to the presidential election. can authorities and tech companies respond fast enough to prevent harm we'll talk about that and much more when "squawk box" returns.

all right, folks welcome back take a look at shares of new york community bancorp symbol nycb. this is not the big headline here they named new executive chairman alessandro, the non-executive chair of the board. look at the stock this morning

you see trading up slightly. up about 6%. $4.45. this after moody's downgraded the stock to junk status looks like two notches below junk status. concerns what's happening here the company coming out today saying their total deposits are actually up from the year end. end of the year 2023 talking about $83 billion in total deposits saying liquidity is ample again, stock up today but this after severe trading down on some of these issues this morning there are a number of downgrades that are after the fact on this jpmorgan cutting them neutral from overweight. price target to 550 from 1150. bank of america also cutting them to neutral from a buy and cutting their price target to $5 from $8.50 a lot of talk around what is happening with some of these mid-sized regional banks new york community bancorp is unique in that it was above $100

billion in assets. pushed to, in deposits and dealing with unique situations in commercial real estate front. look at off the stocks now, we are going to talk to neel kashkari about this along with what the fed is considering, but something the market's been eyeing since last week and we will continue to the have more on this. >> after what happened last year. >> right in march of last year. >> seems like a one-off. commercial real estate in new york >> look at probably some other areas. seattle or san francisco or different places there are some unique issues to new york community bancorp putting pressure on this. >> and keep your house up there? would you? hate to say that. >> more than 100 >> what's insured, i'd say. >> do you believe having this -- goes back to the issue of the implicit guarantee why would you leave it there >> that's the question. >> if they would i guess, paid a

lot more. >> new hampshire attorney general's office saying a robocall from last year appeared to an a.i. call of president biden traced to a texas company called "life corporation" saying charges could be brought resulting in prison time for thousands of dollars in fining joining us to talk about this, a.i. content and so much more, uk berkeley of computer science. good morning to you. you know, we are now -- >> good morning. >> we are within striking zone of the election year, and i'm so curious just what kinds of things like this you thinkish going to take place and what needs to happen to prevent this kind of thing? >> yeah. let's talk about what's happening right now. if you're in the u.s., the national election. last few moss, last year, seen rise of generative a.i. interfering with our election. robocalls in new hampshire discouraging people from voting,

images audio, video floating on social media trying to harm candidates and around the world. some 2 billion will vote in some 70 elections and seeing the same time of interference around the world. serious issues around our democracy. >> i'm not disagreeing with that and appreciate you laying it out. bigger question what do you actually doing about it? who do you hold responsible? the tech companies responsible what kind of responsibility do they have in all of this how do you hold the bad actors accountable? by the way, several thousand dollars in fines, that doesn't seem like enough what are we talking about? >> agree everybody has responsibilities bad actors trying to invefear wt the elections need to be held to accountability absolutely 100% the tech companies. creating the content, those not putting a guardrail on the content, allowing the content to

spread twitter, youtube, facebook, tiktok then, of course, we as the public end of the day this content is showing up online but we're the nuk. head clicking on it, sharing, amplifying and cause the storm blame up and down the ladder we we have to take responsibility from the c suite down to the vitds. >> assuming individuals never like to take responsibility for themselves, we've seen before. how do you do this talked about regulating social media. do you actually regulate a.i. programs that can write these things i'm not sure i mean, hold microsoft responsible for things i write on microsoft word? >> it's not the right analogy, of course. generative a.i. system i go a portal upload somebody's voice, click a box saying i have permission to use that person's voice and get them to say things they didn't. not the same thing as me typing into word. put that aside a second.

talk about how do you regulate this it is difficult. talking about political speech give a wide birth here because lots of speech including lies should be protected. i think if the government is going to get involved. >> including lies you say. including lies >> hold on as kids say, double click on that what do you mean >> first of all, let's not say that but -- it is okay to lie, but it is not okay to tell people they can't vote or where they can vote or try to interfere in an election. a really big difference. limits to those lies it's a, allowed to say certain things but there are still guardrails how the government could do this without running afoul the first amendment. simply say we need, all a.i.-generated content, to be rigorously watermarked and fingerprinted so people know what they are consuming. think about nutrition labels ats grocery store. buy all kinds of junk food but

you need to know you're putting bad things into your body. same for our minds force the companies to label the content as a.i. generated or not and then the consumer can make decisions on whether they want to believe it or not. >> here's the thing i don't understand, professor. goes to how you're going to police lies. so i said that you've robbed a store last night and we'll assume that's a lie. should that be regulated if i said you graduated from a college that you didn't graduate from. >> yeah. >> is that regulated, regulated lie or is the lie only that i'm lying about -- you know, some kind of, effectively election interference that's a different type of lie >> yeah. i understand i'm not talking about regulating lies, talking about legally content deceptive or not different than what's inside of the content. i'm saying if you are going to generate a robocall with joe biden's voice it has to be

cleclea clear to the receiver this is not joe biden's voice. create a video of joe biden or donald trump doing or saying something they didn't say it simply has to be labeled not what the speech is >> generative video of you online do i have rights to do that? >> again, i am not saying what you have a right to do or not to do i'm saying if you do that, the consumer of that content should simply be aware it is not me speaking it is something a.i. generated. labeling is a gift doesn't restrict the speech. simply says, this is what this is it's a very low bash by the way. we are not asking for a lot here. >> professor it is a longer conversation maybe we'll have that conversation or have you back. thanks again. >> good talking to you.

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still to come, we will speak with minneapolis fed president neel kashkari.

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welcome back to "squawk box. right here on cnbc we are just a few seconds away from a new look at the u.s.

trade deficit hahead of that watching futures the dow indicated off 40, 50 points earlier up by about 53 points s&p futures up by about 14 nasdaq up by 83 points treasurys seen yields higher this morning you can see now the ten year sitting at 4.11% two year 4.22. rick santelli standing by at the cme in chicago take it away. >> yes thank you. trade balance for december -- 62.2 billion minus sign, of course, but that is smaller than the rearview mirror which was 63.2, which was just revised to 61.9 so these falling trade deficits may auger for bolsters of fourth quarter gdp. you recall advance on gdp was up 3.3% so the fact that these deficits are getting a bit smaller for november and december could

figure in to make exports a little greater than imports, which could give a little more economic horsepower. $42 billion auction the off at 1:00 eastern auctions are super important to monitor these days, because debt continues to grow. becky, back to you >> all right rick, thank you very much. in a new essay this week minneapolis fed president neel kashkari said the fed has time to monitor before cutting rates. less risk the two tight monetary policy will derail this economic recovery neel joins us now and thank you for being here today. a lot of questions in the market after jay powell went on the, chairman of the fed went on "60 minutes" over the weekend talking about how those rate cuts basically don't expect them in march your message as well what are you seeing right now? >> we keep getting surprised in a good way that the economy is

showing up to be remarkably resilient. consumer spending staying strong labor market staying strong. evidenced by the really strong jobs report friday that all is really good news telling me maybe monetary policy is not putting as much downward pressure on demand as we would otherwise think. so given that, i think we can take more time get the inflation data see it continue, hopefully to come in, very attractively around our 2% target giving us more time to assess the data before we start reducing interest rates this is a good problem to have, but we're trying to figure out some of these mixed economic signals. >> what would it take for you to think that rate cuts would be acceptable come may? what kind of data would you need to see leading up to that? >> well, i think it's similar to what the chairman said on his "60 minutes" interview not looking for better inflation data just additional inflation data also as around this 2% level on a six-and three-month basis

inflation is already back roughly to our 2% target get to see a few more months of that data, confidence we're well on our way back to 2%. and equally important. labor market hopefully continue to see a strong labor market giving me confidence now is the time to dial it back slowly. >> you need a strong labor market to suggest it's time to dial back slowly seems counter intuitive. chairman powell made those comments, taped before the jobs report on friday a really strong number. >> it was a really strong number i think that there's been a lot of debate the last few days on the speed of which we would then cut. if the labor market continues to be quite strong that gives me confidence to say we can dial things back slowly from here if we saw material slowdown in the labor market that would say, hey, maybe we need to cut rates more quickly that's why it's the, the speed

of the reductions that the labor market i think will have a big influence over. >> how many rate cuts are you factoring in for this year righ information? suggesting six rate cuts what do you think is more likely >> i think we're going to put in a new dot plot in march. we'll see where i'm ultimately as given the data we get between now and then sitting here today i would say two to three cuts seems appropriate for me right now but, again, i don't want to prejudge thing that's my gut based on data we have so far. >> okay. a very different picture than what the market had been anticipating this week we did see the 30-year mortgage rise above 7% again, first time since december. that's a pretty significant number for homeowners. does that concern you at all >> well, that's a great example, becky. went from 30 mortgage rate 3% to 8% i thought that would have slammed brakes on the housing

market put in my essay published monday remarkably construction employment continued to grow over that time investment, residential investment roughly flat. there has been remarkable resilience in housing market, whether it's signal family or bleeding over into multifamily surprising to me i thought 7%, 8% mortgage rates would be a bigger restraint on demand also makes me question how tight is monetary policy relative to what we consider the neutral rate is this reopening economy >> the commercial real estate entire industry will tell you that they are in big trouble at least anybody who's an owner of any of these loans that need repriced anybody who's out there potentially on the sidelines think they go can step in, get a better bargain would n't go alog with that. how much does that weigh on you? a lot of commercial real estate loans that if they don't get

refinanced are going to be problems and then there are banks that hold some of those commercial real estate loans new york community bancorp the pressure that we've seen it under over the last week >> well, we're paying attention closely to it. one adjustment to what you said. it's not commercial real estate across the board it really is focused on the office sector. many other segments within commercial real estate seemed to doing really well. that delineation is important. we think it's going to be on a bank-by-bank basis where we see pressures flare up and our bank supervisors are in very close contact with our supervisors around the country and, of course, with bank management to monitor their portfolio. we're watching it carefully, but i think most of commercial real estate is doing well really just the office segment >> so that is not enough for the fed to really be concerned, though i guess the expectation is you don't think that this is a big

problem that spreads through a lot of the banks >> as of right now, again, never want to say "never." as of now seems more idiosyncratic to individual banks and exposures rather than systemic again, monitoring it very, very carefully. >> the other issue people point to the amount of debt we have as a nation and the idea having to sell treasuries at 5.3% versus 3% that's a big deal too. does that ever come into the conversations or thoughts at the fed? just what happens with what we're going to have to do? >> not for the fed the ultimately amount of treasurys issued, amount of taxes and spending is up to the congress and the u.s. treasury department our jobs just take the inputs, try to mod what they mean and ultimately achieve the dual mandate goal for us really that's the distinction between fiscal and monetary policy. >> neel, is growth, economic growth, by definition, do we

know for sure that it's inflationary and where i'm going with this is that you could make the case that if it's not inflationary, there's no reason to try to ever curb economic growth you got to let the good times roll in other words, there would be a reason, i guess, to bring rates down, because you, you know -- that's expensive, too. that's inflationary. hard to business involvement nice to keep rates low as you could, but on the other hand, do you need dry powder for the next time there is anactual slowdow to cut what is a more important force for federal bankers? >> well, i think the core what you just said, joe, scenario you just gave, about productivity growth if we see a big boost in productivity because of a.i., for example, you expect a higher growth rate which is not inflationary that would be really positive

and then you would expect them to neutral interest rate likely higher in that environment, and then we would adjust policy to not try to tamp down growth but just to the respond to the economic environment in that situation, you'd see strong growth, not a lot of inflation and monetary policy would be supportive of that. so i hope in the end what we end up seeing. >> as you were watching "60 minutes" i'm sure it dawned on you there was a voice-over in the middle of it that seemed to suggest that the first interest rate cut would come middle of the year and then a whole bunch of people went to read the transcript exactly what jay powell said and it wasn't exactly like that. what were you thinking when you watched that part of it? >> well, i -- to be honest, i wasn't focused on the voice-over but on what the chairman was saying i thought the chairman, on his message, on it clearly

i didn't think much tit at the time but i understand it led to questions for investors going forward and glad they put out the transcript so investors could see for themselves. >> neel, we ask this of everybody often about the presidential election, and, you know, most folkson the fed say look, can't think about the election it has nothing do with this. and we need to be seen at independent of the election. when it comes to being "seen" as independent of the election you have to somehow think about it does it ever even come up in the conversation >> honestly, it doesn't. only thing that comes up in the conversations us reminding ourselves that we must be non-political, that we must always conduct monetary policy based and what we think the economy calls for. what the data is telling us, and the only way for us to do our jobs hug that mask fightly figh- tightly as we it

that's our job and we remind ourselves we must not stray from it. >> what are most critical you'll watch most closely >> always the same the actual inflation data. let me back up because our models have so ultimately failed to forecast the high inflation to then forecast the disinflation which is a good problem to have, i've been saying we just need to look at the actual inflation data to guide us i'm looking at the actual inflation data and then all the components you know we look at core inflation, housing, services, goods inflation and of course the labor market and wages. so far in the data, it's been resoundingly positive. i hope it continues, and then the question will simply be, at what poise do we then start to adjust rates back down and ultimately where is that destination? a big question mark for me, where's the neutral rate once we get through the reopeni ing

period uncertainty 5iaround that. good arguments and compelling arguments could be in a higher rate going forward we have to see how the economy performs before we draw conclusions. >> your gut, though, in terms of -- sounds like you think it will be a higher rate structure? >> you know, seems like there's big fundamental changes in our economy that have been longer-lasting than i expected an example when the pandemic hit and services economy was shut, people were flooding the goods market you saw huge goods inflation and good supply chains were stressed now that the services economy reopened remarkably people are still buying more goods than they did before the pandemic so seems like there are some longer-lived changes in consumer behavior that we're having to pay attention to especially think of work from home doesn't seem we're going back to the old world.

may adjust from here but not fully back seems like there are longer-lived changes in behavior businesses and of consumers. how that plays out into the rate environment we'll have to see. >> president kashkari, thank you. neel kashkari from the minneapolis fed. >> thanks for having me. coming up, disney, fox and warner brothers. discovery, betting consumerless cheer a new sports-only streaming service. still wondering is this -- do they have do this or a big blockbuster offensive move kind of both, i guess. after a break, talk about the implications for media, for the sports leagues themselves. stay tuned "squawk box" will be right back. in the u.s. we see millions of cyber threats each year.

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hm? you! your business bank account with quickbooks money, now earns 5% apy. 5% apy? that's new! yup, that's how you business differently. welcome back to "squawk box. espn fox warner brothers discovery saying they plan to launch a joint sports streaming service this fall. the plan could pose a big new challenge to the traditional cable bundle joining us now, co-founder and ceo, the long-time manager of kevin durant, investments in all sorts of pieces of the sports ecosystem. what do you make of this >> i liked it. i licked it when i first heard it the idea of there continuing to be optionality i liked the idea of super

serving sports fans and i think that it's obviously reaction to what we know is inevitable with cable long-term but a lot of questions to be answered. >> those questions in your mind are -- >> one is this, you know, for them, is this going to be an opportunity for they to start bidding on rights together to compete with the tech companies? i think also you have to build a brand. you know just to say they're going to have the sports rights and create a new streaming service, put in executive team in place and build a brand, but i like the idea they're missing out on cbs and abc. warner brothers talking to them. maybe that answer the question i like the move. >> did reporting on this last night. they all want to bid on sports independently and if they bid collectively all of a sudden, department of justice, others, looks like a different deal to them looks like a merger? >> yeah. listen, that's a concern

reading a lot about what that concern could be down the road, but also i think espn and some company, still doing to go big independently and throw it into this bundle. it's already an extremely fractured streaming landscape. targeting this towards just sports fans is what -- >> how much will -- part of the move here is to try to take sports fans that have already unbundled and get them back into some bundle. the other question how much will it acceskeaccelerate defunding current bundle and even to these companies? by the way, they'll have a smaller number of people oh sensibly buying this package than on the larger bundle? >> yeah i think more do answering the idea people are still holding on to traditional cable only for sports rights that optionality is what's great. what else they're going to add to this or if this was sprtrict a sports streaming service i'm interested to see.

again, you have to build a brand. can't just put them up with rights more in line with reaction to cable, to be honest. >> what happens to the pricing structure? hasn't been announced. >> haven't announced it. i read even though all three own it, a third, a third, a third, depending what their deal was and their rights setup with each league through the cable broadcaster you'll see espn for all intents and purposes more. >> more on the revenue and distribution >> yeah. >> what in your mind is too high of a price >> can't be priced with cable, because then you're getting cable and all the other channels probably somewhere in the $40, $50. >> conundrum and truth, add in nbc sports or a cbs -- like meaning then the package actually becomes like cable. same kind of pricing issue my separate question was going to be about pricing of sports teams. >> yeah. >> do you believe we are at an all-time high and, or this keeps going?

always a question regional sports networks, which were really a huge part of the value prop that's come undone but the price of teams has not come down yet. >> i don't think it will no some league kosscould slow moren others scarcity there, demand there. you see from the news yesterday how much focus there is around sports fans. and you understand the culture around sports. it's never been greater. no, i don't think so there's so many people that want in >> when you think about the nba, this is now the next big deal, do you think that whatever deal they get this time, they're going to get an even higher deal a decade from now? >> i mean, i would like to hope so, and at that point, i hope kevin is still playing, even though he would be 45. but i think the deal is going to be staggering, and i think it's deservedly so, and i don't see any indication that the culture of the nba, the business and the globalization of the nba is slowing down inany way >> do you think there's enough scale now for an amazon or even

a netflix? i mean, netflix says they don't want to be in the sports business, but with wrestling -- >> they're in it >> they're sort of in the sports business that there will be a moment where they're going to have enough scale that you won't need the classic linear channels to participate at all >> sadly, yes. i think, at some point -- i don't think we're there now. i think as much as some people would like to expedite it, i think the reality of it is that there's, like, a learned behavior, especially from a large portion of society that is not just going to jump ship overnight because of the announcement of, like, a sports bundle, but i think a lot of fans will look at it a lot of people will look at it. i will look at it and go, am i even paying cable for the right reason now just to be conscious of what i'm doing. and i think the fractured nature of it is now you have to figure out what the best offering for you is >> kevin could score 30 points every night, and i take him to score over 25. >> we're talking about gambling

again? >> and then in the fourth quarter, the team is so far ahead that he sits on the bench with 18 points, even though i know he could score 30 and help me, what do you suggest i do not bet on him >> you sound like someone that shouldn't be gambling. >> what do you think the name of -- what do you think -- he could do 30. >> he averages 30 every night. >> but you can't count on it >> that's gambling you took the wrong night i'm sorry. >> are you gambling in-game, by the way? >> yes i do it all. it's fun sometimes. the way i gamble in game, let's say a team is an underdog by three points and they're down by 15 normally by tend of the game, they're down by, like, three, because these guys are so good so put the bet on when they're down 15. what do you think the name of this should be >> he's a branding guy this is a good question. >> if i offer you $10 million to come up with the name -- >> someone just came up with parlay that's a good name because it's

easy to say. factors in a little bit of the gambling phenomenon. you like parlay? do you like -- i like "wide world of sports", but he says that may have been used before >> has it been used before >> you don't have a good one >> right on the spot i'm going to think >> you have no idea what to call it >> i got one the sports watch >> that's not bad. >> how about fanfare >> just admit right off the top of my head, that was good. >> i'm not paying you anything >> it might not be the one >> he gets 30 every night, and he got 18. >> i can't help you. >> nobody can. >> i'm doing well. you know that. i've been taking money out >> i want to call it overtime. >> that is the name of another company. >> boardroom >> i would love to >> it's taken. >> i'll give it to them for free if they want >> rich, thank you sorry for the really tough

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just over a half hour now to the opening bell on wall street. joining us now, nadia lavell, senior u.s. equity strategist. one of the points we made earlier was that compared to last year, people aren't nearly as negative on the markets, yet it's still doing very well and keeps hitting new highs, even with rate cuts not on the

horizon. it still seems to be melting up maybe on earnings. is that what we're seeing? >> yes, absolutely you know, of course, the fad and the direction of interest rates are important for markets but what's more important for equities is earnings and growth. we're seeing that. we're seeing economic growth, and previous depressed areas of the market are now seeing some signs of life. so, we think that's important for a broadening out of the market we still continue to like tech and recognize that though the performance gap is likely to narrow this year, and so you need the other participations of the market to get upside from here i mean, admittedly, i would say, in terms of our upside scenario, we are looking for about 5,000 on the s&p 500, and we're close to that level, but the upside scenario does call for 5,300, but data is coming in better than expected. but maybe to use a term of the fed, you know, more data is needed to get greater confidence that we're on path to that

upside case. so, i do think there's more upside, but we have to see how the data unfolds from here >> do you expect some broadening, nadie? we were trying to figure out a lot of different names now we're on, i think, the fantastic four it's not the magnificent seven anymore. is it going to broaden out, or are you still in that arena with those great big cap tech >> we do think that, you know, the mega cap tech companies can continue to perform well and outperform, but we are looking for a burning out of the rally we are using our risk budget to really get cyclical exposure to small caps i know the small cap has had a tough start to the year after the rally that we saw at the year-end, but we think there's upside to small cap, particularly as the economic data is coming in better than expected we're seeing recovery in the manufacturing segment of the market look at the ism last week. and at some point this year, the fed is going to cut.

it's just a matter of time that should be overall positive for small cap, and so we expect the small cap to catch a bit as the year progresses. >> any change in leadership versus last year that you're picking up, nadia, for investors? >> so far this year, not so much you're still seeing, like, the mega cap tech perform well, but you're also seeing some life among some of the more cyclical areas of the market if you look at industrials and financials. throughout this earnings season, you have seen pretty good earnings from these companies. you're seeing that, you know, industrials are suggesting that the bottom in manufacturing is happening. you're seeing pick-up in investment in terms of on shoring and infrastructure, and so that's a positive the banks also are doing a good job in streamlining the business in terms of reducing head counts, so they also are catching a bid you're starting to see signs of

that but not just fully yet. >> great, nadia, thank you senior u.s. equity strategist at ubs, good to have you on this morning. final check on the markets, which have been a little bit of a melt-up. mini-melt-up in the three hours that we have been on now, up about 67 points now. 84 on the nasdaq we'll definitely have a name tomorrow make sure you -- for the new sports network join us tomorrow "squawk on the street" is next ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange futures are trying to find their legs as corporate earnings come in with some examples of solid guidance, and new york community bank bounces premarket road map begins with upending tv sports espn, fox,