personalized a.i. with apple, those are the two biggest unknowns or biggest opportunities relative to where street's at. >> gene, thank you very much. gene munster. >> thank you. >> big hitter, that llama. >> as in the dali? >> isn't that what you thought? thank you for joining us today. we'll see you tomorrow. right now, it's time for "squawk on the street." ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. we remain on s&p 5k watch. several solid reactions to earnings this morning. our road map's going to begin with disney and that epic quarter. quarterly beat, div hike, buyback plan as well as guiding well ahead of aexpectations. the s&p is nearing a new record milestone less than three years after it crossed 4,000.

and an a.i.-fueled boom. arm shares are up nearly 30% ahead of the open, and the company's ceo, rene haas, he will be joining us this morning. >> exclusively. >> exclusively. >> thank you. let's start with disney, though, and that jam-packed earnings report that did top analyst expectations, raising the dividend by 50%, announcing a ton of major deals and upcoming events, including this $1.5 billion stake in epic games, the maker of "fortnite." bob iger did talk about the streaming shifts with cnbc yesterday. >> all of these things are prepared for us to pivot as well, as the world changes, as the world is disrupted, and by the way, i'd rather be a disrupter than to be disrupted. the linear business is still a business that serves us well, in that it's profitable for us, and we intend to continue to be in it. >> jim, the needham upgrade today is titled "the magic's

back." >> the dividend increase was very good. absolutely, you have to like the ears album being on. you'll start getting that in march. but david, i'm going to come to you immediately. >> please do. >> in the end, how much revenue growth for the company? and how much of it was cost control? >> well, most -- the reaction this morning is act cost control more than revenue. >> is that what you want? do you want that -- in a world of meta and amazon and a world -- >> but they're not in that world, exactly. listen. he can talk positively about linear networks being, of course, a provider of cash, but they're declining. we all know that. and the fact is when you compare disney to some of its peers in that world, it's done a lot better. and yes, you have to cut costs. i think the key here is the $500 million that fell to the bottom line from the cuts in sg&a. you can see it right there. it's that $138 million loss in direct-to-consumer versus over a billion a year ago. that was well beyond what any

analysts who follow the company anticipated in terms of savings there. they're talking about it getting to -- they're talking about dtc. to your point about growth, they are talking about getting it to profitability by the fourth quarter of this calendar fiscal year, not to mention double-digit margins, so you know, for those who would look for growth, there's that possibility of it, certainly, in a more significant way. but frankly, investors still were very much focused on getting margins up. >> right, well, i think they are, and i'll just give you a little heresy here. there's someone who believes this stock is selling on a multiple of promises. >> yes. >> nelson peltz. >> right. >> now, i know "the wall street journal" starts out by saying, well, at least they don't have to worry about peltz. i think that they may be able to say that they don't have to worry about peltz, but peltz isn't going anywhere. if anything, peltz feels that other than the dividend, not much here. >> i mean, listen.

as you know, i've known nelson as you have for many, many years. great respect for what he's accomplished in various efforts he's made through the years in terms of activism and otherwise, but on this one, i don't know that he's getting much traction, jim. >> you don't think that some of what -- when hugh johnson talks about the sense of urgency may be related to nelson peltz? >> the fact is, they did say they were going to save $7.5 billion or more in costs. that was put in quite some time ago. and they are beginning -- they are delivering on that in a way that at least the shareholders that follow the company had not anticipated for the quarter. so, i think they go into this, probably the last month or so of this proxy fight, with a pretty strong hand. i'll be curious to see if nelson will be able to garner one seat. i don't hear he's getting great

traction. >> my problem is the last time when we had this and david was with bob iger, and i talked to nelson, the stock ran up. people felt that things were better, and then the next thing i know, my trust owns it, it was at $79. carl, $116 to $79, even using authentic stupidity as opposed to artificial intelligence just doesn't work, and i felt had. sometimes you just get had. so, i'm afraid to just endorse this and say that nelson way, and not feel like if this is at $100, i will have scrambled eggs all over my face. >> you saw the statement from trian. iger says, "the last thing we need right now is to be distracted by activists who don't understand our company, its assets or the essence of the disney brand." as for the earnings reaction, this will be the best reaction since 2020, and if it can climb more than 8.8%, you got to go even further back. >> the key is the

direct-to-consumer, and if they can get it, like david said, where you have fourth quarter profitability, that's good. but back to you, david. i don't know -- there was a moment when our friend nathanson asked bob about hulu, and the answer was, "hulu plus is good because when it's merged with hulu, hulu is very synergistic with hulu plus, therefore, you have to like hulu." and i'm saying, no. no. what is this, like 1984? >> eventually, hulu's going to be a tile on disney plus. >> no one knows what's going to happen with hulu. >> i think that is the plan. it will be one package. you buy disney plus, includes hulu. at some point, there will be still a direct-to-consumer for espn, even in spite of this big announcement made two days ago, not even two days ago. yeah, i guess. about the joint venture with fox and warner bros. discovery. >> we should bring in some nfl owners.

comcast, when they got the miami-chiefs game, paid a lot of money for it. are the owners happy that a product they thought was going to appear in one place gets to appear in all these other places? >> if you're football, you want your product to be viewed as many places as possible. >> what's goodell's line? you got to swim where the fish are. >> if you're bob kraft's line, you got to make more money on your watch. >> i don't think there's any question about the ability of that league to garner more money, the nfl. the plan that we're talking about, that joint venture, we spent a lot of time talking about it yesterday, if it's successful, the economics will only be better because you're going to get to people who aren't paying right now. >> i can just say everything's great, and i thought it was bad. i'm not -- >> you're not a believer in disney at this point. i get it. >> i don't want to be had. i don't want to be had. i don't like being had. >> i know you don't. we all know you don't. >> it gets me upset. >> and so, what?

you want another quarter? >> you want to wait until q4? >> what are you waiting for? >> i'm waiting to be sure that they deliver on various plans that they haven't delivered before. now, the dividend was solid. >> buyback and the dividend increase, a sign of confidence they're going to be delivering? that they are going to deliver? >> i feel better, but you know what? the stock was substantially higher, and i want to seethem deliver. when you actually look at the numbers of where they were in 2019, which we have to do for most companies, you don't necessarily see a lot of progress in revenues. there's no revenue growth. >> you sound like the fed. decent progress, but we want to be sure. >> janet yellen? >> i've seen you get on board in similar situations. >> and make mistakes when i get too excited sometimes. >> that's true. >> i don't like that. i'm trying to contain myself. i look at this, i say, bob's got it going, i happen to like hugh johnson from pepsi. i trust him on the cost side. what happens if i go out and say it's great and it finishes at

$102 because the sellers, whoever they are, come in like heat-seeking missiles. >> do you think there's still some cultura? iger had no comment on the gina suit. >> i'm going to turn to david again. david has the pulse of "the princess bride." elon musk. >> yes, sir? >> who, apparently, was at a peltz daughter premier. >> i saw the picture of that as well. >> i think elon musk is not necessarily joining the crowd here. >> no, i think it's somewhat unfortunate, that recent hostility. >> unfortunate? >> he's been trashing the vision pro. he's been negative on a bunch of things. >> it does raise the question, i think, and the "journal" raised it today in their coverage of musk's continuing to fire at disney and iger, if you're an advertiser on x, like, you take this risk, potentially, that musk is going to turn on you. >> linda yaccarino, who runs x, she might say, look, it gets

people excited. i don't know. prurient interest. i have not heard her rap of late. >> i'm happy to bring both parties together. we can bring elon and bob together, make peace, and move on from there. as for the quarter, i think it is interesting, jim, that you're not willing to weigh in yet. you obviously still think peltz has a shot here. >> the stock's at $98. david turns to me and says, hey -- >> i think it was the kind of quarter that, conceivably, delivered for many of their critics. >> i think it's better than i thought. i like a dividend boost. i like a buyback, especially if they finish it this year. but i understand -- i saw a play when i was growing up. maybe one of the greatest song-and-dance people of our generation, jerry orbach. and i saw it twice because it was so good. "promises, promises." that's four promises. >> burt bacharach? it's his birthday today. >> really?

do you think people ever talk about him him? >> sure, they do. the world needs now. >> more than ever. >> sweet love. >> you know, even "law & order," jerry orbach. >> a great disney character. >> oh my god. you're absolutely right. angela lansbury, who talks about her anymore? "the manchurian candidate." >> "beauty and the beast." >> he switches the conversation because he looks like an idiot to talk about disney. thank heavens faber is there to make him see what a fool he is. >> i think you about got it right without some of the curse words. i think you nailed it. >> charles lawton. s&p inching closer and closer to 5,000. our first cross above 4,000 was in 2021. jim, is this a ratification for the bulls? is this a thing that is going to be hard to cross? >> you got rotation bull.

we can very easily see a market that's led by merck today or lilly and then tomorrow will be led by some of the, i would say, back to amazon. look at meta yesterday. i think that we're going to have the guest that defines it this morning, renee h haas, because t arm, that's auto, that's internet of things, that's cell phone, that's pc and it's cloud. >> you've been very positive on it. >> from day one, rene. >> well, day one, he was -- and then you came in on day two and took him away. i'm glad we're sharing. >> i stole him and locked him in a room and said, you never talk to faber again. i need to check that. >> that 20-point rise in the stock today is going to be quite impressive. what is it indicative of as he writes a quick text here, the arm quarter? broadly speaking. the broader takeaway. >> the broader takeaway is that, once again, nvidia inference is

amazing. remember, you have a grace hopper, combination chip, in the super computer for nvidia. grace hopper is not -- that's the name of a chip. and then surrounding it with cpus. you can't have just a gpu. you have to surround it with cpu, and the cpu is this. it's arm. so, every time you see, say, zuckerberg buy a graphics card, it's going to have arm. >> so, you can link -- nvidia's benefit is arm's as well? >> that's why jensen huang wanted to buy nvidia for 50 -- for $40 billion, and this is one where they got it -- the antitr people turn around it down. i can argue that everything would have been cheaper if they let it, but i get this. >> it was the eu. >> yeah. but this company is on fire, and it does have cell phone. cell phone is good for them, which is google. auto is good for them.

china. they are wherever anything is hot, and be careful about ruling them out of pc. and david, i'm going to go one step further, and you can just eviscerate me on this like you did with disney. >> yeah. >> i think, for who the bell tolls, intel. they want intel's business. they want to eviscerate intel, just like you want to eviscerate me. >> i won't on that one. >> i'm telling you, with great -- when we talk to rene haas, he will say there isn't anything that he can't be in and be better. anything intel can be in, he can be better. >> are they going to try and start making their own chips too? >> they don't have to. they're just intellectual property, dave. i dave'ed you. i had to. i feel bad about what happened with disney. >> your longer standing thesis is that this is going to drive a refresh in hardware. we had pichai on "squawk" talking about this renamed bar, gemini, with subscription price.

>> that's why when you ask me about how we hit 5,000, today, it could be lilly again. we see the glp-1s, if you're ebees, make you less obese, and you can get a knee replacement. >> how quickly do these things work? >> this is twilight of the -- now, processed food, remember, you can still buy it. just don't finish it. and they have to be on the run. although, they're also confident, because remember, the stocks went down. >> there was the hit -- really, it started a year ago, wasn't it? the initial hit from so many of the food companies. >> in the end, they were talking about how plane companies benefit because planes will be lighter because people are thinner. that was it. >> that was a b of a call about apparel changing and all kinds of things. >> that's too far. that was a bridge too far. >> fuel for planes will come down in cost. >> well, i have to tell you that these things every day, you know, people misread on the

call. they talked about fatty liver, and they talked about cirhossis. nobody's supposed to use that term because it connotes that it's something to do with alcohol. 15 million people are going to be able to -- there's going to be a trial going on for heavy drinkers, and it's not about alcoholism. it's about the idea that if you're drinking 200 grams -- there's a huge amount that if you drink two drinks a night, and you get cirohsis of the liver -- >> amgen was not as powerful. >> we did not talk about that enough. the ceo of amgen did not -- >> lilly and novo have the lock on this market. >> we could have the industrials leading us. we could have the alternate energy leading us, and we could

have -- >> wynn or ralph. >> by the way, ralph lauren is timeless. >> we're going to get to all of the movers, a lot of them in the consumer space. there's paypal, mattel, ralph and under armour, hershey, tapestry. look at the premarket as we continue to keep our eyes on s&p 5k. back in a moment. fresh, warm hot dogs! when i'm not selling hot dogs, i invest in a fund that advances innovations like robotics. fresh, warm hot dogs, straight out of my torso! one for you, one for you. oh, you're a messy one. cool, right? so cool. anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. hot dogs! fresh, warm hot dogs! before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. [busy hospital background sounds] this healthcare network uses crowdstrike to defend against cyber attacks and protect patient information. but what if they didn't?

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as we said, some pretty solid reactions to corporate results. we mentioned disney. of course, the buyback and the div hike. ralph with a beat and raise. we'll dig into a bunch of those, get cramer's "d shmada," and count down to the opening bell after a short break. nature's bounty hair growth.

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and i know it works. and i love it when the customers come back in and tell me, "david, that really works so good for me." makes my day. prevagen. at stores everywhere without a prescription. all right, let's get to a "mad dash" for this thursday. of course, count down to our opening bell, a little more than six minutes from now. ralph lauren looked pretty good. >> when you think about the olympics that are coming, paris, you know what the olympians wear? >> yes. >> they wear ralph lauren, so it's not just this quarter. don't just take this pop. i think it goes higher.

he had 9% comps. one of the things you very rarely hear. china's great. it's off a small base, but it's terrific, and what i think is really going on here, david, is that they figured out where -- you were talking about where the eyeballs are. they have a great direct-to-consumer. they have terrific exposure in so many different markets. the tiktok or instagram, they do everything. but the best thing about this, david, is that we're stellar for a name and apparel that has staying power. we know that a lot of them have been very challenged. vf corp. >> how about lulu? >> that's the highest end. this is a lower multiple. look at what he's done here. it's just the most consistent, and why is that? because ralph lauren's stuff is indeed timeless. i just think if you want apparel, i do like -- what do you got? >> i'm wearing it. i'm wearing ralph right now. >> i have a super 200 brioni that i got because i could have

bought a unit in your apartment for that. >> there it is. see? like that? >> you have a ralph lauren, and you look pretty good. >> thank you. >> you look real good in that. anyway, he's the spokesperson, and that's why the stock could go to $170. patrice is going to love you. he is going to love you because you didn't plan that. >> no. we got a lot of other stocks to watch this morning. we're going to keep an eye on shares of paypal. >> you brought us paypal. thank you. >> he's having quite a morning. who knows what's to come? opening bell definitely five minutes from now. stay with us.

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. as we said, yesterday became tantalizingly close to s&p 5k, jim. we came been 11 basis points of the number, and i guess, is this -- i mean, talk about milestones, you know, big round numbers being difficult psychologically to get above. >> well, i think that this is one where it just keeps taking

people by surprise. it's everybody who's getting 5%, and yesterday, santelli was talking about the a-minus auction, and people -- people are happy to settle for 4%. in the meantime, you're getting that in a day from so many different stocks. i've never seen anything like this in the sense that you could have a stock that's up 30 and then is up 50. i don't think arm is done. i think you can buy arm right here. i think you can buy so many stocks that are up already that therefore you're just going to g through s&p 500. >> is your point, then, that the way in which the three-year was received, the ten-year, longer term auction today, is competition for equities? >> i'm saying that that money's in the wrong place. you just think you're so cozy, earning 5%, but that ends up looking very silly versus what you can own in a basket, a very high-profile, good companies that we all know. >> so, the animal spirits are

still to come. >> i was doing more work on nvidia last night. i can't believe there's more work to do. we just keep getting more use cases for what they're doing, and i think that you're going to start seeing next quarter lots of people -- with a.i. >> let's get today's opening bell under way. at the big board, it's best friends animal society, and at the nasdaq, celebrating an ipo, kyverna therapeutics. >> let's use apple as an example. since the beginning of the year, davidson has had a hold because they say they're not innovative. and then, yesterday, they came out and said, listen, we're raising our price target from $166 to $200, because it turns out they're innovative. suddenly, if you decided to sell apple because it wasn't innovative -- i know, bad chart. david, you care about that head and shoulders.

you think it wasn't innovative, and the next thing you know, it is innovative. have the analysts looked at the vision pro? or did they just come out and say, oh, vision pro, that's innovative. >> i don't know, jim. >> it's a rhetorical question. >> i assume so. all i can think about is what you have been said for years. >> own it, don't trade it. same thing with nvidia. so far, those have been great calls. eli lilly has been my biggest. i had stinkers. i had one called disney. >> nvidia and meta, obviously, have powered the s&p to what is very close to that 500,000. >> when mark came out and said, you can make a lot more money, what -- >> zuckerberg set the tone for a lot of companies in terms of efficiency, and there are any number of companies that are at least trying to follow. >> both marks, year of efficiency. benioff and -- >> benioff as well. >> zuckerberg's also sold a ton of stock. this last round brings it to almost $800 million since november. >> charitable guy, though. >> is he? he's building that crazy compound in hawaii.

>> have you ever been to the public policy school at harvard? >> it's got the big underground -- it's got the cattle. he's going to be self-sustaining there in hawaii. >> public opolicy school in harvard. >> they need money, i'm sure. they only have a $50 billion endowment. >> who founded university of chicago? >> i do not know. >> rockefeller. >> really? >> yeah, he wanted a baptist school in the center of the country. he felt that both sides were dominated by elites and he wanted to have a school that would be the hardest to get into and the best. >> interesting. kind of like carnegie. public libraries thanks to carnegie. >> these were titans. >> we owe a lot of our cultural institutions to great philanthropists and businessmen of the past. quite a few in new york as well. >> tapestry, vf corp. playing

along today on this. under armour, for example. >> under armour was a legitimate guide up. tapestry's a little bit of a surprise, because i didn't think the number was all that good, but this is an apparel day. by the way, did anyone catch what's working at costco? costco put out some pretty good numbers. like, everything. you can buy everything at costco. it's on fire. hard goods too. i'm just saying that the consumer, on the one hand, is supposed to be dead, according to everybody i read, and second, consumer is spending their darn fool head off. the consumer, even in the $45,000 bracket, is spending. so i don't understand why -- i don't know the bank of america numbers came out this morning, and it showed that there's been a dent to the consumer. but the companies i deal with don't see it. >> not just that. morgan stanley today tactically leaning into a softer landing, upgrades discover and ally. cuts amex. >> i thought that was ill advised. you cut amex. steve squeri delivers the

greatest quarter ever and you want me to go into two companies that don't know how to lend to everybody? i don't like that call. >> i guess their point is they're rotating into a more benign backdrop for the low end. >> that's true. i feel like capital one owns the low end, and american express owns the high end, and gen z is american express. why downgrade it? keep it on the list. >> i want to talk a bit about paypal, because the -- alex chris, of course, new ceo. >> never trust a man with two first names. >> come on. >> that's terrible. isn't cramer a first name? >> true. >> never trust a man wearing a bowtie. >> oh, i like that. >> you like that? >> putin. >> he's only been in the job four months, alex chris. he's the new ceo of paypal. you may recall we sat down with him not that long ago where he did say, we're going to shock the world. >> yeah. >> you know, all right. >> he did. >> not yet, but listen, a lot of investors seem quite impatient, perhaps hoping that the good

times will return quickly. again, four months in, the fact is he has, as he told me, rebuilt the leadership team, reorganized the business. he's accelerating the velocity of innovation, but that said, none of the guidance at this point, which has been termed conservative by him, includes any return from some of the innovation that they're currently -- that is currently under way. >> does he have anything for the apple card, the buy now/pay later that dan shulman went all in? >> that's a good question. i don't know. >> alex chris is from intuit, he's really good. he does not want to overpromise right now, he's being smart. and i'm just making a mockery of you, not him. >> i know you are. they also announced a 9% reduction in the employee base. there's an expectation that will continue as they continue to review the company overall for profitable revenue growth and the inefficiencies, therefore, in certain areas that aren't about profitable revenue growth. because the point being that there's been a lot of empty

calories there. yeah, you get revenue growth, but you're not getting paid for it. >> dan did -- remember, i always felt that when rainey went to walmart, boy, he is a good cfo. john david rainey. that was a sign. be careful. >> yeah. and he spoke to my colleague, kate rooney, as well, but essentially the same thing. i think that's the main one. they are not going to overpromise in any way. >> they can't. they have to redo. >> they're saying, hey, it's going to take a little time. you can't just undo the things that were done under shulman, frankly, overnight. >> you can't. no, you can't. brain tree county over there, man. good movie. >> the stock is down in part not just because of the earnings themselves but because of the guidance. >> but is it worse that astrazeneca, which is apparently the only drug company that doesn't know how to make money right now? >> what's going on with sarkesian?

astrazeneca? >> most of the drug companies have had -- bristol told you, listen, it's going to take a long time to get out of the hole. they're not overpromising. and pfizer has not been able to deliver, but i keep hoping, hoping that what they bought, seagen, because they have kidney, liver. i don't know. you got to hope >> look at that. >> look at that. >> i feel like i was working for this network when we hit dow 5,000? i don't even know. >> yeah, you were. >> i would doubt it. >> no? i don't have any recollection. >> early 2000s, we were in the dow 8 range. >> so in '94, '93? >> maybe. >> the dow could experience some change, because walmart is putting three for one. that gives them that opportunity to kick somebody out, put somebody in. >> that's true. >> do you think walgreens, which was a very bad pick -- >> right. it's a price-weighted index, as we point out, the dow. >> you always say, it's atavistic. >> atavistic, statistically

irrelevant. >> benioff, when salesforce got in, meant a lot to him. >> i mention the s&p because that's the important one. >> i'm going to give you a heads-up of what i think. >> tell me. what do you think? >> take the chiefs, money line, and bet on abbott. >> bet on who? >> abbott. >> abbott. >> football -- abbott labs. i think they're the ones that are going to go in. >> go into the dow? >> take walgreens out. you want health care that turned out to be more of a -- i happen to like wentworth. i think walgreens is going to turn around. >> they just keep trying, don't they? >> what, to get to 5,000? >> walgreens. >> what are you supposed to do, s just shutter it? >> take a look at a five-year chart. hasn't gone particularly well for stephan there. the boots deal wasn't that good. >> well, kenvue has been disappointing after disappointing after disappointing, and by the way,

j&j, we still -- it just seems like it's -- the drugs are great. their medical device should be helped by the glp-1, but you have talc, and it's just this undercurrent because talc is, they've been able to say, leaked with asbestos and it's hard to beat it. they're going to capitol hill. that will be great. >> disney shares are expanding their gains, up 9.6%, $9.50, 108 bucks there. you see it right there. over $108 right now. having a very nice reaction to those better-than-expected numbers, particularly as a result of the increased savings at direct-to-consumer, and overall, $500 million dropping to the bottom line as part of the $7.5 billion in overall cutting of costs that they had identified sometime back. >> no halo to warner bros. discovery. even though, when you put sports together and baseball,

basketball, nhl, no -- no movement there. >> it's a new 52-week high on disney. we have not -- we'll get earnings next week. no, it's the week after, i think. >> okay. >> wait, next week? is that warner bros. discovery? next friday? the 23rd. okay. so, we'll find out. i don't really -- >> i think they should get a little bit of a halo. >> you know, the sports joint venture, people are still trying to understand exactly. >> have you come up with a name yet, david? >> i don't have a name. they've identified a ceo. we know who it is. >> carl, he has it. >> i don't know. no, i haven't been told who it is. i've just been told they identified it. >> can you short list it? >> fairly well known, is what i'm told, with a good track record. >> what happens with paramount? i ask you that every day. who cares? it's really small. >> paramount? >> it's an asterisk. >> i think the most -- the potential scenario at paramount is the red bird/david ellison partnership, trying to buy the control stake by taking control

of national amusements. i do believe paramount does have a special committee right now. >> okay. >> but it's going to be difficult to navigate. it's going to be a difficult one to navigate. you got to figure out the basis at paramount, by the way, which is not the easiest thing. you're dealing with some section 203 stuff in terms of delaware. you need the whole board to go along with it, first of all, then you need a special committee if you really do want to roll in sky dance to paramount. not that it's not possible, but that seems still the most likely of the possibilities, and yet it still seems like it's one that's going to have some difficulty. >> no traction whatsoever. you want traction, go with the food stocks. >> bob bakish will join us from the super bowl in vegas, where, of course, cbs is broadcasting. >> wynn had all cylinders. 99% occupancy. >> they talked about the sphere. >> boston was fine.

two places in macao, both of them coming back. the chinese are traveling to hong kong and macao again. they're just not coming here. a lot to like there. and i've got to tell you, my travel trust owns it. we buy some more, this thing goes higher. this is the best they've ever been doing and the stock is down appreciably. two shockers, hershey because of glp-1 and kelanova. rice krispie treats and stuff that's really good for you. boom. and by the way, steve callahan is one of the nicest guys, i'm just really glad that one is working because that's a snack food company. he's on? >> no, i'm looking at our -- oh. >> why is he on my part of the show? what time is he on? >> come on, you know? you're going to be here in the 10:00 anyway, aren't you? >> i'm playing in the 10:00. it's called playing in the 10:00. >> rene haas. >> you mentioned wynn. yesterday, hilton, all-time

highs. >> hilton quarter wasn't even that good. >> we got the news that u.s. drivers drove the most miles in '23, surpassing those post covid years as a record. >> may rate hike? >> you tell me. >> this is one of the greatest economies i've ever seen. >> i think you've been tilting hawkish lately, have you not? >> i just think that you're going to see shockers like home depot put up an unbelievable number. i think target's going to put up an unbelievable number. i think walmart's going to do a great number. costco is doing the best numbers it's ever done. so, i mean, these are places where people shop, and people are shopping. i just think we don't have a lot of inflation. we've got good growth. it reminds me of the '90s when, david, you remember the '90s, you come in, what are we going to take up today? >> those were good days. >> weren't they good days? >> '97, '98. >> yeah, i remember you sitting over there. >> me and joe would sit across. it was great. yeah. every day, we had the lava lamps, and every day, things would go up. >> they legislvitated. >> a lot of nonsense, complete

and utter nonsense, the business models that would never work that were getting funded, by the way, at rates that are not dissimilar from where we are right now. >> there were some dogs. >> there were plenty of dogs. >> dog right there. >> yeah, there's a dog right there. >> best friends rang the bell. >> he loves -- you love your dogs. >> i love my dogs. one is jensen. i'm renaming wolfy, who i already renamed from tony. i'm going to call him jensen, because jensen may be the greatest ceo of our time. and that stock could end up being biggest of all. >> what do you think of -- speaking of the '90s, i'm seeing a lot of analogs of cisco in the '90s versus nvidia price action today. >> it was way above everybody else. >> cisco had half a trillion, i think, $500 billion at one point. >> i don't think it ever traded north of 400. >> i thought it was 5. >> but cisco is -- john

chambers. this is a market where, when you look at the actual multiple of what zuckerberg has, i mean, that's not an expensive stock, and they have so much cash. these companies are spewing cash. >> not to mention the embedded i.t. stack that is much different than it was then. >> look, we watched snap yesterday, and of course, boy, that evan spiegel is nice. but they don't have any business. they have, like -- they're trying to get a billion maus, but they don't have any customers. the goal is not mau. the goal is customer. meanwhile, who makes up zuckerberg's content? >> the other knock on snap is their stock-based comp and just the engine that it is for enriching a small subset of investors. >> that's just a pathetic parody of the human mind, that company. i think meta is an example of a 23 times earnings stock. i know. he's a seller. but -- >> well, he's selling some but not a lot. >> benioff sells. look, if you back out the

cash -- >> bezos is selling amazon too. these guys have expenses. >> do you think amazon is expensive? >> i said expenses. they have expenses. bezos has expenses. >> i'm saying, amazon. do you think that amazon -- that the amazon advertising business may be the single best business of all time? it didn't even exist. >> it's great business, particularly from a margin perspective. yeah. amazing. they're growing, what, 27%? >> they're using inferential chips like you wouldn't believe. they've discovered words that you wouldn't even realize. meanwhile, everybody keeps talking about temu and shein to me. >> that said, nvidia's market cap will most likely pass amazon's, don't you expect? they're very close. >> i bought the stuff. look, nvidia's -- when we talk to rene haas, he will describe how nvidia's still changing, just started changing the world, but jensen is so humble, it won't matter.

he's just -- jensen huang is just a humble man. >> got any thoughts on our parent company's stock price collapse in the last five days? >> none. >> none? it's down another 1.7%. comcast. after hitting almost 47 bucks a share only, like, five trading days ago after the charter quarter, of course. charter is up today. it is down 26% for the year, but comcast continues -- >> point of order. why are you talking about it? >> because it's painful. >> it's interesting. >> i like to -- when there's pain, i like to confront it. >> have you no shame? >> deutsche has a take on the bundle today. they think it's designed to appeal mostly to broadband-only, cord never customers. they think the reaction yesterday was overdone. they think it's going to be expensive, maybe $50 a month. >> i thought it would be $42 if you got max. >> as i said, it's going to be above $40 but not that much above it. i don't know what that means. >> warner bros. discovery goes down if they -- it goes down if

they're not. the heck? >> i don't know. comcast keeps going down. >> why did you bring up comcast? i was having a really good day. i'm going to get a cheesesteak when i'm down there next tuesday. >> maybe you can do something about it. maybe you can help. >> i'm going to do my darn best. >> will you? >> big technology conference. i just think that the focus on it is misplaced. let it do what it does. we work for them. we offer no real knowledge to people by talking about a company we work for. that's the way i think about it. >> i don't approach it that way at all. >> that's why i'm wearing brioni, and you're wearing ralph lauren >> we didn't get to hogg. maybe after the break, jim. another busy day for data, at least. claims came in pretty much in line, actually the first week in three that claims fell. we'll get a wholesale inventories in about 12 minutes and then barkin, two times today, along with that bond auction. back in a moment.

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let's get to jim and stop trading. >> there might be an opportunity here at s&p global, which is a very big company, market cap by the way, doug peterson has done a remarkable job and i think the numbers are going to prove to be too light. conservative guidance. they did the revenues. but what people have to understand, if there's a lot of issuance, which i think there will be, s&p global does well and they have a great business that they've been consistent. rarely do you see the stock down. i think doug peterson is bankable and a company that will rebound. >> yeah. it seemed like last year was a series of all-time highs. >> exactly. it was. and i think people have to recognize that the consistency of this business is

extraordinary. i was a little surprised. i think at the cautious guidance. i don't wants to get ahead of doug, because doug is a terrific business person, but this is a stock that has been a consistently good stock. i think you take advantage of it. >> you will stick around because coming up we'll talk to the ceo of arm holdings after the break. >> david, i'll let you play. >> you will. >> yeah. >> thank you, jim. >> in the hour that i'm actually -- that is -- yeah, that you're not on typically, you'll let me play. thank you. >> david, sometimes you have to take a back seat. this is one of them. david knows. >> this is one of those times. >> this is david's things, and i'm going to play. that's all i meant. >> i am looking forward to that interview, jim. why choose a sleep number smart bed? can it keep me warm when i'm cold?

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good thursday morning. welcome to another hour of "squawk on the street." i'm carl quintanilla with sara eisen, david faber and jim

cramer live at 900 of the new york stock exchange. cramer is here ahead of a big entire, the ceo of arm, rene haas, stock is up 45% today. in the meantime keeping a close eye on the s&p, not quite to 5k yet. about 6 points away. dow is positive on a pretty light day for data. that said, we are getting wholesale inventories and we'll get to rick santelli. hey, rick. >> carl, indeed. you're correct post-sale inventories and trade aren't usually super exciting but this time might be different. our december trade number on the wholesale side up 0.7%, up 0.7%. that's the biggest jump since september of last year. it does highlight the issue of how we've gone back and forth on many of these inventory issues trying to sus both demand moving forward and overstocking looking backward. on the inventory side, carl, this is a december final read and that means that the mid

month read, which was up 0.4% gets tossed out and replaced with 0.4%. remains the same. it's a reversal of last month when it was down 0.4%. neutralizes out. these are december numbers, so the trade sales number and the inventory number may pack a little more wallop into our gdp revisions we get for the fourth quarter. just one side note, of course, at 1:00 eastern, 25 billion 30-year bonds coming up completing $121 billion in supply. back to you. >> can't wait for that. long bond option. 30 minutes into the trading session, three big movers we are watching. disney soaring after reporting a kitchen sink quarter beating estimates, slashing streaming losses, raising its dividend and guidance and taking a stake in epic gains. hor on disney and street's reaction. we mentioned arm ceo is joining us, shares are surging after the

semiconductor designer crushed system and shares of hershey are under pressure. profit at the chocolate maker fell but it did raise its dividend. michelle bach will join us to discuss the company's guidance and theimpact glp-1 weight loss drugs may have on the business. the data, we didn't get a lot of it, but we got jobless claims which showed continued strength. i mean i don't think it even mattered what jobless claims were today. the strong january jobs report. so much momentum in the labor market and that's kind of where the market has been. the other piece of data i wanted to mention was china cpi. i don't know if you talked about this but another negative number showing deflation in china. >> deflation is extraordinary. >> several onths. >> we didn't talk about it in the first hour, and i mean, these numbers are, as you say, extraordinary. >> it's not just extraordinary. fastest drop in '09. ppi, 16 months of deflation down

2 plus year on year. >> the lowest since 2009 and the fourth consecutive month we have seen a negative number on china's cpi. i do think that because we didn't see a huge reaction in the u.s. bond market to the numbers, there is a decoupling going on between china, its markets and the economy. i think precovid, jim, you might have seen a bigger reaction in the u.s. bond market. >> spot on. i was going to -- on -- at the top of my show precovid, what's changed and what's not. not a one for one, but we would have come in and said oh, no. so many of our companies were -- >> they are still one of our largest trading partners. >> yeah. >> and there is still the risk, sara, that chinese, in order to try to juice their economy, are going to be sending goods at prices even lower into our markets, not to mention markets around the world, will have a deflationary impact and exacerbate the tensions that

already exist in terms of trade. >> absolutely. i do think it's also reminder that post-covid, economies are performing just very differently. the divergence in inflation numbers between china and the u.s. in growth numbers between china and the u.s. is a reminder of how much we pumped into our economy and how differently it's performing right now. no question they're interlinked but we're not seeing that kind of correlation we've seen in bonds, for instance, globally. >> maybe you can explain, there are a lot of people throughout when they hear deflation, that must be great. explain what happened in the '20s in germany when deflation wrecked the whole world. >> deflation is very bad. it's why central bankers are scared of it, and it's why, you know, for a long time, that was the boogie man. lately, it's been an inflation problem here in the u.s. and that's also a big problem and that's a hard, you know, once the genie is out of that bottle. there's been problems in germany with inflation as well. >> yeah. >> i think if you're in china, deflation says why should i buy now when it might be cheaper

tomorrow. >> that's what japan faced for almost 30 years. >> decades sfreally. >> we're importing more from mexico than china for the first time in -- >> mexican economy, don't rule that -- that economy has gotten very strong. obviously, there are political issues we know, but mexico is a very valuable trading partner and i think that you have many companies who want to be there. >> including a lot of chinese companies that are going to be setting up manufacturing facilities in mexico for the reason to get around any trade restrictions. >> i have a business there and try to give people higher wages because you can make everything more cheaply in mexico than china. much more cheaply. when you talk about factory and pollution control, which there's almost none, but i do think that people don't -- china does have -- we're in bed in china. a lot of our companies have no choice. they're there. and you can't get out of it. i know stanley black and decker is trying to get out and reshore

into mexico. there's just still too much embedded in china for so many companies. including walmart. when you buy their house brands. >> on the production side and on the demand side, ralph lauren was a reminder today. the only other data point in terms of the u.s. consumer ahead of real estate sales, bank of america had credit card data out for january, it was down 0.2%. >> quizzical. >> weather. they blame the weather. here's a chart by income cohort. the orange line at the end is january right now and you can see it's higher or steady from january of last year which has been strong across income level. it's not bad. the consumer still, you know, spending and in good shape. they expect the bank of america economists for this to rebound next year because some of the winter storms, but do expect the monthly government retail sales to be weak for the month of january. >> what do you make of dollar tree saying customers are struggling, mcdonald's saying customer is struggling, chipotle, saying customer not

struggling and same economic cohort. >> is the customer -- >> it's where customers are prioritizing to spend money. restaurants, concerts and travel, not spending in department stores. the wholesale read for under armour and ralph lauren. >> i'm never going anywhere. i have someone who agrees with me on things. it's a pleasure. the next is a curmudgeon who wouldn't agree what channel the knicks are on. >> good thing you're not asking me that. >> not referring to sara. >> madison square garden. >> 27 -- >> well, i enjoyed being on your show. >> always welcome. >> now we're going to talk about something why i say it's hard to be in a 5% cd because shares of arm are soaring right now after crushing earnings estimates for a new company, a brilliant new company. let's have arm holdings ceo rene haas join us now for a first on

cnbc interview. one of the most impressive ceos i've ever seen and rene, first, have to offer flat out congratulations. how did you do it? >> thank you, jim. really glad to be here. this is a manifestation of strategies that we put in place a number of years ago that are all coming to light, that i think are now even accelerated more by ai. we greatly diversified the company into new markets such as data center, automotive and iot, which we're seeing growth from, really from all those segments, and when he combine that with all things ai which drive the need for more compute we had terrific results and feeling good about the outlook going forward. >> there's great dmauts your unbelievable -- data in your unbelievable depth, you were mobile in other and now it's cloud and network and auto, mobile, consumer electronics. this space you were in iot. this means you must be taking share from everybody right now? >> you know, we're involved in

just about every single market and every single market is now putting more and more compute into their devices. a lot of folks asked, how can i find an arm device or chips that have arm inside it, and it's really just about everything. a tesla, ford f-150, an iphone, your samsung tv, samsung smart appliance, your ring camera. all of those are arm powered. so we are just about everywhere. >> speaking of everywhere, you taught me of your relationship with nvidia, not just the fact that you worked there and they love you when you talk to people about you, but the fact is when you get a gpu from nvidia, what else do you need that people may not realize that really makes the whole package work? >> yeah. nvidia is an amazing partner as you know, and the most advanced chip on the market, which is an nvidia gpu combined with an arm cpu is a fantastic combination. now, every modern computer

system if it has a gpu or any accelerator, it needs a cpu to run the system. you really can't have any system with a gpu or accelerator that doesn't have a cpu. partnering those two ingredients together, the best that arm does, and the best nvidia does, results in fantastic product. >> so rene, it's david. should every time nvidia makes a sale should we ring the cash register for your company as well? >> there's a couple things you can do there, david. you can kind of do the math, if they sell a grace hopper that's good for arm, cpu and gpu, they have a grace super cpu chip, so that grace cpu is arm based and all good. it's not just nvidia. we work with just about every major partner in the ecosystem. samsung, apple, qualcomm, nxp, st,mercedes, any time you see one of those devices get sold that's good for arm too. >> yeah. i'm looking at a stock price that's been up as much as 60%,

up 56% right now. rene, really remarkable move. from a $51 remind people ipo price. i'm curious about your control shareholder at softbank. you know, maybe there's not that large afloat, the thing has gone up so much, any plans there to sell, given this incredible rally? >> as you know we talked with massa the night of the ipo and he's happy with arm and very, very bullish about our long-term prospects. he was a net buyer at the ipo and i think he's very, very long on arm. >> so no plans to sell as far as you're aware? >> not that i know of. >> would you say, rene, he's more likely to be a buyer than a seller? >> i don't monitor who's buying or selling today but mass sa is a big fan of arm. loves what we're doing. he's really in for the long haul. >> rene, one area that i keep thinking you could dominate that

really hasn't been a power is the pc which has a big refresh cycle. intel d intel dom nates that but why can't you be the guts of pcs? >> we are in pc snooze i'm talking about winning space from intel? >> in the apple domain, that operating system, used to be all one vendor and now it's 100% arm. that ecosystem has converted over 100%. apple gets amazing performance and power relative to the experience running off a battery and i think you'll see that move to the windows ecosystem quite soon. folks know windows and arm has been around for a while, but i think we've proven with apple the capabilities of the products and i think the few years with ai, pc, the things in windows, we're going to see growth there too. >> that's great news. >> what about china?

that was certainly a source of strength in the quarter. has it peaked given the concerns around import controls there? what do you see as far as sustainability for china revenues? >> yeah. you know, for china, the china ecosystem follows the rest of the world. we're strong in china in data center and strong in evs. china as you know has been moving to evs and very aggressive quick way, so as far as export controls, you know, we, obviously, comply with whatever regulations come out. we haven't seen anything new recently, but if something comes out we comply. in the long run, we're pretty bullish on china given the fact that the long-term trends that drive the rest of the world apply to china as well. >> now, rene, people have to understand why you keep winning. there's an arm is a ubiquitous choice, great screen deck, your ability to license, energy efficiency. i keep hearing that about you. in in a world where jen son wong

cares about that, why are you energy efficient? >> you're right. energy efficiency is critical and becoming more critical in the ai applications where the data centers start consuming hundreds of megawatts. when you start moving towards artificial intelligence which is more and more compute, sustainability and energy will be one of the key areas to focus on. that is an area we are focused on and why is arm good at it? we were born out of a company that was designing products to run off a battery and that's in the dna of the engineers. that runs through every design philosophy we have. as a result you have power efficient products now moving in a world where power efficiency matters not only in a smartphone but matters in an ev, and it absolutely matters in the data center when trying to run the huge ai algorithms. >> go ahead. >> david, sure. >> rene, a lot of positive comments as you might expect from analysts but i did want you

to respond to something from redburn. they, in part, refer to this move as a short squeeze, but they say as well, the once in ten-year impact of an arm v8 to v 9 pricing is well reflected in valuations, more importantly, the significant stock-based compensation means 5% -- 75% of revenues are consumed by employee related expenses leaving returns more modest than they may see. can you respond to that. >> these a mouthful to respond to. the v8 to v 9 transition, that is early days. the royalty revenues for us that come from our version 8, to version 9, we're about 10% last quarter on version 9. about 15% this quarter. the royalty rates on the v 9 products are at least double what they are to the v8, some cases even more, so early, early days, regarding your question or comment on the stock-based compensation, there's a lot of

details in the filings about how that gets handled, really specifically relative to ultimately paying taxes for employees. that's going to settle itself out in the long term. i'm not worried about that. >> can you help me understand what it means to have edge computing on my cell phone, which, of course, would be you, where i know the android has more apparently than the apple, i have an apple phone, to me it's the next growth like for an apple which a lot of people feel doesn't have a lot of growth, what would an edge phone do? >> yeah. one example might be if you think about the announcements from google and samsung, about some of the ai algorithms that run on the phone or an edge device, one of the examples given was circling something on a picture, for example, on a browser on your phone and just circling a face of say patrick mahomes or jalen hurts it goes off and does a search based on that. this is ai running on your edge

device, meaning that it runs locally, doesn't need to go to the cloud, it can do a lot of that com pewtation in your handset. why is that good? it's faster. you don't have latency to go to the cloud. over time it's going to be more secure. that's just a small example of something that's been announced. >> wow. okay. because we do want that. it might end up -- may not be jalen hurts we're looking at this weekend. i can tell you that much. just a fantastic -- you are a plan of your word, said a series of things whether you came on the show and exceeded every one. congratulations. you are the arm holdings ceo. >> thank you. >> carl, back to you. >> thoughts about that, jim, and what's on tonight? >> okay. look i've got to tell you when i listen to him what i realize every device you have is about to get better and faster. that you -- you can write on his software the stat, a german super computer that jensen and nvidia is putting together that will dazzle us and be able the

first time i think david, is going to be a concern that we are no longer nearly as smart as artificial intelligence. >> yes. >> that's what's about to happen within the next -- >> ai has a deflationary impact on intelligence. >> wow. >> talk about artificial stupidity? >> our intelligence. >> real stupidity. >> deflationary effect on human strength. >> i'm just saying -- >> the value over intelligence is declining. >> i get -- all i can tell you it's going to happen much sooner. this is smarter than you. >> are you -- >> i'll circle you and nothing will come up. give me jalen hurts. >> thank you. >> thank you for letting me play. >> ge and vertex. >> i want to know about the pain medicines versus opioids. ge, fantastic quarter no one believed in the model after they spun off and peter proved them all wrong. i can't wait until tonight's show. i may do nothing except stay

here. don't you have the kellogg -- >> and the hershey. >> and hershey. >> what do you think, sara? >> i think i want to know what's going on with the consumer. >> oh. >> why? >> won't leave. >> you can stay. you're welcome. >> do my morning meeting for the cnbc investor club. rene, it's not a short squeeze. it's a legitimate stock that was under valued. >> okay. that is a key question with an enormous move in arm. let's move on to another big move this morning and that is shares of disney, which are up almost 10%. the stock responding to strong quarterly results ahead of expectations, particularly on the cost line. the company also announcing a number of deals and upcoming events, and i'm that includes updates on cost-cutting targets. bob iger told cnbc we still got work to do in light of, of course, that proxy fight that continues with nelson peltz. >> you don't snap your fingers and get there, and as i said a

moment ago, i'm not suggesting we're patient about it. we've got a lot of work to do. some of it takes time. the fact that we're guiding to profitability by the end of this year and we're going to turn that business into a business we're proud of in terms of margins, we know more about it and how to do that than any outsider is going to tell us. >> referring there, of course, to nelson peltz. that is, you know, let's call it a month and a half away, potentially end of march, what we're talking about. for the quarter of the responses very positive because, sara, of really what is the $500 million in sgna savings that fell to the bottom line and far, far fewer or lower loss in direct to consumer. 138 million versus over a billion dollar loss a year ago. they are well on track to meet and most likely it would seem, given the comments from iger and hugh johnston, exceed the $7.5

billion in cost cuts they've indicated they were focused on and then you have some of the other announcements not unimportant as well. $1.5 billion stake in epic games which is going to be creating a new digital world for them. aside or alongside the fortnite game they are well known for. possibility of having a movie premier one day in the so-called metaverse. whatever you want to call it. that not insignificant because they see a lot of younger people spending time in gaming and disney wants to be involved there. they're not going to be paying for any of the development that fortnite does but did take the investment position that company and the taylor swift tour as well. >> taylor swift. all over earnings. i mean taylor swift is like the new metaverse or ai or whatever the buzzword is to help companies get their stocks up. >> it is amazing. >> and yeah, i don't know how much of the 10% move in disney shares is due to taylor's concert being exclusively

available on disney plus. >> it's a part of it. >> butreally, it is the belief it would seem at this point that they are going to be able to continue to deliver on those cost cuts and then going to be able to get, as they said, direct to consumer to profitability that is disney plus by the fourth quarter of the fiscal year and then conceivably to double digit margins as well. and that sort of is what many have been waiting for. the revenue growth not really significant. parks quite strong as might be anticipated. linear networks continue to decline at a rapid rate as we know. overall, the response in the market certainly is to the success so far of finding places to cut significant costs. >> trian is not impressed. >> a year ago there was a quarter that also showed some progress as you may well remember, nelson peltz said the proxy fight was over and the stock began to retreat.

>> watching disney having a nice move today up more than 10%. another earnings mover is hershey, down earlier but now rallying. it's up more than 6%. the company reporting mixed fourth quarter results. a drop in profit and raising its quarterly dividend 15%. cocoa prices at historic highs the company predicts limited growth this year but resilience of seasonal traditions. let's talk about what that means, president and chair michelle buck joins us exclusively now. michelle, great to have you. welcome. >> good morning. >> it is hard to sort of figure out what's going on with the core business because cocoa prices are weighing on profitability and there's still inflationary effects. what are you seeing from consumers? how is demand? >> we had a strong 2023 with net sales up 20% and eps up over 12% and excited about '24. we are predicting 2 to 3% sales growth and a lot of exciting news coming into the marketplace

behind the caramel launch and increased merchandising. we've seen good numbers on employment, consumer confidence is improving. however, we are still seeing some consumers who are value seeking. >> yeah. tell us more about that. because it's been trying to find this dynamic for consumer companies between higher prices, but now sacrificing volumes which you saw. >> absolutely. you know, we are really focused on how do we deliver the best value propositions for consumers and for some consumers that can mean an entry level price point. for some consumers that can mean a larger package that has a good value and others what's important to them. news and excitement behind innovation. seasonal traditions that they enjoy with their families. we've seen a lot of the growth of the business be particularly skewed to that for us. you know, as we look at the

record cocoa prices, certainly it's a dynamic market and those are a challenge, but we have lived through market volatility and fluctuation and input costs before. we have a good hedging strategy. we have really good price visibility on those inputs into 2024. >> what's happening with just snacking trends and people eating sweets? because there was a little bit softer performance in north america confectionaries versus salty. how has it changed post-covid and what are you seeing next? >> yeah. i would say it is ever changing. and certainly we are seeing more of a reversion post covid back to more normalized behavior. people are out and about, so as we look across different channels, certainly some consumers are continuing to skew towards the value channels but we have many out and about buying in convenience stores as well. i would say the value propositions are a little bit more stretched there than in some other venues.

>> convenience. convenience and [ inaudible ] other channels where the value consumer is going? that's where you see the challenge? >> we're seeing growth in some of those value seeking channels. certainly we are trying to offer the best array of products with exciting news in every channel for whatever is important to that consumer at that point in time. >> do you see any impact of the glp-1 drugs on the portfolio? is it something you can see or thinking about how that's going to impact -- >> no. we see no impact as it looks to '24 we don't expect material impact. going forward the way we view it is, the consumer is always changing and evolving and we are always looking at how we can evolve our portfolio to meet their needs. so we don't anticipate. we are closely monitoring it. we believe we can adapt. >> just curious, michelle, what that means? we all don't know exactly, and i

can't imagine you would know specifically as well, but when you say we're going to adapt, what would be an example or something you have to be at least thinking about, given the impact these drugs conceivably could have on what is a fairly wide portion of the population over time? >> certainly one area to look at is portion sizes. people tend to still want to participate in categories but may look at given the impact of those drugs, they're consuming a smaller quantity and how do we offer that? we have broadened our array of portfolio over time from being focused on sweet indulgence to acquisitions in the salty space, to acquisitions in protein and we know that protein is an area that people on those drugs are looking to because as they're eating less they're consuming less protein and our snack bar portfolio is very relevant to that and we would continue to look at that portfolio evolution as we go forward as we always do. >> michele, i know you mentioned lower consumers searching for

value. on the call you mentioned private label entrants had gotten some focus. i wonder if you can characterize that compared to say prior sooilts? cycles. >> i think private label does get some focus. we are fortunate in the snacking category private label is much lower where he with play than other categories and certainly our brands tend to have higher velocity on shelf so over the long term they are the best bet for retailers to give shelf space too and also to best meet consumer needs. but that certainly is a time where we look to drive the category, make sure there are offerings for every consumer and tweak our value pop poropositio. make sure we have the right price pint, advertising support with our brands and like a skinny pop or do thes or

hersheys. >> how much of your cost is cocoa and what the heck is going on there? it's up 50% since last summer and some think it could go higher? >> yes. it is a big part of our cost bucket. disproportionate to any company out there. however, we have a lot of expertise there. it is a very dynamic market. it has been changing a ton with a lot of different variables at play within the market, everything from whether the health of the crop to speculators being in the commodity and we closely monitor all of those things. we have a great hedging strategy in place in order to provide us visibility and to have consistency in our expectation of what kind of price we will pay, make sure we've available supply and the strategies keep going forward. >> the stock keeps climbing up 6.6%.

the demand commentary helps. appreciate you joining us to talk us through it. >> thank you. we are excited that the investors seem to have as much confidence in the business as we do. >> michelle buck, thank you very much. hershey's ceo. a bunch of other earnings movers to talk about after the break. a lot of them related strictly to earnings. ralph, disney, tap pestry, as, wsor, cone cps wynn. your skin is ever-changing, take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond. you know doug, ever since switching to workday 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.

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welcome back to "squawk on the street." to eamon javers with a news alert. good morning. >> good morning, carl. the house select committee on china is out with a new report this morning. here it is. this report singles out five u.s. venture capital firms for criticism saying that they have spent more than a billion dollars over a period of decades investing in china in companies that helped the chinese government or military. the five firms that are being singled out in this report are ggb capital, gsr ventures, qualcomm, sequoia and walden international and what the report says is that these five

vcs alone made investments worth $3 billion into prc technology companies that facilitate human rights abuses, genocide, contact with the chinese military or strengthen the prc semiconductor supply chains and advance china's national security ambitions. they single out these companies for investing in both ai and in semis. on ai they say the companies have spent more than $1.9 billion to ai companies that support the ccp's human rights abuses. on semiconductors they say the companies have invested more than a billion into more than 150 semiconductor companies in china. we've reached out to all of these firms for their comment. sequoia capital, the u.s. entity of sequoia, sent us a statement pointing out as of december 31st they divided into three entities, those are sequoia capital in the u.s., hong shen in china and pxv in india. they are fully independent with

separate and distinct brands. se yoi ya says sequoia capital continues investing on technology companies in the u.s. and europe and we take u.s. national security issues seriously and have always had processes in place to ensure compliance with u.s. law. sara, that's the point here we should point out. these firms are not being accused by this committee of violating american law, but funneling american money to companies that benefit china's national interest, harm, they say, u.s. national interest and these investments date back to 2001. we're talking about a time period where america's attitude toward investing in china has changed dramatically. back to you. >> and why sequoia did that structure where they split the business. thank you, eamon javers. take look at shares of ralph lauren. they are soaring today rallying toward a nine-year high up more than 14% on the back of the latest earnings report this morning. profit jump beating expectations thanks to strength overseas but

it was a beat in every region. north america revenue a bit flat but comps up 9%. revenue in europe rose more than 10%. asia revenue increased more than 15%. the company pointing to strong holiday sales and continued growth in the direct to consumer channels. i talked to the ceo of ralph lauren this morning about what's working and teit's two words, brand momentum. that's separating ralph lauren apart from some of the other retailers right now in this cc choosey environment. where does brand momentum come from, but a lot of places, helps to have taylor swift wearing ralph lauren on "time" when you're person of the year. that helps the brand heat. as i said taylor swift is the new earnings buzzword. there she is. by the way, ralph invited taylor, apparently, to a met gala many, many years ago when she was very young before she knew anybody and introduced her to all sorts of people.

the man has vision. >> he is rewarding or she is rewarding his faith in her? >> i think the point is that there's an authentic relationship there with the brand. they're not paying, for instance, for a promotional advertising. j. lo wore a ralph lauren wedding dress because she chose it. off of this helps -- >> have you noticed -- >> are you in ralph? >> talk about brand heat. it's going to soar. >> not brie owoni. >> no. >> what are the expectations as you pointed out in the momentum in their brand? how long does that thing last. >>well, they have been building it. >> consumers are fickle. >> but patrice has been in there a few years and one of his biggest priorities is a.u.r., a word for elevating the brand, in terms of getting good pricing and value and doing things like $1200 cashmere sweaters and making them look like a good

value for consumers because they like that sort of thing. he also said it's the assortment they have right now where it's staples and sweaters and tweed jackets, not just fashionable items which are more sort of cyclical and go with the seasonality. i just want to point out china because that is a strong story for ralph and we talked about that. it grew 30% in the quarter. it's 7% of the overall business. before covid it was 3%. and they've done interesting partnerships there. mr. bag apparently is a aspiring sensation on wechat and they did something with him. >> the brand model, polo up 5, wholesale down 15. it's not the channel they're looking at. >> brick and mortar wholesale in particular is weak. macy's, dillards, sachs and blooming dale's stronger. under armour mentioned as well. dick's and ckohl's's for under armour but the department stores

and wholesale channels are struggling because of the low-ended consumer. >> oh. okay. disney is amongst the big earnings movers this morning. a number of bullish calls on the stock today. we'll speak with one analyst who raised his price target. don't go anywhere. 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. (ella) fashion moves fast. 5% apy? that's new! setting trends is our business. we need to scale with customer demand... in real time. (jen) so we partner with verizon. their solution for us? a private 5g network. (ella) we now get more control of production, efficiencies, and greater agility. (marquis) with a custom private 5g network. our customers get what they want, when they want it. (jen) now we're even smarter and ready for what's next. (vo) achieve enterprise intelligence.

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all on the most reliable 5g network nationwide. ditch the other guys and you'll save hundreds. get a free line of unlimited intro for 1 year when you buy one unlimited line. and for a limited time, get the new samsung galaxy s24 on us. let's get back to disney. he see the shares up about 10% rising not only on first quarter beat but as well, guidance that has been well seeflds by investors. our -- received by investors. disney is back on the offense. joining us steven kayhill raised his price target to 128. what does that mean? why do you think they're back on offense? >> yeah. thanks for having me on this morning. over the last four or five quarters since bob came back, the first few were very much about getting things back together, getting the creative strategy back on track, cutting

costs, raising price and that didn't lead to better financial results in the short-term. the last two quarters have led to better results. that's included free cash flow guidance they gave last quarter, eps guidance this quarter and disney seems to be operating from a position of strength and that includes the dtc parks and sports. >> obviously -- do you think investors are responding to the ability to cut costs both in sg and a and direct to consumer? it's not like there's a great deal of revenue growth here, is there? >> i think it is both. i mean i think you're right, david, that investors don't want to see disney just cut it ways to higher earnings. this is a creative company, a growth company, and so i think mixed into that is the fact that they're going to be implementing password sharing to growth subscribers at dtc, raised price, which shows disney plus is under monetized. parks had another terrific quarter which shows people still

value that experience and so i think that the growth is there in addition to the cost cuts just making the earnings look stronger. >> yeah. a lot of strategic announcements as well, not to mention the one about the streaming joint venture around sports but give me your reaction to the epic investment, $1.5 billion and epic going to be developing new games for disney. >> what differentiates disney from the media peers while it does something that peers do, creating shows, creating movies, streaming, that sort of thing, that, you know, relationship that it has with the consumer is very unique with its parks, its cruise ships and now, you know, with things like virtual reality and with the epic investment gaming. and so i think that this ability for it to engage consumers in these worlds that it creates, you know, through the different characters, universes, that's very uniquely disney and creates an attachment with revenue and

profits that goes on for, you know, sometimes a lifetime. so this is another, you know, kind of arrow in that quiver. >> finally, i hate to end on a painful note for those of us who have comcast shares, the only shares we can own here at cnbc i should point out, down another 3% today. you cover it. has reversed dramatically from what was a nice move after earnings on the charter earnings which were not good. what's going on here? why is the stock seemingly down so much in such a short amount of time? >> yeah. and sorry to hear that, david, but it is a reaction to the sports as you know. comcast and paramount were not part of that and our view is that this is going to accelerate cord cutting which, obviously, impacts comcast on the cable side as well as what they're going through on the media side. and charter has seen some similar reaction. so the more there is out there

in sports and streaming, the more consumers will decide to make a different choice than the one they're making today to consume that content and i think that's the risk that market is looking to price in. >> you do, yeah. listen, the broadband is still the main product. you know, you lose video subs, the margin is not that great. maybe it's on the nbc u side as well? >> i think it is a bit of both and of course charter last week, you know, they talked about just the tougher broadband environment than what they had expected for 2023. we downgraded that stock on friday evening. that has some sympathy trade down in comcast the following day, even though comcast, broadband results were more in line with expectations. but, you know, the point is like we've seen in many years for meade media it's a tough market. the customer getting more choice in sports, broadband, more choice in mobile, so i guess that's good for us as consumers. but it's been tough for some shareholders. >> indeed it has. steven, thanks for linking it

together. appreciate it. >> thank you. coming up after the break, another big earnings interview with the chief of kellanova breaking down the latest results and the impact of glp-1 drugs and what they might be having on the business, as we're still about 9 inpots from any s&p 5k. we're back in a couple minutes. move to the cloud. - so, the question is... - cyber attack! as cyber criminals expand their toolkit, we must expand as well. we need to rethink... next level moments, need the next level network. [speaker continues in the background] the network with 24/7 built-in security. chip? at&t business.

kellogg's with an earnings beat and drop in volume in snacks and cereal. and cereal. ceo joins us. steve, great to have you back. stocks responding well. organic almost 7, but you talk about rising elasticities in north america. can you comment on where the consumer stands right now. >> thanks for having me, carl. we did see good growth from a revenue standpoint this quarter, but we do see continued rising elasticities. it's really the cumulative effect of the pricing taken across categories for the u.s. consumer, the worldwide consumer. so, we saw the catch-up in the back half of 2023. we expect recoveries through 2024 as, you know, the inflationary environment is much more benign than it has been.

so, we don't see the need for continued increases in price. we see the consumer getting used to these new price points. so, that's why we forecast for 2024, a much more benign environment for the consumer. >> you're allowing the consumer to catch up to the price or does it change pricing strategy to the downside? >> no. it's really seen consumer catch-up. we're getting back to promotional activities we were at more pre-covid area. you'll see more quality displays, more features, more prom promotions, but not anything crazy. more back towards 2019 levels. i think that's good for the consumer. we want to be affordable. our number one objective is to be affordable to the consumer, to provide those moments of pleasure through our snacks and so, you know, we know that the consumer's under pressure and we know that affordability is very, very important. that's price points, that's pack sizes, that's promotional

activity, keeping the consumer at the heart and soul of everything we do. >> just for reference, steve, where are we relative to 2019 on how much it costs to buy these snacks, based on everything you just said? >> yeah, sara, you're probably 30% to 40% higher than you were in 2019. that's unfortunate. it's been across not only snacks, it's been across everything in the grocery store really. and what we've seen historically when you had this type of inflation, it tends to be sticky, but we're also seeing wage growth happening, which is good. i think the consumer is catching up, but the idea that we're going to get back to 2019 levels of pricing in the grocery store, it could happen, but it's not very likely. >> yeah, i think that's why americans still feel like inflation hasn't come back down. we look at the numbers and say, why are people feeling so miserable. 30% higher than where we were pre-covid. steve, what's going on in europe? really strong numbers there from you. we talked to michele buck at

hershey. europe was a nice surprise, ralph lauren had a nice quarter in europe. that's surprising given the macro economic data there. >> yeah, europe is tough, there's no question about it. we're coming off our sixth year, though, of growing in europe. it's really down to our portfolio. pringles is a growth engine for us in europe throughout all the countries. we have an affordable wholesome snack business with rice crispy creates. it's down to our brand, portfolio, and our team has done a fantastic job. in terms of the retail environment there, we work with our retailers very, very collaboratively to make sure that we've got, again, affordable snacks for them. it's worked for us. it continues to work for us. as we look at 2024, we guided towards another good year in europe. >> steve, it's hard to fully know the exact that the widespread adoption of glp-1s will have on the overall population, but it's not hard to imagine if people's appetite is

so suppressed, they may not eat as many snacks. i'm curious how you're viewing it, what you're doing to perhaps respond to it even though the data at this point is still hard to know. >> you know, david, i start with what we have in terms of the data. right now we see zero evidence that it has had any impact on our portfolio or really the food -- you know, the snacking portfolio in the united states. now, that's not to be complacent and say that might change but we've done a lot of work. we've done work on trying to figure out what the penetration rates would be, the takeup rates would be, you know, how long people stay on it, do they stick with it. and the best that we can come up with is a 1% caloric headwind five, six, seven years into the future. if that's the case, we can innovate our way around that through -- obviously, we've got a portfolio of lots of protein-led offerings, we've got pack sizes, we've got, you know,

trial sizes, portion control sizes. so, we can innovate our way around a 1% headwind if, indeed, that's the case in the future. we're not complacent. things could change. everybody's chasing the next best alternative to what's out there right now. right now we don't see -- we don't see much of a headwind. >> finally, the head of novo says a couple of ceos from food companies have been calling me asking how the drugs work, how fast they would roll out, quote, they are scared about it. he didn't name names. steve, have you been one of them? >> i'm not scared of it, carl. i'm not scared of it at all. we have a great portfolio. people will continue to eat their pringles, cheez-its, pop tarts, we're going to continue to innovate, and very optimistic about our future. >> steve, appreciate it, on the consumer, on price, and certainly on glp-1s. good to see you.

check out shares of new york community bancorp, our check, which has lost 60% of values since it reported earnings. there's 57%. just hearing from secretary yellen, the treasury secretary, who's testifying before senate today, was asked about commercial real estate and some of the risks around the banking sector. here's what she said. >> the banking supervisors are working with their banks to manage this risk to identify it. i believe this will not end up by -- hope and believe it will not end up being a systematic risk by the banking system. >> i think that was an important comment she said, i hope and believe it won't end up being a systematic risk. there are a few positive points. we heard an update yesterday from the new executive chairman, he talked about the fact that

deposits are not down, which was, i think, a big worry and what we were all -- the deja vu moment of last march. that's important given the negative coverage and the headlines and the stock price. deposits are higher than where they were in 2023. liquidity is also not a problem. >> we shared is that yesterday and the stock went down. >> it's an important point. it's an important distinction, i think, to highlight from last march. the other important distinction is, we knew about this commercial real estate problem. this is not a surprise. the unrealized losses on treasuries for silicon valley bank, that was a surprise that was a big problem. so, just some key distinctions from then anno d w. >> we'll keep an eye on it. on the markets overall, stay with us. you know doug, ever since switching to workday

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good thursday morning. welcome to "money movers." i'm sara eisen with carl quintanilla live from post nine of the new york stock exchange. marathon asset manager bruce richards moments away on why the market, he says, is wrong in a by big way about rate cuts.