that's just -- man. it's like bitcoin, right? the vix was all the way up to like 56, went from like 13 to 56. it's back to 24, but up a little today. and there you can see bitcoin's up a percentage point or so. oil was up a little, but down in the low 70s. me and you again tomorrow. >> see you. >> i'm going to get some profit roles. we can share. ♪ good wednesday morning, welcome to "squawk on the street," i'm david faber with jim cramer live from post nine of the new york stock exchange. carl quintanilla is at the olympics in paris. let's give you a look at futures as we get ready to begin trading on this wednesday. half hour from now. that's looking like a very strong, quite strong open. not sure how you want to characterize that, jim. >> i'm going to call it early since the market isn't open yet. >> thank you for that. >> no problem. >> keen sense for the obvious,

my partner there. our road map begins with the extension of a rebound rally for stocks. bank of japan official promising not to hike rates while markets are "unstable." disney leads the earnings parade. we got plenty of them, though. as for its streaming business, it did turn a profit for the first time, but the company says it experienced weaker demand at experiences, namely theme parks. stock looking down. shopify is amongst the morning's biggest gainers, however. a.i. helping to fuel its quarterly results and guidance. we're going to speak with the company's president. that will be later in the hour. all right, let's start with the markets. continuing to rebound from monday's big selloff. of course, we had a rebound yesterday that, by the end of the day, didn't really show that much, up as much as 2.5% at various points. where'd we end the day, up around 1%. interestingly, s&p, nasdaq, russell 2000, all up similar amounts. dispersion, disbursion, whatever

you want to call it. >> last night, when i went to bed, futures were down, and then when i got up about a half hour later, our futures were up, and the only thing that happened was the japanese central banker said, listen, don't sweat the program. it does call into question the whole idea that maybe this thing really was the so-called japan carry trade where there's just unwinding. david, hedge funds do a lot of things that we can't see. remember the viacom? >> by the way, we say hedge funds. really, we're talking about a much larger -- that's a catchall. >> these are multiple billion dollar funds. >> trillions overall when you talk about the big algorithmically traded funds or the quantitatively driven funds, similar. >> you're absolutely right. >> there's so much money out there and a lot of it is trading on, this does this, we do that. >> you're so right.

people at home might think, how can a tail wag the dog? in many cases, they are the dog, so when they all that do this trade and something happens like the yen suddenly does this big move and interest rates start to take rates up, it does surprise people. some people feel they didn't telegraph it. it can jar markets all over the world. >> and it did. >> it jarred ours. >> we should point out, though, the yen now has fallen dramatically for currencies against the dollar. i think we're talking -- you can take a look at the yen. as much as 2%. that's a huge move. that obviously is beneficial, at least, to those who were still in this trade where you're borrowing in yen, buying in dollar, buying baskets of potentially magnificent seven and stocks of that nature. but there's a look at the gain that the dollar has on the yen this morning because of those comments again, just to hit them

again, from the bank of japan governor saying they will refrain from further rate hikes when markets are unstable, which seems to be the case right now. >> that would be jay powell saying, you know what, i saw the market on friday, it was really bad. i saw the market on monday, you know what? i'm going to have to take action. we don't do that. i think that we have a little better, what i would call, decorum. but david, as soon as that statement was made, the vix plummeted. >> yes. >> now, the vix has been a very good proxy for the mag seven, believe it or not, and may i just say, before we go crazy about the mag seven, it's a super micro quarter that indicates blackwell will be late. and against that is micron, which has been my key to the market, just resumed a big buyback and sanjay says there are improved conditions. this is the japan central bank of our semis. you don't expect someone who's a very calm guy -- sanjay, i got

to tell you. family guy. when i talk with him, i mean, just very quickly devolve, asks about my wife, you always get into it, why? because he is a calm, considered man, so for him to do this buyback here says, enough already. and he has great credibility. >> you can see what's happened to that stock along with so many others. >> that's been the leader. >> had been the leader and you can see how down from its peak. yet still up, by the way, as we need to point out many times. this up 34% for the year. trading with the s&p up 9.8% and the nasdaq up a very similar 9% for the year. >> no panic. >> here we are. your point on the vix is an interesting one. bob pisani pointed this out many times. on monday, we had the biggest spike, i think, in history, up 42 points at one point in the preopen, at least as far as the data can go back on that. and then, yesterday, it fell the most since, i'm seeing here, since 2010.

like, does -- by the way, is that -- doesn't that kind of say, whoa, what am i dealing with here? >> it's like volmageddon, remember the first week of february 2018? it was mechanical problems because too many people were using these different options that ended up blowing up the vix and sent it down, and after it, you had a nice rally in the market. if you use the volmageddon, which is the term these very cloistered people use, i think you will come up and say, that is the most bullish sign we have seen for tech. that and sanjay just sticking his neck out and saying, this is it. >> how big is that micron buyback? do you know, jim? do you have that in front of you? >> i think the more important thing is that he suspended the buyback, basically, and what does matter to me is that micron does high-bandwidth memory, it's

a great proxy for mag seven. and it does matter because they had suspended the buyback in 2022. by the way, if you put up a long-term chart for micron, that does not do micron the honors. micron was one of the best-performing stocks the last couple years and we need to put that up to show you how -- well, now you cut off the right side. >> that looks pretty good. >> do you want me to trau a picture? >> that's fine. >> what's happened is that micron's been the leader because micron has historically moved up and down and up and down ahead of the market, so there's a precursor. >> got it. >> they spent just over $600 million on average each quarter when they were doing it. so now they come back and i think they have a lot of firepower. the balance sheet is very much improved. it was a terrible balance sheet even three years ago. >> that's a good tell. all right. i was going to go to disney, but let's to carl if we can right now. he's in paris, of course. monitoring all things olympic-related. and has the very latest for us. carl?

>> yeah, guys, interesting day. fun to watch you guys balance the market talk with the games today. actually, today is going to be really interesting, especially in track and field. we've got the men's 400 meter final, three americans competing for that. you have noah lyles, of course, coming off that 100 meter victory the other day now going for the 200 meter, trying to become the first american man to win both since carl lewis back in l.a. in 1984. and then, you have gabby thomas winning gold in the women's 200 meter last night. this is her third career medal. her first gold. she won bronze and silver in tokyo. just the second american woman to win the 200 meter gold in 32 years, and she talked about the difference between the paris games and her tokyo experience, which, of course, because of covid, was quite different. >> there is nothing like walking into a stadium of 80,000 people and they're screaming and they're right on top of you.

that is a lot of pressure to put on someone, and a lot of pressure for us to deal with, so it was definitely very different, but it's also -- it made it a lot more special when i crossed the line as a champion because i got to share that experience with everyone. >> congratulations to thomas. guys, the other one, and david, i always think of swimming when we chat. i don't know if you've seen this viral video of the artistic swimming move last night in which the team did the moonwalk. did you see this? it's unbelievable. i got to ask you about the physics of this kind of move. by the way, final day of competition here on that front. china is in first. u.s. in second. u.s. has not won gold in this event since atlanta '96. last medal of any color was in athens of 2004. but how do they do this, david? you don't even see them propelling themselves under water. >> i don't know. i don't know. i have never moonwalked in the

pool. spent a lot of time in a pool. i've added it up recently. it was years potentially, but never done that. amazing watching them. wow. >> incredible. >> we'll be watching for that, and wishing the americans all the best. >> carl, thank you. >> the 200 meters is an interesting race. >> what about that 1,500? by the way, carl, i mean, that was an amazing race. the 1,500. i got home to watch that. somehow, i turned it on, watched it live. unbelievable, watching -- and the guy from norway, unfortunately, didn't even medal as he got past and the americans got a bronze, and of course the gold. >> the distance -- the delta between the short races as everybody knows, the 100, 200, even the 400 and that longer race, how you sort of manage and calibrate the gas you have left in the can in those final few hundred meters is pretty incredible. that was a great win. >> yeah. again, i just love watching the olympics.

i can't get enough of it. >> david, can i just tell you? >> tell me whatever you like. >> i was a star at the 200 meters. >> you've shared that with any number of people who want to listen. >> one day, i was sitting next to a fellow on an airplane, not first class, and he asked me if i ran track, and i said, yeah, i excelled at the 200 meter, and he said, how about the 400? i said, i was pretty good. it turned out to be lee evans, who had set the men's 400 meter record in the 1968 olympics, so after that, i've never talked about publicly, other than here, how good i really was. >> i'm sure you were. and i once could throw a baseball, but i proved i'm incapable of doing that as well. >> that was terrible. >> it all goes south on us over time. >> there's a place called the home plate. >> i'm not even going -- i don't know why i brought this up. i don't know. you can't run. i don't even -- could you even run 400 meters at all? if i just allowed you to run it? >> i would have to have a knee replacement at the 400. >> carl, we'll see you later. carl quintanilla, of course,

we're going to talk -- we got so many earnings to get to this morning. we're going to start with disney falling. they were above analyst estimates. we're going to look at where streaming and of course what's really important here is the theme parks and what that says about the strength of the consumer. we'll get to all of that, take a loom at futures. we're going to have a sharply higher open, it would appear, when we get started with trading some 18 minutes from now. ♪ in any business, you ride the line between numbers and people. what's right for the business and what's best for everyone who depends on it. solving today's challenges while creating future opportunities. it takes balance. cla - cpas, consultants, and wealth advisors. we'll get you there.

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let's spend some time talking disney. the stock looks to be down not sharply, but down nonetheless. the attendance at parks, what was somewhat anemic is outweighing the first real profit from streaming, and the positive signals that sends. hugh johnson, the company's cfo, jim, sometime back, had shared the word normalization with the street, and there was never any -- in the conferences since then, nobody from the company, iger or anybody, said anything

more positive about it. >> right. >> and so perhaps not that big a surprise. that said, these numbers, given where the street was in terms of parks, they came in well below. >> right, but you might have an opportunity here. first of all, the stock is down very, very big. >> yeah. >> the reason you have an opportunity here is that there have been a convincing element that comcast universal did not have great numbers for the quarter. >> comcast did not have good numbers as well, which gave disney investors pause a couple weeks back. >> i went over all the different pieces of research. what i came back with is that comcast revenue decreased 11%. disney had been shading the numbers down for theme parks, and somehow, i don't understand why the analysts were so far off the mark, because maybe, though, this is just episodic. i thought that what was far more important was streaming, because, look, tripadvisor is not that good, airbnb is not that good. we saw the airlines, not that

good. if theme parks -- theme parks are going come back, because that's what theme parks do. >> they do, and your point's a very good one because the company seemed to be saying, things are not what they were. and in the call, hugh johnson, obviously, giving voice, and on an interview earlier with our friends at "squawk box," giving voice to the weakness of the consumer, but these numbers, again, came in well below versus expectations. but streaming was strong. let's listen to hugh johnson, because this does have broader ramifications, potentially, for a lot of the concerns around the consumer, which we can get to as well. take a listen. >> the lower-income consumers are a little bit more stressed and they're dialing back and watching their dollars more. at the same time, higher income consumers are traveling internationally much more, and we can see that in the data that we get. those people, we think, eventually they're going to come back and as they come back, the attendance will start to come. you know, one of the things about this business, and it's a

great business, because it has such terrific ip, it tends to get hit late, hit less, and recovers early relative to the other theme parks that are out there. >> thoughts? >> hugh johnson is a straight shooter. everyone knows that from his years at pepsico. if he tells me that this could be just episodic, things can come back, i'm a believer in him, which makes me think that if you can buy disney down here, you should buy disney down here. >> interesting. i'm surprised to hear you somewhat positive on disney. >> i am. i think that theme parks are really the great business, and it was streaming that had bothered me. >> the losses in streaming up to this point, some $11 billion, but they are now making money. that's an important milestone for the company, and by the way, we can't not mention the fact that the studio has gone ga gangbusters whether it's "inside out 2" or "deadpool & wolverine." these are numbers we haven't seen from a box office in quite some time. >> even though the movie theaters themselves are shabby and not up to snuff, i will make

this point. espn didn't bother me that much. david, not everything is going to work perfectly. and i don't think anyone out there who's at home and goes to the theme parks thinks that the theme parks are going to go away. >> of course not. >> it's similar to what comcast had. what are you going to get? you're going to get the one issue that had just been bugging me for streaming, because like maybe it's never going to happen, and then it turns out they did it a quarter ahead. bob iger quietly, no showman on this one. hugh johnson telling me that things are fine. david, if he tells me things are fine when they were at pepsico when i was concerned about something, then i knew i was wrong, because he's money in the bank. i think you buy disney off this and expect that now they derisk the theme parks, that if you get -- >> they've take an lot of costs out of the business, as we know, to get to that profitable number. they've also raised prices significantly, yet again

announcing more price hikes. >> david, if we were -- if this stock were at $110, i would say be saying, oh my god. some of the analysts believe that it would be bad. all of them did not. but at $110, this stock was really in danger. at $87? come on. this is a derisked situation that our viewers should watch. >> yeah. >> and then buy if it stays down here. >> i would -- listen, i have obviously, you know, the ip and the movies really can super charge a lot of other things and help even with streaming because you get these hit movies and basically don't have to produce as much content because people want to go to the site to watch them. all that said, i will come back to the fact that so much of the commentary about the park trends right now is very poor. >> but why didn't they -- the analysts see it from comcast universal? why did they keep their numbers up? >> i don't know. >> comcast universal in many ways has better theme parks. >> and, well, comcast said, people aren't going because they're waiting for the new

theme park to open, which i guess is next summer. then there's a question as to whether that's going to draw attendance away from disney. maybe everybody benefits. >> maybe comcast should buy boats. >> boats? ships? >> they need to buy cruise ships. i would buy cruise ships if i were, say, brian roberts. >> maybe the proceeds from the hulu -- from the hulu settlement, if and when they finally get there -- which, by the way, from what i hear is still a ways away. they are arguing, going to have to arbitrate. >> we work for comcast, and if i were in the boardroom, i would say, you know what? can we go to norwegian cruise, viking, do a deal? it's so brilliant that it won't be done. >> and by the way, if comcast does have a cruise ship, jim's going to be on there for a week. >> i booked in february 2020, at the last week, i had booked a cruise. david, it turns out, unbeknownst to you because i announced it at my birthday party, that there was this epidemic, and you chided me. >> i did. >> you said, jim, all you do is scare people.

>> it was four and a half years ago, he won't let me forget it. i've already apologized. can't wait for his next big birthday. >> and norway, you predicted it with that school board. >> i had no idea how you got there. back to norway. we got a lot of earnings to get to this morning, and we're going to do that as well as this man's "mad dash." stay with us . your memory is an amazing thing, but sometimes it can start to slow down. but did you know prevagen can help keep your memory sharp? the secret is the powerful ingredient, apoaequorin, originally discovered in jellyfish and found only in prevagen. in a clinical study, prevagen was shown to improve memory in subgroups of individuals who were cognitively normal or mildly impaired. stay sharp and improve your memory with prevagen. prevagen. in stores everywhere without a prescription.

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. let's get to a "mad dash." we're going to talk a little, oh, i get it now, ralph lauren. >> i'm nothing if not schtick, right? >> you're all schtick, man. >> i can do plates on sticks and everything else like they did in the sullivan show. >> that's an rl cap there made by the company, or designed. >> and i've got to tell you, it is part of what i regard as being a terrific number that

what they did, just to people know, this was actually a stronger european and asian quarter than united states but they had great direct to consumer. this is about brands and brands that are timeless that held up. i mean, interestingly enough, even though china is only 8% of the business, they were way up in china. we didn't see that from richmont or lvmh. the brand is very strong, and i think you're going to find that patrice, once again, is going to be able to tell a fabulous story, and the reason he can tell it, david, is because they've gotten rid of anything that is low-end. they're all high-end, and they're quality, and i salute them. this is a terrific quarter, and i do think that you got growth -- mid to single digits. look, they can -- they're never going to shoot the lights out. but they're consistent in a business that's episodic. in a business that people say, oh, i don't know, up and down. they're not up and down, and i

salute them, and yes, the olympics is going to produce some very good numbers for them, because it's a high number of viewership that we know from comcast. >> well done. let's get the opening bell right now. here at the big board -- we're going to have a lot more green on that board -- doing the honors here, abbott. at the nasdaq, a.i. technology company helport a.i. that's a listing via spac. yeah. still got some spacs. >> have you looked at fortinet today? >> yeah. ftnt. >> cybersecurity. >> up 15%. i was seeing it up. >> very easy comparisons. >> we've got a bunch of earnings movers to get to. >> okay, i'm sorry. >> fortinet. by the way, $50 billion market value company. >> at the same time, i'm saying that we have had a glitch in cybersecurity ever since the

problem with crowdstrike and if you deliver -- people started thinking maybe this industry is not as -- maybe it's more gloomy than we thought. but you know what? fortinet shows you if you have easier comparisons and you blow the numbers away, people will buy it. >> they beat on the top line. that is obviously the revenue line, but also operating margins were stronger, i believe, than had been submitted by analysts. >> i don't know if the margins are sustainable. that may be the weakness there. on the contra side, david, super micro. we have to get to the not so super micro today. evidence i have had them on a couple times. a lot of people are going to link them to nvidia, and they did say on the quarter, look, blackwell is late, that's the much disputed blackwell, and they don't expect anything until the first quarter, but they did come up with something people should feel good about.

the h-100 and the h 2-hundred are selling like mad. the read-through on super micro, even though the stock is down and they're often linked, is that it may be good for nvidia, which is why nvidia is not -- is up, not down. >> i think we get dell tomorrow. >> they compete with dell. dell is down. dell was at $179 in may, david. it's now at $90 and it's down another four points today. >> it's down in part because of this report. >> yes, it is. and they are competitors, as is hpe. i think it will be quizzical to see if michael can't tell a great story given the fact that in the end, you know who michael dell is? one of the most deliverable ceos in our history. >> i've said, probably doesn't quite get the kudos he deserves in terms of one of the major business figures of the 20th/21st century. >> talk about kudos that he

doesn't get. you have to go down to texas to see how much this man has given. >> given, i mean, listen, dell was in austin. austin is now technology center. it was not when dell began. >> that's him. i think that -- look, i'm not saying that michael dell is going to have a good quarter for dell technologies. i'm saying, a la disney, the stock is down a lot so there are opportunities here. can't stick my neck out for dell after how bad super micro was, but one particular hyperscaler -- >> let's go to some other names that have been a favorite of yours in the past. airbnb. >> yes. >> that is getting hit. we're getting a lot of movement off of earnings, we should point out this morning, and we're going to try to get to the biggest ones we can. >> this is travel. >> it goes back to, shorter lead times, essentially, right? people -- people are booking their trips, not as long in advance, it would seem, at least not according to commentary from airbnb.

>> and that is a good tell for the fact that there's a lot of open homes that you can rent. now, i was a little bummed by how negative brian chesky really was -- >> the ceo and founder of airbnb. >> and frankly, he's talking about watching the trends closely. if you are disney, you're doing the same thing. >> yep. >> trip advisor, doing the same thing. so, maybe, andrew ross sorkin, was talking about yolo trade this morning, you only live once, and whether it's over, and i have to tell you, i think it is over. >> you do? >> i do think that unless you're on a cruise where you have to be -- you have to be frugal when you live once. i only live once, so let me be frugal. not exactly the dictate of the -- >> i'm not -- why do you think it's over? >> people have run out of money. >> that would explain it. >> they also watch tv. >> room nights for airbnb came in up 9%. the street was looking for h

higher. >> it was a bummer. >> guided from the third quarter to "sequential moderation relative to the second quarter." >> it was a bummer. >> and stable is sort of -- that's the story there. >> can i give you a contra that's very good? >> sure. >> bracken darrell, who ran -- stop making fun of me -- who ran lodge tech and ran it well, went into vf corp., which had been a travesty. he had to make emergency sales. i predicted when he came on "mad money" that he would do it. i felt i was a little more positive on vf than he was, but it turned out i was right and the stock is screaming. >> as i have said repeatedly, anybody named bracken darrell, you can get behind them. you're not getting stopped. you're unstoppable. >> my father always said you can't trust a man with two last names, but bracken darrell may

be violating that dictate. coolest man. >> why we're looking at the dow, i have no idea. there's the s&p and the nasdaq. what were you going to say? when they're not showing shares of vf corp., i'm trying to talk to what's on the screen. >> i thought that he might be the next bond. >> the next who? >> james bond. >> bracken darrell? >> yeah. >> oh. >> if we have a picture, you could see why i would think that. i think he's more of the sean connery bond. maybe the roger bond. >> roger moore. >> roger moore bond. we can put the two together. by the way, the assistant attorney general for antitrust looks a lot like the previous assistant attorney general for antitrust. >> it's interesting, watching rahim, who ran the antitrust division of the department of justice, which undertook the litigation against google, as we pointed out, on search, that was won, i don't know who the next antitrust head is going to be, but i do know this. they better get their glasses game working.

when you are the head of the antitrust division, you've got to have strong glasses. >> that's the only thing snapchat's done right. isn't that snap? >> put that together. whoever's going to be next in that position, just go to warby parker and get your game on. all right. just wanted to point that out. back to earnings. >> by the way, look, there's no doubt about it. i want to make this clear, even though -- that cankanter's good. some people are saying to me, are you saying kanter is bad? kanter argued the google case very, very well, and that was not his case. he did not bring that case. >> kanter, good. >> thank you for saying that. >> novo, not so good. novo nordisk. >> novo does not have as good a product as eli lilly. >> but wegovy is just fine for people who want to lose weight. >> everything's going to be brought down because suddenly

people realize, wait a second, these guys are very much in a dogfight and the prices are coming down. >> are the prices coming down? >> the dogfight you're referring to is between lilly and novo. they are the leaders. we have plenty of other potential entrants as they look for an oral -- a pill instead of having to get a shot. >> amgen, i was surprised to see how not farther. that was a little discouraging for me. but i would say, david, that when you own these great growth stocks, like eli lilly, the great told me they could be a trillion dollar company and they almost touch it. you have to ride the roller coaster if you want to win with these. >> should point out, lilly shares are also down, perhaps on this. >> there's a real -- price war. >> sales in north america, operations for novo were up by 36%. >> high expectations. >> take a listen. i believe we have the ceo on cnbc europe saying a few things about the quarter. take a listen.

>> we're very confident in our ability to scale and also supply patients and deliver on our stronger growth for the second half so i say worry less about what happens specifically in q2, there were some adjustments to rebates, et cetera. look at our guidance, and we believe there's attractive growth in front of us. >> that was novo. can't have a day where you don't talk about glp-1s. i mentioned yesterday, the effect it has not just on people's appetite but on other things as well, including gambling. >> that's amazing. gambling. what kind of -- how does gambling taste? >> doesn't taste good when you're on glp-1s. you drink less, so maybe drinking and gambling? >> there have been casinos that told me to leave. >> are you counting cards? >> no, but i will tell you this. don't forget. mounjaro, 20% body, and people felt that wegovy does not deliver that. more toward the 15%. now, in the end, david ricks,

the incredibly calm, terrific indianapolis colt-like ceo, and that's not c-u-l-t, will not be hyperbolic, so you can't expect him to come out and say, we're much better than novo. i'll say it for him. jonathan taylor is going to be a bell cow. >> got it. >> and i think the receiver core is -- >> thank you for your nfl picks. want to talk a little cvs because that's a company that's, i don't know if you want to call it in transition. she has had her share of challenges as the president and ceo of this company. not bad reception to the numbers, though. i'm looking at a stock down over 2%. >> i hit up cvx. now, she will be on "mad money" tonight, and this is an odd thing. it was actually health care that hurt them. i'm so used to hearing about amazon eviscerating the front of the store, but this was more of the aetna part of it.

this was more like humana. this is a challenged company with a terrific ceo. i got to hear what she says tonight on "mad." >> looking forward to that. karen lynch. >> that's called promotion. >> that was well done, jim. >> and i did it seamlessly. >> so good. would you like me to give you grades on your performance? >> i just want a gold star, and by the way, speaking of gold stars, fortinet is driving a whole cohort of cybersecurity higher. >> even crowdstrike is up? >> crowdstrike is up. come on. george, he had -- we didn't even talk about it. microsoft also feels like the delta gave them short shoplifter. >> delta's now in a feud with crowdstrike and microsoft. >> that's a smart position to take, not unlike elon musk being in a feud with all his advertisers. >> i'm suing all my advertisers. >> by the way, linda yaccarino joined in that little fracas. >> she did. >> having sold and taught selling in my life, i never wanted to sue any of my customers. >> you try not to. >> i always felt it was bad.

>> he tweeted whatever, posted it, now, "this is war." >> he's starting to feel like biff. >> not from death of a salesman? >> right. he's biff. >> i was trying to figure out -- >> he's not, by the way, lee j. cobb. >> a number of people have done that role quite well. >> when you're biff, you're not -- you're like trying to steal pens and stuff. i am very, very upset when you sue an advertiser because -- because what happened is when you sue them, it often comes up when you're trying to close. i'd like to buy ads, but you're suing me. >> thank you, arthur miller. let's move on to rivian, why not? down 6% on earnings. they previously reported the company delivered 13,790 vehicles. they talk about that new jv they

formed with volkswagen. >> who's buying that stock? you're just betting on vw continuing to put money in. >> is that what you're doing? >> yeah. i would rather buy tesla, thinking that demand isn't that distracted. >> all right. >> i don't know. >> finally, we the got shopify, which i guess we should get to. we pointed out the stock is up sharply, and i believe we are going to be joined by the company's president. >> we sure are. shopify shares are indeed surging, and i got to tell you something, david. i think that harley finkelstein may argue that the previous quarter wasn't as bad as the market said. this, though, is just a total reaffirmation of the old shopify, the estimates handily beaten and that's thanks in part to what i would say is a boost from, are you ready? what do you think helped them? a.i. >> oh, yeah, of course, a.i. >> harley finkelstein, shopify's president joins us. i'm going to call this a first on cnbc.

i've not seen it anywhere. harley, i would say congratulations, but isn't it true that this is just a continuation of what was a strong quarter that people didn't like last time? >> i absolutely agree. this is the best version of shopify, jim. we're focused, executing on the plan we set out last year, but this quarter in particular demonstrates a trend that we can achieve both seriously meaningful combination of growth and of profitability and just on growth for a second, when you exclude the seller logistics business, revenue was up. that's our fifth consecutive quarter of at least 25% topline growth. on the profit side, gross profit was up, which grew faster than revenue. how's it going on the free cash flow side of things? more than doubled from last year, 6% to 16%. >> it was almost triple, harley. you're very conservative today. >> well, i just -- it's important that whether or not, you know, last quarter's results were -- there was an overreaction in the market or not, this is a shopify that is

growing. we can grow topline, bottom line, getting largest brands of the enterprise on, point of sale is doing incredibly well and i think these results demonstrate that the plan is working. >> people felt last time that you couldn't balance between revenue and profit. i think you showed them that you absolutely can. how did that happen? >> first of all, it's really important for us to make sure that we -- remember, if you go back to when you and i first time started talking, nine years ago at the ipo, let's say -- >> we both had hair. >> i still have some hair, but little bit less hair now. we had e-commerce for smbs in english-speaking geographies. today, we're this unified commerce platform. we have brands of all sizes and all geographies coming to us for point of sale, for b to b, for online retail. if you think about our actual enterprise business, and you look at sort of where we are now, this quarter alone, you saw casper, away, qcv, barnes &

noble, the largest retailers on the planet are coming to us as well. if you think about how some of our growth drivers are doing, look at shopify point of sale for physical retail. that didn't exist five or six years ago. gmv was up 20% year on year for point of sale. so, all these drivers are working really well. we have our guardrails in place to make sure that we are very thoughtful about how we're spending but the results speak for themselves. >> a lot of people concerned about the macro. i was concerned about the macro when i read etsy. it was very difficult not to be concerned about the macro when you read what amazon felt about what was happening in their retail. what is your feeling on the state of the consumer? >> i mean, like you, jim, we hear a lot of other companies talking about a softening consumer spend. our data shows us that merchants on shopify continue to outperform the broader market. and i think that's happening for a few reasons. the first is, remember, if you think about your top brands, the brands consumers absolutely love, those are all on shopify. in fact, new brands are being

built and more brands migrate to us every single day. but the other thing to keep in mind, our business model, what's really amazing is we have a very diverse set of verticals of merchants, so we have scrub companies like figs and pet product companies like bark box. we have nestle and heinz and mattel and staples. there isn't one particular type of merchant. we're across all types of verticals. we have a great direct to consumer business. we have companies like carrier, who's selling their industrial heating products, using our b to b product, so whether it's online, offline, local, global, this is -- these are the brands and merchants coming to shopify and we're seeing great success with them. >> it's david. we talk a lot about a.i. and its impact in a real way. you talked about it on the call. but you said, you know, leveraging emerging technologies to enhance our feedback loops and you went on to explain a bit what you're talking about in terms of sharper, more iterative feedback, but can you explain to our viewers how you're using it

in the business and in a real way explain what you're doing with the information that you perhaps would not have otherwise had quite as deep a look at in the past. >> i mean, we look at a.i. in two ways. one is, how could it make shopify's operational efficiency better? to your example, david, the way that we're looking at marketing channels, we're able to now experiment at a much faster clip. i mentioned this a half hour ago, but in q1, we began to experiment with an emerging new social platform. we put a little bit of money to work to see what the results would be. it worked really well. we doubled down on it in q2, and we saw about a 50% increase in customers, merchants coming to us in the quarter from the previous quarter on that particular channel. this ability for us to make much smarter bets within, of course, the financial guardrails and an average payback period of 18 months means we can make smarter decisions much faster. same thing goes in terms of how we arm our merchants with a.i. if you think about all the -- we have millions of stores on shopify. we're now about 11% of all

e-commerce in the u.s. and we're growing our market share considerably there. we're able to give our merchants great tools to make better decisions so they can write their own ads, make better decisions to run their business and in both cases,whether it's internally or externally, these types of innovations are making our merchants more successful and our business is predicated on that, so it makes us more successful. >> it was the kind of quarter that we're used to. i think the last one wasn't as bad as the market indicated but it sure is glad to have you back in the huge plus column. harley finkelstein, president of shopify, really good shop. thank you, harley. >> thank you, jim. thank you, david. before we head to break, let's check out the bond market for you. not an unimportant part of our overall capital markets. one that perhaps we should get to a bit earlier sometimes in the show, but not today, necessarily. you can take a look, though. that ten-year, creeping back up towards the 4% level. >> the 20-year. >> yeah. remember, though, at the beginning of the week, as you

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we're out of our hour here. >> i know. >> what do you have on the show? >> amgen, a disappointment on the weight loss. i have celsius, which is younger people, that's the energy drink that makes claims that it's really good for you. we have cvs, karen lynch did a great job on retail. so i'm not willing to throw the baby out with the bath water and then rick muncrief wants to talk about gas. >> good show. >> that was one of the reasons i

was up last night -- >> one of the many reasons you were uplast night. >> yeah. aside from my general insomnia. the only person who sleeps less than me is george kirks. who won le mans. >> don't take any naps between now and mad money. >> microsoft, crowd strike said delta didn't do the job. tya sanot a man i would mess with. velvet glove, real fist. >> we're staying on top of the rally this morning, don't go anywhere. no refrigeration, no heating or air conditioning. the winds are not letting up at all here. we're going to see some power outages. number one thing to prepare for is extended power outages. are you prepared? you can be with a generac home standby generator. when a power outage occurs, your generac home standby generator automatically powers up, using your home's existing natural gas or propane, so your life goes on without disruption.

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good wednesday morning, welcome to another hour of "squawk on the street" i'm david faber with seema mody and mike santoli, there i am. we're live at the new york stock exchange and there's carl quintanilla live from paris,

giving us the latest on the olympics. you can see we are up across the board, a bit of a rally here. japan's central banker talking about no continued rate hikes while things are not stable. that's been helping -- not helping the yen but helping our overall markets. >> dial up 470 points with 30 minutes into trade. three movers we're watching, starting with disney, shares under pressure despite beating earnings estimates. that's despite turning a profit for the first time on disney, hulu, disney plus. and then super micro shares are plunging on the miss. the company announcing a 10 for 1 stock split in october. that stock still a winner year-to-date up about 90%. another earnings mover getting crushed is airbnb. not a great quarter for travel.

cutting guidance more than wall street anticipated and seeing signs of slowing demand from u.s. customers and a strong reaction from wall street. all cutting price targets on airbnb. >> and a number of other travel-related names also seeing weakness as well today. >> hilton cut guidance. i looked to last week, marriott the world's largest hotel operator did the same. this is the first time we have seen ceos from several travel companies saying we've seen weakness in the consumer. they're cutting their guidance and they're tying it back to the macro economic environment specifically the slow down in the jobs market. >> we'll get to disney earnings as well later in the program and given parks attendance perhaps a concerning sign. that gets us to the overall market. stocks are staging a rebound, higher for a second day after that selloff on monday. all three indices still down on

the month. mike santoli on the desk as well throughout the show. what are your thoughts as we -- you know, we gave up a lot of the rally yesterday. >> we did. yes. 's the not atypical after you get a market shock. we were down 7, 8% several days really in the s&p 500 so the rallies are tentative and suspect initially, they have to clear some hurdles. what we did this morning is get a little bit above the high in the s&p 500, not much. it's still a rebuild process. the overnight news out of the bank of japan, gives investors permission to relax a little bit about macro shocks. even though the end cary trade was one of many things that seems to have unwound and been an input to the pull back. it's the monster under the bed, you need reassurance it's not there, you need to look under there and make sure that's not the case. so we don't see a mechanical spiral of selling we saw in the

concentrated panic yesterday morning. but it's hard to think the market is going to go back to the highs which were set at a time you had extreme comfort with the idea of a perfect soft landing, the feds cutting on time and for the right reasons. we don't have a slow down in the jobs market and the other seasonal effects we're dealing with. nice rally, coming off the lows, about 20% of the s&p is off 10%. so you reset valuations and positioning and sentiment on some level so i think that's where we are but you still need further confirmation that we can believe in the soft landings process. earnings are coming through okay, but we don't know whether 20:25 numbers are looking too high and that's all about the macro and the consumer as we've been talking about. >> the bank of japan comments what's your raed on what that tells us about the fed? the fact that officials are saying they'll pause rate hikes until the market becomes more

stable, clearly the market is responding positiviity to that. >> the market didn't want to see the friction between what bank of japan was going to do and what the feds were doing. what's that mean for the velocity moves and the current markets? i think what we call the carry trade, borrowing in yen to buy risks and assets in itself is not the big story. cro crowded calms into the markets, when markets started to become calm calm everyone had to go back to their corners. i think it's reassuring that the bank of japan is going to be intentative to the market impact in terms of normalizing policy. >> we had a significant move up in rates in the last two days. >> yes. exactly. >> i'm not sure what to make of that. particularly given what seems to be a weakening consumer based on everything that seema shared and

what we're seeing from the travel related names and the like. >> to me it's like we overshot with the safety trade, panic trade on monday. so yields plunged to levels you didn't want to see it. i don't think you want the ten year to make new lows under 4%, that does tell you something troublesome about the underlying economy. so you're relaxing off those levels. you're still way down from where we rolled over. >> as you can see there, although the charts are hard to read because you can't see the 3.6 and change we hit on monday. >> i know. >> let's bring bob pisani into the conversation with stocks near the high of the day. as investors try to understand how much further we have to go given the move on monday? >> i keep waiting for these knock on effects from this his t -- hysteria last week and monday about the economy going

into a recession. i did not see that. maybe this is an extreme thing to say. monday looks like a flash crash to me and very much around the yen hysteria. the etf to watch was the xxy, this was the japanese yen. there it is. it topped out on monday, we regained almost half of the -- of what we gained -- the 8% we gained going into that right now and the market is sort of moved in tandem with that. the ten year yields have been fallen as the yen has str strengthened. put up the ten years it's moving in almost opposite tandem here with the trade here. the carry trade. the same with the sectors here, the tech rebound, semiconductors a good tell on global risk appetite are up now 2% for the week. so i know flash crash sounds like a strange thing, a sudden

and severe price drop that only lasts for a few hours and that's what this looks like. all of this hysteria about the recession, 4.3% unemployment, 114,000 we're nowhere near recessionary numbers. what disturbs me is the 12% decline in the nikkei i thought that caught a lot of global officials by surprise. that's the tell there. people were having to get out, cover theirbets there because the amount of yen they had to borrow suddenly they had to pay it and a lot more money. i don't know how big the trade is. >> nobody seems to know fully exactly how big it is. >> that's what's disturbing. i don't know how people cover the global currency mark. cover the stock market i know, the u.s. stock market is 55 trillion, global is 100 million. we don't know how big the carry trade is, hedge funds are doing it, wherever they are, whoever

they are. we just don't know. there's estimates all over the place. >> i think we see, you get the futures data on a weekly basis, it's a proxy for how many people are short yen futures and things like that. you can see how much was undone in the last little bit. i think once you have that sort of everybody's eyes on the same factor and you have this volatility storm and everyone is waiting for the next after shock, a lot of times it doesn't -- i never found it to be useful to get in the weeds and say what's happening next. it reminds me of after silicon valley bank, what banks have uninsured deposits, where's the run next. what you need to know is this going to cause a recession, and change the economy on a dime. if the answer is no, okay what's the next quarter's earnings. >> the idea of buying yen to buy big tech stocks with microsoft

and apple the biggest winners. morgan stanley coming out with the evaluation of magnificent seven stocks now at a 30% discount to the five year average. >> going back to fundamentals again. what bothers me, is there was a cloud about the slow down. so the idea we were going in a recession imminently got clouded and distorted by what happened with the yen carry trade. my point is, we did this no october 2022, we convinced ourselves there was an imminent recession and remember what happened to the multiple went down from 20 to 15 or 16, even though the earnings estimates did not come down that much. this is hysteria around a recession that never happened. we'll get a recession eventually but the numbers there don't support. >> there's always a fundamental basis and a technical, mechanical exacerbating factor when you have these things. on the sup side we have it because we have extreme calm in

the markets went a record length of time without a 2% drop. so you're seeing the recoil from the trades based on nothing is going to happen anymore. >> by the way, the vix on monday, that 60 print and we were in 30 in the front, that was a very good tell and it worked. >> 41% drop in the vicks from monday's level. >> we had a historic increase in the vix some 42%. >> it was sort of a phantom high. >> it was in a way. >> let's not get in the weeds on that. >> maybe later. bob pisani, thank you. let's get to carl now in paris following another day of busy olympic events. >> a gorgeous day here in paris. we talked track and field and swimming earlier this morning but one sport we have not talked about is breaking. not break dancing, breaking. and they are called breakers set to hit the dance floor beginning friday into saturday. the sport makes its olympic debut. it's called a watershed moment

for this dance form conceived in the '70s by black and hispanic youth in the bronx. the u.s. has competitors like sunny choi, she'll face competition from countries like japan, lithuania and morocco. she points out unlike a lot of olympic sports, the on ramp to becoming a serious player to this sport can be a lot smoother. >> breaking has really kind of globalized and now we have this extremely beautifully diverse world because breaking is a lot more accessible than other sports and art forms out there. you need a dance floor, some music, nowadays most people have access to technology so you need some youtube and you can start in your living room. >> really interesting point considering how much athletes have to go through to get practice time, facility time in

other sports that require more. as for the medal count, kind of an interesting back and forth between the u.s. and china as the u.s. for now has reclaimed the lead in the race for gold with 24. china close behind with 22. and coming up, guys, i know david you've been a loyal viewer every night like millions of americans and people all around the world. women's basketball, quarter finals tonight versus nigeria. the u.s. women have won seven straight golds. seven straight golds going all the way back to atlanta '96 and they look to become the first team in any olympic sport to win eight straight olympic golds, their last loss was in barcelona in 1992. 58 straight olympic wins in terms of games. pretty remarkable. see if that record stretches in tonight. guys? >> wow. i have a feeling it might. soccer also doing well, obviously in the gold medal

round now. that was an exciting match against germany yesterday. >> indeed, luckily that last point in extra time got everybody riled up. that's going to be another -- there the record has been a little more challenged in terms of the streak for gold but that victory against germany was huge for a sport, i don't know would you argue maybe gets the most eyeballs of any women's sport, at least back home. >> it does. and the women, as you say, have been not quite as dominant as previously but we won our share of world cups as well. the women's team. i never tire watching any of these things. i watch the steeple chase. jumping over the water. it was amazing that race, the lady from bahrain i think prevailed in the last five yards or so. carl, thank you. >> okay. nasdaq up nearly 2%. as we head to break here's the road map for the rest of the hour. a close er look at super micro'

earnings miss. >> and novo nordisk on a rare risk on the obesity drug sales. >> and disney has earnings that well, kind of a mixed picture. pressure from the company's park business is the key here that's why the stock is down. we'll talkbo wt' authas next for disney. we have a big show ahead as well. don't go anywhere. no. how am i going to do this? welcome to the mdy mid-cap cup, presented by state street global advisors. today's challenge is to play 9 holes without the middle of your bag. how does that sound? that sounds terrible. ♪♪ ♪♪ ♪♪ ♪♪

disney topped earnings estimates streaming business posted the first ever profitable quarter, that was actually one quarter earlier than had been expected by many. the stock, though, as you can see, it's down because of weak numbers from the park and experiences segment. joining us to discuss is alan gold, he has a buy rating on the stock, 130 price target. parks was not great, operating income in particular. how serious a problem does disney have given the importance to the overall net income? >> good morning, david, thanks for having me on. it is an issue, the parks are slowed down. it should not be a big surprise. we knew, after last quarter that things would be slower and then we knew after comcast, your parent company reported, there have been even further slow down of the park's business. they'll be soft for a few

quarters, the consumer slowing down, disney raised prices aggressively at the parks. it'll slow down. about 60% of the business is domestic parks and cruiseships. cruise ships do well. the international parks continue to do better. paris is having a little bit of an impact this quarter versus the olympics. i think this is a few quarter issue we wish we had more certainty as to when the slow down would end but over the long term this is a phenomenal business, it's a due oply with disney first and comcast second. the beauty you have the comcast business which used to generate billions of ebitda earnings and had been losing money, lost money the first half this year, finally turned around and generating at a billion dollar run rate the last two quarters of this year. and streaming goes from losses to profits. so i think any weakness in parks

business will be more than offset by gains at streaming and content. >> yeah. i mean, right now the street -- you know, jim and i were talking about it earlier. what happened here. to your point, the cfo used the term normalization, nobody walked it back, you had the comcast numbers and people still seemed surprised by how steep the decline is, talking about september quarter going up 20% to down 5%. that is a big drop. >> it is a big drop. the last quarter call they guided the quarter would be up double digits so that is a big drop. i don't think it's 20% with you -- >> what are your expectations with streaming. now that it's profitable what do the models look like, in terms of what we can expect from long term profitability from the very important business? >> i'd say over the long term,

netflix is the leader, i don't think anyone gets to netflix's margin because no one has the scale netflix has. but i can see this becoming a 15% and certainly potentially a 20% margin business over the long term. >> allen, within the theme's parks business. what do you attribute the weakness to? i'm looking at the travel and entertainment ceos, including airbnb's ceo last night saying americans are opting for shorter trips. is that playing out in theme parks as well? >> certainly. it's a combination of the general overall economy, the consumer tightening, the stimulus money running out. in addition to disney over the last couple of years fairly aggressively raising pricing so it is an expensive vacation to take a family of four to disney world or disneyland. >> sort of the anchor, at least one of the main ones was the

expectation about free cash flow returning back towards prepandemic highs, hue johnston said we didn't change guidance therefore we don't have anything new on that, but there was a short fall in the third quarter. a lot to make up in the last fiscal quarter. is that about inside out 2, and wolverine and dead pool, box office flowing through? how much confidence do you have they'll hit that. >> hugh did not aggressively confirm the $8 billion number, but made it sound like they were in the zip code of the $8 billion number. and the box office receipts from "inside out 2" they're receiving those already. but wolverine will do a million two at the box office, generating a fair amount of working capital benefits that should get them close to that $8 billion number. >> allen, thank you. >> thank you, david.

>> another earnings mover to watch today is novo nordisk moving lower. an angelica is back with the latest on this stock. >> that's right. sales of the obesity drug coming up short of estimates in the quarter. executives are down playing the miss as a one time event from paying higher rebates for the drug. novo is saying as volume goes up, price will come down but they see room to grow here, especially with supply improving. >> so we're confident in our ability to scale and supply patients and deliver stronger growth for the second half. so i say worry less about what happened in q2, there were some adjustments to rebates, et cetera. look at our guidance and we believe it's a very attractive growth in front of us. >> the supply story continues tomorrow when eli lilly report

earnings. they have a competitor that came out last year. another name is amgen the drug maker facing questions about its weight loss drug on an earnings call yesterday. we're waiting for phase two yesterday. >> let's go to amgen what are the questions we're not getting answers to because it's notable with earnings that stock is down 4%. >> the question everyone wants the answer to is what did the data look like? they told us they feel good about what they're seeing and they're going to go ahead and move the drug to phase 3 trials but we haven't seen the data and everyone yesterday is trying to get answers, what can you tell us? what can you tell us? and they're saying hang tight. you'll see the results when you see them later this year. >> amgen down about 4% right now. thank you. as we head to break. check out the biggest laggards on the s&p, led by super micro

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super micro shares are slumping by 15% after a big earnings miss, lower gross margins, the ceo charles lang telling analysts on the call expenses rose due to the buildout of artificial intelligence data centers which require costlier liquid cooling equipment inside those centers and saying shipments remain strained due to supply chain bottlenecks. a lot of questions whether super micro would acknowledge the blackwell delay and the ceo did acknowledge it and also expects shipments to come in early in 2025. which is relatively in line now with what wall street is expecting. so i think that's why you did see nvidia shares move up a bit in today's trade. we did see bank of america, though, downgrade shares of

super micro. their concern if if you look at free cash flow in the fourth quarter it's negative and they think that raises the expectations or likelihood that supermicro will go back to the capital market to raise money. earlier this year they did just that, issued debt, sold stock. so now the question is, given the amount of money needed to build out these data centers if they will have to do more. >> saying black well may postpone how much we don't know on the call. dell is also down in sympathy, i guess as well. and reports earnings tomorrow. >> that's right. so within the a.i. server market as you know, dell is super micro's main competitor both suppliers to nvidia, take the chips and sell them out to hyper scalers. what dell doesn't have is the free cash flow issue that micro

has. that's why bank of america said they like dell more than supermicro. >> the older businesses of dell and hp -- >> the traditional. >> the traditional kind of cash cow businesses continue to support what they need to in the new ones. the big one to me, they were given this premium multiple as highly leveraged a.i. plays now it seems like the economics are not going to be there in that generous a way for those players, the ones that are essentially repackagers and restallers of the technology. >> we thought that conversation was sort of confined to the hyper scalers around the run on investment for artificial intelligence. >> there's no magic nvidia and

chipotle have both traded poorly off their stocks. so i guess that's not direct support for super micro. >> the stock movered up and then investors had a second for deeper read on earnings and the stock selling off. >> nvidia shares had been up at least 3% in the early going having cut skandignificantly th gains, nvidia up call it a half a percent. the nasdaq and s&p also off the highs. let's get a cnbc news update. >> tropical storm debby parking its over georgia and the carolinas today. bling more than a food of rain and major flooding in some areas. according to the national weather service the storm is expected to reintensify as it makes a turn towards landfall again over south carolina later today into tomorrow. and what vladimir putin

calls a injure provocation, forces are battling a cross border incur shs by ukrainian tr tr troops. and perfume isn't just for humans anymore. d dolce and gabbana is offering a musk for dogs. you can preorder it for 99 euros or roughly $108 and get it by august 16th, david. get your order in had. >> yeah. all right. i love my dog, i really do, but no. not going there. smells perfectly good. i tell him all the time you're doing great. sylvan na, thank you. after the break we'll turn back to the market rebound although

as we pointed out, averages we are a bit more of a muted response but still a significant gain. quick programming note as well. later today on the exchange not g want to miss this, j.p. morgan's ceo, jamie dimon, that's 1:00 p.m. we'll be right back. do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. our friend sold their policy to help pay their medical bills, and that got me thinking. maybe selling our policy could help with our retirement. i'm skeptical, so i did some research and called coventry direct. they explained life insurance is a valuable asset that can be sold. we learned we could sell all of our policy, or

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that's slow cooked and smothered in tangy memphis style barbecue sauce. it's no fuss, no muss. just tons of flavor. the best barbecue beef is only a togo's. try one today. incu welcome back to "squawk on the street." volatility hitting the broader markets as the mag seven names have shown cracks and our next guest said to watch for value elsewhere, like citi group. up double digits. bill nygrin joins us now. bill always good to catch up with you. you know, you've been sort of preaching there's value outside the big nasdaq names. where does that leave you right now concerning you probably need

a good economy for the stocks to work. >> how bad can the economy be if the consumers are paying $100 for dog perfume. >> fair enough. >> i think it's fair to say that you do need a good economy for the banks to do well for the auto related companies to do well. but i don't think it needs to be anything incredible. and the levels we're at today just don't seem that far above trend. we're looking at companies like general motors that going into this correction was selling at about 5 times earnings and it's gone down enough it's only four times earnings now. or citi group that was six times expected 26 earnings now at about five times. and people say when will investors ever get interested in these stocks but the companies are taking matters into their own hands and aggressively repurchasing shares. we think that will drive prices higher towards fair value.

>> so that's the answer to, i guess, the question are these not just chronic value traps that really require invests to look over the possibility of a potential, you know, downturn in the economy. how long has gm been trading at a single digit multiple? >> for too long and we've owned it for too long with it trading at a single digit multiple. what's changed is this year they have rededicated almost all of their cash flow to share repurchase because they believe the stock is too cheap. it makes it difficult for them to invest in anything else because nothing else has such good returns. i think investors had never paid as much for growth that comes from shrinking the denominator share repurchase as they do for top line growth. so even though these companies are relatively mundane at the top line, their earnings per share growth matches some of the best growers in the market. >> i guess i'd love for you to

weigh in on alphabet which has been a big holding. has come under some turbulence here with the regulatory concerns. what's the way to think about this business right now? >> the way we've always thought about alphabet is if you kind of separate out what they're doing in their venture capital spending, other bets, and add that back to income you're not even paying a full market multiple for search and investors have gotten concerned, given the court ruling that could put into question whether or not google can be the default search on iphones. we saw the same thing happen in europe about a year ago. investors are presented with an array of choices of what search en engine they want to take and we've no decline in google's market share since then. we think investors are overreacting and we don't think it would be a big deal if they couldn't be the default search.

>> let's get to charles schwab, i don't remember having discussed that with youin the past. it's a larger holding in the oak mark fund why? >> we like schwab because of the cost advantage they have over the other large asset gatherers. they are maybe two thirds the cost of the larger platforms like fidelity and vanguard. the old wire house firms, they're significantly cheaper and because of that, they've been able to grow assets faster than the rest of the industry. schwab's method for doing that has been to give away a lot of services for free and then kind of make it up on the interest income on cash balances. there's been concern that maybe they won't be allowed to do that going forward -- >> yes. >> -- we think that's probably overblown. but if we're wrong, we think schwab could start charging fees

or could kind of revert away from the bank model and it would help to expose to investors how profitable this company really can be, and it's growing significantly faster than the industry selling below a market multiple. >> curious what your thoughts are on the industrials. the sector trading around a five-month low and the name you're a buyer of deere, has under formed the market. what are investors missing? >> we used to own a lot of industrials. our thought was they're selling at about two thirds the market multiple and we thought they deserved to sell at a price as high as the average company. that did happen on most of the industrials and because of that we sold most of our positions. but deere is a relatively new holding for us. sell at about two thirds the market multiple. very dominant in market share in

the ag economy. the thing that's different about oak mark we're trying to make an estimate where the companies will be five to seven years now from now, not what's going to happen in the next quarter or two. when you look out that far, we think deere is going to maintain high market share, it'll be able to increase price for its products because they continue to make them more productive for farmers. and they kind of split the difference. the farmers benefit from the productivity increase as do deere shareholders. so we think deere deserves to sell at a market multiple. >> bill, appreciate the time. covered a lot. thanks, talk again soon. >> thank you. >> as we head to a break. let's look at shares of fortinet. up 23% right now. it's a cyber security company reported second quarter earnings ahead of wall street estimates and boosted the full year outlook. a strong top line beat as i

said. and also seemed to be some general positivity around margins as well. let's get back out to carl in paris with a look at what is still ahead in the show. carl? >> david, you know, the games are the star this week obviously but what else is getting attention is france's efforts to become a hub for tech and a.i. using a light regulatory touch. we'll look at those efforts when we continue live from paris. take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond.

a strong recovery from the turn around. we'll speak with one of wall street's watchers tune in to "power lunch" at 2:00 p.m. eastern time.

welcome back to "squawk on the street."

carl is in paris of course covering the olympics he joins us now with a look at the rise of a.i. startups in france. carl? >> hey, david. interesting the games are giving the french an opportunity to talk about the fact that tech startups and a.i. are a huge priority for the french government. they have simplified business regulations, they're creating incubators, offering business credits not exactly the image you get when you talk about the european approach to business. but tech leaders here say that's why france is now getting a second look. this is station f, the world's largest start up campus right here in paris at this repurposed former train station about half a million square feet, 30 different programs all aimed at supporting the next generation of entrepreneurs. a lot of them focused on a.i., all of them taking advantage of the resources station f has to offer. >> all of this early stages of

creating company, hiring first employees and just getting out of your room can, getting a spao meet with your founders and do the first steps of the process. >> 65 nationalities are represented here, a vast array of talent, it's attracted partnerships with apple, google, microsoft, trying to support the next generation of founders and improve the tech ecosystem around the world. >> if french nation is the startup nation. i think you feel it here. this is the beating heart of the start up ecosystem in paris. it took a lot of political will to make it happen. >> and station f director rock roxanne saying this is the

beginning. >> we're hearing investors saying we're focussing on france, in the last 12 months it really accelerated i think that's because of a.i. >> collectively station f participants have raised more than a bill euros in the last two years, and as of 2023 they represent 15% of all funding raised in france. it's been an interesting mix of tech silos as well as that incue baiter, there's health care, fin tech, climate, quantum and clearly a.i. and on a week we're talking a lot about doj, alphabet, your interview with jonathan cantor, the french are beginning to ask is there a way they can flip the script. it's not a surprise that france is near number one in foreign direct investment in europe and around the globe. they just announced $16 billion in pledges back in may and macron said publically this is a

key issue. the city of lights he said is going to be the city of a.i. >> that's interesting because paris does not have a track record of cultivating startups successfully. so they're trying to make changes and to your point macron has been vocal extremely well educated, in all kinds of areas of science, aerospace is one obvious examples, but a lot of those who have been schooled in science and tech have moved abroad. they've lived in the u.s., have worked in silicon valley, and they have a heightened interest in coming back home and trying to convince the government of how they can change things to become more competitive. we'll see. we'll see if we have a new competitor on our hands. >> incredible stuff. we will be watching. carl, thank you. carl quintanilla in paris. after the break, last month's global i.t. outage turning into a war of words between microsoft and delta. find out why and just what they're saying, as the dow continues to rebound, up more than 400 points at this hour.

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cat -- a capn -- we're opening p a can of whoop-ass on surge pricing. that's what we're focused on. >> as you can see, the stock is getting hit on what was a weaker than expected from lyft, in contrast to shares of uber yesterday, by the way, which were up sharply after that company delivered its earnings. mike? >> stock up not really off its lifetime lows there, under 10. the war of words between delta airlines and microsoft heating up over the massive i.t. outage. our steve kovach is here with the very latest. >> now microsoft is pushing back on delta's claims that microsoft and cloud strike should be held liable for the i.t. outage that caused delta to cancel flights for several days in a row, pushing back on comments delta ceo ed bastion said on our own air last weak. microsoft's attorney sent a letter to delta attorneys saying in part, delta declined assistance from microsoft to fix its computer systems. also, that microsoft's ceo satya

nadella emailed bostion and received no response. also alleges that delta is just using outdated i.t. skystems an the extended outage could be because of other vendors. plus, microsoft pointed out that united and american airlines, they were able to get up and running days before delta could. these were very similar arguments that we heard from crowdstrike's attorneys over the weekend in response to delta's allegations. and delta, by the way, yesterday, did not address what most of microsoft and crowd strike have said. instead, yesterday, a spokesperson told us that the airline does spend billions each year on its oit operations. and guys, this is not over yet likely not the legal threat for cl cloudstrike or delta, but it is the most prominent, guys. >> and is the expectation that crowd strike and maybe microsoft will have to fight these things out, you know, one by one, customer by customer, or is it going to be some kind of more global approach to settling all

of this? >> potentially. yesterday, crowdstrike also put out, they've kind of figured out more about what caused this. that's kind of the first step. i'll also note that an attorney from crowdstrike, his letter over the weekend also said that because of the way these contracts are written, that cr crowdstrike is only liable for single-digit millions in payments, whereas we have delta out here ask for half a billion, mike. >> steve, thank you. steve kovach. that's an interesting battle to keep an eye on between delta and microsoft and crowdstrike. we see the s&p up 1.5%, nasdaq up 1.8%. mike, let me come to you in the brief time we have. anything you're going to be focused on during the rest of the trading day? >> it's mostly about whether this market seems capped right here. i mentioned we were above yesterday's highs, basically went right back to that level. we're kind of fighting it out. to me, we're in the sort of tactical zone of is it safe to add back risk, because there has been a real, i think, a bit of a

purge of positioning coming into this. in fact, you also saw some data that monday was one of the most active days for people shuffling around their 401(k) investments. so there clearly was a lot of attention and money in motion on monday. so people are wondering if it's safe to the normal highs, what they were positioned into last week. >> a lot of frustration in terms of getting online for some of those actual retail brokers. we're keeping a close eye on these maet arks,s we continue to have a rally. we're back right after this.

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good wednesday morning and welcome to money movers. i'm seema mody alongside mike santelli at the new york stock exchange. today, jeff sherman will join us on the move, the ten-year, and how he's thinking about the path for rate cuts. >> then the nikkei rebounds again. portfolio manager has more on how he's taking advantage of the recent volatility. >> plus, robinhood's 24-hour trading participate on the counted outage for overnight trading of equities on the platform. >> right now, markets with some