paid his bet off. >> very quickly, i want to take a look at the euro. we were looking at 1.5 and now it's 1.39. this comes as the it's time for "squawk on the street." good thursday morning. welcome to "squawk on the street." i'm carl quint quint. markets are more stable after yesterday's volatile ride. a lot of earnings today. janet yellen, day two on capitol hill. yellen expressed the concerns about housing yesterday. and then in europe, the bank of europe and ecb left it unchanged

and then we've got china export data continuing. >> and we're going to breakdown the momentum for you. we'll also have the priceline ceo joining us live. >> morgan stanley in agreement. >> and pricing for online orders while amazon adds 15 cities to its sunday delivery program. is yours on the list? >> a busy day after janet yellen speaking.

and jean-claude trichet will be a guest here. >> the guy has become a cheerleader in chief. he's done a lot of good for those who favor growth but there hasn't been growth yet and i think that the austerity park worked but when does growth kick in? one of the reasons why i think the interest rates are so low is because of yields all over the world. i personally think that we should be issuing bonds in this country. the feds should stop selling them. there's a bond shortage but we're not getting the growth that i want to see. i feel for him. >> german industrial production a miss today. french industrial production a miss. >> a lot of the american companies are saying that it looks like we could get 0 to 2% growth over there. zero is not growth.

how do you have zero growth? it's like negative yardage. >> or negative growth, which we have said many times on cnbc. that is a phrase that's been uttered but makes no sense. >> none. we're dealing with a situation where we get 1%, maybe 4%. we're the engineers in the world. there is nobody behind us. we have this locomotive and we're just flying through. >> we're flying through? flying? >> i'm seeing so much good data. i'm sorry. okay? >> give me some examples. >> okay. auto sales are really remarkable. nonresidential construction going up. >> services pmi, not bad. >> gdp did not look so good. >> it was a pause. it was a pause, as yellen likes to say. >> i just think that there is truck, auto, nonresidential, oil and gas are all going the country's way. they don't like to talk about

oil and gas in washington because that means we're pro fossil fuel. that's where the jobs are being created. i can get you a job in louisiana, you go to texas, colorado, new mexico, wyoming, very big finds lately. you go to colorado, north dakota. you will not be able to find a house but you can get a job. >> i know. you can live in your car. >> you can live in your car and that's not so bad. i've got to tell you, homeowners insurance and collision, same in one policy, an umbrella. >> it works. >> that was a joke. >> david and you did not live in the same car. you said our car. >> you're right. i had a ford fairmont. he probably had a beamer. >> let's bring in michelle caruso-cabrera. hi, michelle.

>> mario draghi, when it was ripping towards $1.40, it was so close, and then he said an exchange rate was cause for concern. is he going to do anything about it? no. but as you look at the intraday chart, you would see the move pretty quickly. remember, why is it such a problem? these periphery companies have worked so hard to become more competitive. they've cut salaries like mad. they've cut government budgets like crazy. they've tried to become more competitive and then the euro moves 10% and suddenly half of those gains disappear. even though the yields in italy are below 3%, when you take in account inflation, it's above 3%. their debt stock is still moving. >> we'll see if draghi's

comments go his way. michelle, thanks. a lot of talk about the momentum. tesla beats the q1 revenue. it doubled. as did priceline. the current outlook is below estimate. stay tuned for an exclusive interview with the ceo of priceline, darren huston. >> stock gets hit for 30, 40, 50 points and then you start hearing the metrics and they are very strong. the zillow conference call was like internet 3.0. everything you must say in order to get your stock not get crushed, you're talking about making a lot of money, sign-ups that are return on investment. it's like, listen, we heard what caused our stocks to go down.

we're not going to do it anymore. remember, twitter now is an $18 billion company. if this cut back to 15, 16 billion, believe me, you'd start thinking they pay for what's up, 19 billion? you know what, twitter is worth maybe the same. >> you're right. people have been making that comparison. i have to say, the fallen twitter -- >> i'm not the only one? >> no. i've been hearing it out there. >> i thought it was original thinking. >> it may be original but don't threat. don't threat. >> jim, the loss of market cap is a result of the lockup and the sales, the sales, i've been continuing to try to figure out who were the sellers and, you know, there were a lot of hedge funds. >> there were a lot of mutual funds, too. tero price. they have quotations in terms of

the size of the companies of venture investments. they may have been a seller. there are sellers out there when you're that large a lockup and just trying to explain why we saw this. it's an incredible move counsdo. it's a quarter of the market cap. >> there was no way you could trade it between when it was announced. >> it's not even the secondary. it's not even the so-called section markets. it's private sales from people. you can seek out sellers. ali babba, you can get some. >> nothing is as tight as a drum. when costello said, we're not selling, they thought maybe the leader is saying that he's not going to sell so maybe everyone else who sells is going to be embarrassed but costello is not

in charge of the divisions that are in front of him. $29, that's a far cry from 23. >> read the morgan stanley report. they say that the insider share selling pressure could last for another three-plus weeks. right? >> i think there's a price where a lot of this is where your basis is. if you had a basis of 10 bucks, remember with facebook, the stock drops from 26 to 21 and then a gigantic give-up. can that happen with twitter? i'm just saying that the short trade is done. >> you have guys who bought 16. >> cha-ching. >> morgan stanley on twitter,

goldman on sjm. >> remember, it says there were value-added analysts who said, you know what, take your problems. >> what about the continued talk of this bubble and internet stocks? you've talked about a disservice. >> it's sad. >> it's perfect. >> isi is saying talk about a tech bubble. 90% -- >> that's misleading. >> they cap tech. i it's at a discount. >> the deals that became public in 2014 are all overvalued. you have a little bit of a decline in the number of paid users. every tech company, if you bought the pop -- here's a great one. every tech company, if you bought the pop, you're down. >> i know. >> every single one. >> it's not even like whoa, that one stayed up and that one

stayed down. bubble is the word that bothers me. overvalued i have no problem with. bubble means that it's 2000. when you look at the market cap and you have the sharp stick in the eye, i meant fire eye. >> you've got to give him credit. >> you've got to give him credit. that stock goes to 3 billion or 2 billion from 4 billion, believe me, there are people who want to buy stocks for security. >> what about aol? what happened there? >> cash flow is seasonal but -- >> cash flow for the year. >> and aol -- i go through that and they've really turned on it. there was like a closet group of people waiting for one little ching and they took that bad boy down huge. when i go over the quarter, i understand why it would go down some. but the magic carpet ride is over. >> they are still getting a lot of money from the dial-up

business. >> yes. >> these people, who are they? >> well, you know, they are people who -- suckers are born every minute. but i do -- i think aol is overpunished. they didn't buy back stock. i don't know how many shares they bought back this quarter but i think that tim armstrong, there is suddenly a sense that he had done it all with smoke and mirrors and i think that's unfair. they built up a good business. >> and they push through. like advertising. >> overdone on the sell side. frankly, there's a big lockup on may 22nd, 80-plus million shares. if they have a $5 basis, cha-ching. and we'll get details after the break. >> i don't want them talking

about me. >> and exclusive with priceline's darren huston.

the seattle seahawks have given richard sherman something to smile about. he signed a four-year contract for $57 million. 40 million guaranteed. new contract signed, he tweeted, great moment for my family and foundation. that's a big deal. >> i tweeted him immediately and within, i don't know, a few minutes he thanks me because he did say i did the best imitation of him of anyone. now -- richard sherman, along with kevin durant, these are the people who represent our country. to me there's a level of selflessness yesterday that didn't come out on the contract, because he is, and kevin durant's speech about mvp should have been his mom, i would love growing up to have these role models. >> and hopefully some kids at

round one of the draft will take inspiration of that. >> his blanket coverage, where he's very active along that line, obviously before that, from a very tough area, from los angeles, look, we don't get heroes. so when we do, let's praise him. richard sherman, the president, praised him on the speech at the last correspondents' dinner. >> amazon expands sunday delivery service to 15 cities and fedex will plan to charge by size, not just weight, squarely aimed at customers who ship toilet paper, et cetera. fedex, kellogg and then whole foods is under fire for not cutting prices enough.

>> sprouts does not cut prices and sprouts had a very good number. >> reversed course yesterday, i believe. >> exactly right. people are saying, that's the next whole foods. i'll go back and talk about whole foods for a second. they are the best. they will win in the end. this is one of those battles where you've got to cut price in order to get it. i thought the fedex was interesting and ups. these are companies that should be much more cognizant. >> and they criticize them for not being efficient as they could be, particularly how they use their fleet in the air as opposed to on the ground. people believe they could do better. amazon -- they've got to know that amazon at some point may say bye. >> fedex was up.

it signaled things are not so bad. the downgrade from barclays focused on returns. whole foods is going to be focused on service technology and value at the expense of returns. this is a new theme. got to be careful about this. >> so you're saying you agree with the barclays downgrade or no? >> i think it made a lot of sense. this group is a little frothy. >> what about amazon at $297.92? >> the world changed. i don't want revenue growth. i want earnings per share. everyone that manages their business like amazon, that's whose stock is being punished right now. you'll see spencer of zillow not running his company like that. >> but history will tell you, if you look at amazon, it will come back. >> it will come back. 31 cities in china who have 5

million people in it have taken to amazon. remember, it was mentioned -- >> we have mobile ringing the bell today. >> ali babba -- >> this is why i don't like ali baba. there's the ringing endorsement that he's not in it for the money. the chinese are being kraicrack. >> what happens if they crack down on november 11th, which is big for me. >> huge. >> huge day for me. i'm one of the 283 million people who bought some gifts on singles' day, november 11th. if the chinese say we're not backing the singles' day -- >> they are trying to have a consumer-base economy.

>> are you tuning into the communist party? are you listening into their phone calls? that was a good documentary you did. >> they are. you are in big trouble. big trouble. i stopped talking. >> hey, raymond shaw is one of the -- >> we'll get cramer's mad dash after the break and talk live to a u.s. ambassador to ukraine, jeffrey payot. you, my friend are a master of diversification. who would have thought three cheese lasagna would go with chocolate cake and ceviche? the same guy who thought that small caps and bond funds would go with a merging markets. it's a masterpiece. thanks. clearly you are type e. you made it phil. welcome home. now what's our strategy with the fondue? diversifying your portfolio? e*trade gives you the tools and resources to get it right. are you type e*? at your ford dealer think? they think about tires. and what they've been through lately.

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. all right. it's 6 1/2 minutes before the opening bell. this is cramer's mad dash. >> i want to talk about solar city. solar city truly did report a great quarter. solar city is going into distributing solar, meaning the panel on top of your house. and solar city, along with a competitor nrg, which is david creen. >> the ceo. >> it's a very nice recommendation and says listen, believe me, the distributed business is very, very strong. we're seeing that it's a headline. good quarter, better calendar, even better your 15 targets. this one is ripe. >> so you come and subsidize and then sell power back to the utility. >> the more places that do that, the more you own solar city. first solar is on tonight. that has not been their gig. first solar is about gigantic

power plants. >> mega rays. >> i happen to like both because i think solar prices have come down. some of them -- >> multiple, though, right? >> there's no doubt about it but there is -- this is a future of 50 million buildings that could have a solar panel. imagine that market, it's 50 million buildings. >> that's a lot. >> it's a great business. >> it's a lot. >> i'd like to go in it if they did it. i'd like to think that solar panels on your roof where the utility has to kick back, it's huge. it goes higher. >> tesla goes up. opening bell is in about 5 minutes. stay with us. you're watching "squawk on the street." dog: oh, boy!

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almost exactly 1%, despite all of the carnage, 1% below the record intraday high. >> see, that statistic is killing managers. they never want to hear it. that is the number that they fear because so many managers are well below that that they are like, please come down, s&p, and they are willing to talk down the s&p. they can't have the s&p up. >> yellen is being seated as we speak. again, this is not before the joint economic committee but this time the senate budget committee. some members include mike crapo, a pioneering potential tax reform in this country. pat toomey, mike enzi, bernie sanders is on the economy as well and of course their comments yesterday, not too worried about the gdp print but housing is a concern and may go on longer than expected. >> and is it demand, the fact that there's not enough supply? what is driving it?

yesterday i felt that zillow made it pretty clear that housing is going up 3%. he puts on a pretty good face. he does. >> there's the opening bell. down here at the big board, cheetah mobile celebrating its ipo today you're not doing this? >> every single ipo has been a failure from where it traded at the top except for four biotech companies and one of those got approval for drugs. it's really remarkable to see the carnage, the amount of money lost by ipos. it's been a disaster. >> 2014 has been a disaster.

>> we have not mentioned the sales up 1.2. europe up 1.3. u.s. flat was almost exactly on consensus. a lot of discussion about that. working on operations to improve a q3 story. >> i've got to tell you, i am with them. this stock has been remarkable in part because everybody else's numbers have been coming down. their numbers have been consistent. how do you know that they don't do something self-help? there may be self-help. >> i think there might be. good company. >> yeah. >> i know people are saying that the trend is bad and everyone wants natural food and i get that. at the same time, let's not forget worldwide. this is a pretty good company.

>> green mountain beat by 14 cents at 1.08 and expands a partnership with smukers. >> we reveef short this, short that. how was the green mountain short? now puree short. i say cut short because the guy who runs coca-cola who ran green mountain made a sweetheart deal that's been pretty darn good. they are buying back stocks and they are embarrassed. em barsd. this was a great, great stock if you bought it. i don't mind saying that and i don't think this company has great management. >> you're absolutely right. there was a key short there. >> like with athena, 170, you go to the tape it's missed quarter

and he blames me. and now suddenly i'm the guy. now suddenly i'm the guy. cramer likes athena. i have a show, you can watch the tape. >> white wave is up 22 cents. revenue is a beat. >> and i have been recommending this stock. you can take it to task and greg has done remarkable work here. i don't know how long his company can stay independent. i asked him that. >> if you're general mills, don't you want to earn horizon or the earth bound or great salad that i used last night when i made my salad on a nice

piece of swordfish? it was good. i cooked last night and i used quinoa because i use it for every single meal. i mixed in some quinoa, both good for you. >> much nicer to say than to eat. tesla shares are down 9%. the number was i think not exactly what people were hoping for. i know the nongap earnings number was better. >> yes, it was. >> now they are talking about the huge battery plant also including california in what will be the hunt for a lot of jobs. >> doesn't he have to spend in order to grow? is that bad? i looked at page 14 and they are talking about how they need a substantial increase in production. well, you can increase production by not spending money. that said, this is another stock that comes under the broad

rubric of change. >> the stock is still up dramatically. anybody would be happy with a 22% return so far this year after an incredible year last year. >> people are taking it off the table because it doesn't fit the pair dime and the paradigm is buying back stocks and dividends. >> how about fireeye, a spending story? tesla is the same thing although they see cash flow negative for the year. >> that gaffed people but they did talk about china. if you ever say anything negative about this company, evidence is such a battleground but this is a -- the cfo of tesla, i only read, not talk. at a high level for the gigafactory. >> that's right. that's right.

>> all right. let's go to bob pisani. >> there are other things going on. >> sprouts almost recovered from the loss of yesterday. >> when i have sprouts on, they have a small store format. by the way, they have a quinoa and salsa flax that knocks your shocks off. they have these combinations of food. it's a small format and they are not directly come pet tibl. >> cheetah priced towards the high end of the range. the price talk is 12.50 to 14.50. they priced at $14. that's a good sign not obama nl the ipo market. remember, this is ahead of

alibaba. this is a very good sign overall right now. there have been four chinese ipos, by the way, and three of the four are below the initial prices. the only one trading up is the twitter of china. it priced at $17 in the middle of april and right now it's still above that. that's the only one out there. there have been four pricings of ipos today. put up the full screen. i'll show you. there's cheetah mobile, dorian and k2m and alder bio pharmaceuticals. here's why he's not working. k2m is a medical device company and they priced below the range. alder biopharma priced below.

the renaissance capital ipo closed yesterday at its lows for the year. that's what you're being looking for as a sign from the bounce back. we're not seeing it. international exchange, that's i.c.e., the own the new york stock exchange, they had a modest beast. listing fees went up. there's more money coming in with listing fees. they are going to spin off the euro mix. aramark is out. they had growth costs across all segments. priceline was below expectations. tesla, you see, we talked about

that extensively, down big here. big expectations for that in the next three or four years. they may or may not be able to make it. there was a very important speech on february 25th where he talked about small cap tech stocks potentially being overpriced and stretched. now, tarullo is speaking again today. so tarullo really nailed it. let's see what he has to say. guys, back to you. >> thank you very much, bob pisani. i wanted to get to directv. the stock was up late yesterday. partly afterhours but yesterday late on a report that there may be a merger.

m & a reporting last week when we were following up on some of these reports about confirming an approach had been made by at & t. i was well aware that they had been brought on to help directv with anything that came their way. both owners of the firms are not commenting. nor were a lot of bankers circling in terms of what may or may not be really going on. but the stock itself, again, directv up, even more so than the first reports of interest from at&t. at&t presenting at jeffrey conference company, saying that they will not comment on speculation of the merger with directv. of course, if there was nothing going on, perhaps you'd get

something. there's an opening on this stock here. i'm not seeing it behind me. so, you know, one thing i would direct our viewers to is dish. shares went up because charlie erkin is certainly around this. what exactly his intentions are, continue to be something of a mystery for many of us trying to figure it out. that being said, he's a fairly straight talker. there will be the conference call at noon. >> there's a lot of positives. keep that track. i'm keeping it in mind. a lot of stocks. >> yep. >> yelp is working on that upgrade. twitter is bouncing. this makes sense. my twitter price target reached i can't be as negative. solar is working. keep track that there may be a

move here. zillow is the one to watch. that's the key for today's market. >> while i'm on the subject broadly, sort of distribution and the like, and as well we've got fox up. a very strong quarter. that stock is up over 6% on the production side of that equation. let's move from equities to bonds and go to rick santelli at the cme in chicago. rick? >> good morning. we have to start where the action is at. we have to start in europe. ecb meeting no change of rates. now, as you look at the euro, remember, we definitely, you know, missed 140 by that much. yes. very close. then mr. draghi started to talk about issues that were suppressing the currency lower, like maybe we're going to do something next meeting. so you could see the intraday, the long-term chart.

we are still hovering virtually in a zone of pricing against the greenback we haven't seen since october of 2011. that is not where all of the action is at. let's look at the fixed income markets. one hour from now we have jean-claude trichet. this is an italian ten-year versus ten-year bund. the spread at 150 hasn't touched that level since may of 2011, as you can see on that chart. the dynamic of the southern european interest rate benchmarked against sovereigns is a global force in sovereign trade. trust me, it's big. now, at a time where most of the news, even though we don't really believe a lot of what mr. putin says, isn't bad news. why are we not at 3%? that seems to be again geo politics is the fixed income

market, it seems. but interest rates have rather behaved. we haven't had that close under 2.57 from february 3rd. it doesn't look like rates are going to jump any time soon. now, there's one more chart that i think is really important. when janet yellen was talking yesterday, we definitely had some steepening. the short maturities were purchased when she was talking about the weak housing industry. to be fair, we're still at the autumn of 2009. carl, back to you. >> rick santelli who is going to talk to trichet in a few minutes. and spencer rascoff, the ceo of zillow. and janet yellen has day two on the hill. we'll bring you the q & a as soon as it begins.

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shares of zillow are trading high. spencer raskoff is joining us. sounds like you have some pricing power here? >> the company is firing on all cylinders and it all stems from mobile. that's where our use ij is migrating. we added new real estate subscribers. we make $188 million in year annualized from real estate agents right now but that's only 3% of what agents spend each year on advertising. so the belief is that eventually

advisers follow. >> walk us through how important it is to leverage agents that have been with you for more than a year? >> 60% of our bookings this year were existing agents buying more advertising from us. what that says to me is that it's working. they are making a lot of money from advertising with us. i was in denver and had lunch with a dozen real estate agents who subscribe with us and they were spending between 2,000 a month and $25,000 a month on zillow and talking about how much money they are making by advertising with us. that's gratifying for me and it's great for our consumers who get connected with these great agents. >> spencer rascoff, good to see you. >> thank you, jim. >> i get the sense that there may be a truce between you and trulia. >> we don't spend that much time thinking about them. what you are seeing in the numbers, though, is that competitor moves have not i am

kt pai impacting our success. it's really just not impacting the success of zillow. audience is growing and revenue is growing. what competitors will do, competitors will do. >> spencer, mr. smith was on yesterday. he has a great panacea of businesses, not talking about inventory and a decline in sales. a lot of the agents use your company. doesn't that eventually have to filter down to your sales? >> well, realty is a great company in a different business. so it's a fantastic owner and operator. we're a media company. we sells ads. so it's a great partner of ours and richard and i are close and we root for one another's businesses. it's a great company. >> so you're saying that there's no connection between realigy

having slower sales and zillow? >> so realigy makes money when homeowners sell. zillow makes money when we sell advertising to real estate agents. when agents are more successful, real igm makes more interest. in that sense, our interests are aligned. >> no one is questioning that, spencer, whether you're aligned. we're just trying to figure out if you're in tandem because smith was quite negative about the future. it's difficult to hear that the real estate people are not doing as well and zillow is doing better. >> there are two different spaces that have different levels of competition. they demonstrate value to broker and agents we have 30 to 40%

market share. >> clearly you benefit from an up market and a potentially down market or one that is not seeing a great deal of activity is less beneficial. right, spencer? >> yes. that is absolutely true. when agents don't earn money, they don't spend as much money on advertising. we're benefiting from this market. the testimony of yellen is true, markets are slowing a little bit. the housing market is still doing well. about 1,000 cities in the u.s. are now at all-time highs in terms of home values, that's all-time highs, including the real estate peak. real estate is slowing but it was very hot and not it's just quite warm. >> finally, spencer, we're in this period where investors and

growth names would not mind a print on the bottom line. did you feel pressure to give them those two cents? >> well, we don't manage the business quarter to quarter. what happens is because we have so much incremental margin, the business is overprofitable on the margin. it's certainly nice to print that income and print on ebitda. >> spencer rascoff of zillow, thank you. we'll monitor yellen's testimony on the hill in just a moment. about speeds and feeds. it's all about latency. it's all about how fast does it run. i often sit with enterprises who ask me about how mission critical and how's the performance of the cloud. and i tell them, if you can maker gamers happy, you can make anybody happy.

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performance review in a while. someone whose poor performance is slowing down the entire organization. i'm looking at you phone company dsl. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business. >> some are going to be shocked that gulfport is down. what people like is eog, pioneer. those are all eog which has a tremendous amount of gulfport is in the wrong place when i was in ohio. chesapeake was drilling when they thought there was oil and turned out to be natural gas.

g gulfport saying the same thing. don't forget about production growth on eog. >> and we have sprouts and whole foods. and irwin simon said we're going to do natural organic. people distanced and then first solar, stock was ahead of an analyst meeting. both of these companies doing quite well. natural, organic, solar, i get this. >> we'll see you at 6:00 p.m. jim cramer. yellen on the hill. we're back in just a moment. but what if you could see more of what you wanted to know?

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fed chair janet yellen answering questions from the budget committee. let's listen in. >> long run sustainability and the debt is something that is very important. as you mentioned, this is something, a set of changes, further changes as we look at cbos longer term budget projections, we can see going out 20, 30, 50 years without some further shifts in fiscal

policy. it's projected that the ratio with debt to gdp will rise to unsustainable levels and i would join my predecessor in saying that i do think that it's important that the congress address that issue, that having a long-run sustainable, fiscal policy of debt to gdp path that can be maintained over time does require changes. but it doesn't require changes that would come into effect so quickly that it would impede the recovery. >> do you think the various standoffs and crisis that we have had surrounding the debt limit had negative consequences for our broader economy? >> well, it's hard to put a number on what the impact of all of those crises has been, but i think probably all of you have had the same experience that

i've had as you talk to business people around the country and to households as well who do talk about uncertainties surrounding fiscal policy and that crisis atmosphere along with other elements of regulation and uncertainty about the outlook as something that has diminished their willing to hire and invest and i do think that mentality is beginning to change and i consider it a god good sign going forward. >> we only have a few seconds left. but i wanted to ask you about the income inequality and i know you've talked a lot about the positive impact from opening up more economic opportunities for women and i'd just like you to comment on that in my last 20

seconds. >> it's a long-term trend that i think is very disturbing and it's something that public policy makers should focus on. i do think that opportunity for women has been very important. not only recently but really over the last century increasing opportunities for women and their expanding role in the workforce in promoting a strong economy and really essentially really solid economic performance and growth and i hope that will continue. >> thank you very much. senator sessions? >> janet yellen is taking questions from the senate budget committee. let's get analysis on this. joining us is michael with jpmorgan. how much of the burden here for this economy is she carrying on her own? why doesn't she use the bull y

pulpit to say, come on, guys, wake up? >> i think she's not recommending either specific spending or tax policies. i think it's probably a wise strategy for her to stay a little distant from the fiscal policy. >> on that note, she's following the strategy on fiscal strategy. what about the markets? the dow is having another up day. we're coming off our best day. is there a janet put like there was a greenspan put? >> i don't know about that. we've had good economic data lately. i don't think what janet has said today or yesterday has not been different from the fomc last week. they've had a fresh look at the economy themselves. i would think that what is going on in the mashlg krket is going

the economy. >> really? she did warn about housing and geopolitical risks and it's not like the data has been growing? >> we saw this morning that jobless claims were down again. we also saw last friday job creation was pretty solid. so, you know, she warned about some risks. she's a central banker. she should be concerned about risks. the main message in her speech there is, look, in spite of first quarter, it's rebounding. >> today they are saying that because of the warning on housing, it could take them longer to actually raise interest rates and that's the big question. when you look at yellen speak now, do you think that she is telling the truth like an independent chi innocent child or do you think

she is verbally intervening in the market? in other words, does she emphasize that housing looks soft in order to suppress expectations of when interest rates might rise? >> it seems to me that's a pretty assessment of the economy. she did mention the negative on housing but a lot of positives. i think for her not to mention the negative on housing would be -- that would be i think dishonest. i think she's just giving a complete picture of the economy. we can focus on which part of her talk we want to emphasize but i don't see anything in there that strikes me, looking at the economy objectively, that looks really peculiar. it seems honest to me. >> do we have a sense of the timeline? there was talk about normalization but no hints on the time frame. >> right. she was pretty guarded in terms of predicting when interest rates may rise.

so i think it comes down to where you think the economy is going and most people on the fomc feel that it's going to lead to a rate hike sometime next year. that's a pretty broad range of time but that's something that we can say at least with modest confidence right now. >> are you surprised to see these lows on the ten-year treasury yield, these lower lows even as the fed continues on the tapering path? >> i have to say i'm a bit surprised. i'm not an interest rate strategist but it seems at odds with the fact that we seem to be marching pretty steadily forward to the point of a first rate hike and at least longer term interest rates don't show any end to that. it's a bit of a puzzle to me, i must admit. >> and doesn't jive with your view of the economy. michael feroli, thank you. there are bigger problems

than we thought with the tesla automaker. and in this half hour, an exclusive interview with the ceo of priceline from amsterdam, is growth slowing? "squawk on the street" will be right back. today is thursday today, we greet you. treat you. care for you. today, you can come to cleveland clinic for anything, everything or just to get that "thing" checked out. big, small, and yes, the best heart care in the nation. it's here everyday, for everyone.

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down grading gulfport from outperform and it's trading down more than 18% at $59.61. carl, back to you. >> thank you very much. we turn to tesla beating estimates on both the top and bottom line. some of the guidance was mixed. phil lebeau joins us with more. hey, phil. >> carl, the tesla heaters are out in force this morning. you hear people's commentary about the first quarter but you also hear a lot of people saying i'm not comfortable about the rest of this year. the guidance is not far off from what most have been expecting. shares are down more than 6%. this is an improvement from where the stock started at the beginning of the day. in terms of what the company said in the conference call and what it posted for the first quarter, tesla delivered 6457 model s vehicles in the first quarter and that was roughly in line with what was expected.

in the full year, tesla expects to deliver 35,000 vehicles and that is in line with expectations. so what have people a little hinky in morning? it has to do with how much money the company plans to expand when it comes to building the gigafactory. the company willing negative free cash flow lightly because it's going to spend as much as $850 million in capital expenditures and with regard to the giga factory, there has been a letter of intent signed with panasonic and it's expected that gigafactory will start as soon as next month. here is the ceo elon musk. >> we're going to break ground on multiple points to complete the gigafactory and we expect to

break ground on the first of those probably next month. so it's really quite soon and then shortly there after, a month or two after that, we will break ground. and it's fair to say that california's potentially backing the running but that's sort of improbable. >> that last mention of california got a lot of people talking online. is it possible that california could get the gigafactory? could more than one state get it? we should hear an announcement in a couple of weeks. tesla beat the streets on the top and bottom line for the first quarter. it's the guidance that all eyes

are on. as for toyota, the full fiscal year earnings more than double than what they expected to do last year. they were up 90% in the first fiscal year for 2014 but the guidance going forward because of the currency issues and because of a little bit of pressure in japan, they are expecting a drop of about 2%, carl. but tesla is the stock that a lot of people are looking at today. >> phil lebeau, i love that. good to check in with you on tesla and toyota. the ceo of priceline, darren huston, will be joining us. they beat expectations on virtually all metrics. but there is fear that the business is slowing down. we're live from amsterdam after this quick break.

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priceline has just posted a 40% rise in net profit. the worldwide excite is up 40% of last year beating expectations and the earnings per share are 88 cents above consensus. but still, the stock is unable to make gains. priceline group's ceo darren huston is joining me from amsterdam. how do you feel about the quarter? >> well, you know, simon, i think we had a fantastic quarter as a company. you went through all of the statics. we're feeling great about it. it's a great start to the year and we're really optimistic about the future.

>> darren, there is some disappointment in the market. maybe you are a victim of your own success that you delivered in the past. and when you guide for the future, say, we think the bookings next quarter could be up 20 to 30%, that's a deceleration of the 35% that you've got in this quarter. it fits into a general concern that things are slowing down for you big growth companies. >> you know, simon, we remain really optimistic about our growth prospects. obviously as we've become a larger company, there are a lot of large numbers out there but we like to guide in a conservative manner. i think it's a reasonable manner. we have the world cup that is affecting bookings but we're very optimistic about the next quarter for travel. >> let me pick up the large numbers and a lot of people say it's clearly a conservative guidance. you know, if you're growing your net income by 40% and you've

already got 450,000 partners around the world, what actually happens to the boots on the ground? what is happening behind the websites that we see? how do you physically grow further? what are you doing now? >> well, simon, our growth comes in waves. it was first adding languages and expanding outside of europe but now we're seeing tremendous growth in places like china and japan and southeast asia and latin america and we've grown our property count by over 50% year over year but we're not done yet. there are probably a million multiroom accommodations in the world. there are six vacation rentals. if you look at the size of our business, we're likely 10% of the total opportunity in accommodations around the world. so lots of running room still ahead of us. >> darren, i have a size of your stock price at over $1100 a share. obviously apple and that 7 for 1

split, it's a little envogue right now. would you consider splitting your stock? >> it's not the top thing on our list. i mean, we're so focused on day-to-day execution, making each quarter, driving the business, growing the business that this isn't something high on our list. it's not something that we completely dismissed but nothing we're moving on right now. >> darren, where are the acquisitions? if you look at what they are doing at trip advisers, more importantly, they bought vacationho vacationhomerentals.com in massachusetts. why are you not making the buys? >> well, simon, you know, as i last time i was on your show talked about, we focus so hard on organic growth. that's why we produce net income

growth in the 40% range, is because we've got a model and we're executing it. we're always looking. we're a company that has really made key acquisitions. they happen one every one or two years. the most recent was kayak. we compliment our teams and we're not a highly inquisitive company but we're smart company as it relates to m & a and we're always looking. you never know. but when we do it, we do it big and we make sure that it makes a difference. >> it's the first anniversary of the acquisition. so the volatility that we see in your stock price and the stock price of your potential acquirers, does that make it more or less likely that you can do deals? is it more difficult or arguably easier because they, too, are depressed? >> yeah. i mean, i think it's probably all relative. in a sense, i don't think it

changes our mentality. everything we do on the acquisition front, we look for mediums and long-term gain. we think about strategically how it would fit and i think being in a relative basis, we don't think about that too much. >> can i take you to a conversation that we were having with the ceo of expedia on the show last friday, an idea put forward that the online travel agencies like you are being undercut on the hotel prices that you can offer by the hotels themselves using social media directly and in a way that you can't see or possibly through google's hotel finder which digs deeper into their enterprise software than you can. can you respond to that? >> yeah. first of all, i would say, simon, as a principal, we will never let our customers pay more. we are always out looking and finding the best prices.

and we have the biggest marketing platform in the world for accommodations. so on booking.com or priceline, we have thousands and thousands of rates that you can only get through our sites because people use us very surgically to get these rates and all of these opportunities offered by google and social media are opportunities that we can take advantage of as well. it's really critical to know that we will never give up on that and that's a core principle. that's why we have a best price guarantee. if anyone finds a cheaper rate, we'll match it without question. that's part of our success. i don't worry about it very much. it's a very dynamic world. >> so to cut to the chase, how often do you activate that best price guarantee? how often do people come back to you and say, hey, i found it cheaper than you might think i would? >> yeah, you know, it's not that often but when they do, we always respect that. you know, i would say that in

the world of hotel pricing, there's a lot of noise. there's prices that don't include taxes or are done wrong with exchange rates. there's a lot of misinformation for consumers and i think the whole industry needs to make it transparent because what you see is not always what you get. sometimes you hit a link and it's not available. there's a lot of cleanup to do so users understand what they are getting. i'm very confident that in the large majority of cases we have as good or better pricing than anywhere else on the internet. >> darren, last time we spoke to you, which wasn't so long ago, the first interview you gave us, you said you are happy living in amsterdam and you are running the cash could yw, which is booking.com. and in order that they can pay less tax, are you actively considering that? because within your world there's a lot of funny business, a lot of games you can play with

accounting possibly through island that no doubt would reduce your tax rate. >> you know, we do not do a lot of that. we are actually founded in the netherlands. we didn't come here for tax reasons. the very first hotel we had on booking.com was the american hotel here in amsterdam. we were grown and built in the country. we have a favorable tax treatment here but we also have a net operating loss from many, many years ago in the united states and that's why our tax rates are quite low. but we're really just focused on, let's execute the business, let's move it forward. we're a global company and we've put our people where they want to be and where it makes sense to grow the miss. so that's not something that we talk about a lot internally. >> darren, it was good to see you. thank you so much for joining us. darren huston joining us, the e

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trwith secure wifie for your business. it also comes with public wifi for your customers. not so with internet from the phone company. i would email the phone company to inquire as to why they have shortchanged these customers. but that would require wifi. switch to comcast business internet and get two wifi networks included. comcast business built for business. janet yellen has been answering questions and steve liesman has headlines on that. hi, steve. >> hi, carl.

janet yellen speaking to the senate finance and she was ask about the debt to begin with. she answered with near term government spending reduction causes harm to the near term growth numbers. longer term she says the government has to get its act together when it comes to debt and deficit financing. some questions about productivity and the middle class. she has concerns about inequality and also saying that there are trends in the job market that she's quite concerned about. trends in technology and presents challenge to middle and lower class workers in the economy. not much to do with monetary policy. she did not take the bait when asked about what policies she would implement. she just said on anyone's list would be education and job training. she did not want to get involved in the political debate going on. carl? >> one reason that jpmorgan's

note about her testimony is titled brooklyn dodger, referring to where she is from. thank you so much. >> for the record, carl, she hasn't been asked any monetary policy questions. obviously there are other things on the senators' minds and the first thing is getting re-elected. >> fair enough. >> if she is dodging, she's learning to dodge better last time around when she gave the six-month statement. >> those are professional questioners, simon, those were reporters, if you recall, not senators. and i would point out, if reporters did not get to question the chair, we would know nothing about the monetary policy given how the senators are questioning today. >> you need to run for office. >> no. keep my job and ask the chair on federal monetary policies. >> let's get over to jackie

deangeles. >> reporter: nasdaq is trading down more than 1% on this number from the department of energy on weekly storage injections for last week. we actually saw a 74 billion cubic feet built last week, slightly higher than what platts was expecting and, you know, traders are watching right now the five-year average overall for the total storage injection. we're actually at an 11-year low. a trillion cubic feet under where we have been over the last five years. the question is about the catch-up game. can we get to where we need to be in terms of supplies? that's going to depend on mother nature, how cool the fall and winter will be. but that is what is going to do some of the -- create some of the volatility around the nat gas trade. the prices are at 4.64, down more than 1%. david faber, back to you. >> thank you very much. i want to get to liberty media,

a company that we focus on occasionally. its complexity perhaps keeps some investors away and that continues with another announcement that involves a spinoff. you may know if you followed the company in terms of the tracking stocks that it does and then switch to physical and the various entities that it has, it consolidates and then spins out. the latest is the board has authorized management to pursue a spinoff to its stockholders to be called liberty broad band. it's going to comprise 26.4% ownership of charter communications and ownership stake we talked about a great deal, of course, talking about the attempts of liberty and time warner cable. they came away with a lot of potential subscribers in a deal with comcast a short time ago when and if that deal with time warner cable and comcast closes, the spinoff of liberty broad band will include that charter

communication position something called true position in time warner cable as well. shareholders will also receive subscription rights that are being issued as well to buy one more share of liberty broadband at 20% discount to the 20-day trading day volume weighted average trading price of liberty broadband stock. i told you this was complicated. we'll be segregating that broadband, if you will, position led by the 26.4% stake in charter, raising money as well for lib betterty broadband leado further flexibility with that important ownership position for the company, which, of course, marked the return, if you will, of the man who controls all of this, john malone of the industry he helped to create, mainly, liberty. up a little over 1%.

guys? >> all right. a bumping night at southerby's. robert franks at hq. >> prices kept going up but last night we saw a sign that maybe prices got too rich for the rich. let's take a look at sotherb's. auction total was okay. around $219 million at commission. that was the low end. the estimate of 218, 219, half of the pieces went for less than $3 million. di dealers just say that buyers have gotten smarter. momentum stocks are starting to show up. look at fail to sale. this is a portrait by picasso.

and we're going to show you another piece by therese. it was expected to sell for 20, 30 million and only went for 19. and then this monet water lily was supposed to sell for 25 to 30. only went for 24. now people said one of the reasons it didn't sell is because it's vertical and not a horizontal. i guess horizontal sells better because it goes behind your sofa. that's what people said. the big news will be tesla. this gets the really big tripri. here's my favorite. popeye. he's expected to sell for $25 million. guys, back to you. >> it's fail safe at this point. >> it has really important

implications. you know this space better than i do but these houses have to create a market on the day. they have to sway the big families to put their art up for sale. for a lot of them, it's really emotional. if this starts happening in the public don public domain, they may not put the family art collection up. my only concern is that whether sotheby's is not functioning properly and didn't put the buyers on the phone or internet last night like they are supposed to do. that's the deal. they have to create the market every day. and i wonder if it's distracted at the moment. >> the broader problem is you sell picasso for 6 to 8 million when it's only worth 3. there's so much capital chasing a scarce number of objects, the rich will pay just about anything and now we're looking

at what the limits are. next week is going to be the big test. who knows whether it's the management or just a bad sale but next week will tell us more about your question. >> robert frank at hq, thank you. pro-russia rebels defy putin's plea for delay the referendum. we'll get all of the latest details from the u.s. ambassador to ukraine when he joins us live from kiev in just a moment. but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea

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welcome back to "squawk on the street." i'm seema mody. the stock was downgraded from neutral to buy despite strong advertising for acmc. more people watched its popular tv show, "the walking dead." stock trading better than 10%. >> despite a public call from

russian president vladimir putin for delay, pro-russian separatists are vowing today to continue with a planned secession vote on sunday. in a curveball yesterday, vladimir putin announced that russian troops had pulled back from a ukrainian border which the u.s. says there's no intelligence to support. joining us exclusively from kiev is the u.s. ambassador to ukraine, geoff pyatt. first, just as we were starting to see a de-escalation or what we thought was a de-escalation in the last 24 hours, this has to be a setback that they are calling for a referendum this weekend. >> well, we're going to keep working on the diplomacy here. we think it's the best answer to a situation here in kiev. what i would emphasize regarding the acce

separatists and the referendum that they are calling for on sunday, ukraine is not a country in turmoil. this is not a civil war. this is an isolated security problem and, as i said, we don't see this bogus referendum changing much of anything in terms of the political situation. >> does that make you question, though, how genuine president vladimir putin is in his efforts to try to defuse the situation and handle it in a diplomatic way? >> we've seen lots of mixed signals from vladimir putin starting with his declaration that his troops were not in crimea when indeed they were. certainly the two steps that president putin announced, if implemented, would be a step forward. that would be a withdrawal of troops and the separatists to

stop taking over buildings, stop it with the guns and the radical rhetoric and come into ukraine's democratic political situation. >> three times they said that they would withdraw and three times they failed to do that. i understand that they are arranging a formation for invasion should that occur. it doesn't, to many people, look like an isolated security problem. it looks like it may potentially be a major world event. what does it say about the power now of this country, the united states, and the european union, that both of them are unable to defuse it? >> well, first of all, when we stand with our european partners, we're obviously much stronger and that's been the guiding principle with the sanctions regime and has affected russian behavior. the fact that you haven't had a russian invasion of ukraine says that the sanctions are at least

causing second thoughts. on your question about the tactical deployment, we have not seen any change in the posture. i think you need to look out for a change in nomenclature, these forces that were loaded are going to stay out on the border for indefinitely the future. we hope that's not the choice because we think there can be a positive future for russia/ukraine relations. certainly everybody i speak to in the ukrainian government wants to have a stable and respectful relationship with russia. >> mr. ambassador, what's your assessment of the impact of the sanctions so far from the u.s. and europe on the russian economy, how crippling is it on the russian currency and perhaps do you think this is what has caused the change in tone from vladimir putin? >> well, i certainly hope so.

and it's certainly the case, despite some of the joking you saw in moscow that these sanctions and the international pressure have had a real impact on capital outflows, on investment decision, including investment decisions by american and european countries, by stock -- an impact on stock valuations, an impact on the value of the rub lchlle. so those that suggest that russia can afford to ride this out, i think, have not processed the real macro financial hostility and gre hostility aggression that russia has chosen. this began with russia's illegal invasion of crimea. it deepened with the decision to begin stirring unrest in the east and it's going to end because russia makes a decision to pull back and to send a new signal to its proxies and agents

across eastern ukraine. if it doesn't pull back, if that change in signals does not happen, there will be further economic costs which we will work very closely with our european partners to lay out. but we hope very much that that doesn't come to pass and that we can make this diplomatic strategy successful. >> all right. very valuable perspective. thank you for joining us, mr. ambassador, geoff pyatt. i know that ukrainian elections are set for may 25th. the biggest rally in the euro for three weeks. joining us next, the former ecb president jean-claude trichet will weigh in on central bank policy. squawk on the street will be right back. [ male announcer ] what if a small company became big business overnight? ♪ like, really big...

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european central bank from 2003 to 2011. we have a long delay here, so we're going to try to keep this easy. welcome, and my first question has to do with recently you've said the euro is too high. it almost touched 140, and the current president, mr. draghi, really did talk it down a bit and it's much lower. your thoughts on the value of the euro and how it plays into the ongoing recovery in europe. >> well, first of all, i would say that the euro is not a target of monetary policy. as you know, in europe. but, of course, it is one of the perimeter, one of the data that integrated in the overall pol y policy, and especially in a time of very, very loewen flags -- low inflation, this is clearly an issue, the euro is on the high side. why exactly the market is giving

such upward move to the euro when fundamentals are mixed, obviously. we have good fundamentals with the current account surplus, but growth is not what we would hope for. job creation is not what we would hope for. and a more, i would say, balanced judgment of the market would probably put the euro down, which would be good, obviously, for the level of inflation in the euro. >> when i look at interest rates in southern europe, and i see the italian spread between their 10 year and bunds touched 150, hasn't touched there since 2011, low interest rates aren't hurting the euro and relatively high interest rates in the u.s. aren't helping the green back. why do you think it is that european rates, especially in southern europe, have moved so much lower?

>> well, first of all, i would say the main reason, obviously, is that the resilience of the euro as a currency and as a concept, as a political and monetary and economic endeavor, has been remarkable. remarkable resilience, which had not been priced in before. so there is this discovery that, as i have always said, and as mario draghi has always said, the discovery that the resilience of europe is much more considerable than thought. let's also consider it's good for italy or for the other countries that the long-term rates, the benchmark of the long-term rates, is lower, because it favors the integration of the euro. you know well of the problem of the monetary policy transmiss n transmission. it is that you decide a level of interest rates in frankfurt, in

the governing council of the ecb, and then it is transmitted in a very different fashion in the various countries if the benchmark, namely the treasury, are at level which are very different. so i would -- i would say, first of all, what we are observing is good, of course it doesn't call for any complacency. the country's concern have to continue to merit the fact that confidence is going back progressively, but in my own understanding, it's right, because the fundamentals have considerably improved in the so-called countries that were under stress. >> all right. listen, one minute left, sir. i want to ask you the final question. back five years ago, in 2009, you talked about how all central bankers were using nonstandard measures. our own previous chairman, mr. volcker said borderline on

challenging the charter in many conditions. did you think that we would still have these types of programs in place five years later? does it disappoint you? do you think we'll ever see normalization? >> well, first of all, it is, of course, not normal than five years after the -- >> well, i think i lost the shot, and i'm very sad, because i think mr. trichet was doing a great job, and the last question was my favorite. wherever you are, the trichet, as we call you in chicago, thank you. back to you. >> thank you. that made my day, rick santelli and jean claude trichet. >> i didn't know he had a chicago name. >> who's we? >> you know, central bank followers. >> still ahead on the show, it's been a roller coaster week for

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>> announcer: welcome to "squawk on the street." here's what's happened so far. >> a lot of the american companies are saying it looks like we could get zero to 2% growth over there. you know, zero is not growth. we have zero growth. no, zero -- how do you have zero growth? [ bell sounds ] >> there's the opening bell. >> the company is firing on all cylinders and it all stems from mobile. this is because this is where the usage is migrating. >> i would think what's going on markets is more of what's going on in the economy rather than any new information we got about fed policy. >> i think we had a fantastic quarter as a company. i mean, you went through all of the statistics. we're feeling great about it. it's a great start to the year. and we're really optimistic about the future. ♪

good thursday morning, it is 11:00 a.m. on the east coast, 8:00 a.m. out west. here's what we're watching today. shares of twitter rebounding after big declines over the past few days. we'll tell you why and what the future may hold for the social network. plus, a new move by fedex could make a lot of things you buy online up to three times more expensive. and e-commerce companies, too, that are paying for that. find out what this means for your money and portfolio. shares of sprouts rallying as earning s soar in the latest quarter. is the ceo worried about competition? we'll ask him. and should you clip and save groupon, or save? and john steinberg, a cnbc contributor, along with jon fortt. good morning, guys. twitter, shares in the green, finally after getting an

upgrade. it stops the bleeding a bit. the stock's still down 15% in the past week. jon, you have a theory on why stocks like this, king, linkedin, have gotten hit so badly. >> i think the laws of physics are kicking in. there's only so much usage people can do. if you're on your device, using kink and browsing, people are now spending five hours and change on digital, versus 4 1/2 on television. the sky is not limitless for usage of these applications. >> you're talking about existing users. that's why the emphasis is on new users, right? >> the new users have to come from somewhere. with mobile device penetration on smartphones reaching saturate in the developed world, if you're going to spend time on something, and a new user, it will take time from another application. >> that's really smart, but i think that's why it's not true. it's too logical, too much sense. so many of the stocks who are trading together, workday, with linkedin, with twitter, actually

have different models, different structures. so i got to feel like they're trading together because people feel the same way about them. >> right. >> rather than they're trading together because their fundamentals are necessarily moving in the same way. >> right. every single one of them is getting hit on the top line. it's never enough on the top line. king is being hit because there wasn't enough unique payers. twitter because there wasn't enough unique users. the financials are not nearly as disappointing as the overarching growth -- >> there's a death nail among a lot of the companies and that's guidance. you can only justify a valuation for some of the companies if you believe the trend will continue. >> yeah. >> when you see groupon, linkedin, even king to a certain extent, basically tell you that the guidance over the course of the next year is not going to be blockbuster growth. that's something that can top a little air out of the stocks. >> it's true. i think the guidance in different categories is what people are paying attention to. so maybe your revenue and earnings look pretty good. like in twitter's case. but your user growth doesn't look that great. maybe in linkedin's case, similarly it's been down. but its numbers overall looked

pretty good, if you take a look at the overall chart. not only were their overall numbers good, but growth across multiple different product areas. i'm just not sure the fact that the patient is stabilized now means that we're out of the woods completely. >> you also can't ignore the lockup operation. >> yes. >> the secondary operation at fireeye. >> no, and you know what's funny, i e-mailed faber and jim yesterday. i didn't realize how many people owned twitter share, how many people had bought it in the secondary market. i knew lots of investors that had gone out and bought it. i think we were talking about management, but there were tons of employees and people that had bought at high secondary prices that now just wanted to get out. yes, that's the force here. >> also, you look at the intraday chart of twitter and yelp, they traded almost perfectly in tandem. some of what's happening, as jim cramer, as found of saying and knows a lot about, it's not necessarily guided by individual

stocks. so many of these are trading together, you don't exactly know why they're moving. >> absolutely. and for twitter right now, it's a pivot into a story more like yelp, more like zillow. get off the usage numbers, a destination for media. the financials are great. our revenue is growing at 44% on an average basis over the upcoming years. don't obsess about the usage anymore. >> we've heard now david einhorn, dan loeb, richard chilton all talk about the bubbilicious valuations, and how they know there's an ipo bubbilicious, and how he got contacted about buying friends and family shares pre-ipo. now, arista has said to delay its ipo. but he writes when times are so good that executives are willing to disregard the difference between ethical and unctuous behavior, it's just one sign that the end relatively speaking is near. jon, what do you think this signals about the companies trying to go public and do it quickly?

>> i don't totally follow exactly what he's saying. what i do understand is it's so hard to go public, and there are so many secondary transactions, that effectively mirror the public offerings, that the line between public and large private transaction is one and the same. >> -- to a journalist that covers your company is really unethical. >> oh, is that -- >> well, i think what adam is saying -- i got to the san jose mercury news right after this scandal was kind of dying down, chris nolan, a columnist there, got that offer. it was very controversial at the paper. adam had just left. i'd opponent opoint out it tooke years after that happened that we did have the big stock market meltdown. it doesn't necessarily mean it's -- >> they were offering a journalist a share? i've never heard -- that's insane. i can't believe somebody would do that. >> well, there's a sort of atmosphere around the valley, in the bay area, not just in things like that, but, adam, every party venue is booked up, not just by tech companies but by

everybody else that continue forever. >> adam has been covering the beat, that's for certain. fedex making a big move. instead of charging for the weight of the package alone, all ground packages at fedex will be priced according to size. this could mean a price increase on a third of ground shipments and hurt companies like amazon with shipping one of the most rapidly increasing costs for the company and other online retailers. it's a big reason amazon is working on its own delivery service and just expanded sunday delivery to 15 new sundays. >> the net cost of shipping went to 5% from 4.7%. it was 4.7% in q4 and a year ago. even in q4, which is the busiest time, it rose in q1. it's a bad issue getting worse. >> the solution, i'm guessing, is not buying your own fleet of trucks. >> well, there is some of that. you look at what amazon is doing with amazon fresh grocery delivery, that's a lot more hands on for amazon. the quality experience is so

much more important when you're dealing with stuff that you're eating versus stuff you're wearing or anything else. >> we're looking at some various items here. shoes. toilet paper. that's a significant increase in shipping costs. >> yeah, it's interesting, when you read the alibaba filing, they have 17 different -- i think 17 or 18 different shipping partners now to diversify. amazon is basically postal service 35%, u.p.s. 30 prks and fedex is 17%, a little too concentrated. now that fedex is going to raise, clearly u.p.s. will raise on the side. >> the analysts have already come out and said u.p.s. needs to stay competitive, so they will match whatever fedex is doing. but on the flip side, jon, do you think some of the retailers like amazon, like gilt, that pretty much use u.p.s. primarily, do you think u.p.s. could win more business if they didn't do this? >> that's a good question. i have to think about that for a bit. while i'm thinking about it, let me keep talking and say i think sunday delivery -- >> answer my question -- >> yes, yes. >> you should be a politician.

>> sunday delivery is a game changer in my experience. we've had it in this area for a while. i'm a prime subscriber. it makes the decision to buy something, you know you're getting it in two days no matter when you buy it. there's a bifurcation to now answer your question between the effect on amazon, which has all this market, they can actually afford to make changes in the logistics operation and even slightly smaller companies that absolutely depend on the traditional postal-type carriers, in order to do the work. not only capital they get the postal service to do sunday delivery for them, but they're going to have to really foot the bill for these kinds of price increases. it's a potential difference maker for amazon, because they can provide an experience that the others can't. >> this is exactly like the tax thing. remember when you didn't have to pay taxes and amazon got a locust in different states and you started getting sales tax? this is an advantage for a lot of the brick and mortar retailers, especially the ones with small footprints, where they can centralize logistics, like a radioshack, like a best

buy, a bed, bath & beyond. it could be a huge issue for them. >> very interesting, guys. i know people buy toilet paper and diapers in bulk, so you don't have to carry them home from the storm. jon, we'll see you later this hour. jon steinberg, thank you, as always nice to see you. we want to move to tesslate. it's off its lows. look now, it's down about 6.5% to 1 88.4r5. and phil lebeau has more. hey, phil. >> hey, kayla. the shorts are definitely out. the short sale circuit breaker kicked in briefly this morning when tesla shares opened up, and at one point down -- oh, about $18. and as we see now, they're down $13, trading in the 188 range. so really, what are the complaints that are out there amongst investors who are either shorting the stock, selling the stock, whatever your position is on tesla? three things came up on the conference call yesterday.

first of all, the company saying that it will be negative free cash flow for 2014. that's because it's expanding, it's investing so much, the capital expenditures, it will result in a slightly negative free cash flow for the year. they are capacity constrained. there's more orders than what they can build right now at their plant in freemont, california. and finally, there's the question of execution risk over the next three years. and we put out the next three years, because tesla will be ramping up and building its giga factory. they expect to break ground on the giga factory -- the location remains unknown, but we'll know because they'll be breaking ground within a month. and there will be two locations, whether it's in one city or in one location -- one area, two locations there. it remains to be seen. but they will be supplying batteries from that giga factory by 2017. and that's right around the time frame when people will say, okay, will they actually come to market with a mass market third generation vehicle, around 2017, that will be effective and compete at a lower price point?

so that's why when you look at shares of tesla, lost in all of this, guys, is the fact that tesla reported first quarter enings that beat the street on both the top line and the bottom line. there's been some suggestion today, oh, they didn't beat on revenue. yes, they did. came in at 713 million, the street was expecting 699 million. so that's the story with tesla. a lot of people out there today saying they can't execute over the next three years. you know, we've heard this in the past, guys, and elon musk has beaten back the doubters in the past. and i think that today a lot of people are saying, let's see if he can do it. >> there's always a bull and a bear case, especially where this name is concerned. phil, thank you. >> you bet. >> phil in chicago. up next, janet yellen testifying on capitol hill this morning, and for the first time this week, answering questions on monetary policy. we'll tell you what she had to say. plus, take a look at the move on sprouts. the stock rallying this morning, up better than 5%, after falling nearly 12% yesterday on concerns

over rival whole foods. so which move, up or down, gives us a better picture of the company's value? we'll ask the ceo later this hour. first, rick santelli, you got yellen, you got draghi, you got a lot to work with today. what are you looking at a little later this hour? >> well, kayla, what i'm going to be watching is something ronald reagan said. the closest thing to eternal life on this planet is a government program. but i'm not going to talk about it in terms of a government program. i'm going to talk about it in terms of nonstandard central banking strategies. all at the bottom of the hour. t. woman: welcome to learning spanish in the car. passenger: you've got to be kidding me. driver: this is good. woman: vamanos. driver & passenger: vamanos. woman: gracias. driver & passenger: gracias. passenger: trece horas en el carro sin parar y no traes musica. driver: mira entra y comprame unas papitas. vo: get up to 795 miles per tank in the tdi clean diesel. the volkswagen passat. recipient of the j.d. power appeal award, two years in a row.

welcome back. major indices still in the green today. look at the consumer discretionary sector. it's one of the best performers on the s&p today. seema mody is back at hq with more on that. >> a very good day for discretionary stocks led by 21st century fox, which posted better than expected quarterly earnings after the bell. l brands raised the first quarter outlook, tiffany also, merrill lynch upgraded it saying higher domestic sales should drive expansion. overall, a good day for consumer discretionary stocks. carl? >> seema, thank you very much. fed chair janet yellen still testifying on capitol hill this morning. this time in front of the senate banking committee. she's answering questions on monetary policy. our steve liesman's been listening in and has highlights. hey, steve.

>> carl, yes, finally monetary policy questions here. you just got done listening to -- listening to yellen explain why she wants 2% inflation, not higher, not lower. earlier, she said the fed, when it decides to taper, looks for progress in two areas, progress towards maximum employment, and cheaper 2% inflation target. she also said the fed would reconsider tapering if the fed decides it's not making progress towards those goals. she said it could take five to eight years in order to get the balance sheet currently greater than $4 trillion back to the precrisis level. she didn't say what that level is. i happen to know that the fed will not want to go back exactly to where it was, because the economy's grown in that time period. but certainly much smaller than it is now. finally, she said deflation is associated with very weak economic outcomes, and said even inflation that's persist at any timely -- persistently below, so neutral comments, but looking at the 10 year, don't know if it's

still the case, but the 10 year, four, five bips lower in yield. kayla? >> steve, the comment that's really on fire in the twitter sphere now is this comment about it taking five to eight years to get the fed's balance sheet back to pre-crisis levels. is that something new we've haven't heard before? >> yeah, so people, i'm not sure, are paying attention. we've done several stories on that number, kayla. five to eight years would be, what, 19 to -- what would that be, 22, 23, in that zone? so the new york fed puts out a projection that we've reported on several times that says that under current assumptions of the market, essentially, this is when the balance sheet would get back to normal, and that's right in line what she's saying with that number. the balance sheet does not come back to $800 billion. it ends above $1 trillion if i recall correctly. it's not a new number, but perhaps, you know, the market, when they hear something -- sometimes it causes them to get excited. >> all right. thanks, as always.

steve, we know you'll be back at news merits. thank you for monitoring that for us. shares of chinese app developer cheetah rallying. what can the company tell us about the ipo of another chinese company? of course, alibaba. that happens later this year. we'll ask the ceo about that and why you should be buying his company's stock this morning. that all up next. with all the opinions about stocks out there, how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today. ♪ "first day of my life" by bright eyes ♪

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♪ welcome back to "squawk on the street." check out agerion pharmaceuticals. it had been hammered after reporting disappointing first quarter results earlier in the week. keep in mind the stock is down

about 50% from its 52-week high, currently trading up by around 1.3%. carl? >> all right, thank you very much, seema. china's second largest internet security provider, cheetah, working to overcome weak performance by its peers by pricing an ipo near the top of the range. cheetah is now trading under cmcm, and pretty good action at the open. the ceo joins us for an exclusive at post 9. good morning to you. >> thank you. >> not too bad considering where we've been the last couple of days. you muflt feel good about the open. >> yes, we're definitely very excited, and we're very happy with the stock opened up today. for us, the ipo is just the beginning for our long road, with capital market. we'll continue focus on, you know, our business going forward, and we want to expand, you know, globally into mobile internet space. >> why list on the u.s.? i'm sure you know the number of chinese companies looking to list here. people wondering if there's enough appetite to go around. >> right.

actually, when we -- we have first job all across the world, and i think it's because they look at our track record in growth, and also look at, you know, what we've been able to achieve on mobile internet side over the last year. we have amassed 223 million mobile -- monthly active users, so, you know, if you look into the opportunity for growth in mobile and global, we have -- i think we have very good, attractive target for them. >> you have a lot of competitors. there's lookout mobile security here in the u.s. intel's got mcafee, interestingly is interesting ly symantec executive said anti-virus is dead. what's your take on the model and how long -- what you're doing exactly right now is going to be the main way to keep the devices secure? >> i think, you know, we are a little different from the traditional anti-virus software companies, because we have a suite of what we call mission

critical applications that help not only protect users on mobile internet, but we also help you optimize the operating systems for android, for example. >> free up memory, things like that? >> free up memories, make it go faster. and another thing that's different, we're a firm believer of a free model. you know, for large traditional anti-virus software company, they still have either, you know, a pay subscription models or a free model, but, you know, if china we've developed a unique model where you give away your security product for free, and then, you know, you monetize it in a demp way, for example on advertising, on games. and i think that would be very disruptive business model, even in u.s. >> andy, there's some skepticism generally about trusting the security for your device to a chinese company, especially when there are viable alternatives here in the u.s. or other home countries. how do you get users comfortable with having a phone secured by a

g chinese system? >> well, first of all, we're commercial enterprise. our main focus is for our users, to make sure our users have the best product they can have and have the best user experience they have. if you look at over the past year or so, we have, like, more than 500 applications over the past couple of years, more than 500 downloads and the most majority of users are happy. if you look at google, google play and the rating of google play, the product, queen master, more than 140 million active users, rating of 4.7 of 5, and, you know, we have 8 million users have rated our product. i think overall, consumer actually very receptive to products, doesn't matter where they come from, as long as you provide a good product for them and good user experience for them. >> when it comes to investors, i think a lot of them are curious about chinese companies in general, but think the metrics are opaque, and they feel like they're going to be beholden to the whims of the party, the

chinese party in terms of picking winners or losers. what do you say to them? >> again, we're very commercial enterprise. if you look at our user base, for example, 63% are from mobile user out of the 220 million mobile active users we have outside of china. in fact, like, 8% of our user base is based in the united states. so i think, you know, our business is very smart looking, looking at mobile internet space and looking the market globally, not only in china. >> you say you'll spend some of the proceeds on acquisitions. /assume some of that will be u.s.? >> certainly, opportunities in the u.s., especially in the advertising business. if you look at the mobile internet space, advertising business, the u.s. is very advanced. and so, you know, we definitely look for a partnership here in the u.s., also potential opportunity to do m&a, to basically accelerate our portfolio of product and technology. >> you have a lot of people watching you now. andy, thank you for coming in.

>> thank you. >> cfo of cheetah mobile going public, ticker cmcm. >> thank you. >> that stock is still up big today. meanwhile, shares of whole foods hammered down yesterday. walter robb spoke to us first on cnbc. >> we see tremendous long-term potential for this company. >> no headwinds for competitor sprouts, though, earnings soaring at that company. stock up more than 5% this morning. the ceo of sprouts will sit down with us coming up in an exclusive interview on the competition in organic food. plus, in just a few minute, the bells will sound across europe. we'll have that close for you when it happens, and what's moving and what could move here. coming back on "squawk on the street." e experts at your ford dealer think? they think about tires. and what they've been through lately. polar vortexes, road construction, and gaping potholes. so with all that behind you, you might want to make sure you're safe and in control.

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european markets close in just seconds ago. here's simon hobbs. >> feast on the green. look at that. a lot of markets -- actually made gains throughout the session today in europe, partly because mario draghi, and this is the big new, the head of the european central bank, has indicated there may be extraordinary measure, some move, he's saying in june. take a look at him over in frankfurt today, actually suggesting, and i quote, the governing council is comfortable with acting next time, but before we want to see the staff projections that will come out in early june. those are growth and inflation projections before they act. now, in a sense, of course, verbal intervention, we've heard

this before from him. it doesn't necessarily mean you'll get qe. you may find they move to negative interest rates, kind of a signal they're doing something. however, the main target clearly is the euro, which was heading, as you can see here, up to 140 -- $1.40. so he's clearly trying to pull that down, and he has to a certain extent managed to do that today. the problem he has, and i said this before, is a vicious circle. for as long as he keeps talking about qe in order to depress the currency, people go, hey, let's buy sovereign debt. so they get into sovereign debt, buy euros, and the euro goes higher. let me mention where we are on barclays. a lot of the banks are higher across europe because the cost of funding continues to fall and sovereign debt markets continue to rally. barclays is now up 8% on the session, making up for the losses earlier in the week. big announcement from jenken, the ceo, cutting 19,000 jobs over the next three years. big news for us in this country,

7,000 of them will be in investment banking. that's one in four investment banking jobs, as they shrink the size of the investment bank within barclays from roughly half to about a third. may not necessarily affect jobs here on wall street, so much as in asia and other parts of the world. essentially what jenkins is saying is that the recent halt in the trading boom is now permanent. it's not cyclical. that's the judgment that he's coming to. they're also going to put $140 billion of debts from the investment operation, the investment bank, into a bad bank. listen to the ceo. >> basically we're dividing the bank into two -- a core group of four strong businesses that are well positioned in their markets with good growth prospects and good returns, we're combining our personal and corporate banking interests in the u.k. into a new business. we have our barclay card payment interests and an investment bank

which will be much more focused on client origination and smaller part of the group going forward. >> there were loads of companies to mention today, because we're at the height of earnings season. i'll leave you with one, astrazeneca, trading higher at 47 pounds a share. the daily mail in the united kingdom is suggesting that pfizer will come back with $113 billion offer for this drugmaker. that would be what they call a knockout offer at 53 pounds a share. the only thing i would add to that is the daily mail is not reknown for breaking business stories. back to you. >> thank you, simon hobbs. janet yellen's testimony in front of the senate budget committee wrapping up. steve liesman has some headlines. >> you know, carl, i'm beginning to wonder if there's some black-box program out there that causes people to buy treasuries and stocks anytime yellen is speaking, no matter what she's saying. a series of comments here beginning at about 9:35 in the morning when stocks seemed to get a lift a little bit when

yellen -- the answer of yesterday's testimony. and then, what's interesting, bond yields began to fall around 10:10 when yellen made the following comments. in many ways, we're far from full employment. the high number of long-term unemployed is disturbing. made a series of other comments and i don't hear anything new in policy but perhaps the market hearing that dovish talk, even though it doesn't change the outlook at all. for example, she seemed to give the same litmus test, reaching maximum employment goals and inflation targets for continuing the taper or ending it that we knew in the past, but the markets seemed to like what it heard, carl. >> yes, one gauntlet she's run, and with not too many scars, steve. thank you, steve liesman. let's get to the cme group. the dow is up 78. let's get "santelli exchange." hey, rick. >> hi, carl. you know, as i try to pay attention to as much of the qe and get my producer to get me

transcripts of the qe and pay attention to central banking with regard to not only yellen and the u.s. but what's going on overseas. we talked to mr. trichet today. it seems as though the central banking community isn't really being forthright with us on a number of issues. whether it's targeting currencies. now, i know there's not a direct targeting of currency, but there are policies in place where currencies are deemed to be better for an economy if they're weaker versus stronger. think of exports and who has the biggest exports economy, mostly in europe, but the u.s. would like a bigger piece of the action, as well. let's take it a step further. as for questions regarding issues that one of the biggest problems that janet yellen sees is that she's just not communicating correctly, that there's not enough transparency into what she's trying to do. as logical as that may sound to her, when i look around, i see one-sixth of the economy with the affordable care act, lots of question marks, lots of it

postponed, a lot of it postponed due to calendar issues of politics. i see what's going on with taxation. it makes no sense. companies moving abroad for better taxation, or what? everybody agree, both sides of the aisle, but nothing gets done. see, those are the reasons the economy is stagnant, and, you know, when it comes to small business and job creation, everybody is talking about small business, but in the end, how easy would it be for the left side of the aisle and right side of the aisle to say, listen, if you're a business starting up, up to a threshold of x tens of millions of dollars in revenue, we're really going to cut back on your regulation. see, wouldn't that be the way to go? it really isn't about communication or transparency. and i will contend you can't be transparent when you really don't have everything in place, whether it's the exit strategy or concrete knowledge of what the future economy looks like. and the word certainty should never be applied to anything, whether it's mother nature, climate change, the markets, because there is no uncertainty. that's part of the game.

if central banks think they can give us certainty when we know the strategy is flawed. and my last question today where we lost the satellite feed for jean claude was five years later, nonstandard is what the europeans call it, here we call it extraordinary fed measures, it's time for them to end. and my final notion, look at the last two charts, whether it's the narrowest spread between bund yields or 9 1/2 year separation, which is wide when it comes to bunds versus ten, all of that creates stimulus everywhere, because it causes traders in the u.s. to buy tens because they look at how low they are in europe. you see 2.58 now. it will be a matter of time before we're talking 2.48 or lower. kayla, carl, back to you. >> thanks, rick. i know a lot of people are watching that yield as treasuries rally. thanks, rick. we want to send it over to seema. >> check out terra data getting hammered. the analytics company warning

second quarter revenue would fall and it expected full year revenue and earnings would come in at the lower end of the forecast. that's not what investors wanted to hear. the stock currently down better than 10%. kayla? >> all right. we're also watching sprouts. what a turnaround for that stock. it's rallying this morning on earnings after nearly a 12% drop in trading yesterday, thanks to slowing growth at competitor whole foods. so how does the ceo of sprouts feel about a rival sending his stock into a spiral? we'll ask him in a moment. plus, check out the markets. nasdaq near session highs, up 39 points, dow up 86. we'll be right back. i bought a car, over and tells you, and you're like. a good deal or not. looking at truecar.com. there's no buyer's remorse.

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it's a big turnaround. the stock was down almost 12% yesterday. and definitely a different story than whole foods whose ceo appeared on this program yesterday to discuss the company's disappointing quarter. here's what walter robb had to say about competition in the organic food space. >> there's a tremendous amount of competition, which is a validation of the size and the growth of this overall mood of fresh healthy foods market. there's no one out there exactly like us. yes, folks are hitting us on the margin from different directions and the online space continues to grow, but we've got steps in place to continue to grow this company. >> joining us now for a cnbc exclusive is doug sanders, president and ceo of sprouts. he joins us today from phoenix. doug, it's good to see you again. good morning. >> hi, good morning. >> what a week. you've got all these names in your space with high valuations. you got walmart moving in. you have food costs going up. are you seeing anything wrong with what's happened to some of the stocks this week? >> well, i think it's important to understand the evolution of

the natural foods industry. you know, for year, natural foods has really limited to the high-income wage earners and the really hard-core natural foods shoppers. but over the past few years, that's really changed. natural foods has become more broad based and really the majority of the growth in natural and organic is in that middle and upper middle income consumer, which has been and typically will always be a very value-based conscious consumer. when you look at the the model of sprouts that are focused on health, value, and offering healthy foods at affordable prices, it puts us at the intersection of two biggest priorities for that consumer today. >> and enthdle then, of course, why you raised the comp forecasts. does that mean you'll be more competitive on pricing and what's the impact on margins looking forward? >> i think the thing to remember is sprouts has always been focused on health and value. being a value leader in our space has always been something that's been at the core of sprouts. when you look at our target

customer, the core customer for sprouts is the everyday supermarket customer, which is where the growth is today. so knowing that that customer is a value-conscious customer, being a value leader for sprouts is important. it goes into everything we do. it goes into how we position our stores to how we market our products. >> but, doug, there is competition. you can't deny that not only kroger and fairway and some of the traditional brick and mortar grocery stores are getting into the organics space, but also just a couple of weeks ago, google, shopping express, amazon fresh, are expanding. so where do you see any competitive threat? and how are you combatting that? >> well, sure. there's no doubt that the market is getting more competitive, but understanding that sprouts has always been competing with the traditional supermarkets, which were always very price conscious. when the growth is in the middle and upper middle income consumer, that's the consumer we target. it goes into everything we do to the products we market, to how we go to where we place our stores. and when you think about it from the online perspective, you know, over 50% of what we sell is perishable. and to that point, 25% of our

business is fresh produce, which is a product that consumers like to touch and feel and pick themselves. so it's not just about caring about natural foods, it's about the total overall customer experience. it's about carrying the products, about offering the breadth of products and also about the service and knowledgeable customer service that helps them understand the products and make the right choices for their needs. >> thinking of the companies in the food space that have said in recent days they'll have to raise prices to keep up with commodities -- kraft, kellogg, chipotle, and the restaurant space. are you in that club? >> yeah, we saw a modest inflation, probably about 1%, in the first quarter. we have started seeing commodities creep up over the last couple of months. mainly around dairy and cheeses and meats. and a little in produce because of the drought. but our competition -- really, our ability to pass through that inflation is driven by our competitors, and we are seeing our competitors start passing that inflation through, just through the normal course of business, and we're going to do the same. >> what do you think the impact,

if any, that walmart is going to have on the organic foods space? >> well, again, you can find natural foods in a lot more places today than you could, say, five years ago. but kind of like to my point earlier, it's not necessarily just about carrying the products. it's about carrying a breadth of the products. it's about carrying the products that the consumer are looking for, who are focused on food attributes, like natural, organic, gluten free, non-gmo, and raw. we carry a wide selection of those products and it's having the knowledge that helps customers understand the products. >> skeptic might say, well, that's -- you're right. but it's hard to argue with a behemoth that's 10% of all u.s. retail deciding they'll start to carry the kinds of products you're carrying. >> well, sure. but there goes along with being an authentic natural food store. sprout, we rest -- our core common -- our cornerstones of the success have been health, selection, value, service. we carry healthy products, a wide selection of all the products customers are looking

for, all the attributes i mentioned. we have great service, great product, knowledgeable customer service. more than anything, we have great pride, great value. from a -- the offering at sprouts attracts a very wide customer base. when you think about where the growth in national organics being in the middle and -- upper middle and middle income consumer, that's the everyday grocery shopper and that's the customer we target. the everyday grocery shopper looking to eat healthier but doesn't know who and probably feels like a healthy diet may be out of their reach from a cost perspective. and that's why our focus on healthy foods at affordable prices breaks down a lot of the barriers that consumers are facing today by giving them access to affordable and natural foods and putting the service and the knowledge -- product knowledge behind it to help them make the right choices. >> well, the message appears to be working today, if you look at what's happened to sfm. doug, please come back soon. good to see you. >> thank you very much. >> doug sanders, sprouts farmers market ceo and president joining us from phoenix. another earnings mover.

check out shares of coupons.com. volatile moves ahead of the numbers. one of the growth names being hurt. but after earnings, sharply lower this morning. a really volatile day for that company. the ceo of coupons.com will join us as shares go on sale coming up next. i'm type e. my golden years will not just be gold plated. i had 3 different 401(k)s. e*trade offers rollover options and a retirement planning calculator. now i know "when" i'm going to retire. not "if." woman: welcome to learning. spanish in the car.c on. passenger: you've got to be kidding me. driver: this is good. woman: vamanos. driver & passenger: vamanos. woman: gracias. driver & passenger: gracias. passenger: trece horas en el carro sin parar y no traes musica. driver: mira entra y comprame unas papitas. vo: get up to 795 miles per tank in the tdi clean diesel. the volkswagen passat. recipient of the j.d. power appeal award,

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♪ digital coupon provider coupons.com making a seventh quarter in a row of double digit gains. but what can we expect going forward? steven boal joins us at post 9. thank you for being here. >> thank you for having me back again. >> you have a big jump in sales, loss narrowing. talk about the quarter and what you saw at work here. >> you know, we're really, really happy with the quarter. we're strong all the way across in all forums and segments of our business. what was really great at the end of the quarter, we saw a big rush to our platform by all of our clients as they drove more of their promotions dollars to digital. >> so digital has long been a more effective way to market these coupons. i think i saw a stat that 15% of digital coupons get utilized, whereas 1% of paper coupons do.

there are also people who argue that the coupons business in general is a recessionary business, and when we get a stronger economy, fewer people actually use them. is that what you're seeing? >> actually, it's not. surprisingly, the digital coupon business specifically is noncyclical as opposed to be countercyclical. when we're in tough economic times, consumers do turn to coupons for sure, but that tends to be a learned behavior. when the economy strengthens, they continue to use the coupons. conversely, when the economy gets stronger, people adopt digital more. they're using mobile phones more often and they're using a full digital experience, and our company grows during that time, as well. >> what are -- i mean, i'm looking -- we had a conversation with the head of sprouts about food pricing, which is on the rise. but in general, are all skus headed up, and what does that mean for your business if they do? >> certainly, as commodity prices go up, that drives the price of food up. which drives manufacturers to spend more money on promotion, so they can move consumers to continue to buy their products.

>> although electronics. we know what's happened to pricing there. who needs a coupon when the price of a tv has fallen 90%, right? >> i can always use a coupon. it doesn't matter what the price is. >> any room for paper coupons? >> sure, there are. two forms. the paper coupons that come in the sunday newspaper, and believe it or not, 99% of coupons are still distributed that way. >> 99? >> 99. 315 billion coupons a year are primarily shipped through the sunday newspaper with less than 1% redemption rate. that being said, 1% is digital, but we see a 15% redemption rate. so 7% to 10% of all coupon redemption is digital. is there a place? yes. will it decline? certainly. where we're seeing the fastest growth is on mobility. >> there's a use for them in packing valuables, at the very least. you announced a digital analytics platform where you're using receipts from things, integrating that with your coupons. what sort of data are you

harnessing from this? how do you use it? >> it's a great question. we actually announced it was called retailer iq, and we're actually taking e-receipts, digital receipts for things purchased in grocery doors, grocery mass dollar stores, so we're getting the data from the register, the data coming out of the point of sale system, and we're using that in concert with web data and other analytic data, and believe it or not, even things like pollen count, humidity count, flu count data, to drive promotional value into consumers' hands. >> people are asking about the up tick in loyalty cards and what impact that has on your business. >> it's great. any use of digital is good for our business. our platform integrates both with loyalty cards and also directly into point of sale systems. remember, also, that many retailers don't have loyalty cards, and so, where there is no loyalty card using coupons.com digitally is almost like having a loyalty card. >> i know when we talk about the target breach, there's some speculation it was target's marketing database that got hacked because people's addresses, phone numbers, full

names were accessed. what are you doing to protect the information you get from consumers as they're buying things in stores? >> for 16 year, we've thought of ourselves almost like a documented data security company. and so, we take extreme measures, not only internally, but we also hire external firms to continuously audit and attempt to penetrate the services. >> finally, the most important question is, coupon or coupon? >> this is an age-old question. i say coupon. >> do you? >> but 20 minutes ago, i said coupon. you never know what i'll say when it comes to that question. >> you don't want to alienate half of your audience. >> and it depends on what part of the country i'm in. >> that's a nuance. i'll be watching that. steven, finally, the stock up 3%, down 45% from the ipo. how do you feel when you look at a market like this, and what are investors worried about? >> you know, if i could really predict where the stock was going to be, i probably wouldn't have started a coupon company. i would have picked a different career. for almost 17 years, we've been

building a company with durability, and that's really what we're focused on. we're obviously in a -- you know, in a time in the market when there's uncertainty around tech in general. but this is a very, very different experience than we had in the '90s, and i'm comfortable and happy with the company. >> steven, thank you for joining us. the market is liking your story today, up nearly 3%. >> thank you very much for having me back again. it was great. when we come back, the new weapon in the breakfast war, or is it lunch? more on that in a moment. plus, take a look at the markets. 9 dow, s&p, nasdaq all close to session highs. dow is just about 2 1/2 points from going triple digit. when folks think about what they get from alaska, they think salmon and energy. but the energy bp produces up here creates something else as well: jobs all over america. engineering and innovation jobs.

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the new front in the breakfast wars is a war on breakfast. burger king rolling out a n new burgers at breakfast menu, along with more traditional items. burger king taking the opposite tact with whoppers all day. they said 5,000 restaurants have opted to sell burgers at breakfast, which does raise some questions about kitchen complexity and through-put and the length of lines. but that's a war that's been going on a very long time. >> yes, our producer mark gilbert sent us an article from 2001 where burger conditioning announced the same then, because

it said people spend more on the average ticket when they're buying a burger than they do on breakfast. >> unbelievable. meantime, s&p, after the week we've had, is three points from its closing high. at 1,890. we're currently at 1,888. scott wapner will watch that and more for the next hour, right, scott? >> -- highs, too, maybe no coincidence, it comes, carl, as the fed chair is on the hill. have a great rest of the day. welcome to the "halftime" show. several retailers are shooting higher today. are those the stocks to add to your shopping bag? biotech bubble. the ceo of high flier alumina on whether his stock will give investors a cold or clean bill to buy. the nfl draft pick kicks off tonight. investor phil is sheer for the best bets on number one. let's meet the starting lineup. steve liesman is here. as you might have noticed, for the second dayn