good morning. 8:00 a.m. at instagram headquarters, 11:00 a.m. here on

wall street. and "squawk alley" is live. good friday morning. welcome to "squawk alley." carl is off today. but with me as always is jon fortt. on a relatively calm market day after the best two-day streak for dow in more than three years. we start with breaking news. the fbi any moment is set to update on details around that sony hack. eamon javiers has been reportin in washington with the latest. >> the fbi statement is expected later today. perhaps soon today. and in that statement they are

expected to officially name north korea as the hand behind the hack that hit sony so devastating and caused the postponement or indefinite cancellation of the movie "the interview"which apparently riled tempers in north korea. the question is now what does the united states do about this? cnn also reporting new developments here. a new message from the hackers. according to cnn, the message says it is very wise that you have made a decision to cancel the release of the interview. we ensure the security of your data unless you make additional trouble. so the hackers there clearly sending a message to sony that they approve of the decision to hold or cancel the movie. and saying the data they have will be protected unless further developments warrant more release of embarrassing information about sony's internal goings on. that sets up a dilemma for the president of the united states who is going to speak later this

afternoon in a press conference. it will be national tell vitalized before his vacation. the question will be what does he do about all this? there are a range of options here. the options go anywhere from indicting specific north korean officials that the united states believes are responsible for this to seeking a the u.n. resolution. some kind of cyber response. military exercises. and then all the way up to a military response. although none of the experts that i talked to suggested that that is the way the go here. but that gives you the sense of the menu that the president will be looking at and how to find that proportional response that doesn't further escalate tensions and create bigger risks for american companies is going to be the president's challenge today kayla. >> often times we hear government officials talking vaguely how a certain attack was state sponsored or how they have intelligence that points to a certain country. but it would seem rare for the fbi to come out on the record and point to a specific attack

and a specific set of officials possibly behind this. >> yeah it completely unprecedented actually. the type of attack and the kind of response that the united states is now contemplating is outside of anything they have trained for here in washington. what they have expected is a cyberattack state sponsored that might hit critical u.s. infrastructure or something of national significance. an attack that is devastating to one particular company, and particularly in an information oriented attack leaking embarrassing details is not something they expected. and that is why they have to calibrate. and there is a lot of back and forth behind the scenes on the statement from the fbi. so we're going to have to take a look here to see what officially they put out within the next couple of hours. >> thanks. lots of questions remaining about the hack. hopefully the fbi can clear some of them up. next this morning. citi group upping it valuation of instagram to 35 billion dollars. nearly double the previous

estimate which was 19. and to put that in perspective, facebook bought instagram in late 2012 for 715 million. meaning they would now be worth about 49 times what the social network paid for it. people laughed at zuckerberg at the time. take a listen to what instagram kevin sis trom toldualia boorstin this month. >> twitter has a more mature business. they are public. we've just started monetizing and and we have a lot o prove before, you know, we're worth many billions of dollars. >> in case you do want to compare the two this puts instagram about 30% higher than twitter's market cap. joining us on the phone, mark may, director of internet research at citi group. >> you say this valuation is based on instagram being fully monetized. how is that different from how

you would value it based on how much monetization you expect in the next year or two. >> absolutely. and thanks fhaving me on. the way we look at valuations is look at potential and trying to discount that paced on different risk factors and that is the exercise we've done here. fortunately for us instagram is performing incredibly well from a user standpoint. user engagement is incredibly high. we think about twice that of a typical twitter user. and we also now have lots of benchmarks for how the social media properties are monetizing. and it is working. advertising is working on sites like twitter and facebook, linkedin in yelp. and we're able to use those ooze benchmarks to look at the earning potential over time. and that is really what's underpinning our valuation that we've put out today. >> so what value would you put on whatsapp given that those are two important pillars of

facebook's non core app strategy. >> yeah, and i think you are pointing to something that is important. which is the way zuckerberg is really thinking about facebook's future. is more as a platform and leveraging its engineering pallet, advertising platform, its user data to help launch really and support a portfolio of applications. today it is primarily facebook instagram and whatsapp. we expect more in the future that. thinking is behind our valuation of whatsapp which we peg at $18 billion evaluation today. and that is looking at not only the user valuation in whatsapp its but others in the region that have more models. and as you probably know whatsapp is beginning to staff up its executive team to monetize that property over the next year. >> people are talking about the brilliance and timing of this

deal. when they bought instagram for 715 million dollars the same way they are now looking at google's very timely purchase of youtube. the danger is that employees see the growth and revenue numbers internally and think wow we could be so much bigger, so much richer a as the stand alone company. and maybe they want to spin out. do you think they stay throughout the trajectory of this growth? or do you think at some point there is a little bit of the wreslessness. >> >> as i think i got whether you are saying, is there a risk that maybe other start-ups want to hold on and remain ind foent see th independent to see this value increase separately or --. that's a risk i think that has existed not just recently and within facebook but for many years in the valley and one facebook has to address by remaining highly innovative fun

place to work and being able to, you know, allow those people the kind of upside, [inaudible] from a career standpoint but also from a financial standpoint. and that is a challenge they face today. and frankly faced as a private company trying to entice people like google, you know, to join them in the early days. >> i guess we'll see what happens with companies like snap chat that have turned down facebook, whether they can monetize in 2015. mark, thanks for joining us. >> thanks for having me. >> apple ceo speaking out after a documentary alleged that apple mistreats workers in chinese factories are ipads and iphones are built. more on that story. >> the bbc investigation is making waves at apple. sent some reporters under cover to one of the suppliers called pegatron. they found labor conditions that breached the company's

standards. it also says employees routinely forced to work over time. sometimes without proper pay. and apple has faced similar charges in the past. in 2010 when 14 workers of another major supplier committed suicide. apple has implemented a new stet set of standards since then. and says no other company is doing mar to ensure safe and fair can working conditions. a statement, like many of you, tim and i were deeply offended by the suggestion that apple would break a promise to the workers in our supply chain or mislead our customers in anyway, now, i haven't been specifically to that factory. however i been in and out of a lot of the factory suppliers. i'm familiar with the supply chain there.

is and most of the workers i speak to says that the jobs are well paying by local standards. the work is very repetitive and very stressful because they are making a the highly specialized product. overall when you look on a comparative relative basis the conditions aren't terrible. of course that doesn't mean there aren't terrible conditions and abuses within the working conditions in china and that is one of the reasons why you see a company like apple really trying to improve the standards and all the dynamics of the chinese economy are there to try to make that happen as well. >> invaluable context. thank you for that. up next, shares of the blackberry taking a hit after revenue missed estimates. and we'll talk with ceo john chen in a moment. and after 50 years the u.s. may finally end the cuban trade embargo. that's big news for cruise lines everywhere. the ceo of carnival joins us. and the justice department

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blackberry reporting a third quarter operating profit of a penny a share. but revenue came in below consensus on disappointing smart

phone sales. john chen joins us now. thanks for joining us. i want to get a perspective here. at the end of october when you and i sat down. you said within the next couple quarters you would be cash flow neutral or positive. check from operations. you also said you want to stabilize revenue and didn't want to go so far as saying grow. on the call this morning you said stabilize and grow. have you gotten more optimistic. >> hi. yes on the fy 16 i'm talking about which is the next fiscal year. we still have a couple of quarters of the transition to go through but yes i am more bullish on the new products that came out. it was very well rereceived. we just launched the classic phones. seems to be doing well. and the software is doing extremely well. >> you said classic preorders were ahead of the passport. the inventory of old devices is down 93%, which should be good

for average selling prices. but what impact does this have on the core business that you really want to move forward in the next year? your software business that you say you want to double. will those phones increase sales of the bes 12? are t do you have early numbers? >> i think we are able to kind of separate the two. our bes 12 are very focussed on cross-platform. on the call i name a number of wins that was very high profile that move to bes 12. importa more importantly we're getting a pretty good book of business coming and doing it on subscription basis, that is why the revenue will be a little later. it will come more steadily downstream. >> john, sony's internal e-mails are all over the internet. blackberry made its name on

secure e-mail. what is your sense? if sony has been using blackberry enterprise server and blackberry, do you think the hackers would have been able to get in like this. >> i wouldn't be able to comment like that. because i don't know what the sony system looks like and what device they are using. it's proven that blackberry devices and the server, are a lot more secure than any other solutions out there commercially available. at least it would help. i don't know whether it would completely prevent it. it's not knowing the exact reason and how the intrusion happened, hard to comment on that. >> absolutely. you mention on the call a deal with boeing. we know that boeing is working on the boeing black phone. based on its own secure version of android. it is supposed to completely wipe its storage if anybody trying to pry open the back. the customers, our govrt

government. i know you can't talk specifically about whatever you are doing with boeing but they say they are using bes 12 in a deal like that. how are the margins if you are to do other types of deals with people with outside phones. are those higher margin than the standard? lower? >> no i think it would be about the same. you know obviously the most security features is added on. boeing and us are in collaboration developing together and the solutions is going deliver to the highly securely minded enterprises where there is government or others. so of course, you know, those are tend to be more on the, you know, more expensive and higher priced model. >> give me an update on bes 12. that is the most important thing you have going for the next several quarters. again you want to double the software business in the next year. is that at expectations as far as customers picking that up? is it running ahead of expectations? and given the movement that we've seen in the market upward,

some positive signals for demand going forward. we see in the enterprise with oracle earnings. do you feel better or still cautious about how that is going to do over the next couple quarters in bes 12. >> we launch on november 12th. and i a lot of people join us on the launch over the carrier, the distributors. as well as even samsung has joined force was managing the nox system which is their secure systems. i feel good about the prospect. i think the sperenterprise are r the highly secure and highly private system. so i feel good. and i review some numbers. we double the number of licenses traded in since the last time we reported the number, which is exactly 90 days ago. we now have over 6.8 million licenses out there that want to trade in up to bes 12. at 30% plus came from

competitors. so i say we're picking up some momentum. >> and cash flow, positive. clarify for me. you said you expect for the cash flow to remain positive. should we expect that every quarter now? what should the expectation be as you make adjustments, as you see how the revenue comes in as far as your cash flow is concerned? >> thank you. good question. i do expect to be cash flow positive from operation going forward. obviously i can't guarantee, you know, 100%. but it is our intent to be maintained that way. and we feel good about the chances of doing that. the profitability will come with the growth of the revenue. and that probably is going to be, you know, some time in fy 16. given our track record we usually do things a little sooner than we promise. so i guess that's all i could say at this point i guess. >> all right, john chen.

underpromise and overdeliverem we'll see if that follows through into calendar 2015. thank you for joining us on cnbc. >> thank you. >> coming up the fbi set to update details around the sony hack. we'll bring that as it happens. we'll be right back with "squawk alley." ay he controls the lights and unlocks the door when i forget my keys... it's just that... i feel like he's always watching us. yes, that is why we should use wink. ...look, it can monitor and manage our house but it won't start to develop human emotions. hey buddy. control your entire home with one simple app introducing wink it's like a robot butler, but not as awkward.

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welcome back to "squawk alley." check out shares of red hat, the leading gainer in the s&p 500 today. higher after the better than expected third quarter results boosted by strong subscription revenues. credit sweets raised to 75 from a prior 70. and the programming note here. red hat ceo jim whitehurst will be life with jim cramer on mad money tonight right here on cnbc. >> quite an interday chart. thanks dom. >> getting back to our top story we are awaiting an fbi statement

on the sony hack investigation. at any moment authorities expected to point the finger at north korea for the devastating cyber attack which could set up a confrontation between washington and pyongyang. joining us is the chris swecker. given your experience o as former assistant director of the fbi and what you know at this point about the hack, how do you see the situation playing out? >> well i see it playing out in what i think the fbi is going to announce is that it is indeed at least north korean government inspired, supported and enabled. and that is not unusual. the north korean government is known to consort with criminal elements particularly in counterfeiting, drug sales to raise hard cash. and every indication they may have tapped one of their go to criminal organizations to do

this hack. was a t because the data of the employees is on sale in the black market. >> could be a possibly chinese link. is that unusual? >> that wouldn't be unusual because the chinese are the best in the business at computer intrusion. and it wouldn't be surprising. what i think is -- is unusual here -- not unusual but note worthy is that this data is for sale from the employees at sony. there is 6800 employee data sets sold on the black market. that is a criminal act. and i wouldn't put that on the chinese government. i'd say there is probably still the involvement of criminal elements here. >> what about the possibility that somebody did this and wanted to make it look like it was north korea. given that in the early communications north korea wasn't referenced when this hack was getting started.

should we be careful about that element of this? >> i think. so until all the facts are out. we're all speculating at this point. i can't say between the fbi and the fire eye e they are two of the best in the business. they have pretty extensive libraries of the stiet chinese and other state malware. and if they come kout outand say this they are going to have have a high confidence this is definitely identifiable with those governments. >> how does the fbi work with companies in identifying potential threats that may arise from content that is protected around the first amendment. but of course that doesn't exist in other countries. there is talk about whether sony may have been informed of a potential risk around releasing the interview. how does the fbi work with countries in these situations. >> well, prior to -- sort of in a preventive capacity t fbi has a program where they share

information with private industri industries, like sony and try to give them the current malware they are aware of out there. but in this case how they -- they are counseling on whether to release the movie or not is something they would not advise sony on. i think they would leave that completely up to sony. >> as an independent cyber security expert doo you agree with their decision to pull the movie or indefinitely postpone it at this point. >> as a former fbi agent and as independent cyber expert i would say it's a very basibad decision to give in like this. it wasn't a specific, and it wasn't an imminent threat. you look at their capabilities and it is like someone who calls in a bomb threat. i mean they are talking about it, they are probably not going to do it. so i would not give in to terrorists in that fashion. and, you know, if we took that to the next level we wouldn't walk out our front doors. >> chris, we appreciate your time this morning.

>> thank you. >> chris swecker the former assistant director of the fbi. >> we're looking at the mixed map in europe ahead of the close. let's bring in simon hobbs. >> it's quiet of course after the six day slump and then the very strong two day rally. a lot of the peripheral banks are lower. oil services and stocks have turned into positive territory. you will notice an underperformance in greece. in athens the greek government is dismissing claim there is's been bribery in the parliament. earlily suggesting they were offered over 3 million dollars as a bribe to vote with the government to get the president elected for all the things we normally discuss. we also got a report from reuters. suggesting that the european central brang is looking how to in order to limit risk of qe, it would ask the central banks in portugal or greece to bare the

risk in that i ven.e event. it's been a bad week for the euro as we work presumably towards qe. january 22nd or perhaps in march. air france issued a third profit warning in the wake of the strike. the stock is down almost 8% as you can see. these guys are fairly active. the parent company for british airways made an offer to buy air ling us in dublin. top gainer, one of, atossa. they are paying 1 billion to acquire xerox's it capability. and that stock up 6%. the brussels eleaders wrapped up

their summit. they managed to skip the final day in its entirety. partly because they have a new more efficient leader but also because this is the scene in brussels today that they wanted to avoid. they knew angry farmers were on their way. and that is the commission building to the streets in order to protest. so rather wisely they wrapped up in the early hours and were all home and safely back in their capitol before this occurred where they were. >> up next. re/code reported it weeks ago. as we wait for that statement from the fbi to officially blame north korea for the hack on sony, we believe. re/code's kara swisher with us next. for practically just your signature, you could drive home for the holidays in a german-engineered volkswagen. like the sporty, advanced new jetta... and the 2015 motor trend car of the year all-new golf. if you're wishing for a new volkswagen this season...

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welcome back. joining us is kara swish herb, co-executive editor at re/code. kara swisher. and now the first hostage digital situation playing out in public. the fbi getting ready to officially blame north korea for this it appears. after cnn reportedly obtained a copy of the message from the hackers saying it was a very wise decision to cancel the release "the interview."

>> what's interesting is nobody wants to believe this was north koreans. when we wrote a story weeks ago saying it's probably related to this movie. everyone else was looking for other things they can't believe it would happen. so i think the implications of the story are still far ranges and there is lots to go. because everybody is nervous to speak up because they don't want to get attacked. it's a really disturbing situation. and sort of uncharted territory of what to do. >> kara, in the beginning western saying okay, well if sony cancels "the interview," maybe a streaming deal with netflix. maybe on the internet or itunes. but the sense is increasingly no one wants to touch this content. and i'm wondering if you think that is a bigger problem as well. it's not just sony operating out of fear but also the broader industry. >> absolutely. i think everybody is really nervous about putting this thing up. if netflix would be the natural place to put it or google play or amazon.

somewhere like that. now, a good thing is everything gets out on the internet so someone is going to put it on the internet and nobody will going to be able to stop it and people will watch as they want. but what people are very nervous about the security of our and being attacked. and when an entire country is coming at you it is a very different story than hackers. which are a really big problem. i think people don't really how much is going on in cyber hacking. but this puts a bright line under the difficulties of operating under this environment. where companies are very vulnerable. >> looking at soip's side, they are getting a a lot of criticism for not releasing the movie, at least online. but given the information out there on emails and sony employees and executives, apparently passwords for financial accounts. is it possible the hackers have a lot more data and access to more things than we even heard about at this point and that the company is just trying to protect employees? does that play? ? >> i i don't know.

but our lives are online. think about it. our lives are online and a lot of them are at work. you saw lot of the personal stuff that went on between executives. that's very normal. it's how people operate. it's like breathing. sort of this is the way american business is conducted. and it is very vulnerable to being hacked because it is all digital. i think the question is, you know, i don't think sony had a choice. the theaters were not taking the movie. the online distributors were not taking the movie. they don't have their own system to distribute. i don't think they have a choice in this matter. the companies and actors that are attacking them of course are not brave enough to do anything themselves. so they are a victim in this situation and i don't think there is any good choice for sony. >> kara, there is a column in the "new york times" talking about how maybe the erasable internet will take off. because people will realize how much of their digital live is

stored. but we learned the hard way that even stuff distributed on snap chat is cached somewhere else. do you think this changes the way people do business? >> i think like an auto crash. and will people use cars. people are living in this digital environment. the question is how safe can we make it and how can we take the vulnerabilities and turn them into strengths for the companies. it's very difficult and the problem is there is not enough people trained in fighting this. there is a lot of people o who know how to hack but in terms of companies really taking it seriously i think people haven't taken it seriously and that is wh has to happen. companies have to realize how vulnerable their data is. i think about it all the time. anyone who's halfway intelligent understands, everybody is hackable. there is nobody who's not hackable. >> i think something a lot of people might not realize is big companies are the constantly under attack. and it is not so much a matter of keeping them out entirely but

once think get past the first line of defense, preventing them from getting to really sensitive information. it's about being acble to look t data patterns and being able to tell somebody is in and moving the way they shouldn't be. are there opportunities for enterprise security companies trying to push this idea of the new form of security? are you hearing buzz about that? >> well yeah. there is a lot of very credible companies around. and there are going to be more. this is a need. and i think there is going to be a lot of bad companies too. like we'll make sure you are secure and won't be able to secure you. so i think there will be probably a run on these kind of companies because of this incident just like any crisis that happens. you know, i think you are right a lot of these company, google is under attack every day. they happen to be very good at pushing back attacks. but they are the best and they still have trouble with it. and so, you know, a lot of these internet companies get this all

day. facebook, google. and it is still very vulnerable. and it's because it's digital and it's because it's gettable. it is not the same thing as a pile of papers in some building that only one person can go and get. this is written once and copied a million tiles. >> e yes indeed. tough story for sony and for people who wanted to see that movie. but an important stort. thanks for joining us kara. >> thanks. >> come up the falling oil and the news that u.s. could release the trade embargo have been good news for cruise lines. the ceo of carnival joins us later on this hour. first, rick santelli. >> of course we are watching interest rates but we're going take a slightly different tangent to describe it today. we're going to look through the prism of foreign exchange, what the euro's been doing and what

that may tell us regarding bund yields and ten year note yields. after the break.

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barnett who started investing at the age of 9. looking forward to that. see eonew a bit. >> we want to bring you an update on the story we've been talking about all hour. that is an update from the fbi on the hack that has occurred at sony entertainment. we are fwh getting a statement from the fbi saying today the fbi would like to present an update on the status of the attack. in late november spe confirm it was the victim of a cyber attack. the guardians apiece claimed responsibility. the fbi says it is determined that the intrusion into sony's network consisted of the deployment of destructive malware and the theft of prieptry information as well as employees personally identifiable information. jon have you been reading as this well. >> i have. and a technical -- the fbi

observed significant overlap between the infrastructure use in this attack for malicious cyberactivity. the u.s. government has previously linked directly to north korea. so looking at some of the code here and some of the methods of deploying it they are trying it to things they know north korea was involved in in the past. despite the fact that a number of people have questioned the language the hackers have used are really consistent with someone acting as north korea. they are able to determine that the methods they have used are consistent with north korean methods in the past. >> -- on the private sector entity where ordinary citizens had their information accessed and reaffirms the fbi stands the

cyber security threats are some of the greatest national threat security threats we have right now. getting word on the attack. requiring sony to pull its movie, "the interview"." the plot of which was a fictional assassination attempt on the north korean leader. >> the fbi also saying working together with private business, at the end of this, the fbi will identify, pursue and impose costs and consequences on individual, groups or nation state who is use cyber means to threaten the united states or u.s. interests. that is a little muscular language at the end there. and to me it goes beyond what we've heard in the past in government responses to this. statements just saying generally we're here to help business in cases like this. they are saying they are ready to impose costs and consequences on individuals, groups or nation

states who use these type of cyber measures, clearly indicating to me at least that we are in a new era. >> joined by chris swecker who was with us earlier in the hour. now they that we have affirmation from the fbi they did conclude north korea was behind the attack and saying they will impose costs to those responsible, your reaction to this. >> that is a whole new tenor of conversation and tone coming from our government. we've been basically giving china a pass for many years. they have been stealing technology via the internet for a long time. so i think the gloves are finally coming off with state sponsored hacking. >> chris, what the fbi is pointing to here, ip addresses associated with known north korean infrastructure. also, the code they say was used before an attack linked to north

korea. is that enough for you do feel confident that the north koreans had a significant role in this attack on sony? >> yes, it does. because i know the company that's working on this fire eye has a very good handle on the types of malware that come out of these countries. they have been building this library over time. the fbi is very good at this. i do not think the director would have come out and said this without having very good evidence. >> so whether do you make of the fact that north korea denied any involvement in this? what do you think is there strategy here? it's similar it seems to the denial that we heard out of china when we first heard, i believe it was from fire eye about a special military unit that was using technical resources to attack u.s. business interests. why would they not crow about this and say we warned you. now we've hit you where it hurts. >> it's hard to attribute any

rational thought to north korea and their leadership. you know, they wanted to threaten and make good on their threat and they wanted to everybody to know they should just own up to it. but that is not the way it works. china, as this has been happening in plain sight for a long time with china. and there is sort of a dancing game that takes place. and we have not wanted to point the finger directly at them because we want to do business there. north korea is a different story. and really it is perplexing why they don't just stand up and own up to it. they enjoy the attention. they want the attention. so it really is puzzling why they don't just stand up and take responsibility. >> chris, the fbi highlights that north korea's attack was intended to impose significant harm on a u.s. business. when you think about how costs would be imposed, there is really nothing that we want of north korea's. in other situations we have

imposed sanctions or we have tried to impose similar rules that have tried to hurt their businesses, not similar attacks of course. but i'm just wondering how you see this playing out and how you see the fbi responding to impose such costs when this is such an asymmetric situation. >> yeah. thank goodness this was not a critical infrastructure. it wasn't telecommunications or financial sector. it is not the power grid for example. those are critical infrastructures that really matter. movies we can do without. and, you know, the matter of the theft of employee data which they are selling on the black market as we speak. but i don't see draconian retaliation coming from us because it wasn't an american company and it wasn't hitting at the heart of the critical infrastructure. >> chris i apologize -- i don't medially mean to interrupt you i want to bring in eamon javers in washington who's been following the story. what do you make of the

statement we've just seen. >> well it is a lengthy statement. looks like there have been a lot of people involved in crafting this. a couple of key points from the fbi giving us information that that we didn't know before about what they know about north korea. for example in the statement lower down they are talking about some of the evidence they have found that supports the conclusion that it was the north koreans. the technical analysis of the deletion malware in this attack reveals link osteoother malarwa that the fbi knows north korea developed. they also say fbi observed significant over lay between the structure in this attack and others the u.s. government has previously linked to north korea. that is some evidence they are putting out to bolster the case. part of the challenge for u.s. intelligence is they don't want to go too far into saying what they know about north korea or how they know it. but here they are lifting the

curtain on some of that. >> all right. and our thanks to chris swecker, the former assistant director of the fbi. we'll have more on the stunning developments on the sony hack and the recently released statement from the fbi when "squawk alley" comes back. h? the equipment tracking system will get you to the loading dock. ♪ there should be a truck leaving now. i got it. now jump off the bridge. what? in 3...2...1... are you kidding me? go. right on time. right now, over 20,000 trains are running reliably. we call that predictable. thrillingly predictable. ♪ my baby drove up in a brand new cadillac. ♪ ♪ my baby drove up in a brand new cadillac. ♪ ♪ look here, daddy, i'm never coming back... ♪

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attacks where north korea was behind those cyberattacks to link to the destructive attack that has occurred at sony pictures entertainment over recent weeks that has led to the cancellation of "the interview," which was one of the most highly anticipated movies of the season. now the fbi stands well to assist any u.s. company. and also says it will impose costs on nation states or actors they find to be behind this. >> they looked through this and found similar lines of the code encrypti encryption, data deletion methods meaning how the hackers cover their attacks. and clearly the story continues to develop. >> yes. meanwhile let's get to simon hobbs. the other big story, the possible lifting of a trade embargo with cuba. what that could mean for the cruise lines. >> the cruise line carnival is

out with earnings this morning. shares have been on a tear in recent months. up 25%, 26, since the middle of october. when of course the ebola fears were at the worst. carnival's ceo joining us now from miami. welcome back to the program. you have had now 48 hours to think about cuba. how do you feel about being able to put ships back into havana, 230 miles from where you are standing now? >> hp holidays to you simon. of course we're very excited should the legislative embargo be lifted on cuba. there is a lot pent up demand for people to visit. there are eleven ports that accommodate our ships and the ships from the industries. the havana port itself has a shallow draft. it takes smaller ships.

lit require investment and infrastructure to enhance. but show the embargo will lifted we are very excited. >> the earnings you have beaten by 7 cents a share. is that totally down to fuel savings? because you unlike your other competitors don't actually hedge fuel on a daily basis. >> we use collars. we don't hedge as you point out. our gains, even without the fuel benefit we got in the four quarter we would have been beaten guidance. strong performance across our brands in north america and europe and looking forward to even more. >> you have announced you are going to advertise with the parent company nbc during the seu super bowl. basically saying cruising is a great idea. why are you doing that as a business and not doing that at the industry level? why put all nine brands up there? because it could backfire in not

directing them to a single choice, isn't it? >> and the reality is each of our brands cater to a different segment as we said before. the idea is to expose all the great wonderful things that create the great vacation experience is that cruising is. it is to address all the myths that people have about cruising that just aren't true. we have actually have a site royal --. we'll let people come in and they will vote and that will be used as input to determine which one airs on the super bowl sunday. and they can win a cruise for life. so they can go on a cruise for every year of their life. >> we're almost at the end of the show. very briefly, can you sum up where you are. what you see for the all important booking season coming ahead. prices are slightly higher which might disappoint some from where we were a year ago.

still of course below peak prices before the crisis. >> we see some challenge in the caribbean in the first quarter in terms of yield improvements but therefore even in the caribbean we see strong yield improvement and overall in europe and overall in north america and other destinations looking for a yield improvement across the board. we should have a very good year. >> happy holidays. >> always a pleasure. >> kayla and jon. >> we want to recap quickly what has happened with sony. the fbi coming out and formally naming north korea as behind the cyber attack that occurred over recent weeks. sony shares down nearly 3%. they have oscillated this month on this news. but certainly a very interesting development, jon. >> it is, particularly because the fbi saying they are going to impose costs and consequences on individual or state actors who do this sort of thing.

so more muscular language than we've seen in the past. >> meanwhile the broader market losing steam. the dow still managing to hang on to positive territory. wiping out its december losses earlier. so certainly an interesting development. witching hour is this afternoon. so you will want to watch volatility but for now let's send it over to the judge in the halftime report. all right kayla, thanks very much. welcome to the halftime show. let's meet the starting lineup for today. stephen weiss, josh brown, and jon and pete najarian are the co-founders of option monster. steve brasso on the floor of the new york city stock exchange and paul richard is at ubs. good to see everybody. our game plan looks like this. oil shock. we're live on the ground in the permian for the real story how