over to "squawk alley." take it away. >> good morning. 8:00 a.m. at box headquarters in california, 11:00 a.m. on wall street, "squawk alley" is live. ♪ ♪ >> good thursday morning. welcome to "squawk alley." henry blodget, founder, editor and ceo at business insider joins us this morning. jon fortt and kayla tausche. here at post nine. market is interesting. dow up 176, best day since early february, box, shares of the cloud storage company sliding after the bell when the quarterly results did

disappoint. ceo aaron levy took out his frustration on the analysts saying they got the numbers wrong. josh lipton in san jose this morning to sort this out. hey, josh. >> well, carl, aaron levie came out swinging on the earnings call and when i spoke to him last night he told me analysts just got it wrong. box posted a q4 loss of 1.65 on what appear to be the consensus view of a loss of 1.17, but levi says the 1.17 number was wrong because some analysts had set expectations based on the wrong share count and tweeted as much after the call last night. the real consensus estimate, says levlevi, was a loss of $1.. box's results would have looked better. levy pointed out box beat expectations on revenue and billings, still, even if lev vi is right, they will have bigger

concerns, forecasting revenue growth of 30% for fiscal year 2016, a big slowdown from the 74% growth rate that the company enjoyed in its last fiscal year. levi tells me the growth rate is slowing because box is a bigger, more mature company. he urges investors to concentrate on other metrics such as the growing number of box clients signing $100,000 contracts. box down hard today, still up about 25% since the ipo. the company is moving past just on-line storage where it has to compete with tech giants like microsoft and google. instead, the company is concentrating on offering products tailored for specific industries such as health care. when i asked levi about whether box could get back to growing at a 50s% clip he sounded a note of optimism saying there are a lot of tailwinds in this business. back to you. >> interesting story, for the first one. thanks a lot. let's talk about this.

i mean, not the way you want to come out gate? >> rough break on the math certainly. 28 million share count the street using, when they should have been using 20 million apparently. it's the 30% revenue growth rate the more interesting thing here. there could be a siller lightning here. we don't understand how marketing spend fuels revenue. it could be box is planning to spend less as the year goes on and why revenue will come down, so what might be a more realistic level going forward. that's not clear, though. what is clear is this is a company that spends a lot more money than it takes in. aaron levie has a good story to why that is but not good enough this morning. >> we talk about this balance between spending a lot as a young company and wanting to make sure that you have a clear path to profitability. share count aside, being a public company and losing 1.65 a share is not a vote of optimism. >> this is a terrible debut and the share stuff is just embarrassing and my guess is, when we dig into it, and figure

out what happened, this will come back to some ipo communication rules that are stupid. we talked about this with facebook where there's this pretense that these are estimates, the company has nothing to do with them and yet the underwriters talk to the cfo and know where they are. how the number could have been this far off, it's just embarrassing. again this whole process could be improved a lot. but to your point, jon, this is all about the future. that is a very slow growth rate for a company spending this much money. you would think by this point they're spending that much on marketing you would start to see real momentum on his own so that's a concern. >> marketing is the -- it's what is going to separate their business from the commoditization of the overall business, right? do they have a choice but to spend that kind of money? >> to kayla's point it may be they are saying we are losing so much money we have to get it under control and that will hit the growth rate and stock price that's okay. we can go up from there. they may be resetting

expectations. >> a big part of their marketing cost is their free model. everything they do to service the free customers, low level of storage, consumer level, that gets counted on the marketing line because these aren't paying customers. not clear if they're planning to shift that model as they go after these customers paying a lot more money which levi likes to point out, those paying 100,000 or more but that could be a part of it too. >> it seems they're having to spend a lot to even bolster their existing customer base seeing revenue growth come down that much and spend go up that much, to your point earlier. >> it does. i think this is a company that's in the midst of a shift, relying a lot more on the free model up front. now looking to use people to go after these larger businesses. the businesses the likes of which they're talking about pharmaceutical company they don't get hooked on a free model. you have to show them you have security, all of these enterprise class services they want to see in the cloud. that's a shift for them.

it's going to be painful for investors to figure out how they're doing with that. >> speaking of box, levi will join "closing bell" for a first on cnbc interview around 3:30 eastern time. meantime lumber liquidators as you know the kind of week they've had has resumed trading after being halted today. the conference call on this controversy over the safety of the flooring products has come to an end. scott cohen is in san jose and following the calls and gives us the details. >> hi, carl. about a one-hour conference call. tom sullivan founder of lumber liquidators the face and voice of the company was not on this call. it was rob lynch, the ceo and dan turrel the cfos addressing these allegations of unsafe flooring and high formaldehyde emissions and if you take a look at the stock which has bounced off its low considerably after being halted earlier, they had some success but put it in perspective as dominic chu points out this was $108 stock last year. they spent a great deal of time

talking about the test methods used both by "60 minutes" in their expose on march 1sst and the so-called standard operating procedure by the california air resources board. they point out correctly that's not the test that's in the regulations. it's what's known as a deconstructive test where they take apart the flooring and to test the core, but there's some controversy about that within the wood flooring industry, controversy that existed before this expose. nonetheless, lumber liquidators says that it goes above and beyond what the regulations are, employs testing independent labs, unannounced visits to its mills, and also has been cutting down somewhat on the sourcing to china which is an issue here. nonetheless the company saying that it cannot any longer forecast its results for the full year, but it would take about a 27% drop in sales year over year for the company to run out of cash. in other words, they have plenty of liquidity to withstand this.

we'll see what steps happen next. we should point out tom sullivan will be on cnbc first on cnbc with scott wapner on the halftime report at noon eastern time and we expect, we may get some response from the short sellers who have been pushing this case, led by whitney tilson who said that, regardless of the test methods used, if the competitors wound up testing so much lower in formaldehyde than lumber liquidators' flooring, how do they explain that and they did not explain that on the call today. >> the first chance to give sullivan some q&a, interesting to watch. thanks scott cohen. alibaba investing $200 million in snapchat in a deal that reportedly values the messaging company at $15 billion. snapchat was previously valued at $10 billion after the latest round of funding one of the most valuable start-ups rumored to have more than 100 million users. not part of a broader fund raise. >> i don't know.

it's unclear exactly what snapchat is doing but a lot of people want in on this one. what's interesting to me, i kind of asked a few months ago, wrongly, clearly, is anybody into snapchat anymore. apparently so. their growth appears to be strong. the big question with the mega valuation, do they have a platform. it's one thing to have users, engagement, that can be a little bit more ephemeral to kind of play with what snapchat does, can they build a platform the way facebook has that really creates this virtual cycle. that is not clear me yet. >> but definitely early signs that's what they're doing. some of the new snapchat discover, videos, stories, these are promising. some of the statistics around the usage you're talking about an audience the size of prime time football ratings, that's staggering and it's a longer game, compare a lot of things, but the usage is incredible. some of the new product or services are very promising. >> to people who watch both

alibaba and snapchat it's not a surprise because actually the lead banker on the alibaba ipo joins snapchat as chief strategy officer a couple months ago and has been spear heading some of the fund-raising efforts. a lot of interest has been inbound for snapchat as we reported and some investors were trying so hard to get a piece of the company willing to value it at $19 billion. i know that $15 billion is a huge price tag and i know i'm going to get a lot of flack for saying this, but there's a chance that spiegel the ceo of snapchat has exercised a little bit of discipline in this fund raise and that he did not take investors' money at the higher valuation, instead went for a seemingly strategic partner at potentially a lower valuation. >> why we went 23r from 19 to 15, maybe 19 was wrong and so forth, but it may be that there's something that gets snapchat into china based on this. alibaba is trying to be aggressive with investing as we thought at the ipo, this is one way that they can expand internationally without owning things 100%. that's no surprise. but this discrepancy between

where we have been told that snapchat was looking and the deal is something worth looking into it. >> interesting because some reports say snapchat is still blocked in china. i haven't tried to use it in china -- and how much of a political lightning rod is alibaba willing to be to make such a sizable investment in something not allowed on the mainland. >> intel, shares falling after the company did warn on revenue guidance for the first quarter saying the change in outlook as a result of weaker than expected demand for desk top pcs and inventory levels across its pc supply chain called the most obvious warning of the year and still hurt about 5%. >> i don't know how obvious it was. i look at the transcript from the last earnings call. the ceo said our inventories as we exit q4 we're comfortable with where inventories are. cfo stacy smith went on to not dismiss the issues but more an issue at the low end and saw shipments behave more normally at the end of the quarter. now we get this.

part of this might be anticipation of windows 10 coming at the end of the year. very often you see kind of a pause in demand ahead of that. nobody wants to buy the old thing when the new thing that looks pretty good might be coming out. intel used to be really, really good at forecasting demand back when the pc market was a bit more stable. when you see something like this coming after a call like intel had it makes you one it der what year we're in for. >> that's right. makes you wonder whether this is everything. a weak europe as well and currency and i'm sures those play into it. other stuff going on as well. >> and the collateral damage and pretty strong tape, micron, western digital, sandisk, others related tangentially to the pc. >> which had been suffering earlier in the week. microsoft seeing some damage as you mentioned. it's also important, though, to point out, intel said the data center business, behaving as expected. that part of the business also important to a lot of these players like a microsoft that's seen a lot of growth in the

cloud. that is not having the same sorts of issues. doesn't seem to be an issue of business spending overall because businesses are big in data center spending. seems to be about business pcs and overall expectations, at least for president first half of the year for the pc industry. >> intel and microsoft the only dow components in the red today. >> henry blodget joining us today. >> check on the markets. dow and s&p having their best day in about a month. currently the dow up 183 points. s&p up by about 19 points. of course we did see retail sales come in negative for the month of february pr. the third month in a row. financials have been leading the broader market higher. shares of hp are slipping after barclays downgraded it to equal weight. may be hit harder by a slide in the euro than previously thought, the stock down by about half of 1%. dollar jen really rallying after earnings matched analyst estimates and the company initiated a quarterly dividend

of 22 cents a share and that is good enough for about a 3% gain on dg. >> when we come back, uber and lyft heading to court for a trial that could shape the future of the sharing economy. what this case means for both of those companies and their drivers. the former ceo of priceline and fresh direct moving into associate will join us. and apple making drastic moves at its stores ahead of the launch of the apple watch. which companies are going to be left in the cold when "squawk alley" continues. if you're running a business, legalzoom has your back. over the last 10 years we've helped one million business owners get started. visit legalzoom today for the legal help you need to start and run your business. legalzoom. legal help is here.

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welcome back. uber and lyft in separate class-action lawsuits failed to convinces u.s. juries their drivers are independent contractors rather than employees. the latter likely entitled to certain operating operating reimbursements and benefits which would increase costs for the companies. a judge saying a jury will have to decide. valuations still high in the space snagging funding but is the future of the larger sharing economy uncertain. for more bring in gary, president of the national limousine association which launched its ride responsibly complain a set of regulations for ride services now. it's a complicated space. a lot of people argue that because of the way uber in particular also lyft perhaps have attacked the space, kind of do what we want first worry about regulations after, it's

created an unfair environment for traditional limousine services. what are you presenting to throw into this argument? >> first of all, thank you for having me. the nla with over 2,000 members worldwide operating over 50,000 vehicles being in the industry for 30s year years our main cons technology is moving fast, we love technology and embracing it every day, our concern is this. it's moving so fast that we're forgetting about the passenger safety aspects of it. and that's why this week we're launching ride responsibly.org which is the first kind initiative to bring back the passenger safety aspects. >> how are you going to do that? >> so ride responsibly.org is a voluntary initiative where our members are going to be signing up to make sure that we guarantee smooth operations and mandated safety regulations we all have to abide by and that's

our main concern with on demand apps, ride hitchhiking, digital hitchhiking, and so on and so forth. >> are these newer ride sharing apps less safe than traditional taxis or livery drivers? it does seem incidents in an uber or lyft get more headlines than a taxi, but do you think there are statistics that back up these are less safe? >> you know, it's hard to say. but they are in the media every single day and there are incidents that we all read about every single day. the issue and i'll give you an example in california, california, is allowing them to operate under different guidelines and safety regulations than we have to abide by. one is employee status. we at my company in particular, in california, i have to hire an employee status driver. i have to provide health insurance. we provide 401(k) plans.

we enroll our drivers into a dmv whole notice program for their driver's license, so if they get a citation, get an alcohol or drug related charge, we are automatically notified immediately this has happened and we have to make the right decision. on top of that we have to enroll them also in a pre-drug test screening and random after that. >> you say the industry loves technology. why didn't it come up with uber before uber? >> it's a very, very difficult technology. there's no doubt about it. we've been trying to implement it the last three years. our bigst obstacle in california we couldn't even utilize app technology until january 31st, 2014, because the utilities commission forbid app technology. our industry in california was kind of tied up for a while. >> it almost had to come from the outside in a way. >> absolutely. there's no doubt about it. >> that's kind of messed up from

a regulatory standpoint. >> it's scary and that's our opinion, government has failed. government has failed to help bringman dated safety regulations across the board in an equal playing field for all of us. >> you're trying to fight fire with fire. blink card. something you yourself have been working on? >> yes. that's not the issue here. yes, our industry is trying its hardest to get new technology every day, but our main concern right now is really getting all the safety regulations on an even playing field for passenger safety, driver safety and public safety at large. >> well, i guess we'll see how that turns out. i mean, it certainly seems with all the funding that these folks have got, just hearing about lyft, another half a billion dollars in funding it will be a long fight. what would you do with a half a billion dollars? >> i would retire.

>> on behalf of the industry. >> on behalf of the industry. yes. >> come back when self-driving cars are for real. >> absolutely. that's the next big thing. >> all right. >> gary, thank you very much. up next, apple clearing room in its stores ahead of the launch of the smart watch. which companies are losing out in a moment. the markets the dow rising by about 205 points. broad broad gains across the board. "squawk alley" will be back in a minute. can it make a dentist appointment when my teeth are ready? ♪ can it tell the doctor how long you have to wear this thing? ♪ can it tell the flight attendant to please not wake me this time? ♪ the answer is yes, it can. so, the question your customers are really asking is, can your business deliver?

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fit bit, nike, jockey, the wearables you probably won't see on apple store shelves going forward as the company set to release the apple watch next month re/code found stores in l.a. and new york and san francisco are no longer carrying competing wearables. mio tells re/code that apple notified her months ago that her product would be removed from

the store but did not attribute the change to the release of the apple watch. jon, when we got a glimpse of the apple watch in september a lot of companies said our apps and technology will still be compatible which could potentially be a blow to sales. >> you can't buy a samsung phone in an apple store either so not a surprise. apple likes for people to play nice in their esko tim. might have noticed you didn't get the normal starbucks reference in the keynote this time because starbucks isn't playing with apple pay that's how i took it. maybe not why. but they cited an entirely different thing. of course tim cook on the board of nike and they'ves discontinued the fuel band but some of those others, yes, it's you versus apple now. >> yeah. tend to be friendly to those playing friendly with you. normally we have the european close for you, but because of daylight saving time the european markets close at 12:30 eastern. don't cry. you can catch simon hobbs with the close in the next hour and back on "squawk alley" in a

couple weeks. when we come back shares of shake shack taking a hit after reporting a loss in the fourth quarter. a bump in the road for the newly public burger chain? we'll talk to richard brad dock the ceo priceline and delivery direct as well. when "squawk alley" continues. .

hi, everyone. i'm sue herera. your news update at thus hour. two st. louis police officers are in serious condition after a

peaceful protest outside the ferguson police department turned violent. three shots rang out around midnight local time and the two officers were hit. one in the face, the other in the shoulder. both were rushed to the hospital. no long-term injuries are expected. iranian tv reporting iraqi troops along with shiite militia fighters have gained control of most of tikrit. the iraqi offensive against isis led by an iranian commander. a spokesman for vladimir putin has dismissed rumors on the internet the russian leader is in poor health saying the handshake was so strong it could break your hand. in london kate middleton visited the set of downtown abby and given a bouquet of flowers and spoke with one of the writers before touring the sets and meeting some of the cast. i'm jealous, i love "downton abby." back to "squawk alley."

>> pretty much. you're going to -- thank you, sue. we're getting breaking news on compensation over at coca-cola. sara eisen is on the floor. good morning, sara. >> been at the forefront of this debate we have learned according to the proxy statement filed by coke that ceo muhtar took home $22.5 million in 2014. that was a little higher than the $20.4 million he took home the year before largely due to a $7 million increase in the pension value, something we saw as cross companies not really controlled by the company. the other big headline that i think is important, is that muhtar kent did decline to take home his incentive award last year in light of what coca-cola called difficult but necessary decisions being taken at the company as it repositions for growth. we've reported on those, layoffs, cost cuts, restructuring, try to right size the business in a challenging environment for the big soda

company. that would have been worth $2.5 million. he did decline that. take out the pension out of their control, he did take home $18.1 million last year and that was a little below what he took home in 2013. obviously important in light of some of the accusations by david winters and others, coca-cola muhtar kent taking home a bit less and dekriclining the incentive. >> sara eisen with breaking news on coke. thanks so much. from travel to food our next guest has a wide range of experience. let's get the first look at the latest venture, richard brad doc executive chairman of theed board for join them, a social commerce platform the former coo of citi corp. good to see you. >> nice to be here with you. >> so you guys just raised new money and the press lease says it's the first community powered digital retailer. what is join them? >> that's important because as you mentioned in the intro i've been around the internet a long

time and i would say we're in faze two of the internet. two new trends i think dominate the next couple years. the first is mobile commerce and obviously everyone has a mobile phone today, but mobile commerce is nasen, in its earliest days, and what's going to happen with mobile commerce is, it's going to grow largely by what i would call internetizing the 90% of total retail sales today which is still off line. e-commerce is less than 10% of total retail sales. and as that happens, and what i mean by internet ties, real-time rhythm and customer targeting so the world will be in a time selling environment. and so mobile commerce is going to grow like topsy. >> how high can the number get? >> well, i think it effectively the whole world will be on the internet with mobile commerce as

long as the -- all these companies, big box retailers, are signed up for it. and there's a few implications of that in terms of functionalities that have to be built out to make it happen. let me put that aside because to your question, to me, the more important trend is the explosive arrival of social media. it's 2 billion consumers worldwide. united by a single benefit which is effectively sharing, collaboration, community. the same thing said three different ways. that is a marketer's dream. never has there been a digital collection of consumers near this large. >> crowds have a lot of buying power. you get enough people together that want a price cut on something and that's effectively what joinem is trying to do, get ten to buy something we'll take the price down by 2, 3, 10. >> why don't you sit here. >> this isn't a new idea. mercado from 15 years ago, went

under. are you sure that facebook, that twitter, that the social media sites that we have now are going to be enough to keep that from happening again? because again, this was tried 15 years ago. >> definitely. because the difference is, that we are pivoting off this core need. so our entry into the sharing economy is, as she said before, a community powered digital entry. what that means is, we are using the collaboration value, collaborative buying, to generate group buys and thousands of items. we're effectively a store, not a deal site. and to enable that to be sold at a better price than any price on the internet and we research that for the customers up front and to do that by taking our business directly to the front door of either the factory or an

early stage vendor, thereby disintermediating the supply chain on the other side. a model like priceline which was a virtual company between a vendor that tells us what price they're willing to charge at and fulfill, the orders, and a customer who comes to us off a core value that is why they're using facebook and the other sharing items and buying in bulk. so i think we have a much firmer positioning ground than the prior efforts of group buying. >> how do you get amazon on board when the model you're presenting is arguably lower margin than the model they're existing on now. how do you sell that to them? >> we're not selling to amazon. we're looking in a modest way and a pygmy in what i'm about to say to compete with amazon. we offer a true alternative way to buy. on the one side, we're offering group buying so people and we've

done a lot of consumer research, people love this idea of sharing with their friends, and then on the other side of the equation, we offer real benefits to vendors because if you're a vendor, number one, say you're samsung you're getting demand brought right to your doorstep. you're not on a shelf with apple and everyone else at retail and secondly, we're giving you that at the price you've chosen to fulfill at and thirdly, we give you tremendous data. amazon doesn't give the vendor data, best buy doesn't give the vendor data. we're going to let them know who those customers are, which will allow them to do new product research and the like going forward. >> we appreciate you being here if you can't beat them joinem that's what they say. re. ike i said you come over >> rick braddock with us at post nine. >> as we've been tauking the do you up 200 points back in the green on the dow and s&p.

bob pisani is on the floor with details. >> interesting morning because take a looks at the s&p, the strength of the premarket activity really didn't incate that we would have such a strong open. i was surprised we did so well at the open and sitting near the highs for the day. the s&p 500 if you can. this is the best day we've really had in the month here. there's our sectors. look here you will see interest rate sensitive fames like utilities and telecom doing better and other names like financials and also leading but tech and industrials a little further down. regional banks doing very well. we talked about passing the stress test and raising dividends but outperformance here even over the big money center banks, key corp and regents financial. for retail i was as disappointed as everybody else but i believe and the street does to that everybody froze their butts off in february and stayed home for a while and if you look at internet sales, you see they were up nicely, month over

month, january to february, 2.2%, year over year 8.6%. if march retail sales are crummy again then everybody will start getting worried. some of the retailers today and you can see there's no big sell-off. abercrombie down a little bit but most trading to the upside. i think the street believes that. for intel citing their weaker than expected business desk top pc demand, that certainly is a concern, but if you look here, the declines are pretty modest. seagate down earlier and has been trading to the upside all throughout the morning. looking for the glass half full today. carl? >> i'll take it from there, bob. thanks. up next more than ever are streaming their content on-line and a lot of that is thanks to the birth of one service in particular. seven years ago today. we'll explain in a moment. first rick santelli, what are you watching today? >> jon, i'll tell you what i'm watching. weak retail sales up 196 on the dow we will talk about that and

talk about the fed, kind of like a small aircraft trying to land and take off with the wind instead of against the wind and last but not least, the main event, is going to be growth versus jobs. where's the disconnect. all after the break. yoyour friends have your back. your dog's definitely got your back. but who's got your back when you need legal help? we do. we're legalzoom, and over the last 10 years, we've helped millions of people protect their families and run their businesses. we have the right people on-hand to answer your questions, backed by a trusted network of attorneys. so visit us today for legal help you can count on. legalzoom. legal help is here.

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coming up stocks roaring back today. we're discussing the best places to put your money to work right now and whether it's outside the u.s. lumber liquidators on the

offensive, why the stock is up big after the company's conference call. jim cramer in the house celebrating his tenth anniversary, he will join us live with a view of the markets and traders' portfolio. see what score jimmy gives them. coming up on the half in about 15 or so. >> thanks a lot. over to chicago and the cme and check in with rick santelli on this thursday. hey, rick. >> hi, carl. i find it fascinating and listen this is nothing new, been doing this for years and years and years, but it takes on a bit of an added dimension for two different reasons. one, of course, is that the european union has joined the quantitative easing brigade and the other reason is that fed is taunging about and soon may normalize rates meaning we'll lift off from 0 interest rate policy. when we see a weak retail sales i don't think it's as easy as we like weak numbers because the fed will continue to keep the punch bowl there. that may be a part of it and a

couple months may matter with how short the increment of holy positions is to a bulk of a park place but more important why is the stock market up? yes retail sales weak, because of what's going on with the euro and quantitative easing. second topic if you're an airplane pilot, especially small planes, if you take off and you land in the wind, it gives you better lift, better control with the wind it's like trying to go somewhere fence the current when you don't have oars in a row boat. the reason i bring it up a new topic, a lot on the santelli exchange, but a new talking point that seems to be getting more mass appeal the notion that managing the economy from a monetary policy perspective gets really difficult at 0 interest rate policy when central banks are going in different directions and especially as negative rates seem to take over the world. the argument for not raising rates are compelling until you take a step back and think it's about timing. that's why fluid monetary policy

should raise and lower a little bit not necessarily have all the built-in expectations because we have no place to go should there be a crisis and that's the new theme. the last one is this. the main event. what is going on in a market where, you know, jobs, jobs, jobs, i like to say it three times, have been doing quite well. but as i look at the first, second, third and fourth quarter of 2014 no matter how i do my math, i end up with 2.42% growth for the year averaging up four quarters of gdp. so how do we square this? i know joe curnpen has been talking about it a lot i've been talking about it a lot but in the end what we overlook are some of the simplest things and there's new studies coming out. it's good regulation is good, overregulation implied with really kind of dumb regulations and excessive regulations it creates a feedback loop. which impacts the macro and micro areas of productivity in the u.s. economy. that's the negative feedback loop and that's why jobs

forgetting what the quality is are having a tough time, you know, salmon swimming upstream because a lot of things we're doing with big government are taking the magic out of the productivity of the u.s. economy and that always has been the magic bullet. back to you. >> rick santelli in chicago, thanks. up next, tim cook tried to downplay it. rumors of some kind of apple card won't go away. what do other car companies think about apple potentially moving into the auto market? the ceo of volkswagen weighs in when we come back.

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welcome back. volkswagen is this close to becoming the largest automaker but can it get there without the u.s. catching more of the bug? see what i did there. our own phil lebeau sat down with volkswagen's chairman for a rare exclusive interview. phil? >> and thank you very much, jon. we wrapped up a day spent with dr. martin vintercorn, the chairman and ceo of the volkswagen group and the meeting that the company held here in berlin where they outlined a couple important points. the company is now saying that for all of 2014, it made a total profit of $17.9 billion euros a record profit for volkswagen. a little concern from investors that some of the profit margins for certain brands were under pressure but a couple other points stand out when you look at what volkswagen had to say, the $17.9 billion profit also comes with them announcing

they're going to be expanding production in china. they currently make 3.7 million vehicles. that is going to be increased all the way up to 5 million by 2019 and here's the reason why. when you look at the global manufacturing for the auto industry you've got toyota being number one, volkswagen number two, gm number three but volkswagen will likely pass up toyota this year. here's the doctor talking about the race for number one worldwide. >> >> translator: this could be but i keep reiterating we have four big tarts, we want to be the value number one, but we want to have 8% operating profit, the most satisfied customers and employees. those are the four targets. one is the volume. i don't know whether we'll surpass this year but we try to achieve our other targets. >> we talked to dr. vintercorn about the possibility of apple

or google possibly becoming an auto manufacturer. vw has a relationship with both companies, android auto and apple car play. they're working regarding those products. i ask do you think either apple or google will eventually build a car and sell a car? here's what he had to say. >> well, i believe that for city traffic with small cars and low speeds, they are well placed. i feel confident of them managing. but combustion engines not so much. >> he believes that both apple and google have a long ways to go in terms of the auto industry but make no mistake, they do believe there is the possibility of apple and google doing much more than what they're currently doing in the auto industry. back to you. >> great story, phil. if you're not careful they might put you on the euro boat. phil lebeau in berlin. also in the car business,

formula e continuing its inaugural season with its first u.s. race set to take place in miami on saturday. joining us this morning from miami is formula e ceo. alejandro good to have you back, had you on last april and here we are, can you believe we're finally here? >> yes, i know. thank you very much. happy to be here. it's incredible. times goes so fast. already we had four races. started in beijing and then malaysia, argentina and here we are finally in miami and it's going to be a great event. >> you said this is like going back to the '50s where it was so much more unpredictable the way the race would develop. what did you mean and how is the equipment going to hold up? >> we are back to the '50s because we've had four races and four winners. our races are totally unpredictable and we are the ath the beginning of this kind of racing. racing electric is new. we are pioneering going into completely new territory.

the race, every race, the drivers are learning what's going on. every race is different. we're expecting another one in miami this is what's happening in the beginning of combustion motor sport in the 50s. it makes it exciting. >> has that translated into demand and if so, where are you seeing the most demand for this type of racing which is much different from a spectator perspective than traditional racing? >> it has affected demand. i was on the phone, we're completely sold out in miami. looking at places to put more people. the excitement in the city is great. we focus on the younger generation. we want the younger generation to get used to electric cars, to change the perception of electric cars. if we achieve that, the kids 12, 14, when they buy their first car is electric, we'll be making a huge achievement. definitely demand from investors. we were happy to announce our major partnership with a new

shareholder liberty global a few days ago. there is also demand from oems from car manufacturers looking at the championship. they're all investing in electric. we think it is right in the best position for the future. >> we've seen the tesla videos of the insane button changing a lot of people's perceptions i think about the pick-up that you can get out of an electric car. how important is that perception shift about what you sacrifice or to the when you go electric? >> well, i think perception is one of the most important things. there are two, batteries and perception of electric cars. electric cars are the best solution today for mobility in the city. they're perfect for the city. no one does more than 10 or 15 miles a day normally in cities. this is what we want to race in the city. we bring the race inside the cities around the world to show that, you know, electric cars are the solution for the city. perception is definitely a big barrier still for many people who don't want to, you know, make the streets in electric

cars and showing cars racing in this fast, cool, kind of show, i think may help change that perception. >> it's going to be fun to watch all season long. examine back soon. we'll talk to you later. >> thank you. >> of course with formula e. when we come back seven years ago today, one of the first on-line streaming websites was launched. more on that in a moment. as we go to break check out the markets right now. dow up 193, best day since february 5. back in just a minute. [ male announcer ] your love for trading never stops.

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it's thursday and we're throwing it back to march 12th, 2008. ush usher's "love in this club" topped the charts and hulu launched to the public. then an additional round of money from private equity later that year. in 2009, disney invested and then hulu's ceo who runs his own on-line video service vessel wrote in a blog post that day, quote, as a frustrated media consumer myself at times i know we still have much work ahead of us before we can confidently say

we are bringing all the great content that's out there to users on their own terms. a report out yesterday that hulu plus is in 6.5% of american households now and, of course, the espn and hbo going over the top seems like it's been a while. >> i remember having when it first, of course, nbc was part of it and i remember talking to a senior executive saying is this the answer to television's troubles and he said i think it might be. as a concept that was a pretty good call. >> yeah. i mean a lot of people thought hulu another one of these things that will come and go but jason made his mark and hulu defined the space as something safe for content to come in and play. >> do you think there was a fatal flaw in the business model or too much capital at some of the companies doing it themselves? >> i don't know. so much money is rushing into the space following hulu's lead. look at amazon, apple, so many others. google investing in content. hard to think any of those would be doing it at the scale they are now if hulu hadn't

succeeded. >> we will spend a big part of this year as watching new entrants follow what hbo and hulu have done already. that does it for "squawk alley" as the market hangs on to a gain of 191 points. wapner has a big show. let's get back to hq, the judge and the half. ♪ >> thanks so much. welcome to the halftime show. meet our starting lineup for today. joe terranova is the senior managing director at virtus investment partners. josh brown is ceo of ritholtz wealth management jon and pete najarian the co-founders of optionmonster. member favor is cio of cambria, steve liesman here on set with us as well. our game plan looks like this. on the offensive, as lumber liquidators fights back the stock is surging we are live with the latest ahead over big interview friday with the founder of that company. pass