>>. >> good thursday morning. welcome to "squawk on the street." i'm carl quintanilla, jim cramer and david faber. who would have thought caterpillar would be a good standout? futures are relatively weak. oil claims below 300 k for the seventh week in a row. road map begins with caterpillar. reporting a beat strong dollar

citing that as part of the boost. some of the blue chip peers not getting the same love. we'll get to all of it in the premarket. >> that strong dollar is cutting into pepsico's bottom line. we'll speak to the company ceo hugh johnson in a couple of minutes. >> facebook has more monthly users than the entire population of china. the mobile ad revenue impressing some on the street. despite that revenue miss, where will the stock open today? procter and gamble quarterly profit in line but sales fell for a fifth straight quarter. currency effects weighing on 3m. caterpillar beating the street. >> we saw construction in the u.s. and north america up. that's the bright spot we have. it's fairly anemic but it's growing. it's getting better quarter by quarter. we see that.

we are happy with that. everywhere else in the world we are double-digit decreases in sales year over year regionally. we've seen a real dichotomy here in the world. >> they are upping sales guidance upping earnings guidance as some of these operateing efficiencies kick in. >> this is a good quarter. i've been critical. what is important, if you have north america and north america is significant, then you beat numbers. this is what's going on. we are seeing north american construction make a major turn. unfortunately, the rest of the world is just stacked against us. but in this case we forget america is a big market. they have cut costs. we are starting to see good inventory numbers. i had no idea how levered they were to north america. it's not a china play. if it's not a china play people want to buy it. >> too late to stay short?

they say oil will start to bite in the second quarter. >> one thing he did say this can't continue. i don't know how long china pmi will be negative like last time below 50. i don't know how the euro zone will stay as bad as it is. we had weaker numbers last night. caterpillar's u.s. business is trumping everything. their raw costs better manufacturing better. this is a change. i like twitter where yesterday "fortune" magazine credited me stopping their insider selling. >> they did. i mean "fortune" credited you and they stopped the selling. >> i'm now eating crow on caterpillar. i'm saying doug delivered. >> is he on the wall of shame? >> no. too great a manufacturer. too great. >> you thought about it. >> yes you did. >> you were close.

>> oh i was this close. this was the quarter where he may have been voted in unanimously. >> he avoided the wall of shame. >> 3m is a miss at $1.85. revenue is a miss. they see the dollar impact two times what they saw prior. >> he still delivered. you've got to go line by line. he gave you organic growth i'm looking for. this is no better or worse than the other major industrials. i think the stock has to come in just because no one thought it was this bad. this was like a basket of currencies you had to be short and they're in them. i did like the organic growth. he did operating margins plus 22.8, that's up 9%. still did 3.3%. this is positive. all the areas, all business groups on geographies. don't write off 3m. 3m did a good job. the stock had gone up a lot. >> facebook first quarter revenue, growth shy of forecast.

weighed down by the stronger dollar. mobile ad revenue 73% of the company's total revenue. earnings did exceed consensus. higher spending on r&d. last night you said that's the price you pay for opportunity. >> i'll tell you right now, the people selling this stave off that revenue miss. they were not on the quarter. they did not listen to this conference call, which was a thing of beauty. i'm saying it right here. talking about 5% u.s. consumer we are not close to 5%. they haven't thrown out the first pitch yet. this is the story i thought was magnificent. yes, they spent. why? they are building an international cable system. you are know going to have content they are so cognizant they are turning down so much business. they are turning down business. the phone is ringing right now.

>> it's all user content. >> it is interesting when you look at employee numbers well below that. yahoo. there are purer plays at facebook than yahoo. >> video exploding facebook. people selling the stock. i was on the conference call. my wife was saying what are you doing? what are you doing? two hours you are on the call. how about texas instruments? stop it already. let's watch a new "criminal minds." no. i'm going over this quarter. i had to listen to the conference call twice because i couldn't believe the stock was down $2 given this is the great international growth story. >> desktop to mobile. this is the story.

>> this works better than mobile. >> payments take place typically on desktop have been plummeting. it shows how. it's all mobile. it's all mobile. that's what the story is. >> international cable company. the numbers are extraordinary here. there are 2 billion people on this thing when they are finished. the numbers are explosive. 800 million? i thought that was supposed to be a write-off. we paid a lot. don't think we are just going to do nothing with it. >> but it's 33 times 16 numbers. do i want to pay 33 times 16? >> you want to pay 24 times some shampoo company? >> no. not necessarily. >> no. >> it grows at one on a good day. it's 100% better. i like clorox. well managed company. this is a company with genuine growth. and they are restraining the amount of money they take in because this guy zuckerberg

doesn't want to destroy things. >> we've seen price targets in the $130 range. when is it too expensive? >> i think it's too expensive when, if we do not see -- i think we could go to $100. i do think at a certain point if they continue to say, listen we do not need to take the ad revenue because we are worried about the experience too much we'll be paying too much. not right now the guys there are these algorithms that sell stocks when they miss by x. they are down to $81.78 last night at 5:30. that was insane. the growth is amazing. >> you don't have a problem with that do you? >> i don't have another growth story like this. i don't have one. zuckerberg's quite eloquent. >> they are hard to find

companies growing revenues at 42%. >> with $1.4 billion. >> sandberg is just start now getting movie ads and entertainment. somebody asked a question. when is geico going to start? >> don't forget instagram. >> when do you start doing video on instagram? >> when zuckerberg says it's not a turn-off. we'll start thinking about programming that goes through it. this is comcast without nbc. >> when is the fcc and doj going to shut them down? >> facebook? knowing these guys? >> that was a joke. >> it's usually my role to be sarcastics. married guys aren't sarcastic. >> you lost your edge. it didn't take long.

half the revenues are from overseas. people don't think about it as a potential victim of the dollar. >> who notices that? there's a line charles sandberg is talking about small business who would never be able to hire a film crew to put videos on. they are saying tv is too expensive. they are saying something i'm hearing over and over again. it's cheaper to advertise on facebook than on tv. you still need tv. you still need the super bowl ad, no doubt about it. this is the way to reach internationally, inexpensive way to reach a billion people. all right. i'm done. i'm done. >> okay. actually, no you're not. there is more to come. >> i've got to talk at&t a little bit. we've got qualcomm. >> that's exciting. >> we've got more. >> a lot more winners and losers this morning. we'll get to what is the busiest day of earnings season. hugh johnston will join us.

facing challenges due to the stronger dollar. take one more look at the premarket.

pepsico results out the first quarter with the top and bottom line. for more on this quarter, joining us now first on cnbc hugh johnston chief financial officer of pepsico. always good to see you. how are you? >> i'm doing great, jim. happy to be here this morning and happy to report a terrifically strong start to the year for us. 4.4% revenue growth. gross margins up 150 basis points. strength across the portfolio. managing cash flow. we feel good about the start of the year. we are up to a solid start. >> i know you are proud of this quarter. looks like pricing is holding up well.

advertising in marketing is giving you a bigger bang than previous. >> pricing is holding up well both in north america and around the globe. we saw 3% pricing in beverages we feel great about. we are getting good returns on those investments. you recall we've been increasing advertising and percent of sales and seeing top line working right now the revenue group numbers look good at this point. >> i saw improvement in quaker. you've been personally involved with that. i've been upset quaker wants a great brand name. it's the turn. >> we are turning the corner of quaker, without a doubt. we are seeing more innovation out there. in this quarter we launched three minutes steel cut oatmeal so you could have a great bowl in three minutes. it's a terrific product. you'll see more good things coming out of quaker. we've been gaining market share across all the categories. snack bars oatmeal, cereals.

the business is starting to perform well. >> ten consecutive quarters of gross margin improvement after that restructures. how long does that string go? >> i think we can do it for a long time to come. i think the combination, number one we are getting stronger and stronger productivity. the company hit its stride in terms of driving productivity. everybody in the company is relentlessly focused on that. we are getting good solid pricing. therefore, that is a more sustainable pricing. you will continue to see gross margin improvements. >> we keep getting earnings reports and the dollar is the common thread. we keep hearing about mix and sourcing and all the things you do when you're up against a currency. how hard is that and how hard is it in markets where the currency effect is the most acute? >> it's a lot of heavy lifting. i think the pepsico people

around the world are doing a great job managing. right now it's a head wind. localize as much as we can. number two, price what we have to price responsibly. we have to be careful about how we do that. number three, really focus on labor and nonlabor costs. it's a lot of heavy lifting for a lot of people. our people are committed to delivering results. we feel great about how it's working. >> frito lay is a strong quarter. take a look at the combination of snacks and carbonated. you've got a new fellow on the board, mr. johnson. he is a nelson peltz sponsored individual but paid by your regular board. do you think he will see these combinations make sense and would not make sense to split carbonated from snacks, given the fact you are a snack company but that you do get good cash

flow from carbonate? >> i think all of our board members are comfortable with the fact we reached the conclusion that the portfolio truly is better together. we see it developing in emerging markets where the beverage business serves as a great platform for the snacks business. we see it in markets like north america. last quarter frito lay was the number one contributor to retails sales growth across the retail channels. this quarter and north america beverages, we are number one and frito lay is number two. there is no reason to make any change to that. any change we make would be a negative. >> isn't there a bit of irony here. old days i would look at emerging markets of pepsico growth look at china, maybe europe, the rollout. this is a north american story because how strong our country is. >> it is both. without a doubt the americas are

performing very well right now. in addition to that developing emerging markets grew 10% for us on the quarter. we wouldn't put them in the back seat by any stretch of the imagination. what you are seeing more than anything else is the portfolio is working very well together. whether it's a product portfolio, geographic portfolio. frankly, a lot of that is powered by great marketing and great innovation, all funded by that relentless focus on productivity. that is making pepsico work. that's why we are delivering the results we are. >> thank you very much. yes gross margins is the story. that is relentless productivity and well received advertising. thank you for coming on the show, hugh. >> thank you. great to be with you guys. >> tomorrow sara eisen will sit down with coca-cola ceo muhtar kent and kathy waller. >> carbonated is just a small percentage of pepsico versus coca-cola. diet which is down but not down as much as sara pointed out, not

a factor in pepsico. these are very different companies now. very different companies. wouldn't put them in the same category. >> interesting. people say pepsi coke. >> monster beverage and keurig green mountain. >> we'll get to duncan earnings, a countdown to the opening bell.

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so many things to hit. i spoke to at&t cfo about that quarter. stock is looking up. >> this is a good opportunity for me to ask you something. i looked at the quarter. i know that directv is going to be a game-changer for them. frankly, earnings down. i don't understand. this is the most widely asked stock on "mad money." >> really? >> yeah everyone, at&t at&t. >> raised cost synergies. why now? i did with the cfo. he said we have more time to analyze all the different ways we are going to benefit from the transaction on the cost side. full analysis during this

interim period. you are talking about things like we can do one truck roll single ads, scale on supply chain. they knew all that but now they are being able to quantify a better way. not that people didn't expect they would raise those numbers, but $2.5 billion. that may be one of the key reasons. >> thank you. >> it had decent turn. second lowest of all time. people look at the additions and say most of it's tablets. stevens makes the point, yes, but we are losing feature phones. we are actually gaining smart phones. >> that is something verizon said 20% are feature phones. >> 16% of their subscriber base 10 to 11 million people is feature phones. >> isn't that incredible? the dumb phone still lives. i like the yield here. i said i didn't think they had that growth. that helps me.

>> that will come down once they do the directv deal. >> that's great. let me give you really oxygenated growth. domino's. i was looking for 8% growth domestically. they gave me 14.5%. people are sitting there on facebook eating pizza. there is no other way to explain it. look at this. remember, this is where he came here when he started. what did he say? boy, the pizza tastes bad. >> that's social mobile. >> you stole it from me. it's social and mobile. >> it's because i listen. >> thank you. paddy doyle, the single beth user of technology when it comes to advertising.

there are no mistaken orders because you do it on your cell phone. you don't have to give the guy a tip. you can do it on your cell phone. it has a great app. if you haven't had a domino's lately it's on me. they can do it with uber. >> they can do that. >> less than four minutes till the opening bell. female announcer: sleep train's interest free for 3 event! is ending soon! get three years interest-free financing on beautyrest black,

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you are watching cnbc "squawk on the street." opening bell in 30 seconds on this thursday. we've got 170 s&p companies under our belt. we've gotten to cat and facebook domino's and 3m.

tonight amazon google microsoft and starbucks which after duncan and domino's has to deliver the mail. >> duncan was a very big pick-up in actual business. it's a better quarter. i did not think it was that much coffee related. what i think you saw duncan do was recover from weak numbers. >> there is the opening bell. nobilis health. over at the nasdaq it's live code training young kids with autism how to cope. baskin up 8. >> tun can.

duncan, i'm worried about how hot my coffee is. the dollar is killing people. >> gm is a miss on the top and bottom line. north american gross margin is the best they had anywhere since bankruptcy. >> my charitable trust owns that stock. soon as i saw latin america, then europe. the u.s. is so strong. gm is a mistake.

you just don't know when latin america is going to come back. i don't believe in latin america. >> it's been a mistake for a while now. why don't you sell it? >> i was wrong. i thought they would buy some of the stock back. >> incredibly cheap. great cash flow. >> i should have bought more health care growth. it was a mistake. did it wrong. he does not think the dollar is significant head wind. >> there goes money for charity. i would rather give it to charity than to gm. >> procter. 92 cents is a beat. revenue a miss.

organic sales up one. currency takes away eight. >> i wasn't that thrilled with procter. this is the best they can do. give me colgate. honestly. procter wasn't exciting to me. i would rather be in unilever. that's the other side of the trade. >> they've got the beauty care assets. they've got a big sale coming up there. i think first round bids were due yesterday on that. that's moving along. >> beauty down four. >> they'll get a big number when they sell that thing. >> looking for low single-digit organic growth. organic growth is ugly. it's minus two volume. procter is a great company. unilever is in the driver's seat because all the fabulous trading partners crush us.

>> been following qualcomm since they announced that plan to buyback. they did buy back some during the quarter. jana with a $2 billion position advocating for a close look at the idea of splitting the company into two and even saying buy back more stock more quickly or buy back more quickly. they reported earnings last night, not a great reception. they are finding competitive challenges. we talked a lot about samsung. incertainly producing their own chip set instead of using qualcomm. it's the modem. apple goes with its own part of chip, as well to a certain extent. they are finding pressure there we asked the qualcomm ceo to come on and they declined. i gave an interview to the "journal" but not to us.

>> when we see a lot of win or loser. >> loser. >> polaris with a great quarter. yesterday harley-davidson cutting back. >> how about pulte? closing down two. >> horton was very strong. we are seeing within groups we are seeing winners and losers. i think that's important to point out. >> what is that about, execution? >> yes. >> plain and simple? >> yes. it is just execution. we are seeing clumsy execution with some companies. >> texas instruments quarter shocked me. they shocked me. they said there was a sharp drop-off in pcs. talking about the wireless business saying you can delay an order. texas instrument analysts were shocked. one of the most consistent terrific stocks. >> airlines hanging in there. southwest is a beat. revenues in line. same story for united

continental. ual is in the red. >> there is an example. continental did not execute, as well. did not make as much money per passenger. southwest was on this morning. you've got some terrific unit cost declining. winner and loser right there. it's happening. >> hershey, $1.09 misses $1.16, cutting their guidance. i made a list of guidance cuts. hershey, qualcomm texas, 3m johnson controls. half a dozen or so. >> i look at these companies and think how many of them have the overseas exposure? how many have something to do like look at union pacific. which was at critical level. it's frack sand and coal. and the west coast port situation. a lot of excuses. i think i will tell you, there

are some excuses, but a lot of what they do is get their head beat in. >> i've seen a few mentions of higher than expected tax rates. the usual suspects. >> some of that stuff. let's put it this way. how does andrew livers deliver this is numbers? getting out of the commodity businesses, going higher up the food chain lower the cost dramatically. i like that. that's self-help. they are doing what's right versus dupont, which some people were questioning. >> yes. >> questioning dupont. >> in terms of guidance. >> yeah. dow's guidance was amazing. >> we moved to the lower end of a range. that's why we have a range. we have a range for a reason. >> dupont has been a good performer. dow is shining. they have billions to buy back. they've been getting out of the low. they are all value added.

line items are there. it's electronics is good. tremendous number of things that are good for dell. meanwhile, they have this very little exposure to oil. if oil goes higher algorithms say buy down. >> ebay is up sharply. >> what a quarter. >> almost up 5%. they did release first quarter numbers last night. they did provide second quarter guidance. that was in line with consensus on the earnings per share line. big story is split's coming. >> 165 million active users. it will be incredibly well capitalized. tremendous cash flow. this will be like your millenniums of credit card company. it's remarkable. they are doing great mobile. migrating very good to mobile.

anybody migrating good to mobile, you are going to see people like them. if you have a facebook up a lot aahead of the quarter. ebay did not run. people were worried about gross merchandise. that was pretty good. >> marketplace was obviously more under pressure. paypal. >> much i'm very impressed by what they had to say about paypal that. was a very well organized conference call. and donahoe said here's the ball, guys. you tell the story. where is he going to go? what will he do? >> take time on the beach, rest. he is a young guy, will come back. first take a nice few deep breaths and decompress. >> the split looks great. he is a very gracious man. >> we are hearing the president is going to deliver a statement in the brady press briefing room

at 10:00 a.m. eastern time. waiting on more clarity what that might involve. later in the afternoon he will welcome -- let's go to ahman javers in washington. >> we don't have official word from the white house about what the president will say at the top of the hour. we have a new statement here from the press secretary. this is a fascinating one, saying it is with tremendous sorrow that we recently concluded a u.s. government counterterrorism operation in january killed two innocent hostages held by al qaeda. the press secretary saying our hearts go out to the families of dr. warren weinstein, an american held by al qaeda since 2011 and giovanni loporto who had been a hostage since 2012. the white house saying all analysis of available information led the intelligence community to judge with high confidence the operation accidentally killed two hostages. they say here in the statement

that this attack happened in the border region of afghanistan and pakistan and the white house press secretary saying no words can fully express our regret over this terrible tragedy. the white house also saying two other americans were recently killed in u.s. government counterterrorism operations in the same region. they are saying ahmed farouk was killed in the same operation that resulted in the deaths of dr. weinstein and mr. loporto and concluded adam gadan, an american who became a prominent member of al qaeda was killed in january, likely in a separate u.s. government counterterrorism operation. apparently, a tragic result in an operation and the u.s. government concluding those two innocent hostages were killed in that counterterrorism operation. >> ahman javers in washington thank you for that. we'll take the president's statement live at the top of the hour. dow down 50. book ended by dow on the down side.

cat on the up side. >> we are weaker down about 50 points. dow industrials are weak. staples, as well. overseas, i thought the global economy was getting better we have very disappointing economic results. i thought a weaker euro would support exports. pmi was below expectations. i was surprised. greece is up a little bit on big optimism what about china? asia is on a tear again. nikkei shanghai seven-year high. shen zen, historic high. it's below 50. more stimulus is coming. they cut the reserve requirements for banks on sunday. i think an interest rate cut will come next. surprising here numbers are so weak. turn to the u.s. you talk about the dollar. it's the big story. i want to show you exactly what's going on with the dollar here and what the company is

saying. 3m said 2015 sales would be 6% 7% lower because of the strong dollar. dr. pepper said sales would be 1% lower. lilly said the first quarter revenues were 6% lower. these are huge numbers for companies. hershey said it was 1.1% lower, as well. there is enough data points to clearly indicate multinationals are getting hurt. look at the numbers. companies that have less than 50% of sales outside the united states, domestic essentially, revenues are up 0.1%. companies with more than 50% of sales outside the united states revenues are down over 10%. there is the clear evidence the dollar is hurting the multinational companies right now. let's talk about pulte. pulte missed on top and bottom

line. they are getting killed today. their numbers were eh. if you want to see the effect of the weaker fracking activity on the home building industry it's clear if you lift the hood on pulte's numbers. orders were up 6%. up nicely in the southeast and southwest and north. texas was down 5%. that's a clear sign slowing energy business is starting to affect home building. we saw this yesterday as well with united rentals. certain parts of the country where there is significant energy business. lower equipment rentals, as well. dow is down 55 points. >> thank you very much bob pisani. likelihood seems to be growing every moment the doj and fcc will move to try to stop comcast from buying time warner cable. latest reports from the "wall street journal" indicating the likelihood that the staff at the

fcc will recommend taking the case to an administrative law judge. this is done very rarely and almost always spells the death knell for a deal. doesn't mean comcast won't stay in there and keep battling and take this all the way down to let's call it august at least. when merger agreement was come to an end. given the coordinated messages coming from the doj and fcc, even though the cases they may be making may not be based on logic, necessarily, nonetheless, it is a pretty good way to kill the deal. the question, and i don't have the answer and nobody does what will comcast and time warner choose to do here if that is the case. keep fighting and working it? seeing what they can get to in terms of potential deal which would require what seems to be large divestitures to try to

satisfy regulators or simply walk away? what is plan b for time warner cable or plan b for comcast are key questions. the focus seems to have been on the market power in terms of broadband. comcast probably has 40 some-odd percent already. comcast has spent the money to upgrade. that is a key consideration here but one that seems lost on the fcc. likelihood charter wants to still buy time warner cable. i feel comfortable reporting that. will time warner cable be comfortable trying to sell itself again or does time warner cable want to potentially go on its own or be the consolidator? those are key questions.

shares are down though not down sharply. given the value of the charter deal, the old deal is above current price because charter has done well. many may start to say why didn't you consider charter. it would already be done. all those concerns you had about charter and the paper have not been borne out by the marketplace. look at charter stock price. if charter does pursue that or time warner was interested charter would drop the bright house deal. you would not have great land which would be a large cable company. so many different things here. what is comcast going to do? our parent company not getting any comment out of them. >> stock's higher. >> something, maybe short covering. maybe if the deal falls apart they institute a large buy back

because you wouldn't expect that? many people believe the strategic logic was compelling. you wonder what does comcast do to grow. you can't get bigger than cable. do you go international? do you look at wireless company? do you look at content again? there are so many different potential roads. i don't have the answers. we've got a lot of questions. >> i was hoping this deal would go through with comcast obviously because time warner is not that great an operator. comcast a much better operator. >> i was hoping i would get free cable. they could buy stock. i think you are right. it was low hanging fruit for this deal. they war thinking come on. is where the overlap? >> there is no overlap.

many people say they might prevail were they to take the doj to court. that's almost always a no-win. we'll be watching it. a lot of different moving parts here. let's get to the bond pits in chicago. >> home on the range. no matter what market you are looking at. highly up changed. that doesn't mean there isn't volatility. i'm looking at closing basis. look at one-day chart of 10s. there is movement. we move right back to the unchanged line. look at two day. it jumps out at you. look at the two-day bund. notice high yield today about 16.5 17 basis points. it's double. that doesn't really tell you the whole truth, does it?

if we continue with that range mentality, put the sharp back to mid march. talking over five weeks. closing range there between 1.85 and 1.98. let's do the same thing with s&ps. it's had a lot of volatility. virtually in a 50-point range. it's trading now upper end of the range. euro/dollar. we want to monitor these ranges. you know what happens when you stand on a spring long enough and lift your foot? it pops a bit. >> tomorrow on this program, sara eisen's exclusive interview with the chairman and ceo of coca-cola. down is down 50 points.

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time for cramer and stop trading. >> one of the most heavily shorted stocks i follow is skechers. we have them on tonight. another remarkable quarter. anyone who hasn't tried the shoes, to that before they short it. this is the comfort shoe play. congratulations to skechers. they'll be on tonight. i can't wait. domino's is up the most today. it's a technology play. we'll talk about that. and snap-on, another technology play hitting an all-time high this morning. three of the biggest winners in the s&p. >> see you tonight. >> thank you. >> "mad money" 6:00 p.m. new home sales and the president speaking in a moment. s 11 intelligent driver-assist systems. it recognizes pedestrians and alerts you. warns you about incoming cross-traffic. cameras and radar detect dangers you don't. and it can even stop by itself. so in this crash test, one thing's missing: a crash.

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we begin this morning with breaking news. the president expected to make a statement in a few moments after the white house says a u.s. government counterterrorism operation in january killed two innocent hostages that were held by al qaeda, an american and italian national. this information was classified until today.

the president directing that the information be shared today as the white house says quote, he takes full responsibility for these operations and believes it is important to provide the american people with as much information as possible about our counterterrorism operations." we will await the president's remarks assuming he is relatively on time and bring it to you as soon as it happens. >> march new home sales, 481,000. that's down over 11%, but it's from an upwardly revised march -- excuse me, february. it's now standing at 543, but those are the best levels since february of '08. of course with that revision this is the first number of the year that it's under 500,000. we finished up last year at 479. ten years ago this number is

1.328 million. to talk about all of that is our resident expert diana olick. >> prices did come down a little bit, down 1.7% year over year. we've been watching prices closely because they've been getting high for builders pricing buyers out. these are signed contracts in march. not closings. existing home sales numbers are closing. these are much more immediate. we know this is the number of people out in march buying homes, signing those contracts. the supply did rise to 5.3 month supply up from 4.7 month supply in february. that is a good sign to get more of these homes. realtors have been begging for builders to put more homes up and get the inventory level higher. that is holding the market back. this is not as big a disappoint as it sounds. down 11.4% month-to-month. you had that upward revision

from february. it's fits and starts in this housing recovery. this is not a terrible number but we would like to see sales numbers rise. we saw pulte homes with a big miss today. not as many sales as expected. not seeing as robust a march as they expected. hopefully things will improve a little bit. it's good to see those prices come down. back to you. >> diana olick in washington. facebook shares up slightly after revenue did fall short of analyst estimates. facebook experiencing its slowest growth in eight quarters battling rising costs. how can the company turn things around? joining us colin sebastian from robbed w. baird. stocks not showing acute concerns about expenses. how concerned are you? >> expenses are part of the fabric for facebook currently. they are investing in near term intermediate term and long term growth initiatives, putting user experience first. that's part of the strategy.

i think investors understand that. quite frankly, the concerns on the stock are more related to currency and high expectations on the revenue side going into the quarter. >> how did the impact of the dollar surprise you either way? >> i think it was magnified a bit. especially towards the end of the quarter. that's part of the story, for sure. there is an element to the other side is advertisers in europe spend less money perhaps than we expected. peeling back the onion, the core advertising revenues beat the street's expectations. in terms of looking ahead, i think that's the key metric. >> interesting you mention what's happening in europe. credit swiss say they are doubling down their conviction of the stock because of the outperformance. in this country you monetize users almost three times as well as they do in europe. if that trend continues there, obviously, there is a lot more

money to be made. what are your views on that? >> there is a large gap. part of the facebook growth story is expanding arpu in regions outside north america. from day one that's been part of the thesis. arpu is quite a discount in europe to north america. that's the opportunity there. more than that or in addition to that, the growth in online video as well as facebook powering ads off its own applications on their ad network as well as instagram, these are tail winds for growth going forward. >> 40 times 2016. is that including compensation expense or not? >> yeah. stock base compensation is certainly a reasonable expense for facebook in silicon valley with the employee base that they're building. we certainly do contemplate that in our valuation. >> your price target $96.

it's conservative compared to other calls we are seeing. >> we raised our price target ahead of their report. the advertiser checks we conducted were very positive through the quarter. i think we saw that play out in the core advertising revenues. you are seeing a little bit of catch up i think. >> are you sensing any appetite? it's amazing what a beautiful buy instagram was and clearly turned out to be a huge success despite criticisms about the price tag early on. is there appetite for a large-physical acquisition? is it whetted still? >> i think facebook has, to some extent, an open checkbook. they have currency in the form of their stock. i think they are watching trends very closely. obviously, virtual reality is an area they pursued last year. so we would not be surprised to see some more consolidation from facebook. >> any idea where that might be

targeted? other public companies, public rivals? i think you know where i'm going. >> we can't speculate specifically on companies they might acquire, i'm sorry. >> all right. we'll see where it goes. clearly, performing relatively well despite some of the criticism last night. colin sebastian at robert w. baird. let's bring in john silvia chief economist with wells fargo securities. good morning. >> good morning. where are we on housing? perhaps new home sales are not what we hoped for. yesterday existing home sales came through at an 18-month high. that led many people to suggest it will be a strong spring selling season and that will further encourage the housing market. what do you think? >> i agree with the encouragement argument. i think diana had it right. there's been an upward trend in

housing sales both new and existing the last six months to a year. not historically as strong. the key is inventories are up and prices were down a little bit, suggesting to me that the market is broadening out. a lot of the new home sales are less expensive for a home than they were maybe three or four months ago. it seems the market is broadening out. it's a good sign for the housing market. >> interesting. where does that lead us then with the fed and broader market overall? paul richards at ubs put a note out today that said it's risk on for the markets about another week. then we go into extreme caution for the employment report on may 8th. as he put it it's a binary event. we are not going to get interest rate rises this year i paraphrase, or it's a strong report and we head towards lift-off. that will worry a lot of people. where are you? >> it is a problem right now.

as you sense, when we had a weak employment report people pushed back expectations for further fed action. when you have a strong number expectations start moving up and we may see more volatility here between the june or september choices. it's a little bit tricky. remember with respect to housing you, get a sense housing is a little sensitive to those changes in interest rates. i think fed will be very cautious raising rates and probably not june but more likely september at this point. >> interesting. that leads us to this question of what happens to the treasury market on interest rate rises from the fed? for many people german bunds are now the canary in the coal mine because some people would say you've got a clear bubble there. yesterday we had -- you almost doubled the yield yesterday in that sharp sell-off in bunds. you saw treasuries reacting in this country. what does that move say, if anything, as to where we would go on an interest rate rise? >> what it tells me you are on

a bubble. there's a lot of volatility here. people are not quite sure where those rates are going. once again going back to your argument with respect to the employment number, and that is not clear interest rates are going to continue to decline for all time over the next three to six months. and that is very much a volatile situation. big bets are probably not advised at this point. >> is that what you tell clients? >> absolutely. i tell them to be very very cautious here with respect to the bond market with respect to the fed changing policy and the volatility that's involved whenever that market turns, whether it's 2004 or 1994. that policy changes. markets can be quite volatile and go in the wrong direction for you. >> briefly, sir, on stocks. what is the conclusion there? >> the story is i think, the central banks were made expansionary and profit growth

continues to improve. perhaps not at the pace some people expect but seems like for a lot of people equity markets are still an attractive investment. >> do you think core cpi is here to stay? are we going to start to run hotter not cooler? >> i will tell you, inflation is average less than 2% since 1994. my bet is modest inflation is the story for the next two to three years. >> what does energy add on top of that? any idea? that is a tougher call to make. it seems some are calling for oil to have crept out of the mid 40s as we are at $57 today. >> what you'll see there, of course is not core cpi but overall cpi and year over year basis continuing to creep up for the next three to four months. maybe some acceleration in the second half of the year when there is year over year comparisons become more dramatic. the core cpi, i think, we'll be

fairly steady here. >> good to see you. thank you for the advice john silvia, wells fargo security chief advisor. >>. >> the white house this morning put out a statement saying it's with tremendous sorrow we recently concluded the u.s. counterterrorism operation in january killed two innocent hostages held by al qaeda. this is an american and an italian national. here comes the president now. this morning, i want to express our grief and condolences to the families of two hostages. one american dr. warren weinstein. and an italian giovanni laporto who were tragically killed in a u.s. counterterrorism operation.

warren and giovanni were aide workers in pakistan devoted to improving the lives of the pakistani people. after warren was abducted by al qaeda in 2011 i directed my national security team to do everything possible to find him and bring him home safely to his family. dedicated professionals across our government worked tirelessly to do so. we worked closely with our italian allies on behalf of giovanni who was kidnapped in 2012. since 9/11 our efforts have prevented terrorist attacks and saved innocent lives here in america and around the world. that determination to protect innocent life only makes the loss of these two men especially painful for all of us. based on information and intelligence we have obtained we believe that a u.s.

counterterrorism operation targeting an al qaeda compound in the afghanistan/pakistan border region accidentally killed warren and giovanni this past january. yesterday i spoke with warren's wife elaine and prime minister renzi of italy. as a husband and father i cannot begin to imagine the anguish weinstein and laporto families are enduring today. i realize there are no words that can ever equal their loss. i know there is nothing i can ever say or do to ease their heartache. today i simply want to say this. as president and commander in chief, i take full responsibility for all our counterterrorism operations including the one that inadvertently took the lives of warren and giovanni. i profoundly regret what happened. on behalf of the united states government, i offer our deepest apologies to the families.

as soon as we determine the cause of their deaths i directed the existence of this operation be declassified and disclosed publicly. i did so because the weinstein and laporto families deserve to know the truth. i did so because as certain aspects of our national security efforts have to remain secret to succeed, the united states is a democracy vetted to openness in good times and bad. our initial assessment indicates this operation was fully consistent with the guidelines we conduct counterterrorism efforts in the region. which has been our focus for years because it is the home of al qaeda's leadership. and based on the intelligence we had obtained at the time including hundreds of hours of surveillance we believed that this was an al qaeda compound that no civilians were present, and that capturing these terrorists was not possible.

we do believe that the operation did take out dangerous members of al qaeda. what we did not know tragically is al qaeda was hiding the presence of warren and giovanni in this same compound. it is a cruel and bitter truth that in the fog of war generally, and our fight against terrorists specifically mistakes sometimes deadly mistakes can occur. but one of the things that sets america apart from many other nations, one of the things that makes us exceptional is our willingness to confront squarely our imperfections and to learn from our mistakes. already, i have directed a full review of what happened. we will identify the lessons that can be learned from this tragedy, and any changes that should be made. we will do our utmost to ensure it is not repeated. we will continue to do

everything we can to prevent the loss of innocent lives, not just innocent americans, but all innocent lives in our counterterrorism operations. today we joined their families and friends honoring warren and giovanni. two humanitarians united by a spirit of service. for decades, warren lived the ideals of our country, serving with the peace corps and later with the united states agency for international development. devoted his life to people across africa and south asia. he was a loving husband, father and grandfather who willingly left the comforts of home to help the people in pakistan. at the time of his abduction, he was a usaid contractor helping families escape poverty and give a better life to their children. giovanni's humanitarianism also

took him around the world, to the central african republic to haiti and ultimately pakistan. like warren he fell in love with pakistan and its people and believed passionately he could make a difference in their lives. giovanni's service reflected the commitment of the italian people, our great allies and friends, to the security and dignity of the people around the world. today is a reminder the bonds of friendship between our countries and the shared values that bind americans and italians together. there could be no starker contrast between these two selfless men and their al qaeda captors. warren's work benefited people across space. al qaeda boasted to the world it held warren citing his jewish faith. al qaeda held both men for years, even as warren's health deteriorated. they deprived these men of

precious irreplaceable years with family who missed them terribly. amid grief that is unimaginable i pray these two families will find some small measure of solace knowing warren and giovanni's legacy will endure. their service will be remembered by the pakistani men, women and children whose lives they touched and made better. their spirit will live on in the lives of their families who live on today especially his wife elaine, his daughters and their families. the shining example of these two men will stand as a light to people the world over who see suffering and answer with compassion. who see hatred and offer love. who see war and work toward peace. god bless these two great men

and watch and comfort their families through the years. >> that is the president offering what he called deepest apologies to the families of two al qaeda hostages who were killed in u.s. counterterrorism operations in january. he did point out the operations did take out dangerous elements of al qaeda, but said in the fog of war, mistakes are sometimes made. something he called a cruel and bitter truth. >> he says he takes full responsibility for all counterterrorism operations. this drone campaign in and around that hindu kush areas has been one of the signatures of the counterterrorism policy for years. it's been criticized by people who say it has this disadvantage of killing potentially innocent people. now we are seeing the united states acknowledge the first time two innocent hostages were in fact, killed.

more news from nbc news of what unfolded here. reporting that dr. weinstein and giovanni were killed with ahmed farouk and nbc saying those two strikes occurred on january 14th and january 19th. the president going on at length about the biographies of these innocent hostages who were killed apologizing to their families. obviously a devastating moment for the president personally and this drone campaign. >> eamon javers in washington. back in a moment.g 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.

starbucks releases second quarter earnings after the bell today. a big part of their growth plan involves not coffee but tea. courtney reagan joins with us a special guest on that topic. >> good morning. i am here in tusian arizona, at the global retailing conference joined by annie young scribner involved with all of teavana. if we can talk about teavanna. is there a fear it's can balancizing what's sold in stores is cannibalizeing the stores itself? >> tea is growing.

tea and coffee are completely complementary. since our first store in 1971 we sold tea. the consumer tea needs are different. >> tea is the number two beverage in the world behind water. much bigger perhaps in some international markets. it international the growth plan for teavana? >> we are in 66 countries across the globe for star buck. leveraging that scale to grow teavana is in the cards. we are only in seven countries today. it's definitely a growth story. >> 87% of millennials are tea drinkers. that was a statistic that surprised me. is teavana able to capture that very important demographic? >> we are seeing millennials coming in. customers are telling us the millennials love tea for a couple of things. they understand the health benefits and they understand the different flavor profiles you can have. we offer the best quality tea

and also over 100 different blends. >> what about consumer packaged goods? starbucks sold in many locations. is that in the cards for teavana? >> ready to drink is absolutely in the cards. we have a second brand tazo which continues to do very well in that super premium category down the aisle. >> you have about 350 locations. is mall traffic declining or mall traffic a problem for growth? >> great thing about our stores we are providing an experience for our customers. when you walk in you smell the tea. you learn all tea come from one leaf, white, green, oolong and black depending on oxidation. we help our customers choose their tea. >> experience is a big part of retail. at the conference we are speaking a lot about the future

of retail. giving consumers a reason to go and shop in physical locations. is that part of teavana's plan? >> teaching our customers, engaging with them educating them on tea, helping them find their tea, and we offer beverages at teavana. you can grab a beverage grab a gift. it's a great opportunity for people to learn and engage. >> thank you so much. hopefully we'll learn more about the performance when starbucks reports their earnings today after the bell. howard schultz is the ceo of starbucks he'll be on closing bell. thank you. when we come back caterpillar getting a nice boost. the ceo is quick to warn the company will not be this strong for the whole year.

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reporting from the nymex. right in line with expectations. taking prices down a little bit. we were at 2.55. it's a weather story. more injection here on the east coast. that's because we are seeing seasonal temperatures not a need for heat right now. not a need for air conditioning. traders questioning where these prices can go. how low they can go? we've been talking about that

2.25 range but hanging in this 2.50 area. traders want to see how this spring and summer season develops. could be a hot one. wait and see approach when it comes to natural gas. now to melissa lee with your cnbc business news updates. >> thank you very much. i'm melissa lee. president obama expressing sorrow over u.s. counterterrorism operations that killed an american and italian hostage held by al qaeda. as well as two americans who were working with the terror organization. american warren weinstein and italian giovanni laporto were killed in january. deutsche bank will pay $2.5 million. they agreed to terminate and ban employees who engage in misconduct and install an independent monitor. a volcano in chile aerupted the

first time in 40 years. 1,500 people were evacuated. the volcano is considered one of the top three most potentially dangerous among the country's 90 activity volcanos. >> contracts signed and tickets for the highly anticipated floyd mayweather/manny pacquiao fight may 2nd. prices will range from $1,500 up to $7,500. shares of caterpillar higher after the company reported strong first quarter earnings. the ceo was on "squawk box" and talked about the impact of currencies on his results. >> we worked for decades to structure our company so we have a footprint in the big economies

around the world. we have a big asset base in japan, europe brazil among others. when those currencies weaken and we have high cost structures we benefit from the cost side. joining us now is senior analyst eli luskind. >> the real gain was in profitability. very strong operating margins in both construction and in the energy and transportation sector. far better than expected in showing caterpillar eileen journey and focus on improving operating profitability. >> i think the ceo is saying that. the odds are stacked against them. as far as oil prices are concerned, i see they say sales for oil equipment will start to

decline in q-2. that effect has to roll through. >> that's why the first quarter atypically will be the best quarter of the year. the big drop in rig count over 50% and its impact on caterpillar business would not happen in the first quarter. it's going to be spread out throughout the year and mostly more in the second half than first half. that's why we put a modest increase in the operating improvement and modest increase in earnings for the year. >> we speak all the time about china and slowing and measures they are taking there. how does china compare to brazil? today this huge writedown from petrobas, much of the economy gripped by the corruption situation. >> china is not a huge piece of anybody's business. they are relatively comparable. brazil has been a basket case. one thing to remember is that there is a big olympics next year brazil has to get ready

for. there are probably some expectations for improvement the second half of the year as they try to meet olympic needs. >> if this quarter was about some of those efficiencies kicking in when do we start talking about true end demand? do you have a price target on cat yet? >> we don't. we are neutral on the stock. we are going to go up and down all year. our surveys told us north america was going to be better than people expected. that is going to continue. the next green shoot will come out of europe. emerging markets, particularly china and brazil are government driven. little by little things will get better. this will be a tough year, which is why the $50 billion sales target remain. oil and gas will take its toll. >> obviously they want to be positioned ready for the up turns you talk about. when they are warning dealers may reduce inventory to align

themselves with the slower pace of sales do you think they are being aggressive enough about scaling back their own capacity? >> caterpillar's done a marvelous job downsiding its operation. you look at what is going on in mining more than 50% declines. caterpillar is revamping its manufacturing. it's focusing on a lean journey with profitability and balancing production around the world so currency really doesn't kill them and they can compete against global competitors. markets aren't going to change quickly. 2015 will be difficult. you probably get modest improvement in 16 because inventory doesn't go down any more. >> do you see the stock getting above $110 any time soon? >> no. i don't. if we did we would have a buy on the stock. to us the stock is rangebound.

we have record level stock market and we would be holding our own because profitability is kicking in. end demand will get weaker. >> good to see you. >> general motors posting weaker than expected numbers. stock lower on that news. hit a two-month low earlier today. phil lebeau is live in chicago with details. >> right now the gm conference call is going on. a fair number of questions for ceo mary berra about where the company is positioned. she is adamant although these numbers may have disappointed, those on wall street like where the company is positioned. let's go through the numbers for the first quarter. it was a miss on both top and bottom line. bottom line coming in 86 cents a share. street expecting 97 cents. as far as revenue, later than expected by almost $2 billion.

coming in at $35.7 billion. what was behind the earnings miss? there was a currency impact with the brazilian real. that is above 9 cents out of the miss attributed this morning and higher than expected adjusted tax rate. a number of analysts were expecting tax rate to come in at 24%. it came in at 28%. there were positives in the first quarter for general motors when you get past the top and bottom line. first of all, north american profit of $2.2 billion. the strongest first quarter ever for general motors since it went public again in 2010. china profit of $500 million continues to outpace sales in that country which are slowing down. going to be in the range of 6% to 8% this year. gm sales in china were up 9%. chuck stevens, cfo of general motors this morning talking about how he believes there are still catalysts to get the stock

moving higher. >> there are significant catalysts to improve both consolidated earnings and earnings in north america. we talked about them before. our product launch cadence will be exceptionally strong in north america and europe and china. >> to back that up on the conference call, they were asked whether or not they could hold pricing on new cars. europe is holding. you look at the new models in the u.s. they believe pricing will be able to hold up despite intense competition in that segment when it comes to sedans. bottom line is this. when you look at general motors shares, you heard jim cramer earlier today. he owns it in his charitable trust and calls it a mistake. they haven't been able to get the stock moving despite the buyback, dividends, et cetera. >> phil lebeau in chicago. thanks for covering that today. judge. >> when we come back, a live exclusive with the u.s. energy secretary. we'll talk about negotiations with iran plus his views on the

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earnings beat but revenue light. the company experienced a lower turn rate as fewer wireless customers switched to other carriers. shares up 3%. >> with the dow down 16 let's send it over to rick santelli in chicago for this morning's exchange. >> thanks simon. i would like to welcome andy brenner, frequent guest. as unique visuals into the marketplace. yesterday we traded down close to the low, low yield close. today we doubled that. that isn't really the story, is it? give me your thoughts on bund yields. >> there is no question. we had bill gross say bund yields are the biggest short, the best play over the next few years. he might well be right. with the european central bank continuing to buy and still gearing up ten-year put yields could go to zero. effectively had a doubling of

interest rates in 24 hours. that's hard to believe. >> but it's still only seven basis points. in terms of mr. gross, if you just think about the logic of where any country's rates are, especially the southern economies, it makes no sense. there is no common sense to those rates. the idea it's a great short, i think, is a very nonprofound comment. it's a logical comment. where it gets difficult is trying to handicap that logic against all the policies in europe. your thoughts? >> no question about it. right now, you have greece in the headlines, a nice rally in greece. i think merkel and draghi don't want to throw greece out of the euro. i think they'll do everything

they can to possibly keep greece in there. you have a dichotomy with the german economy turning around. the wise man have you well over 2% gdp growth. we think that will only accelerate. it's hard to figure out with interest rates and gdp growth and changes around and how germany dominates the euro and what's going on with the currency. there are a lot of moving parts. >> when i was younger there was one person in your class that graded on a curve that. was the genius in the class. he distorted the curve for everybody else. that's was's going on the german economic skew. i think greece ends up being a referendum that policy in such a hodgepodge of different economies without a federal stencil is going to be difficult on the easy side and possible on the aggressive side. your final thoughts in the last 30 seconds?

>> if they throw greece out, greek gdp is 177%. that is a misnomer. italy is behind them at 132% gdp, that is a gdp growth. italy is going to be a problem. if greece goes italy won't be far behind. that will be a major problem. that is your contagion. >> i do believe germany -- greece is on the hook for germany with $90 billion, spain $40 billion, france about $70 billion. in total about $330 billion. we have to watch the story play out. thank you so much. simon and the gang back to you. >> thank you rick santelli. when we come back with mr. coffee yankee candle crock pot to name a few, jarden gives a

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welcome back to "squawk on the street." dunkin' brands tracking for the best day since its ipo debut in july of 2001. the company raised outlook as it reported better-than-expected first quarter sales and profit. the stock has surpassed its 30-day average volume of 1.3 million shares. trading at two million shares so far today. take a look at the stock, it's up 9%. carl back over to you. >> morgan brennan. shares of jardine gaining three%. the consumer brands posted revenue of 1.7 for the quarter and posting a first quarter net loss of 55 million after posting a profit in the same period last year. joining us exclusively is the ceo of jarden. 4.7 organic growth is that a north american consumer play. >> i think it's a great harbinger of how the u.s. economy is doing and it feels good coming off 11%-plus growth in the fourth quarter. >> we keep battling between the

notion that the impact of the dollar year on year is peaking and we get other companies today, 3m who believe it's going to get a little worse. where are you? >> i think it's clearly volatile. think it's probably going to stay volatile through the back half of the year. we're not banking on any kind of recovery. we're planning on it to continue to erode slightly as we move in through q 2. but clearly it's been a strain on a lot of companies. i think we planned accordingly and you see it in our results. >> i'm thinking this through. presumably the strong dollar is good for you. a lot of what you make is manufactured abroad in china and therefore as an importer it reduces the cost of what you're selling across the country the have i got it right? >> we're about 60% based in the u.s. 40% international. we've got 75 manufacturing plants around the world. so we play right up the middle. we have opportunities on currency. we manufacturer product in

europe, sell it in europe. manufacture products in the states, we've repatriated a lot of products over the course of the last few years. and so while fx is a variable to us you know it isn't quite the painful event that it is for many companies. >> are you seeing the caterpillar ceo talked about a dichotomy in the global economy where north america clearly is out-performing everywhere else. even despite the optimism in europe. is that what you're seeing? >> we're seeing that the u.s. is outperforming, outpaced by a year and a half. our business in europe is doing pretty well. we're not high-price point items, we're everyday items. so consumers are picking them up and quite frankly we've been taking market share. >> what about debate we're having other gas prices jim? is that evident of what you're selling? >> we're about at the one-year anniversary where oil prices have gone down gas prices have gone down. so the consumer believes it's

real as opposed to a fluke. they're more confident about it. importantly, i think you're seeing real wage inflation, coupled with gas price stability. and you know good activity in one's 401(k). lower unemployment level. soy think the u.s. consumer is feeling pretty good. and it's shown in our results. >> you know jim, we often interview martin franklin your boss, the stock has done very well up over 40%. a 10 billion stock market valuation where you are at the moment. a lot of eyebrows were raised when it was announced that last year he took home $118 million. partly in stock options from the last four years, but it was a very high figure for a publicly traded company. how are you rationalizing that internally? >> well look, if you look at the same period of time. honestly we are well compensated. but it's because we deliver shareholder value. the market cap of the company has tripled over the same period of time. so if you took that reward and you divided it by the five years in which the award was granted,

while it's still high by any measure, it's clearly appropriate based on the performance and our shareholders like the alignment that we have. and so our board has continued to grant awards that drive shareholder value. it was an increase in six billion in market cap during the period. >> it's a good looking chart. awfully close to an all-time high. you mention you're taking share, you feel free to say from whom? >> i think, i'll give you a great example. louisville slugger was just sold to a finnish company that creates opportunity for our rawlings brand and we manage the west coast port issue. you see it in our working capital numbers, we brought in a lot of inventory in the back half of the year and again in q 1. as other people have struggled with the west coast port issue we've created an opportunity out of it and hopefully we can keep the market share gains. >> you think west port it seems resolved. no surprises, at this late stage of the game? >> no. it was if you look at our

inventory in transit during the first quarter, we were up 2-x over the same period over last year. in march up 25% over the prior year and as we move into april we're over normal levels and so for jarden it's resolved itself. >> jim lillie from jarden thanks for stopping by. >> thanks very much. almost time for the alley here on cnbc john ford has a preview of the next hour on the network. >> well facebook technically missed on revenues. so why is the stock still around all-time highs between positive and negative this morning? we'll give awe look at the shocking numbers from the call. also ebay and qualcomm heading into opposite directions after their earnings. we'll dig into the reason bees hind that. and the u.s. energy sector all of that and more coming up on "squawk alley."

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♪ ♪ ♪ what i like about you ♪ ♪ you hold me tight ♪ ♪ welcome to "squawk alley," joining me this morning, henry blodgett founder and ceo of business insider. and kayla tausche at post 9, hanging in with a loss of about 31 points market so far. we'll begin with facebook shares looking pretty good. even though revenue did miss estimates thanks to a strong dollar and the increase in expenses, but mobile up a bright spot nearly three-quarters of ad revenue coming from ads on mobile devices, video advertising is exploding with users watching over four billion videos a day. 1.4 billion maus and a lot of talk about if you're going to own a company like this you've got to put