they want the style and driving dynamics of a sports car. this takes it to the limit. >> it's like a half suv but not quite. >> i don't like using that tomorrowterm. it's a dynamic design. there is a segment of the population that absolutely loves it. and luxury sales are up this year in the united states. >> thank you for being here this week. make sure you join us tomorrow. "squawk on the street" begins right now. ♪ >> half way through dow earnings this morning. welcome to "squawk on the street." i'm here with jim cramer and jim faber. lots riding on the open this morning as apple tries to defend key levels after last night's earnings. couple that with boeing, coke and upgrade for exxon. the focus is on commodities. copper, gold coal and even

zinc. apple shares under pressure with a rare disappointment for investors. >> shareholders also frustrated with yahoo's results and microsoft posted the largest loss ever. the story of the morning, apple with results did beat on the top and bottom line but iphone shipments lower than estimated and projecting fourth quarter below estimates. they didn't break out the apple watch sales as a category but they did address demand. >> a major highlight for the last quarter was the launch of apple watch in april. as you know we've been very excited to get this revolutionary product to customers. we started taking preorders in

nine countries on april 10th and demand immediately exceeded supply by a large margin. as i look at all of these things, we felt really great about how we did. >> of course the apple watch is fun to talk about but the phone metric is key. 47.5. best third quarter growth ever. are we to believe the quarter hinges on if it can hold 119. >> i think there are many issues involved with apple the least of which the people are making the most to do. speed bumps. at once point in answer to a question on whether china as slowed because of the stock market crash, the iphone sales,

cook said there could be speed bumps. it was all within the context that he's even more enamored with sales in china. if we knew the weekend of iphone sales after the crash, we would be able to determine. this is a 3 million phone unit short fall so to speak, where if you look at the progression of the buy side they kept increasing. it doesn't seem to matter that only 27% of the people have upgraded or samsung going to apple matters so much. the long knives were out. it was as if tim cook had never delivered anything an suddenly he was revealed as being someone who was a bluff artist. two third of the company's profits come from something that has peaked. i like gimmicks. that's me. i have right here, i want to show you this. see what this is? this is a mock apple cuff link

device that i've created that is already disappointing in the sales because i've only bought one of them. >> although it does have a watch face on it. you can use it to tell time. >> this is the beta that tim cook has not even thought about it. it's so disappointing that i say sell apple. the craziness. >> we heard from the parties that demand was slipping since the launch. they sold more in june than they sold in april or may. they're trying to push back on this without giving us the absolute numbers? >> in terms of the watch. the numbers were all over the place in terms of numbers from the analysts on the watch. he only spoke positively on it. and they're introducing new software. a lot more native apps. they view it as a long term product category that they'll develop. i did have a couple of conversations with hedge fund guys who had owned it but are

taking their hedges off. they feel the inventory issue hasn't been addressed enough. >> i liked it. >> a lot of people did like it. a morgan stanley said they liked the one created by lower inventory. they view that miss as a function of management taking a conservative approach. and also what other people told me was the expectation you're going to get new products. they always do this in front of a new product. >> so we understand each other, there are galore there are notes galore about apple. i actually -- i dropped it. i had my sunglasses on for reading so many notes. i happened to see exactly what you did. this morgan stanley note did solve the c 2 q 2 puzzle.

this is a nightmare for sky works. they're selling avago. everyone is giving up and said this is the peak and i say how could it be the peak if there are fewer stores in shanghai and beijing and new york state. when you see the number of doors added of who's selling the apple watch, you think it's just in a couple apple stores that's wrong. >> china revenue did double. iphone sales there up 87 and has cook said on the call the worry is probably overstated all the drag about the future of the chinese consumer. >> it issed a when you hear the ceo of the largest company in the world talk about how the chinese market is up 90% year over year. and then we read stories in the paper about how at one point only 10% of the stocks were trading. we were trying to figure out how

many people were really in the market versus not. why would apple sales not be weak given the fact that china sales are so bad. it comes with the fact that people decided that the iphone has peaked and there's no product to fill the channel after it. and if you want to make that judgment, go trade apple all you want. >> we'll see. >> i say own it. >> as you have said consistently for a long time. >> stock is up. >> use this as an opportunity, i would assume. >> let it settle. someone might say we have 39 buys on apple. 15 holds, and two sales. you can say wait a second that's too many buys. someone is going to say this thing has no close. i like the morgan stanley analysis but they keep hoping that how will apple pay do. >> or apple tv.

we're going to have a streaming service at one point. but finally on the idea of the iphone somehow running out of steam, i would note that mr. cook used the word many three times. we have many many many years to go. >> and legs. legs. that's probably -- no one mentioned quarters. training camp opens today for rookies. we need the first quarter. people are putting it in the two-minute warning zone. it's not in the two-minute warning. every single analysis -- look at this. this is for apple. this is insanity. sell it if you want. go ahead. go buy go pro. there's a lasting device. >> we'll get to that in a little bit. a lot of other earnings in tech. yahoo out with a mixed quarter. that stock down over 2%. microsoft largest loz ever for the fiscal fourth quarter as they book the $7 billion of the

nokia acquisition. stocks down over 3%. here's nadella on the conference call last night. >> the eco system has been under pressure recently. i believe that windows 10 will broaden our economic opportunity and return windows to growth. >> now, refresh our memory. you've said they were going to have some trouble hitting numbers. >> yes, and they did. now, it's funny. these are opposite stories, yahoo and microsoft. yahoo, the quarter when you go through it it sound like things are turning. i like the momentum. and then they go to alloy and it's horrendous. the outlook is bad. >> you're referring to the number display adds up nine things -- >> just saying listen, we have to lower our ept da. >> they're spending a lot more to acquire traffic.

all the deals, you see it more often. i get yahoo is my search choice now of the deals but they're paying up for them. >> they are. compare that to microsoft, balmer gave them a phone division. you can't write it off enough. it was so bad. i actually thought some consumer device news was good. i think that the cloud progression which we'd been waiting for is accelerating. i liked the quarter within the context of a shrinking pc market. windows 10 i know people are saying wait a second they're giving it away. it doesn't matter. i thought there was enough to like in microsoft water and microsoft on the quarter, there were a lot of congratulations gentleman but in retrospect people say they didn't do what we looked for but if nokia thing is so painful. it's like the lover canal. it's a river in finland. it's a super fun site. >> they wrote off the entire

price of the acquisition. >> now they're doing more than that. it's really painful, and nadella, it should be his company by now but there were so many things that were not right here. >> but windows 10 is almost here. >> i'm hearing good things about it. people who use it in beta. >> people upgrade and not have to pay? >> and you can also back. >> they'll be trying to sell you services, more so. >> i don't think it was that bad. and they have a lot of cash. look, this sector is going to be under huge pressure. but microsoft was not as bad. yoo yahoo was good until they told you about the future. >> yahoo will be viewed by some as a value play because you have $32 billion of alibaba being spun and then you are still getting the core business for a low multiple. >> noclarity, no in. >> when we come back a lot more

earnings. jim is still showing off the cuff links. >> it's disappointing and it hasn't even been thought of. >> meanwhile sara eisen just got off the phone from the ceo of coke. we'll talk about the analysts downgrading the stock. right now down about 7%. is that a buying opportunity or a sign of more pain to come. fufs fuf futures in the red. a lot more "squawk on the street" in a moment. if you can't stand the heat, get off the test track. get the mercedes-benz you've been burning for at the summer event, going on now at your authorized mercedes-benz dealer. hurry, before this opportunity cools off. share your summer moments in your mercedes-benz with us.

coke is going to be one of the bright spots this morning. earnings revenue and volume and pricing peating expectations today. sara got some color on the quarter. >> particularly organic revenue growth which takes out currencies and volumes were the bright spots in terms of exceeding analyst expectation. we just spoke to the cfo of coke ahead of the earnings call. she juns lined the fact that this is a transition year for coca-cola. something the ceo has talked a lot about. what does that mean? she says a lot more work to do on cost cutting. we're continuing to focus on tight expense control. that includes layoffs. it also includes investing more

in marketing which is how they plan to drive growth. we talked a lot about the difficult macro economic environment. waller telling me she echoes other cfo ease concerns this period about the brick countries in particular she called out brazil. said the situation there is deteriorating economically india was a concern in the second quarter but the outlook looks a little better and next quarter, china. she said very much uncertain in terms of the gdp growth. we talked about the volume beat. she said especially the 1% global brand. they've been putting a lot of money behind marketing the personalized mini coke cans for

instance. they're starting to see that take effect. we also talked about the investment in keurig green mountain. this was the big bet on growth on where the consumer was going but the shares have lost almost half of their value this year alone. she said we're very focussed on the long term and the partnership of the cold machine which is supposed to launch this fall. we're encouraged that long term it will be a good bet. the excitement should ramp when it gets into the market. keurig is a public company who hasn't released results. but it's not boom time for the soda makers. it's a tough operating environment and so far it looks like coke's turn around efforts starting to bear fruit and next year will be the show me year when it comes to drive and growth. >> thanks sara. this same comes up a lot in conversations i have and it also comes up in conversations

about activism. it's an enormous company but there seems to be a general sense that there is a lot of costs that could be taken out of coca-cola if somebody really took it on. it's unlikely it will happen but i'm curious as to your thoughts when it comes to this organization overall? >> it's interesting. they want to kind of say that they're doing the zero based budgeting but are they really? i don't know. i'll give you a fact that i thought was important. double digit increase in advertising. merchandise and marketing and they still had a 50 basis point decline in cost expenses. i thought that was positive. that's what happens when you get the top line growth. this company is levered to top line sales. again, you keep hearing this, social media. the money keeps going that way for them. obviously, coca-cola a huge advertiser. getting great bang for their buck in social media.

north america, you hear the term disciplined pricing. code for end of the price war which allows for some margins to increase in the united states. i'm still concerned about indict drinks and whether they're going well. coke zero doing well. diet coke not. overall, i think sara is right. work in progress. india was weather related. do you buy the stock in i think it's not going to hurt you to own it but i do agree, david, that if someone came in new and fired a lot of people i think they'd find they're doing a little bit of a firing internally. >> and they have a man named mr. buffett there. the question is if you had a big name activist, would they have the support of mr. buffett? he wouldn't actively support them but we'll see. >> i'm more concerned, monster has the distribution thing. >> she mentioned brazil.

whirlpool is out. >> this quarter they make big. they're inconsistent. it's short, it's long. it's interesting that ge had been able to sell their appliance business to electrolux people would have said -- whirlpool, if they reduce the expectations so much they finally beat expectations. >> a lot of companies doing that. >> there is. do you think boeing is doing that? i think they're playing out good but people saying this is his last quarter, jim mcnerney. it was a true blow out, the cash blow. congratulations jim mcnerney going out at an absolute high. >> unbelievable. 197 commercial airplanes delivered in the quarter including 34 dream liners. boeing's quarter is amazing. >> remember when they gave up on

the d liner? i wish him great things. he's going to stay on for a while but what a great quarter to go out on. >> we'll get a lot more on boeing and a bunch of other places reporting. we'll count down to the opening bell. for "squawk on the street" is straight ahead. behold, these are two wind turbines. can you spot the difference? the wind farm on the right was created using digital models and real world location-based specs that taught it how to follow the wind. so while the ones on the left are waiting the ones on the right are pulling power out of thin air. pretty impressive, huh? now, two things that are exactly the same have have never been more different.

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all right. it's time for a mad dash. want to start off with chipotle? >> i often talk about how stupid people can be. they report a number.

immediately the stock drops 8% and then you listen to the conference call and you realize this is the big turn quarter. they know it too. one of my favorite cfos telling a remarkable story about how good things are since they stopped the pork shortage. started talking about the pizza initiative. they have pricing flexibility. i thought this was a remarkable quarter, and at one point someone said about loyalty programs. what do you think. they said we don't need to. we have loyal customers. we don't have to figure out a way to pay them to have loyalty like everybody else. a slap in the face to everybody else in retail saying listen we're loved and then pizza is out, that's good. they did not talk about shop house asian kitchen. but july was good and that also was what people were surprised

about and the karneta shortage overseas they're sourcing hogs. fourth quarter, the problem solved, my prediction not theirs. >> go pro. >> okay. go pro, stock immediately up two points and then people think about apple and the stock drops five points. that's great. do you think apple -- go pro and apple have nothing to do with each other. go pro goes back up because it's doing well because they are user generated content, social media, virtually wallty and quad copter. that's the 2016 story. >> ambarella. >> you said it and i have no more to say. ambarella is the buy. >> we have a lot more to say. keep an eye on apple.

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just over a minute's time. we've covered boeing and coke and apple and microsoft and go pro and chipotle and yahoo. we haven't gotten to what's happening in minors or commodities. gold is down $16 below 1100. >> the setup is horrendous. once again, you have the dollar is strong. rates are going down. gold, oil, copper, they're all going to be terribly again. i did a piece last night on mad money saying why i thought that oil, the stocks were telling me i thought that oil could bottom. >> energy is hurting. a lot of the mlps also. apparently the closed end funds are levering and they're selling the mlps as well. >> how can you scoop me on that? >> did i scoop you? >> yeah. i was going to say how the high yield shots are being shot against. now i feel like my whole,

there's a half hour of work i didn't need to do. well done. >> let's get the opening bell and the s&p at the bottom of the screen. at the big board, it's the cycling team highlating their bike athon. >> that was apparently pretty hot offering blue buffalo. >> i know bluebird. i know buffalo wild wings. how can they issue this is a pad day. these companies that are reporting at opening day should wait other days. >> yeah. i think they've sort of committed but i guess -- >> wouldn't it be nice if you could postpone earnings due to market conditions? >> i think so just because like the number five isn't running well. i'm going to hold off. >> we mentioned oil which holds 50 for the moment. goldman does add it to the

conviction buy list. >> i thought it was a great note. exxon, the $80 level is where all the charges tell me it must hold. there's positive coverage. no one seems to listen or care. it is a break down of unbelievable proportions that is not talked about enough. oil talks and mlps. >> i completely agree. we hit it every day but not in great detail. it has been a slaughter lately. >> china. you could actually say china is everything. united technologies china. the speed bump comment from tim cook china. copper china. aluminum china. everyone thinks china. i keep coming back to delivering alpha last week. the underlying theme was china is a paper tiger. >> the concern is not based on the stock market volatility as much as simply that the economy

in china is slowing and that we still don't get a great read on what the numbers are truly and as you point out, that means a lot. a slowing chinese economy means a lot. to the growth rates around the world. >> isn't it ironic that the stock added $65 billion in market cap has no exposure to china. google. >> take a look at the tech leaderboard, so to speak, obviously led by apple. down about 6%. yahoo down about almost 3% but google and amazon both up. >> two companies that are not that exposed to china. netflix shouldn't be up yet. it shouldn't be down yet because they haven't moved into china. maybe by 2016 they'll have solved the problem by crouching tiger hidden dragon two.

released in i max. >> yes. >> so with apple at 122. >> holding the 120. >> you're going to be watching this. is it the key to today's market? >> it's a long day and i think there are people with lots of profits in apple. someone is going to look and say i have a chance to downgrade it. my take is you own the stock. you're still up even from last week. remember, we've seen situations where stocks have run up and then all they did was give back the run up of the last week. you can say what kind of thing was that. look at chipotle ran up gave it up and got it back within a period of seven minutes. the trading is a little too aggressive. it's going on. >> along with all the suppliers which top the list of s&p losers today, the analog devices and avago avago. >> they don't care about the internet of things. they care about that they turned

out to be just apple plays. and i think there's more of the companies but i don't want to fight them on day one. >> apple still buys back a lot of stock. i believe they'll restart that in a few days. they have 200 billion in cash. they're returning a good deal of that this. my point is you can't be in the market around earnings but they'll be back in there as a buyer of their own stock. >> i love this accelerated buyback but also cook buys when the stock is down. he doesn't just use the robo buy. these brokers short the stock and they buy. i mean it's like the dumbest thing. these executives who have been bought into that whole accelerated -- it's like hey, let me sell you a bill of goods. you think i wasn't on the sale side at one point? but cook, the stock is down a lot, maybe we ought to do some buying. >> during the quarter they bought back $4 billion.

>> they had more money than kreeshs. >> $203 billion. >> but the watch, there's a couple days the watch didn't sell as well as it should have. no you can't make up this stuff. >> auto nation, income comes in in line but the eps is a miss on a higher than anticipated share count. more importantly, though, they do reaffirm that we're looking at a year of 17 million sales. >> i also think that a previous guest said don't forget when gasoline goes down people don't buy as many electric cars. he said he thought tesla sales in america were going to be down. you're not allowed to say anything bad about tesla. my daughter upgraded me. she said why are you saying anything bad? you have to buy a tesla. the love of younger people were tesla overshadows a guy saying

sales are probably week. >> even though some say no one is going to buy cars. >> and people talk about hacking cars. harmon payed a fortune for anti-hack for cars. somebody hacked a car. >> yes. we got a deal this morning that's worth a mention. it's over $3 billion. st. jude getting active acquiring thora tech. you can see shares are up over 9%. thor is the symbol. not going to be around that much longer. there is a go shop through august 20th where you have a reduced termination fee should they get another buyer. they also announced revenues would exceed estimates at thor tech but st. jude getting active and picking this thing up. what's the multiple? about 7, let's call it 31 -- almost 32 times on value over

ebita ebita. >> saint jude has an excellent small device that people like. a lot of people like edwards life science. they have the best one product story but i like st. jude more for the deal not less. >> you like it more? >> i do. they have a fantastic device. when they showed it on air, you couldn't really see it. it made the graphics the executive producer was like make that thing bigger so we can see it but the point was to make it smaller so it had gotten hard. not as good tv but good for your heart. >> watching google 706. boeing is close to a three of month high. >> as long as google says they're not going to china, they're going higher. >> and chipotle is back to 719.

>> it's a great quarter. they did plus 4. people are used to much more than that. they also had some huge $0.60 miss over changeover software. the conference call reads as listen no matter what we do because we care about natural game and we only have a few ingredients, they're going to someone else people want to go there. it's a great quarter. the shorts are being gaffed right now like that 24-inch flounder that i caught a 17-foot boston whaler -- never mind. >> finally want to mention lily shares are down about 4 %. there was a great deal of operation awaiting some of the results from the trials for an alzheimer's drug that treats what they call mild alzheimer's. they seem encouraged but the

stock market is not. they did show some progress or some ability to slow the progression. they're going to continue development. we'll see but the market is having its say here as well. >> i would have thought more after the 17-point runup, biogen, i know this is a hard disease and you're always hoping they can roll back the plaque. this did not encourage me to think the stocks should belong at this level given the results, but i hope for everyone who has it that they keep working and keep making this drug better. i would point out that allergan had been hit on it and these drugs don't sound any different than what allergan has going. brent saunders you can come on mad money tonight if you want to augment this. >> dow is down 29. the losses from apple being offset somewhat by boeing. >> reporter: the important thing here is a very mixed market. i want to show you the sectors right now. while apple is doing a lot of

damage yarks it's hurting the tech sector but the market has a defensive tune to it. utilities showing gains. in terms of tension, it's sort of broad swath. broad come is kind of weak. you see some broad weakness all on the concerns about apple and a few other things. i want to concentrate on buybacks. we have enough companies reporting to point out that we are in the middle of an enormous buy back craze that is going on for almost two years. i have almost 100 companies reporting. i just talked about this this morning. 20 of the 92 that have reported have reduced their share counts joud standing by at least 4%. it's whether you're reducing your share count. that increases the earnings per share. guess who the big buy back monster is in terms of the

number they're buying back? apple? in the last year they've reduced their share count 4.5%. their earnings per share has increased 4.7%. over two years, they reduced it by 10%. that's an enormous reduction. now, there are other companies out there that are even more adepressa aggressive than apple in terms of the percentage of reduction in the share count. bed bath and beyond has done it by 16%. yahoo reduced it by almost 6%. delta as well. sherwin williams reduced it by almost 5%. a lot of people have been reducing their shares and dramatically helping their earnings per share. there are a couple that qualify as buyback monsters besides apple. the two many my book are ibm and exxon mobile.

ibm started doing this aggressively in 2010. in the last five year they have reduced their share counts by 22%. everything else being equal, their eps increases by 20%. exxon mobile is the monster of all buybacks. they've been doing it since 1999. since then they've reduced their shares outstanding by 40%. do you see why everybody loves buybacks so much? as long as you engage in share count reduction and don't just use it to pay out options, that's the important thing. i want to point out just moving onto another subject j we have an ipo trading today. it's at the nasdaq. two weeks ago i was getting calls about this that the demand was high. this is blue buffalo. they do an all natural pet food product. they upped the share count to

33.8 yesterday night. at $20 instead of $16 to $18. we are waiting for that to open on the nasdaq. restaurants have been hot this year. natural food pet products issed a but a loyal ipo base. that stock will probably pop at the open. right now the dow is only down 19 points. >> i'm glad you mentioned that ipo. multiple times over subscribed. a quick diversion to the boardroom in corporate. not just america. corporate canada too. an interesting story involving canadian pacific railway. a name some people may know. a board battle a few years ago in installing a number of directors and management. this came out last night involving what is the resignation of the company's chairman gary colter and having to do with the resignation of

another board member. on july 2nd, cp director steven tobias told mr. colter he was going to resign from the board. apparently in consultation with another board member chair of the nominating and governance committee, mr. colter had a press release go out saying he was resigning on july 3rd rd. why does any of this matter? well they're actually a foreign issuer. they get the fcc foreign private issuer exemption but because this gentleman actually was on the board on july 3rd past june 30th, they had too many americans on their board and they no longer can get the exemption. he was trying to back date the guy leaving the board so they could maintain the exemption. somehow it came out and, therefore, he is continuing as

the director the majority were u.s. citizens and they'll become a u.s. issuer beginning in 2016. the key guy is the ceo, his health doesn't sound particularly good. he had stints implanted. he's recovering from a mild bout of in a moan ya. >> >> and hertz, you may recall the big restatements that led that stock to go up. did you see they took a lot at their old ceo. it's worth mentioning. again, these things are rare that you see them come out like this. our former chief executive this resulted in an environment which in some instances may have led to inappropriate accounting decisions and the failure to disclose information critical to an effective review on

transactions and accounting entries. it went on from there. rare for a company to take a shot at the old ceo. why the need? >> it does imply come conduct that authorities have traditionally looked into at other firms. >> perhaps. he's running caesars now. >> that's a great outhit. let's go to rick santelli in chicago. take it away mr. santelli. >> reporter: thank you, david. if you look at ten, there's a bit of a u turn. consider this for the last five settlements it's closed between 233 and 237. today looks like it could be the sixth day but what turned the market? a benchmark deal probably related to the altera deal and also they haven't come to the market place in a while. but everything changed right around 6:30 7:00.

look at the bunds. bunds followed up. dollar index turned up a bit as well. if you want to look at the 30-year and think the range concept on a longer time frame, open up. 3 to 3.25. what we've learned is we get lots of consolidation in treasuries. and then it reverts back to ranges. we still see flattening in the yield curve. is it liquidation of steepeners? is it's tens to twos. flat since the 19th of june. flattest since mid june. we want to pay attention so all these issues and pretty tight on data points. we'll get some housing data points but pressure ritreasuries, we're continuing to monitor ranges and pay attention to anything above 2.48 or anything below

2.31 or 3.32. back to you. >> a lot more to big through on the earnings reports ahead and buckle up. six flakes outgs out with earnings this morning. dow is down 22 and would be positive if apple hadn't replaced at&t in the industrials. we're back in a minute. are you moving forward fast enough? everywhere you look, it strategy is now business strategy. and a partnership with hp can help you accelerate down a path created by people, technology and ideas. to move your company from what it is now... to what it needs to become.

morning. broke through the average last night. that's about 119. rebounding a bit to 123 and change. we'll keep our eye on that. and we'll get a look at stop trading with jim in just a moment.

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xçó0 caterpillar is not acting well. a lot of people feel this company's cross hairs with everything going on right now has -- it reports tomorrow. you have to be careful informal. >> on squawk in the morning -- >> i'll have to listen. >> and the flip side is the chipotle is inspiring a

restaurant revival now that oil is cut from 50 and you're seeing almost every single dun -- i like sonic because it hasn't moved yet. chipotle is an unbelievable conference call where people felt like if they came down from a 4% number it would go down. that was the toughest comp they've faced as a public company. they did well. i continue to be amazed by their team. >> 100 point swing from last night. >> just a lesson in how bad you can do when you play after hours. >> not to mention this memo from mcdonald's that all day breakfast could be coming as early as october. that would be a massic logistical effort. i don't see how they could do it. >> next he's going to be letting, as opposed to last friday, where they deliver to me in the parking lot when i prez a button. >> earnings from them tomorrow

as well. you've been liking it lately. no more of the synthetic burger business. >> flos accounting for taste. after last week where peltz of wendys and ackman of burger king saying it can be fixed. i like easter brook. they need the loyalty. they have to pay for loyalty unlike their exchild, suptep kid, what do you want to call chipotle. if they do all day breakfast, they've got me. on mad tonight, live nation. they own all these three-day fests that i hope your kids never go to david, because it's too much fun. and then spark, i like biotech. i'm just kidding. it's a great client. it's a great business model.

when you go to the festivals and you -- never mind. they're fun. three-day -- have you ever been to a jim boar ree? >> yeah. >> we'll see you tonight, "mad money". when we come back breaking news. dow now down only 12. back in a minute. it's a fact. kind of like shopping hungry equals overshopping. being a keen observer of the world has gotten you far but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea

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>> good wednesday morning. welcome back to "squawk on the street." i'm quintanilla with sara eisen and simon hobbs and david faber. a slew of earnings from boeing to coke to microsoft to chipotle, continued weakness in commodity including crude which is barely above 50. let's go to washington. some breaking news on existing home sales. >> reporter: existing home sales up 3. 2% month to month in june

to a seasonally adjusted annual rate of 5.49 million units. that's the highest monthly volume in over eight years. may was revicedsed slightly. that's not the headline. the headline is this. median home price, up 6.5% from a year ago. that is the highest median home price ever on record. why? there are no homes for sale. inventory up barely. 0.4 % from a year ago. just 2.3 million homes for sale. anybody out shopping knows days on market very fast 34 days. that's the fastest since the realtors began tracking it two years ago. we want to note this is a median home price. we are seeing higher priced homes selling at a faster rate.

homes under $100,000 down. 30% of the market they should be 40 to 45% of the market. the realtors are saying you have to note these are based on contracts signed in april and may that closed in june. we may have seen an extra bump because of interest rates. again, huge headline on that price number. the realtors calling it quote, unsustainable. >> wow. big deal. thank you very much on that breaking news on existing home sales. we get to the big earnings story of the morning now, apple. the company beating on the top and bottom line. iphone shipments a little lower than expected and the revenue forecast also missing estimates. we spoke to tim cook yesterday about the earnings. josh good morning. >> sara, if tim cook is concerned at all, he is not showing it.

apple's ceo was as confident and positive and upbeat as ever when i spoke to him. cook told me the quarter was, in his words staggering with revenue declining strongly. the iphone is a run away success with apple continuing to take significant market share from rivals in the quarter. cook made a point of saying apple is seeing the highest raid of android switchers ever. what about china? that was a big worry heading into the report. namely whether the swoon in the stock market there would ripple into the broader chinese economy and weaken apple sales but sales in greater china jumped 112 %. it's hard to find problems cook told me with a growth rate like that. but at least this morning investors are not sharing in cook's enthusiasm. one problem, apple shipped nearly 48 million iphones nature. a strong number but

disappointing. bulls are unbowed. they noted plenty of apple fans still using the 4 and 5 who will be your yuscurious about 6 s. >> we are off the lows overnight on the weaker iphone and apple watch figures. the company did not separate out apple watch sales as its own target but the ceo addressed demand on the conference call. >> a major highlight of the past quarter for all of us at apple was the launch of apple watch in april. as you know we've been excited to get this product to customers. we started taking preorders in nine countries on april 10th and demand immediately exceeded supply by a wide margin. the apple watch sale through was higher than the comparable launch periods of the original iphone or the original ipad. and so as i look at all of these

things, we felt really great about how we did. >> okay. an analyst is now joining us from bernstein. he's ranked the number one apple analysts. on a big day like today, it's good to have you hear. welcome. >> thank you. >> apple is fascinateing. where we traded to before it's still only where we were two weeks ago. this is hardly falling out of bed, is it? >> correct. i think we've had a bit of a round trip over the last couple of weeks. expectations increase that phones might be 50 million or more in the quarter consensus print numbers were around 48. when it came in at 48 there was a little bit of a sigh of disapointment. we have effectively round tripped i think on what had been elevated expectations over the last couple of weeks. >> cook makes a good point. this is staggeringly successful

as a big picture. the iphone up 45% and the average selling price up $100. you can't argue with that? >> the absolute numbers are staggering. you have a $230 billion company that grew almost 40% at constant currency, top line. grew eps at 44% and has generated $80 billion in free cash over the last four quarters. all of those are other worldly numbers but apple continues to be really sentiment driven in terms of how the stock trades and so investor enthuse yachl and expectations are really important. that's the characteristic of most growth stocks and apple trades like a value stock. it trades like a growth stock. >> wenhen the stock has doubled, people are worried about when

you are going to top off on iphone sales. the request question is whether a miss on iphone sales or revenues of 1% how many companies miss on revenue these days is actually material in arguing it's slowing down. that's my central question. >> yeah and i think the investment controversy around apple is can they really grow their iphones in their next fiscal year when they comp against this very powerful iphone six cycle. so the bear thesis is apple is just enjoying a pull forward in terms of people who want the buy the phone. so they're having a spectacular year this year but next year iphones won't grow at all. so i think the street was saying if the numbers were higher this quarter, then sort of running out now, we could be a little more confident that iphones would grow in the next fiscal year. i think the results are still a

little bit inconclusive in terms of if you run out normal things based on the numbers they report, can iphones really grow. that's the central babysit. and the numbers weren't powerful enough to resolve the great. you have great numbers now but investors are saying okay we had a great product cycle but it's unclear that iphone can grow next year and potentially going forward, and hence, you have a low absolute valuation that reflects that. >> well part of the answer to that question is going to come from whether china can continue to be a booming growth narcotic. i has been the engine of growth for this company. were you convinced by the comments that say maybe there are speed bumps but the long term faith is in china as a top performing market for us? >> china's results were terrificterrific and better than we experienced.

i think there is a question about whether apple can really sustain growth at such high price points. apple eels challenge is that its phone on average costs about 660 660. the average smart phone in the marketplace today globally other than apple is $175. so that delta is growing between apple's price and the rest of the market and so the challenge for apple and the key question is, at some point are there going to be the r youare you going to run out of consumers in china who can afford such a high end phone and they'll go somewhere else. apple is capturing those consumers but that can't continue indefinitely. i think the momentum will suggest we'll have growth in china for a few more quarters but we can't extrapolate that forever. >> bottom line it for us.

where will the stock go in your view over the next six to 12 months? >> i think the stock is going to consolidate now because people are still centrally focussed on can iphones grow? our belief is that they can, that we're going to see about $10 in earnings next year. it's high single digit growth. even in an off cycle year. given that we think the stock is very attractively valued at about 10 times earnings x cash. our target price is $142. and we certainly believe that the stock can get there in the next six to nine months. >> we appreciate your time. thank you. >> tony joining us. the number one apple analyst. >> when we come back a lot more on the earnings reports on the morning. sara talked to the cfo of coke this morning. and boeing delivering a big beat as well. close to a three-month high.

well get details on that and some of these home builders whirlpool, restoration all moving on the existing home sales numbers. more on that when we get back in a minute. ♪ every auto insurance policy has a number. but not every insurance company understands the life behind it. those who have served our nation. have earned the very best service in return. ♪ usaa. we know what it means to serve. get an auto insurance quote and see why 92% of our members plan to stay for life.

dow member coca-cola shares are trading slightly higher on the back of a an earnings beat. earnings sales but especially volume growth which is a key metric for the beverage

industry. 2% growth. it's 1% around the world for coca-cola. 6% for coke zero. 3% for sprite. diet continues to decline. down 7%. and coke saying double digit growth for dary. that's a partnership they have. coke is also being helped by pricing. in other words getting higher prices through the mini cans and along with pepsi and other beverage mikeakers, rising prices. i spoke to the cfo who said it was a solid quarter but there's a lot of work to do in expenses in the so-called transition year. she's talking about zero based budgeting and also spending a little bit more of extra money saved on marketing to drive growth. currencies were a huge hit for them. talking about the challenging

macro environment. they could have been up if not for the stronger dollar. brazil was particularly weak. china is uncertain. north america is actually a bright spot. now as far as the stock, i mentioned coke is higher right now it's still underperforming this year. both pepsi and the broader market, it's flat over the last year. the ceo has made it clear what his strategy is. he's sticking with soda cans and sticking withes a per tame. the challenge is for him to show next year if they will drive growth. >> i sat next to you while you did the interview. the question i'd like the keurig green mountain. the stocks are down. what do you think of that investment? >> it's almost lost half of its

value this year alone. she can't talk about the results because keurig is a public company. she said while there is some pes schism on the cold machine, she said it needs to hit the market and excitement will ramp back up. long term, she said it's a good bet and they believe in this technology and the consumer taste going this way twardoward personalization. they're sticking behind it. obviously, that has been a pretty lagging stock. the monster deal also closed in the quarter. they're taking a stake there too. >> and boeing beat expectations. phil is here with more on that. >> reporter: i think a lot of people were wondering after last week if boeing would have solid q 2 numbers. they beat the street and beat it handily. earning 1.62er with share in the

quarter. revenue stronger than expected at $24.5 billion compared to $22.4 billion that was the forecast. boeing, record deliveries in the commercial airplane business. 197 planes delivered in the second quarter. 34 of those being dream liners and the operating cash flow. this is what investors have been focussed on for some time. boeing brought in 3.3 billion in the second quarter. it's 2015 earnings guidance for the remainder of this year. we knew last week when they announced the tanker charge that it would be lowered. they have brought it down by $0.50 a share dropping it down to 7.40 to 790 a share. that is the new guidance from boeing. they dropped it by $0.50 even though the charge was for $0.77. the new ceo of boeing will be presiding over his first earnings call soon. we'll let you know what he has

to say during that call. these were better than expected numbers from boeing for the second quarter. back to you, simon. >> and a nice order from fedex to boot. and let's go for a market flash. >> reporter: a lot of earnings for sure but one that's gaining a lot of steam is chipotle starting off well in the green at this point. that's after dropping yesterday in the after hours session. that followed mixed quarterly results. they beat estimates by a penny but missed on revenues as the removal from some of the pork products hurt sales for the second straight quarter. they announced the return of the menu item. they found a new pork supplier. what was down is now up again and it's all tied to pork optimism. >> coming up on the program, microsoft reporting the largest loss ever. the stock is down sharply. hear what the ceo, nadella had

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let's have a check on the markets down 13 points on the dow and in the wake of apple frightening people with their results but some of the losses cut and we're now trading back down to where we were last week. a lot of people reporting. and coke. >> i don't know if i would call it frightening. i think apple is slightly disappointing because expectations were ahead of forecast. interestingly, one sell. only one, at least a cut -- >> in actual rating there haven't been too many.

>> it says maybe we're topping out in the near term. >> taken in isolation, the numbers were unbelievable the idea of earning over $10 billion, selling more than 47. >> 203 billion plus cash. >> to that point shares of microsoft falling. the quarter was hurt by a write down on that acquisition of the nokia cell phone business. the ceo, nadella, expressed confidence in the area of windows 10. >> our pc eco system has been under pressure recently but i believe that windows 10 will broaden our economic opportunity and return windows to growth. >> joining us now, managing director brent phil who has a buy rating on microsoft. what did you hear that

reinforced that buy recommendation? >> we think microsoft's pivots to the right product portfolio and the cfo is taking swift action. microsoft is in a new era where they're effectively saying we're in products that are going to grow rather than going a lot of different courses and having multiple products that don't go anywhere. we think they're still cleaning the house from the old microsoft, and that process is going to take time to cleanse but over time we do believe that they're going to produce the type of financial results that investors are looking for. so i think when you see the stock, i thought investors thought it would be down a little bit more today but i think that they are putting together the right strategy and it's just going to take time. this is a messy quarter. the nokia quarter, fx and a hand full of other issues around windows 10 deferral but most of the issues are in the numbers. i think investors are looking

forward now to the next fiscal year. >> the corporate software importantly corporate software, many people say looks weak. of the share price, how much is made up of big corporations leasing relatively cheap pcs to their staff which run microsoft application. how vulnerable are they to employers saying we're going to give you an apple ibm system here, something that you might enjoy more or at least that doesn't have as many bugs in it as you experience on a daily basis? >> i think for the corporations microsoft is still the go to. you're going to see a lot of apple in other platforms in the enterprise, but more importantly, nadella's new vision is we run on any platform and that's going to play out. he doesn't care about the

platform. in this world they've diversified. they don't really care what device. they just want their software on your device nature we think that's going to continue to play out over time. that's a major change in their strategy and it's resonating near silicon valley. we talked to a lot of startups that you would think would be other platforms and they're sticking with microsoft because of the diversification play they're taking. >> to elaborate on that we were talking about apple. they sold 47.5 million iphones. where is microsoft on mobile and is it all on software. is it okay in this mobile first world not being a major player in hardware? >> microsoft's pivoted. they went down the nokia rout. that was led by the past management taechleam. i think the new team realized that wasn't the right course to take. they had the big write down and they're still going to be in

mobile but they're going to think about it in software hard rather than hardware. when you look at the envenn tory out there, it's the right move. >> brent, one quick question. when they launch windows 10 this time next week i think a lot of people who already have windows are going to be able to upgrade for that. that's a major move for the first time for them to allow for that to happen. what are the add ones they're going to try to sell with it and how successful do you think they'll be in that strategy? >> they're going to tie search closer and more instore applications. the os is going to shrink over time. the importance is the applications and the infrastructure that runs. you don't look at your iphone and go i love my ios. i think microsoft is diversifying away from windows. it's important but not as much going forward. it's 15% of revenue. it was 30%.

it will continue to shrink but the importance of the overall portfolio is growing and that's where they're putting their resources. >> thank you, brent. >> straight ahead, apple is weighing on the markets, although close to session highs, dragging the broader tech market now. we'll talk to an analyst who downgraded apple today who says every rose as its thorn. they'll explain that after a break.

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welcome back to "squawk on the street." the department of energy out with the weekly petroleum energy report. a build of 2 .5 million barrels. the api gave us a build last night. maybe traders were expecting more of a build. but it's a bearish number. we're trading at 49.87 at this point. we drew down 1.7 million barrels of gas. we're expecting to see demand trail off and even anticipating that fuel prices at the pump could go down and distillates saw a small build. diesel is trading at a 6-year low. fls our session low, 49.75.

a close under $50 would be paramount to the downside. now for your news update. >> the senior nuclear negotiate has confirmed the issue of american nationals imprisoned was negotiated in talks. he made the comment on the one-year detention of the washington post journalist was espionage espionage. saudi arabia is one of the biggest critics of the agreement. and one of indonesia's busiest international airports was briefly closed after it was forced to shut down due to a volcanic eruption. incoming and outgoing flights were cancelled for about two hours. and mcdonald's could start offering all day breakfast as early as october. they started testing the idea in

march and was encouraged by the results. that's your news update for this hour. back to you. >> s&p down 4. apple the big mover this morning. the company didn't break out the effects of the widely anticipated apple watch as its own category but the ceo did say he's excited about the watch in the long term. >> we're more excited about how the product is positioned for the long-term because we're starting a new category, and as i back up and look at this with 8500 apps, we've already announced the next operating system watch os 2. it will bring native apps which are going to be killer to the watch. even though store selling was

delayed. we learned a lot. based on the experience, we're planning to expand our channel before the holiday because we're convinced that the watch is going to be one of the top gifts of the holiday season. >> our next guest downgraded apple today to market perform saying the watch is not expected to significantly contribute to revenue for a couple of years and that iphone numbers were tepid. tim, i've read so many analysts notes this morning. i believe you are the only one that actually downgraded the stock and cut estimates nature what are you seeing that others respect? >> there's still a great opportunity here in absolute but in terms of relative i think from here it becomes much more difficult for apple to beat iphone numbers from here. this has been all about new version beating numbers and they've mined a significant opportunity for the six and six plus. i think moving forward, the opportunity is more about price

reducing the six and six plus than about growing the new version they're launching in the fall. i think the new version in the fall, the units will be down cycle over cycle. >> why do you think that? isn't the case that when they're in the midst of a transformational cycle, it ramps back up and this is the third quarter we're getting results from the six, six plus which are strong historically. >> very strong. there's no question. there's a huge opportunity for the six and six plus but i think the narrative changes a bit. now to me it is more about price reducing the six and six plus mining the long tail rather than them being up cycle to cycle. if you look at the initial cycle to me it looks like it's down cycle to cycle versus the initial build for the six and six plus and also now, of course, now there's broad concerns about china.

apple is very levered to china. if you exclude china, they're growing 15%. that's a huge gap. >> china numbers showed the demand remained strong. did you not believe with the executives were telling us? >> no. i heard what they said and i think that they may not have even seen it yet. i think if you look across the board, you've had many companies, you've had united technologies and many semi conductor companies with broad exposure exposure. these companies have broad exposure not only to the infrastructure build out but also on the consumer side. many companies are indicating there was a pretty material slow down starting in may and june. i'm not sure that apple has even seen that yet. >> and what did you model as far as the watch? you said it's not going to continue to revenue for a couple

of quarters down the line. what do you make of it and do you think it will continue to impact the stock, the noisiness that they're not reporting on the numbers. >> they don't give units so you have to infer. i think they were 2.5 million, maybe 3 million. i was expecting three. people were talking about four. but the watch, there's a big longer term opportunity for the watch. once they come out with generation two, it will be much improved. i think they could sell 40 million units of the watch next but but in the near term it's still all about iphone and the ability to beat the iphone unit numbers and i think that's more challenging for the next three or four quarters and to me that would suggest that the stock moves more sideways now. we're entering a transition period. >> talk us through your valuation now that you're bringing it down. >> well look if you look at apple relative to the large cap tech universe they're trading at 13 times forward numbers.

i think it's rightful that this tine of market gets a discount to that. assume a 10% discount to that. i'm using 12 times multiple on my average numbers and that so me implies a $130 price market. i'm a little bit below the street numbers next year. i think they're achievable but they don't have up side the way they have the last couple of years. i've been bullish on apple until now. and i'm still optimistic about the opportunity in absolute but over the next few quarters i think the stock moves sideways as you enter this period of transition. >> your price target $130. thank you for joining us. >> thank you so much. >> up next on the program, new york city's controller is fighting back against the mayor's proposed cap on the number of uber drivers in the city. he'll join us live at the new york stock exchange when "squawk

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gear up for great. ♪ [music] ♪ defiance is in our bones. new citracal pearls. delicious berries and cream. soft, chewable, calcium plus vitamin d. only from citracal. s&p down a quarter of a percent. one stock to watch is campbell's soup. raising the earning for the fiscal year earnings in august. the company is holding today. the company which owns campbell's soup name saying pep ridge farm is struggling but analysts are optimistic about the strategy. tomorrow we have an exclusive out ceo. she'll be on "squawk on the street." again, an exclusive on the stock that is moving in a company that

is very much in transition mode. >> watching them closely. when we come back uber's battle with new york city is heating up. we'll talk to the city's comp controller. if you thought the sharknado movies were not enough sharknado 3 premiers today and we'll get the inside scoop from the screen writer who will join us live after the break.

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we continue to keep our eye on apple now. 124 after bouncing off the moving average again last night after earnings. a lot of people considering it the key to watch today and it certainly has our attention. in the meantime ridiculous and unexpected is how the writer of sharknado has described the third installment of the hit. this time they rain down on the nation's capitol. more celebrities. the film's screen writer thunder levin joins us from los angeles. it's great to have you back. congratulations on this one. >> thank you very much. good morning to you. >> was this just crying out for a third installment?

>> i think it was crying out for a third, fourth there's no tell. >> ian ziering says these are bad movies that capture the imagination. is that what you're going for in. >> i'm not sure that we're going for bad movies. if people enjoy it it's not a bad movie. people seem to have fun with it. >> what did you set out to do? >> we set out to make a mu seaovie that people would have fun with. it's just a fun ride. there's not a lot of deep thought. >> can you walk us through the plot points? how do you top "sharknado 2"? >> we have three times the sharks and 100 more hoff. you keep going bigger and better and each. the first two took place in one city and now we're hitting the

entire coast. and for your viewers, sell umbrellas, buy umbrellas. >> people are talking about the cameos. obviously, some reviewers say they're not allowed to tell us about something involving a famous beach life guard. is hasselhoff the key to this show? >> i don't know that he's the key. i would say that ian ziering, tara reid, our entire cast is the key. david hasselhoff will play a pivotal role in the end of the film. >> if you could sell this property to any channel, streaming, broadcast, cable, where is your head right now on the rainbow of options you have as a producer and screen writer? >> well i think where we are is right where we need to be. sci fi channel is the ideal

channel for our movies. >> why is that? >> because their audience is the one that will appreciate this kind of insane ride. >> and are you serious when you want to go four five six? i mean your appetite for this is limitless? >> well as long as the audience's appetite is limitless, i think we can provide a limitless stream of flying flying sharks. >> and how -- i remember last time we talked about how long it took you to write it where you dream up the ideas for the narrative. was it easier this time in does it get easier over time? >> actually it gets harder because each time you use it you use up some of the ideas. this time we really crammed four different movies into "sharknado 3". we have a white house down die hard thing in the beginning. we have a road movie. we've got a disaster in a theme park movie and then for the end we go even further than that.

every time you do one, you're using up material. but, you know there are a lot of sharks in the ocean so we should be able to keep coming up with things. >> we hear thunder, we can't wait tonight, 9:00 p.m. sci-fi. good to talk to you again. >> thunder levin, we should mention, nbc universal is the corporate parent of sci-fi cnbc and a bunch of other folks. thank you. got to mention gardening shears, which are also a weapon. as the battle between new york city mayor bill de blasio and uber continues to escalate the city's comptroller is urging the city council to delay the key vote to put a cap on for-hire vehicles in the city. comptroller scott stringer writing in a belong post the government must not pick winners and losers by stacking the regulatory deck. rather we should lay the foundation for creating a transportation network that works for both drivers and consumers.

joining us here is the new york city comptroller, scott stringer. does this vote look set to happen? as early as tomorrow? >> incredible as it seems, there's actually going to be a vote taken in the city council to cap uber even before a study is concluded. so we're doing this whole thing backwards. we are a city that should be leaving, leading in the innovative economy. we should be thinking about worker protection as it relates to our transportation network. and we're doing this all wrong. and think we shouldn't go in this direction. >> just do bring us all up to speed on this. i've seen on uber now the tab, the de blasio tab of what would happen and how long it would take to get a car if he got his way. what would it do to uber and the number of drivers out there on the road? and jobs in the city? >> here's what we don't want to see happen. we want to make sure that everyone in our city beyond manhattan can get a car. we want to make sure people in the bronx, staten island and

brooklyn have access to transportation, both in terms of access of getting to and from work and to enjoy the whole city. for too long the yellow taxi industry has been the monopoly. they've navigated government very well. rather than invest in technology these yellow cab companies were investing in politicians. so uber comes along and becomes the disrupter. i think we should take advantage of this moment help the yellow cabs get into the 21st century in terms of building their technology and strike a balance, there's a lot of workers who come to this country and we want them to have opportunity to have benefits and a real opportunity to make a living. >> there's a concern about con jeks jegs. there are 13 14 yellow cabs there are 26,000 uber cars and now they're talking about limiting to 200 new licenses however often it is. so do those 26,000 uber cars stay on the road even if the vote goes through?

>> yes, that's my understanding. but here's -- >> that's a lot of uber cars. >> we have a huge we have a huge number of people who need to enjoy our city. remember we're 8.4 million people. the problem with this is sure let's look at congestion i'm concerned about congestion. but we have a study that we're urging the department of transportation. do the study. get the data. >> you said just now very pointedly that the yellow cab industry i think the words you expressed, very good at playing the political field. uber would point out that bill de blasio received hundreds of thousands of dollars in your political campaign which you fought against, from the yellow cab industry. do you think that is relevant to mention in this environment? i mean what exactly are you saying about the mayor? >> i'm not going to go there. i mean the mayor is an honorable man. we work closely together. we don't always agree, but the comptroller is supposed to be the watch dog, my job is to call it as i see it and here's what i

see. we cannot cap one part of the industry and give another part of the industry a free pass. we have to invest technology into our yellow cabs people have worked a lifetime to secure these medallions,er that down 30%, 40% for the city. uber has to become part of our city. there's a surcharge yellow cabs pay for investing in mass transit. i think uber should do the same. there's a whole issue of workers rights and making sure we protect the people who dot work with these car companies. here's what you can't do you can't pick sides. that's something we shouldn't do. and that's the same thing as saying i like samsung over apple. i'm going to cap smart foensphones with apple because -- >> that doesn't work. >> yellow cabs are capped by medallions. >> there's a lot of yellow cabs. >> you feel bad for guys who bought a medallion years ago. they probably knew the industry needed to innovate but they had

no juice, right? how are they supposed to invest in cap ex and write algorithms if the tlc and their leaders weren't doing that? >> i want very much to help the people who own those medallions. but you don't do it by trying to pick sides or do it at the expense of these other companies like lyft and uber. why don't we have a conversation? city hall should bring everyone together. this san incredible transportation moment not a political moment if we get this right in new york city we can be transcendent. new york city should be leading wait in figuring out what our transportation infrastructure is going to look like. not just car for hire services. but investing in mass transit and building out rapid transit if we do this right in new york city we don't think politics we think right about infrastructure, transportation infrastructure, we'll be the defining leaders, that's what new york is all about. >> there are a lot of sides to the story.

i want to bring in uber's we spoke to uber's general manager who was on "squawk box" this morning. speaking about how a service like uber is the answer to helping congestion problems in the city which the mayor says he's trying to do. have a listen. >> technology is the answer not the problem. so a product like uber pool which encourages people to share their rides. that's what's going to get cars off the road. >> so he says technology is the solution to the problem. that the mayor is trying to fight, which is congestion and pollution. >> why don't we actually have a study, look at what uber says look at the yellow taxi cab industry and let's do the data let's invest in the data study and then we make decisions on what's best for new york city. but you don't put, you don't cap before you have data to think, to analyze whether that's the appropriate measure. we may find that that actually would hurt congestion. and i just think there should be a time-out a pause, let's not rush to a legislative solution

before we conclude a study. i think that's fair rational and i think we have to bring sanity and strategic analysis to this process. >> i think a lot of people would agree with you, we'll see how the vote shakes out. thanks for joining us to make the case the new york city comptroller, scott stringer. we did reach out to the mayor's office for comment, we have not heard back. although they have talked a lot about why they're planning to do this let's send it over to jon fortt in san francisco with a look at what's coming up next in "squawk alley." good morning, jon. >> good morning, sarah. we got you covered coast to coast. we're going to be talking a lot of earnings, buzz around apple earnings the iphone number disappointed a bit but the stock has come back somewhat from the after-hours lows. also microsoft, some concerns about guidance. how is that transition happening from--premise to the cloud? and there's yahoo, the turn-around effort continues, didn't seem to show up much in last night's numbers. we'll cover it and more coming up.

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