welcome back. breaking news. a huge move in wal-mart today. john fort and kayla joining us here at post-nine. s&p capital tells us one of the top 25 worst sell-offs ever. you have to go back 15 years to see a decline like this one. >> they're doing that in the face of a relatively flat sales outlook for the current fiscal year, and along with that e.p.s.

will come in way down 6% to 12% where the sell side was looking for something closer to 4% or 5% growth. with that not only has wal-mart become far and away the worst dow performer of the year, but closing in on a 10% loss for the day. >> and taking the dow negative with it. the dow had been positive right before we started getting these headlines out of the company's investor meeting today. you were just talking with the fact that doug mill mill airborne was on "squawk box" this morning, and he talked about the outlook for the company and the macro. then we started seeing the headlines. you can see the press release, and you can see the move in wal-mart. down 9.5%. they're also announcing a $20 billion buy back. they say the bulk of that will occur over the next two years. it replace the remaining $8.6 billion that they had outstanding under the current program. certainly with 9.5% decline, as perverse as this may sound, it's getting an attractive buy-in

price. >> yes, indeed. courtney reagan has been watching not just the news and the stock reaction, but the way in which the company is trying to communicate what's turning out, courtney, to be a more complicated message than we thought. >> it is very complicated, carl. that's right. we had wal-mart ceo doug manage mcmillan on "squawk box", and other than saying they were giving more in depth guidance, we didn't anticipate we would see numbers like this. it wasn't until mr. mcmillan got up and gave the beginning of the presentations, welcome, where he began to sort of hint that he was investing in the long-term, and i turned to my producer, and i said, oh, i think we're going to get some big downward moves here, and then we certainly did when charles holly was cfo got up there and gave us some of the numbers. wal-mart saying it would be flat and largely due to the currency bakt. reiterating they are in an investment phase. they will add $45 billion to $60 billion in revenue over the next

three years. that's an annual growth rate of 3% to 4%. then when you get to the earnings per share for 2017, they were saying it will be a decrease of 6% to 12% from where we are in fiscal 2016. 75% of that is a reduction. 75% of that reduction comes from the wage increase. they're making a number of other investments when it comes to stores, digital, supply chain, international. among other things, they are also going to continue a share repurchase program. the board has approved $20 billion over the next two years. still, investors are not impressed. you can see the shares there falling more than 9%. the analysts are sitting right above you guys downstairs at the new york stock exchange listening to these presentations. the question and answer session with the executives is going to come at about 12:00. i don't know if it's going to get all of our questions answered in that one hour. i don't think that the analysts were anticipating what they got here today because these numbers are very far off from the

estimates. we've got a lot of things to work through here as this day goes forward. >> yeah. we're not even gotten to why things like low gas prices are helping the consumer and offering cash flow a little bit more. obviously, a lot to talk about regarding china, the yuan, exports. if you missed this t morning, doug mcmillan was on ""squawk box"" and this guidance was not out at the time, but he talked about their investment in technology and in their workers. take a listen. >> competition is change, and the world changes fast. rates started to move in the market despite what we had done. i think it's a combination of things that got us to this place. what we're doing about it is what matters. >> by the way, at these levels for a poemt there, when we were down 9% plus, you fwot to go back 20 years to see a decline like this in wal-mart. this is "squawk alley" and we

would be talking largely about tech this hour, but part of this is trying to keep up with technology that they would argue has become outdated in their stores. >> part of it is -- i wonder if we're seeing a little bit of a theme. we're going back to earnings last night. >> that's nothing near what wal-mart is talking. >> amazon has been making these investments over time and condition investors to them. certainly parts of amazon's business, quite plausible. we see the numbers broken out on cloud for them. a business that they pretty much

invented out of whole cloth. the margins on their traditional commerce business as well thought to be pretty decent. it's the investment that is they're making in up and coming areas like streaming, areas where wal-mart has not been as aggressive that account for the fact that we don't have amazon posting profits quarter after quarter. >> previously it was a billion. they have more than a dozen start-ups. they've been refocussing, rebuilding their on the ground footprint in fill convalley trying to get ahead of the next thing. john, you wonder how much of this is playing catch-up and how much more they might have to spend from here.

>> it's got to be playing catch-up. absolutely. am sdmron is spending that on just original content. >> right. we're talking about amazon, essentially, eating wal-mart's lunch on on-line shopping. it comes on a day where j & p cuts oracle because aws was eating oracle's lunch. it's being felt all over the place. by the way, wal-mart, market cap now under $200 billion. amazon, $254 billion.

of the time that wal-mart has fallen 5% in one week, 85% of the time it takes costco down with it and genesco down with it, macy's, nordstrom's, kohl's. an average change of roughly 6%. certainly, keep an eye on wal-mart and others names in the seconder. >> one story, one narrative, david faber, who has returned to post nine that's quickly made its way to the forum and whether or not they're increasingly a target. >> it's an interesting point and one i hadn't thought of. you got to remember the walton family still owns an enormous amount of this stock. while it's in different hands and certainly amongst the grandchildren and things like that, they can coaless. that could make it more difficult for an activist to try to show up to actually bring any sort of board representation.

it's ab interesting point that you raise. i certainly would have issues simply with the way they rolled it out. i know i tend to focus on that, but when you see a 9% decline roughly in a company of this size, you do wonder about the communication side of it and why they chose to go about doing this the way they did, which i would argue is very sloppily handled by wal-mart with a press release that wasn't out early this morning and clearly was a material change in the guidance in the company. >> it's a very complicated release. there's a lot to work with there, david. i would love to get your take on the optics of announcing a $20 billion buy back at a time when you are expecting earnings growth to be muted, investment in the business to be heightened. it's either perverse or it's brilliant to say that you expect your stock to be weaker over the course of that investment so, therefore, you view it as an attractive investment. how should we be reading that? >> you know, it's a good

question, kayla. i would refer you to a quote from the cfo. now, of course, to kayla's point they're going to generate $08 billion in cash over the next three years, and they say given the current landscape, whatever that landscape may be we a strategic opportunity to use that $80 billion for repurchase over the next two years. they see it as a strategic opportunity now, kayla. i'm not sure what they mean, though, by the change in the landscape. i'm not in the meeting able to ask questions. mcmillan was on our air earlier this morning, but we did not have this news to be able to ask follow-up questions. >> and i might add was asked

directly about the economy and how the coming year was shaping up. shows obviously not to go there. finally, courtney reagan, i'm told that wal-mart has lost more in market cap today than nearly half the s&p is worth. >> yeah. i mean, those -- these numbers are substantial, and to see wal-mart down this much, i mean, we talk about it all the time, but wal-mart is gigantic. yes, i know in market cap now amazon is bigger, but it's the world's largest retailer by revenue. it employs more people than i think the department of defense or the chinese army. i mean, it is just massive. when you see these big numbers, it takes on even more intensity. i will point out as we talked a little bit about the roll-out of all of this and the communication, the investor relations -- the head of investor relations that's been there for some time actually moved on from wal-mart in august.

i'm not saying it has anything to do with it, but maybe it does. there's a new head of the investor relations department, and the cfo is moving on. have you some movement there too. on a relative of what was a flat take. people are saying largely it's about the shopper. >> which is interesting. >> costco shopper tends to be a bit higher-end paying to get in

as opposed to wal-mart. there is a flip side to this. the han street angle, they're going to invest more in technology and will be spending that money somewhere, right? also, they're going to pay their people more, and they have a lot of people to pay. >> it sounds like that money is going to somebody else. >> it won't be gasoline. obviously a major story. we're going to cover it all morning long. thanks to everybody. we'll take a short break. dow is down 91. half of that is wal-mart. back in a moment.

wal-mart quickly turning into the story of the day as they talk about their investments and increasing the minimum wage, technology, and a relatively flat sales outlook. that is almost anal.5% decline on wal-mart. got to go wack to 2012 to see prices this low. joining us this morning, founder fund jeff lewis. good morning to you. >> good morning. >> is this an isolated story about a retailer trying to turn around their shopping experience, or is this about the lack of america shoppers willing to spend enough money to guarantee a margin? >> i think the real story here is that it really does represent this massive tipping point for e-commerce.

>> it's really coming to the forein this powerful way. once this shifts, it always takes longer for these things to shift than people expect. once they do shift, as wal-mart certainly has today, it sort of happens very quickly. the unraveling tends to happen very quickly in all these ways. >> jeff, help us visualize exactly how yumted technology could help wal-mart. we know they were among the new users to have chip-based terminals. what else could we see coming to the consumer experience that would be visible to the naked eye, that we can think, okay, this is where the money is going, this is how it's being deployed?

>> i think they've been among the best in the world as doing that, but they've extracted all the value they can from all the sort of backend technologies, and at this point the technology investment they need is one to drive sales growth with consumers, and they are massively handicap odd that score there. obviously companies like amazon. there are merging private companies. companies like wish and jet, which is an e-commerce play. these businesses are a real threat to wal-mart. people stimplly find it less preferable to walk into a store when they can get the same things on-line delivered very, very quickly in some cases in near real-time for the seam or lower price.

>> you wrote that the -- >> yes, carl. i'm sure he was this morning knowing what was to come. you know, certainly last year at the analyst day we heard the same hinge from wal-mart. talking about that this year would be a year of investment, and clearly we are just getting started when it comes to investment spend. you can blame amazon. they are forcing them to camp up with their e-commerce brand on-line and make the storage more compelling. >> stacy, it seems like 75% of this hit is because of the wage increase that they expect. is this because of a change in leadership thinking with new people at the top at wal-mart,

or had they just kept wages so low for so long that they absolutely could not sustain that anymore? >> last quarter 90 basis points for wal-mart. look forward. you're paying your people more. health care is costing the company more, but the consumer isn't necessarily spending those incremental dollars in the store. >> it's david. we know that other big retailers are also suffering right now. target or costco down. i would note in the release they seem to have actually increased

their net sales growth target from what it was in february where it was 1% to 2% to now 3% top line. this is not necessarily about their top line view, is it? i wonder whether, therefore, it's fair to say penalizing some of the other large retailers out there. >> that's an excellent call-out. you are exactly right. you know, the currency -- they're talking about flat sales this year because of currency mostly. you know, let's take the holiday panic aside here. let's put that aside. four owe retailer that is are taking it on the chin, like costco, tjx, time to take advantage of those opportunities. what wal-mart is really talking about going forward is the spending part of the equation, the investment part of the equation. i don't know if i believe the longer term goals, but this is

not a warning necessarily that the bottom has fallen out for holiday. >> stacy, they're saying that cap x -- or capital jechinvestm as they call it, will be $11 billion and flat in 18 and 19. that's below their forecast for the previous two fiscal years. >> it is, kayla, and certainly the cap x is coming down, and why is that? it's because they're opening less stores, which is a good thing. this is what we want. this is what we need. i have said before retail needs to go on a diet. that is a welcome piece of news. on the flip side of that, obviously, there is spending that needs to take place on technology, on improving the stores, and most important, getting their e-commerce competitive, which they have really fallen behind and neglected that part of the business. >> and jeff lewis, when you think about what stacy just said, getting competitive with amazon, or anyone of the major

players on e-commerce, how long of a process is that? is there any catching up really? >> they're not going to be able to catch up on e-commerce. i mean, that table is set. they don't have any comparative advantage on that. consumers don't associate wal-mart with going online to buy things. wal-mart was driving events in the store and going in with a shopping cart spshgs they are really handicapped on that score. >> amazing story. on a day where retail sales show that people are spending on their cars, but maybe not a whole lot else. we'll get to that. jeff, thank you to you and stacy. thanks, as always. when we come back, we're going to talk to someone who just walked out of the wal-mart meeting. he is going to join nuss a monument with the dow now down 119.

wal-mart, a big story as they bring their guidance in. the historic sell-off of more

than 9%. stacy on the phone. joining us jay rogers who just left the wal-mart meeting. can you describe what you saw wrup sarz? >> wron if they'll let me back in after this conversation. i was sitting in the second row. as they laid out their activision, i thought, wow, this is a very dust-up communication going out to the street, and you are seeing the reaction. the stock is down considerably. i think they're telling the right story, right? they're going to be this great onlean business. they're going to put the money into on-line. they're going to be a big player in on-line grocery. i like the story, but the cost of doing it has hurt their stock significantly. >> how do you like the story? >> because i don't think they have a choice of how they're going to compete. they've got to be competitive with the am sxwlons of world. they have to be competent tiff in the grocery space. they have to do what they're doing. they had to raise salaries, hfs part of the tip they're taking here. i don't think there was an

option for them to do something different. then weigh saw tj maxx follow suit. do you think that puts a chill on other companies for that matter doing this, seeing the reaction that it caused for wal-mart? >> well, as i recall, being on air to talk about that when they did it, i said barack obama should give them a phone call because it was the greatest thing they could do for a minimum wage because when wal-mart raises the minimum wage, the minimum wage goes up. you do think they had to do it. they had to be competitive. they had to bring the employee back into the fold and make it all work. once they did it, it was a big hit to everyone else, and my contingent was that wal-mart would handle it better than other people because they have the supply chain to push it back against, and it's hard are for other people to do that. i do think that it makes it hard

for all the rest of retailing who has to play the same game with them it sounds like you can spend a few million dollars, and then you become a world class e-commerce player ready to take on am sflon. if it was that easy, you think a lot of other people would with have done it already. is wal-mart really ready to do what they say they're going to do it and do it on mobile as well. we know how tough the find for talent is for people who can build this stuff. maybe they can grab a few dozen people from twit earning but that's not going to do it. are they actually able to execute on this plan? >> they got 2,500 people on the west coast trying to do it. >> they've already got those people and haven't done it. >> they're currently moving forward on doing it. right now you would say that the best omni channel retailer is nordstrom and the second best is

macy's, and wal-mart is working hard at being the next best one, and they have the biggest infrastructure so to do it, and they're building new warehouses to do it. they've got all the stores in the country that you could possibly want to be close to the customer. do i think they can win against amazon? they can play the game, but what's the definition of winning against amazon? it's not like amazon is making any money on their on-line. when david asks why is target down, is that people expecting more discounting in apparel and fwroeshry? why would it be having an affect on some of the other big retail competition? >> well, wal-mart just raised their estimate on the sales they were going to do. if are you competing with wal-mart, you got to step back and go got to come from somewhere.

>> wal-mart is going to be 3% growth in sales. >> yeah. >> on a company that's doing, what, almost $300 billion in the u.s. where is that coming from? >> over people have to suffer. >> you are obviously -- he is a young man, but this is a big bet, isn't it? >> i think that if you are the brand new guy, which he is a brand new guy, right, and you say you're going to do all the things that have to be done to make wal-mart competitive nationwide in omni channel retailing and you are willing to spend the money to do it, i

don't think anybody is throwing doug mcmillan out. he will be with us for 20 years. i think he said i'm going to make this happen, and it's happening. >> i know we have other perspectives on this matter, but because you were in the meeting, i'm so interested in the color, in the tenor, the mood of the people who were there to see a move of this magnitude in wal-mart, the contagen elsewhere in retail. volume quadruple. were there people on the phones talking to their brokers rushing out of the room to sell wal-mart stock? what was the reaction? is. >> one of theed reasons is there was no place i can stand without somebody else using their phone. yeah, people rushed out of the room and got on their phones. people stood outside in the room talking about what they had just heard.

what would it be if not for this investment turn? radio shack? stacy? all right. i guess we lost staty. what do you think the toons that question has been? >> i think the answer is if you are a $500 billion retailer, you are never going to be radio shack. especially when you are an a-rated retailer, and especially when you can buy back stocks and pay a dividend forever if upped to. if you believe the other side that they can make it all work, and i personally do. i know there's a lot of skepticism, but i think doug is doing all the right things. there is a point here where people are going to be buying in, right? we've seen a big decline today. i suspect there's a lot of

people standing around going maybe it's now. >> what now is wal-mart's key competitive advantage? amazon has moved away from price. they have a whole suite of products you can get there from them. is it the whole omni channel that macy's and nordstrom are doing so well, that's the key advantage for wal-mart? >> that's the key advantage of anybody trying to do omni channel. you have to have enough lobbyings. you have to offer them the opportunity to pick up in the store, return to store, buy on-line, use any mobile platform they want to, and that is the cost of buying in. you've got to be able to do all of that if you are a brick and mortar retailer today to be competitive. will it be enough? i don't think any of us know that.

twai, stacy, we'll come back in a little bit. meanwhile, wrurp closed about five minutes ago. simon has an update on that. >> it's another day where europe underperformed what's happening in this country. more open, of course, more open to concerns about where we're going on global growth, and you saw asia down and the concerns out of china again. it just adds to that general tenor of concern. what's important to note is the affect of this day by day accumulatively is the bounce that you are getting off the august lows. in this it's far better than you have actually got in europe.

it's a divergence now of about 5% because day by day we don't do quite assist well in europe. for the year europe is still ahead because of that qe bounce that we have right at the beginning. unemployment hitting a seven-year low. 5.6%. that means. unemployment is now a 73.6% for 60 to 64-year-olds, and that says citi is now high for the euro zone. the yes question is when does the bank of england raise interest rates? do they pull the trigger simply because unemployment is so low regardless of your inflation concerns? it's interesting that the u.k. house builders are lower today. i can't see a reason for that other than your expecting on the bank of england might be chapging. if you walk around just on the subject of building, if you walk around big cities in this country, certainly new york,

you -- one-third of its revenue comes from this country has taken a big $77 million write-down because its projects here have margins that are now year-long lows. partly because it would appear those in charge of the projects keep changing the goal post of what they should be doing. one more with the top loser. one more from earnings season. asml, the dutch maker of machinery that makes microchips today gave a sales warning for the fourth quarter that has disappointed many. it is an indication, perhaps, of capital expenditure to come in semiconductors and, therefore, of the concern that you have more broadly about where chips are going. guys, back to you. >> when we come back, a lot more on the wal-mart sell-off. take a look at some of the dow lagards right now. virtually not a single retailer is in the green. everything from dollar tree to sears, penny, you name it.

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>> here is your cnbc news update at this hour. the violence continues to escalate in the west bank. a palestinian attempted to stab paramilitary police at an entrance to a jerusalem city and was shot dead. israel has started deploying soldiers across the country to combat a wave of palestinian knife attacks.

two mobile homes were destroyed by a fire after a small plane crashed into a trailer park in palm beach county, florida. several people were killed. several investigators are on the scene looking for a cause of that crash. martha stewart says she wanted to buy k-mart before it was sold to sears, but she says another executive at martha stewart living was less bold than she was and was against the buy-out. she regrets the purchase didn't happen. the chicago cubs are on to the national league championship series after beating the st. louis cardinals last night. ticket prices, they are going through the wiggle where i roof. the average price of a ticket for the upcoming series is over $1,300, making it the most expensive lcs ticket ever. that's the cnbc news update this hour. back to "squawk alley" and carl. >> thank you very much, sue. as we've been covering this morning, wal-mart down over 9%. this is doug mcmillan, wal-mart ceo, earlier this morning in an exclusive interview on some of the investments they're making.

>> we've got a storage business that needs investment and the investment that is we made in people and training and in stocks, faster check-outs, those things are starting to pay off. in the stores we've got fast, clean, and friendly stores that have gone from 16% favorable to 67% today. the customers are telling us it's working. >> obviously that was before the news came out regarding earnings. a lot of other retailers taking a hit off of wal-mart's move. bob pasani is on the floor, and you don't see this action this big intestine. >> a lot of people scratching their head. we're he having a tee bait with whether this drop in the other stocks is justified because wal-mart is moving the whole retail sector. let's look, for example, at department stores.

target is down. dollar tree is down. kohl's is down. ru storage is down. varying numbers here, but target obviously the most direct pe tore with wal-mart. down 4% here. tumi down almost 3%. what's that got to do with wal-mart? kate spade. coach also dropped. the whoa retail sector on average dropped roughly 1%. even home improvement stocks. >> the cfo made it clear that 75% of the lower earnings guidance that they gave was due to the fact that they're paying higher wages. it's not because sales are

plummeting. s they have more costs overall for paying their employees. >> that is word competitive that's hurting maybe some of the other names. courtney reagan back at hq. ahead of the holiday season. might be additional things going on sale. >> absolutely, carl. that is very true. stocks seem to be one of them today if are you in the retail category. especially wal-mart. no cameras are allowed into the presentations that are going on right there at the new york stock exchange. they are rolling out a web cast, and that's how we've been able to monitor it here throughout the session.

if we show the growth project ebbings for e-commerce side-by-side with the segments, you'll see that we expect this business to be increasingly significant growth engine preconsistent with what we told you in the past. it's important to note that the operating losses will reduce over the next three years. >> but over the next three years it's going to be a little painful when it comes to the eps growth. it just doesn't look like it's going to be there. the company is forecasting a drop of 6% to 12% for 2017. eps as bob pasani said there, 75% of that, the company says, is a result of their investment in those higher waejsz. there's just a lot going on in these numbers. the q & a with the analyst, which is the final portion of today's presentation, will begin in about 15 minutes. i said it before, but i'll say it again, i don't know if an hour is enough to get all those

questions that those analysts must have in that room. back to you. >> well said. real quickly, he wonder what success looks like in wal-mart's mind? you just heard jan rogers nippin say they're making a run of being the amazon with stores. an amazon with a multiple of the distribution centers? >> they've already got the distribution centers if they can use the stores for that. instead of just amazon, that is ae tough road to hoe. >> that is where mcmillan expects to see results. you ask him matter of factually when they first announced this, how he with l measure the success of what was even then a $1 billion investment, he said same-store sales.

more on wal-mart when we get back from the breck.

>> coming up on the halftime show, we'll have more on the wal-mart stunner. the stocks suffering its worst day in years on a sales guidance. our pros will weigh in on what to do now. we're also going to take you live inside that analyst meeting for a question and answer session with the ceo and the cfo to give you more on exactly what is going on inside wal-mart right now. plus, big bank earnings in focus. we'll talk to star analyst mike

mayo, and we'll go value hunting with one of the best in the business. bill nigren on what stocks is buying right now. certainly wal-mart is the story of this day. we'll be all over that. >> sounds good, scott. thank you very much. we, in fact, are still watching wal-mart after their earnings guidance and the subsequent stock decline. joining us on the phone today, cnbc contributor and former office depot ceo steve joins us on the newsline. steve, it's good to talk to you again. good morning. >> great to be here. thanks. can they do it? >> this is -- they have to. they have no choice. this is important for them. this is what maturity looks like, and this is what saturation looks like. you know, they have been growing for decades based on taking a small box, making it a bigger box, making it an even bigger box, adding food, making super centers. they're running into competition and bricks and mortar around the

world and -- their concept hasn't worked everywhere. dollar stores are hitting them here. juxtapose these two numbers. wal-mart expects relatively flat sales this year. theerl getting killed by the internet, and they don't have any choice than trying to create their e xhersz business. >> the part that keeps hanging me up is if it were as simple as throwing money at it, a lot of people would be doing it as well as amazon. is there anything that you see either in this wal-mart leadership team, in this environment, that should give investors confidence that they're going to be able to turn this around in two to three years, and they seem to be suggesting they have a plan to do it. they got to a saturation point, a maturity point.

it's very, very difficult. they have got to throw everything at it. i mean, as i said, it's -- they've got a great management team. doug mcmillan is a great guy. he has a situation where he has to -- he has to reenvent this business in a big way, andist fwog take a lot of money to move this mother ship. can it be done? i don't know. the question is the brand. does the brand stand for something that people don't want anymore? then you have, you know -- you have the cost base that's coming in. you know, they've had to raise their salaries. this $10 an hour move is costing them i calculate about $1 billion. these are huge numbers in cost increases that they're having to sober. it's very difficult to change the wheels on a moving train, isn't it?

>>. >> is this what investors should expect? >> i think that's the key point, isn't it? amazon is not making very much money, and jeff bazos has said right along as a key shareholder, look, we're going to focus on growth. we're not going to focus on this. what wal-mart has become is a cash cow. i mean, the fact that they're able to throw this much money on it suggests that -- i think that their best thing -- the best thing that they could do is really call it a reset and i would -- i would call it much more deeply than what they have and just say, look, we're going to have to remake this entire business. their stock is down 9% so far. heave got to really reset expectations.

you can deliver inexpense i products, but when you can have the internet able to deliver without any fee at costs at or below the dollar stores, which is at or below wal-mart, you know, it's just intermediating all of these bricks and mortar retail. why do you need bricks and mortar is the big question? the only bricks and mortar retailers that are going to survive long-term are the ones where you have to go there. either it's experienceal. you have to try things on. the fashion kind of thing. it becomes entertainment. i think for basic daily goods, which is what wal-mart is, it's -- they've got to build something else.

>> if you study retail and you study these kurnz, you know, these growth curves where they go -- where company after company and sector after sector has gone through these high growth and then there's maturity curves, it's very difficult you wonder whether wal-mart shouldn't take the cash and buy amazon. i don't know if it's possible. really remake itself and roll everything up. at some point, then, you know, that level of fixed investment in bricks and mortar kind of becomes an anchor and a ball and chain around their feet. >> yeah. this is definitely not like redecorating your house. this is like taking it back down to the foundation and starting again. steve, thanks. good to talk to you. >> great to be here.

thank you. >> steve, the former office depot chief, now head of the committee for economic development talking about wal-mart, which is trying to find some stabilization above 261. still the story of the morning, but a lot of other stocks are moving. netflix tonight. intel off the lows. we'll talk about that in a few moments.

>> john fort people still trying to make sense of the guidance on the data center enterprise part of the business. that business did not grow as much as expected in the quarter, and they pushed out some costs. p.c. business will have to wait and see. that stock opened up down 3%. now about flat. >> the journal says subscriber isn't enough to keep the lights on. it's all about getting more money from each of the users. price elasticity.

we'll see how much they can do. >> jp morgan obviously bank of america, wells. goldman and citi tomorrow. it's tough to be a trader, essentially. you can do loans, but it's tough to get trading in revenue. >> this is the first time i've actually heard executives really lamenting a rate hike and saying we need this. >> with all of that, dow down 92. scott has his hands full with wal-mart for the next hour. let's get to "the half." >> indeed, we do, carl. thanks. welcome to "the halftime show." we do continue to follow that stunning fall in wal-mart shares at this hour. a historic decline for the stock. the company's updated sales guidance has disappointed the street. we're going to get the view of our pros in just a moment. we're also going to take you inside that analyst meeting in new york city.