n now. >> good morning, welcome to "squawk box" right here on cnbc. i'm andrew along with joe kernen. kayla is with us for the day. facebook is front and center this morning. they topped estimates. they did it big time. driven by strong ad sales growth. 1.7 billion monthly active users. today is the busiest day of earnings season with more than 60 s&p 500 companies reporting. rb come can go up after the close, we're going to hear from alphabet, formally google, 56% have topped revenue forecast as well. it's a little top and bottom line action. >> among the biggest stock

movers this morning, grow upon shares as that company reports a smaller second quarter loss and raises full year outlook. adding more than 1 million new customers. that's the most in two years. stock is up by 23% and ceo will be on "squawk box" in an first on cnbc interview. that is at 8:40 a.m. eastern time. amgen tops estimates. that stock basically unchanged. cheesecake tractfactory repg better than expected profit. still upping stock buyback plan. up about 1.5%. >> we have more here. groupon. is that going to be around? >> we are going to talk to the ceo and i suspect he will tell you he plans to be around. >> it was 25, 25 dollar stock once so it's up today.

is it are a real. >> it's a real company. >> i bet the $6 billion offer they got from google a few years ago is pretty good right now. >> let's talk about alphabet. google now is a verb. it's probably known in every language. then there was another one that decided -- changes the name. and totally ruins years. p when you say alphabet, i know it's google, but google. why don't you do it some other way. keep it as google. it's google. alphabet. >> the company hasn't even rebranded from the top down. >> you can't rebrand the alphabet. stop. go back. >> it's still the google table. >> new coke was a mistake. admit it and go back. >> you think alphabet is as bad

as new coke. >> yes. i think it's a horrible name for a company. >> it's not a brand. it doesn't matter. >> but you want to have a brand. >> it's a basket. >> amazon from here on out is going to be called -- would you ever change after you've worked that hard? anyway, i know you're always working on getting an interview with someone so you'll never say anything bad, but alphabet was a bad move. >> coming with the fire first thing. >> this is such a fallacy. >> marriott is trying to get trump to come on. >> come on. you want to have him on. >> bring him on. >> wehou used to have trump tuesday. >> much marriott second quarter profit rising nearly 3%. beating forecast. hotel operator says leisure is robust and continues to see

strong bookings. gopro dropping 47%. says it's still on track to launch it's new hero five camera and karma drone later this year. whole foods, profit falling for the fourth straight quarter. same store slips amid increased competition. high end super market giving a weak forecast for the current quarter. >> let's talk a little politics. if you went to sleep early last night. here's what happened at the democratic national convention in philadelphia. president obama taking center stage. happening in prime time vouching for hillary clinton and making a point to say she will protect democracy from home grown demagogues like donald trump. >> no matter how much people try to knock her down, she never, ever quits. that is the hillary i know. that is the hillary i've come to

admire. that's why i can say with confidence there has never been a man or a woman, not me, not bill, nobody more qualified than hillary clinton to serve as president of the united states of america. >> vice president joe biden also targeting trump in his address. >> no matter where you were raised, how can there be pleasure in saying you're fired? he's trying to tell us he case about the middle class. give me a break. that's a bumplg nch of malarkey >> former new york city mayor michael bloomberg also urging americans to vote for hillary clinton and unite against trump. >> i'm a new yorker and i know a con when i see one.

we're going to get a lot more from the floor of the dnc later this half hour. >> meanwhile to today's agenda earnings likely to dominate the discussion yet again. there are still a few pieces of economic data to watch. weekly jobless claims in june international trade numbers. each hit at 8:30 eastern. let's check on the markets this morning. i did see some green at one point. at least in this country. it was a little better earlier. i think it was up 30 on the dollar. we're indicated up 15. nasdaq was strong yesterday. much stronger than the other averages yesterday because of apple. the s&p up about three. talking to sara and wilfred earlier, the fed, maybe they'll g again because the market is up. it's all based on the market. market goes up, maybe they raise. market goes down, they add more stimulus. >> they're keeping the door

open. >> keeping it open, but is it financial conditions or. >> real economy. >> stock market. >> why is it not the real economy. >> because i would say that the initial accommodation in qe was to boost asset hoping the real economy would catch up. then when we have a break for whatever reason they get tentative about raising rates. even in other areas around the world. >> they're not going to do it because of the election, but pretending they're going to as the market goes to new highs. the swrr market i would say way to market oriented, i would look at other stuff. >> you don't think it's the warnings from the world bank, the imf about what other central ban banks are doing. >> i was really worried about brexit. 100 economists said it would be bad. just take everything with a grain of salt. let's look at europe and see

what's happening there. what was was on the downside as you can see. down fractionally. asia, shanghai stayed up 3,000 recently. now it is. must have gone down a little bit yesterday, but that hasn't been what we talked about. remember when that was in free fall and that was affecting us over here. oil must have sold off late in the session yesterday. it's down again. we're inching closer possibly hitting that three handle as rigs have supposedly come back online. i saw 1 percenta.5 on the 10-ye treasury. that probably indicates some dollar weakness. you can sea the euro back. closing again 1.32. then gold had a nice jump. saw earlier it was up $12. >> let's talk facebook this morning. those shares jumping higher.

we mentioned at the top of the program the seeshl media giant blowing away estimates. joining us now. pretty remarkable earnings report. julia. >> absolutely, andrew. very remarkable. adding more users and making far more money than expected from each of those users. company growing revenue to $6.44 billion while earnings grew 94% to 97 cents per share. facebook cfo warned as the company comes up against tough comparisons, revenue growth will slow. he as well as ceo mark zuckerberg talked about the potential to grow advertising engagement especially as video takes center stage. >> we see a world that is video first. video at the heart of all our apps and services. over the past six months, we've been particularly focused on live video. more immediate and creative ways. >> and facebook is using video

to grow revenue from small businesses. now there are 60 million of them on facebook. that's 10 million more than just three months ago. >> we actually see more than 2.5 million small businesses who posted a video just isn't the last month. if you think about how hard it is for a business to create a video ad even five years ago it meant getting television cameras and a production crew. they can take the smartphone out of their pocketing and film something in just a few minutes. >> facebook vp of small business telling me that one thing advertisers have been promoting recently is pokemon go stops. we'll have to see if that phenomenon lifts results next quarter. guys. >> thank you so much. joining us now onset, senior media analyst. victor looks across the board like this is a company that's firing on all cylinders. they seem to have changed the

message a little bit. talking so much about small business and facebook as a tool for businesses. how different is that and how can they leverage that. >> they always talked about it in the past. now it's a bit more pronounced. the small businesses that have a page on the platform. so that run wway is long and wi in terms of being able to capture advertising budgets from the small businesses. >> they delivered a lot of things investors liked. the fact they were able to double their profit in six months is pretty incredible by itself. is there anything not to like. >> well, i think the one tiny little wrinkle in the print last night is engagement in the u.s. slipped a little bit and so what i think the bears on the stock will point to is the fact maybe snapchat is having some sort of exact on engagement on facebook

in the u.s. in particular: is there any risk video has an impact. if it is full of video and i don't have time to sit and watch all of it, i'll sit and scroll all the way through. >> video being one of the most engaging aspect of the flat form. i would slightly disagree. i find video to be more engaging. i think that's more additive to the social media experience. >> you don't find the video we're in the video business, but the amount of time it may take to watch a 30 second clip relative to scanning two sentences that may say something very similar or in terms as an efficient play on your time. one is more engaging, yes, but only because you have to press the button proactivelily and in some cases not. >> one of the reasons why snapchat is getting so much head

way right now over the past year is because of the fact that video is a lot more engaging and people want to see the video as opposed to readi ing text. you may see a lot more video in your news feed in the future because of that aspect. i slightly disagree with that one. >> the reason why engagement is so important at a certain point everyone who can be on facebook will be on facebook. user growth in the developed market was only about 1% so they're adding more users in other parts of the world, but the bulk of the revenue is coming from the u.s. so they need the figure out a way to get the people already on it to stay on it more. you're bullish on that. >> i do. if you just look back at the world events over the past few weeks in terms of whether it be elections, black lives matter movement, police shootings, sporting events over the past several months, that's brought a lot more people back on the

platform. i've seen people come back the facebook who dropped off the platform over a year or two ago. those sort of events are helping facebook, helping twitter become more relevant. >> while we have you because we have google coming up or alphabet rather, what are you expecting. >> i think it's going to be a strong quarter. some of the checks on google are somewhat mixed. they have several different ad units making their way on to the platform that will drive more monetization coming out of that search that you conduct. youtube is growing like weeds. the monetization is strong. >> among these three if you had ten grand to invest in one, which would you put your money in. >> i would you know, i would split it across google and facebook. it's a two man race right now. >> split ten fwrangrand, you ca even buy alphabet.

i feel like i may be wrong. i never went on facebook. i chose twitter. i don't like twitter t. stock is not really that successful of a company. if i was going to go to social media, if i'm going be social, should i have facebooked instead or twittered. >> i think the uses are different. >> they are? >> yes, i use twitter heavily. >> do i tweet. >> is is there a way to be on twitter where you don't really tweet, you just follow news services so you can get news. can i do that? can i just take myself out of the equation and just follow news services. >> that's 95% of what i do. >> i have stopped, but maybe i'm thinking i should have -- >> only you can help yourself. >> kelly is done. done with twitter. >> i don't blame her. >> and she's much happier. >> maybe facebook keeps doing well. that's the one i should have. >> still go go on.

still time. >> i may help that 1% growth rate. you said everyone who is on is eventually going to be on. >> 7.5 billion on the planet and only 1.7 billion of the people are on facebook. >> but there's a lot more growth ahead. that's my point. >> those people live in third world countries, yes. >> there's one person who shorts facebook and says it's going to lose a third of its value. you have a $160 price target. is that saturation. is that the level at which facebook at basically rung every dollar out of the business model at these levels. >> i here that argument a lot and i disagree with that gentleman. i think as long as estimates keep going up and that's because they have yet to monetize message in a meaningful way. search is an optionality for them over the next several

years. as long as estimates keep going up, valuation in the stock will keep going up. >> will they have to break out revenue. >> i think at some point there will be pressure to itemize or break it out those different plat tomorrform platforms. won't happen any time soon. you saw how long it took google to alphabet. >> stupid. google alphabet. every time you say it, people have to say it. thank you. you're a harpers bazaar? do you have an app? >> you don't get any individual magazines. >> yes, netflix. >> texture is the app. >> next issue with does it have an e on the end. >> will you look at harpers bazaar from time to time. >> i haven't, but i could. >> you need to see this. kanye is in and he's quoted.

he said. i actually don't like thinking. i think a lot of people think that i think a lot. by i don't. he does not like to think. if you were wondering, you bring up kanye. >> i wasn't wondering, but now i'm going to have to think. >> i'm going to have to think about him not thinking. >> it makes me think about kanye, but in fact people think he likes to think, but he would like people to know in fact he does not like to think. >> that was inside our minds. >> heck of a businessman though. >> he is, but he doesn't have to think about it. >> final jmajor in the year, gof major. president obama leading the democratic convention last night. first this day in history.

they told me a bottle couldn dream. that i would never become a superhero. [singing indistinctly] but i learned how to fly. just to come back in a nedisguise, and be the hero i've always wanted to be.

the second time the course has hosted this event, but the

course has hosted many u.s. opens, jack won two u.s. opens. in fact some of the best players refacing off, including dustin johnson who won the u.s. open. the defending champ, jason day. and two time pga championship winner rory mcilroy in the tournament as usual comes just a couple weeks after the open. the british open, but doesn't always do it that way. it's been moved up because of the olympics. >> what's the thing at ball tus rockbaltusrol. number 17 is a par 5. two of the par fooifs on the front play as par 4s for these guys. it's a par 7. it's a par 5 for everybody else. so it's a 70 par.

one of them is like 680 yards. john daily was the first guy to hit it in two. number four is this beautiful hole with a lake and the clubhouse. beautiful clubhouse. . >> it's going to be a great tournament. i don't recommend tuning in until nine. 9:00 a.m. >> work with me. 9:00 a.m. when the show is over. when squawk is over, you can change the channel. >> okay. in the meantime let's talk politics. president obama taking center stage at the democratic national convention. he's got a lot more from philly in morning. >> reporter: good morning. brought out all the star power last night.

and even the former mayer of new york who is not a democratic at all, but will start with tim kaine the vice presidential hopeful two took the vice presidential attack dog role last night in slamming donald trump. >> trump is a guy who promises a lot, but you might have noticed, he's got a way of saying the same two words every time he makes his biggest, hugest promises. believe me. it's going to be great. believe me. we're going to build a wall and make mexico pay for it, believe me. we're going to destroy isis so fast, believe me. there's nothing suspicious in my tax returns, believe me. now, bloomberg the independent making a real appeal at the stage to independents saying donald trump is a danger to have

as the president of the united states. saying he hasn't always agreed with hillary clinton, but independents need to to turn out in the fall. >> i'm a new yorker and i know a con when i see one. >> that's tough criticism of donald trump from his fellow billionaire michael bloomberg. then you have president obama wrapping up his own presidency, transitioning to what he hopes will be a hillary clinton presidency, and passing the baton as he said to hillary clinton. here's the president. >> there has never been a man or a woman, not me, not bill, nobody more qualified than hillary clinton to serve as president of the united states of america. >> reporter: and, joe, if you go back to the tim kaine bite we played earlier, the dig about

believe me, believe me, cane implying you can't believe donald trump, but that's one of those little things that can get under a candidates skin. trump will have watched that and wait and see whether donald trump will remove that verbal tick from his speeches or whether he lets it go. that's the kind of thing that can get in a candidate's head as they move forward. we saw all that through the primaries and now we're going to see it again in the general. >> i think george washington, there's got go be somebody that might have been -- we've had some good presidents. might have been more qualified. maybe not. the other thing, bloomberg, in fact, is kind of a democratic. i hate to tell you, but before he ran for office, he was a long time democratic until he switched parties in 2001 to run for mayor as a republican. so i've always thought he's more democrat than republican. >> where he stands on gun

control and the issues of sugar and sow da and all that, those are things republican look at and say this guy is an liberal. he's definitely more on the side of the democrats than the republicans, but he's making the appeal to independents. >> where is the future? where is the obama from 2004? biden and the clinton's and the oba obamas. i don't know. >> you definitely have a feeling you have a lot of senior statesmen shuffling off the stage. biden in particular this might be one of the last times we see him in a major national platform. every political party needs to have the young rock stars and you're right. there hasn't been an emphasis on that here. >> if you ever say i shuffle off the set. that's a bad -- that's an agest

term. >> can i suggest cory booker is clearly one of those people. he gave a great speech. >> earlier. >> not last night, but earlier in the week. >> what about chelsea. >> yes, keep the dynasty going. >> potentially. >> sara silver mman was here. maybe she's got a future in politics. stringer things have happened. >> what was the reception of tim kaine in the room? twitter ate up his dad like personality and i was crying laughing at some of the twitter comments about that and then people at home were saying it was a tough spot to be wedged between biden who is basically leaving it all on the field and the president who is a skilled public speaker, but what was the reception on the ground. >> people like tim kaine in this party. the bernie supporters are not huge fans of his. outside the arena here, the bernie supporters were still

fired up. they tried to climb over the fence and get into the secure area. that's not the base that a tim kaine is going to appeal to. he opened his remarks by talking about his son in the marines. defending the same nato values that donald trump is dismissive of so that's the kind of thing that's designed to appeal to the political center. not to the hard core base of this party, which is really out in the streets and still marching. >> when is the next legitimate poll to measure the dnc? did anyone look? seven-point la thing. and even before that the rcp average, i don't think anyone thought at the time of the convention, especially after i don't know the media coverage of the rnc, i would have thought there would be a negative bounce based on the media coverage. there wasn't: when is the next we're going to see. >> you can't given begin to start polling it until friday.

you've got hillary clinton's speech tonight. she's going to be introduced by chelsea clinton. you can start the sample reaction on friday and other through the weekend. i wouldn't expect to see real numbers until monday at the earliest. then you'll get a sense of whether there's a bounce or not. you wonder if the rules of politics have changed so much now it's a different world and a running a tight traditional convention is not necessarily the recipe for success in this election year. >> well, okay. i think the press made a mistake yesterday. i would have been talking about hillary being the first female candidate. i wouldn't have been jumping on the e-mail story again. if someone bring up e-mails and 9/11 reference -- you have to talk about which e-mail scandal. why would you let him dictate the conversation yesterday after she broke the glass ceiling the

night before. they played right into it. thank you. >> you bet. >> coming up reshaping the lux refi luxury hotel business. how his global brand deals with changing consumer taste and terror concerns. as we take a head to break, take a look at yesterday's s&p 500 winners and losers. ♪ the first stock index was created over 100 years ago as a benchmark for average. yet many people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average.

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terrorism changing the way we live and work and also travel. companies joining us to talk about the effects of tourism industry. and brexit what that means to european travel. sebastian is here. own as number of some of the biggest hotel chains in the world. nice to s chains. nice to see you. >> same here. >> started this conversation talking about terrorism and when it came on, i said to you, would you go and stay in a hotel right now in turkey, in istanbul, how are you thinking about terrorism

and how it relates to tourism. >> it's extremely related. i'm obviously looking at terrorism as being not inevitab inevitable, but the world today we're facing. i told you yes, you should go to istanbul. istanbul is a staff place. what you see on tv is what is not happening in the real world. tv emphasizes everything. make you feel that its totally unsafe and you have terror all over. it is not the case. go to ints bull and you're going to have great pricing because there's actually fewer people going there. terrorism you have adapt to it and face it. the one thing you have is prepare for it. >> has it changed your business, not just in terms of who is coming to the hotels or not, but in terms of the security costs and other things you've had to implement since. >> it's been enhancing. it's been more expensive.

at the same time, it's part of the job. when you're in the travel industry, you have good days, bad days. some geography which is going to be difficult. it creates opportunities. we're big boys. we've been doing this business for the last 50 years. we know what we're doing. we have to tell us guests whether it's safe, not safe, but we're going to give you all the info with full transparency. >> how does a manager of a portfolio, do you look across it and say this place is higher risk than this place. you're based in paris so it's close to home as well. >> aqua has been in countries and never exited because of terrorism risk. we never will. you don't want to overextend to one country. be there for those who need you most in difficult times. we are dapting.

what is happenings in paris is extremely unfortunate and violent. turkey is going to be a great country. you have problems in brazil. it's going to come back on its feet. my job is to predict for the next five to ten years from today. basically think about it the long as way in the long time and just again, project yourself. >> in terms of last piece on the terrorism peace, biece. thomas cook cut the profits outlook in large part as a function of what's taken place in turkey. >> just last night, the first numbers we're down 4% versus consensus, but we're up last year in a very difficult time. the resiliency is huge. why it's actually not doing well in france and brazil, doing well in germany, very well in asia.

one balances out the other. we're going to have a good year for this year. again for the next 24 months, some countries there's not much hope. >> the impact of brexit on your business. >> difficult to assess. certainly impact when it comes to currency. currency went down and i don't know when it's going to be back up soon. however, for the travel industry, you have something new stay occasion. people in england are going to stay in england, it's going to be good for hotel. your going have a lot of inbound traffic. and you're going to have lesser outbound traffic where the uk are not going anywhere because of the currency. i'm going to be able to give you a full answer in six to nine months. too soon. too many unknowns. >> occupancy in england and across europe, are people actually going to england because the see the pound. >> yes, we have more and more continental european people going to london benefitting from a 15% drop in currency.

our currency is still good for the hotel in london. >> in terms of the strata of the type of traveller these days, you have historically focused on some of the great luxury travelers wi travelers, right now are they traveling and spending the money they used to be. >> we are in a blessed industry. we are in a industry where tourism increases. likely to increase in the next five to ten years. the high end customers are still traveling. they are very loyal to a brand. they have a soul and a lot of emotions out of those brand. then you have for us the economic brand which is half of my business which is mostly inbound travel which is basically the small medium size enterprises which are local and you're not depending on outside traffic. accor is well wait sbood the high spenders which is

international basically travelers and the locals for the economy brands. >> competitively, how do you look at the impact of the star wood marriott merger. >> i think it's a wise move. >> wise move for them. >> yes. they're creating something with strength and force. great brands. it is still u.s. based company. we are the only nonu.s. we're getting back into north america, but when you look for europe, accor is the largest by far. yes, it is great for those two to be together. it is impactful to me, answer is no. >> coming up, harry potter fever. new book setti ting sales recor more "squawk box" in just a moment. ♪

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time now for the executive edge. harry potter continues. breaking records in the u.s. for being the most preordered book on both amazon and barnes and noble. the record was previous held by harry potter and the deathly hollows which was released back

if 2007. harry potter and the curse child is set to hit bookstores on july 31. it's hard to believe, joe, that harry potter turns 20. not the character. the series. the first book came out 20 years ago. i knew you didn't mean the character. he's an adult now. he's got his own firm now. >> she a wonderful guy who knows more about international fairs. >> that's not harry potter? >> i'm sorry. that's wrong. >> a mysterious light streaking across thehe sky in california. video what residence dents thought was a immediate your shower or a smoldering satellite that broke up. i don't know. someone must have thought it was -- dennis thought it was a

ufo. experts were quick to correct witnesses. one astronomer said the debris from a chinese rocket that was launched last month. could have been a natural event like a meteor produced by inner planet tedebris. coming up, more "squawk box" coming up next. proud of you, son. ge! a manufacturer.

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almost out of this denominating season in the convention season. both political parties officially season. both political parties have nominated for president. one similarity coming out of the conventions, both parties' platforms calling for the breakup of the big banks. joining us now tim pawlenty. he's the president and ceo of the finances round table. i want to talk on the big picture. we had you on many, many times. you're supporting donald trump. what is the difference between you and the establishment republicans that make up the never trump group? and we don't need to mention who they are, but there's a lot of prominent names that are there. what do they see in donald trump -- what do you see in donald trump that has you back

him? >> i said all along i support the nominee. in the case of donald trump i don't do so without some reservation. i don't agree with everything he says. but let's look at the establishment in my party and the establishment in the other party has said for a decade or more they're going to take care of the deficit, the debt, cut taxes in a pro-growth way. going to repeal or replace or fix obamacare. fix the infrastructure, take care of the military in a way that doesn't degrade it. and none of it happened. for a lot of people scratching their head saying how did socialism nearly take over the democratic party or how did trump rise in the republican party, it's because people who do things in the normal course haven't gotten it done. people got frustrated and mad. along with economic stagnation. >> it's weird to watch how it's all playing out and obviously they have the, you know, there are sort of media narratives that -- where people, i think, some people might have a -- i know for a fact some have a

horse in the race or dollar in the race obviously. but we're at a point now where even establishment types are saying, all right. there's donald trump and he says things that make me think he is unstable or i'm not sure what he's going to do. then you got hillary clinton where they're almost saying at least i feel like there's some certainty there. i know what she's likely to do which is probably nothing similar to what she's saying right now. but when she does become president, she will do these things that i think are going to be okay. that's what they think. but with trump's it's things he said. with her they're willing to ignore a lot of the things that she has done which have been well documented over the past five, ten years. it's weird. that just the -- what a guy says means more than looking at someone's record. >> yeah. and i think the challenge and the opportunity for donald trump between now and november is to address these concerns particularly among swing voters about a sense of maybe he's not

as informed or he's a little more impulsive than he should be. but if he's got until november to try to address that. he's never going to be something fundamentally different. basically the democratic message last night was we're going to give you more of the same. and you got to country where the majority of the people think we're on the wrong track. >> as you know when we set the segment up, we mentioned at the top that right now trump perhaps more so as a candidate has spoken about breaking up the banks and specifically about bringing back glass/steagall. the democratic party has put that in their platform but hillary clinton has historically said she's not interested in bringing back glass/steagall. how do you feel about that? >> most of your viewers know that would be the law if you reinstate it that would separate investment banking functions and more to it. but that's the short version.

if you impose that kind of requirement on american banks but don't impose it on global competitors, you put american business and finance at a relative disadvantage. so only five or so of the world's biggest top banks are in the u.s. and there's other things to consider in that regard as well. but donald trump, the platform talks about reinstating glass/steagall but i don't think donald trump has addressed that himself at least in recent days. >> to clarify, i believe he has as have his spokesmen talked directly about the need to bring back glass/steagall. >> manafort did. that's a fair point. but i think people need to think through the implications of glass/steagall and what problem you're fixing. >> but that doesn't bother you that trump and his people are talking about that much more aggressively than the other side? >> well, the other side talks about it as well. in fairness you point out hillary clinton hasn't yet embraced that. but certainly the party has, key leaders of the party has.

>> governor, do you think that the never trump camp would be appeased if donald trump were held to some of the same standards as other republican candidates before him? namely releasing tax returns. it seems like a pretty simple thing to do. >> well, releasing tax returns is the tradition. he said he would after the audit. but it's unclear if and when the audit in his case will ever end. i think in some reform he should comply with the tradition or adhere to e the tradition in the case of presidential elections and release a summary of his returns. >> goldman sachs which i don't believe is a member of your organization at least as of now, when new recruits came to goldman sachs and they talked about people they would do business with and wouldn't do business with, people to trust and not trust, one of the pictures they used to put up during the presentation is donald trump. they would say from an integrity

point of view we don't want to do business with certain people. what do you make of the fact goldman sachs would tell new recruits that we're not doing business with a guy like this? who now wants to be our president. >> i can't address what they said to their new recruits. but i think at core, look, what the american public wants a keep us safe and give me a job or better job or economic opportunity. those promises or those hopes have not been fulfilled so they're looking for something different. we have to stipulate. just stipulate donald trump is different. no question about it. and people are going to have to get their brains around are they comfortable with it? >> i think most americans know, if you're going to vote integrity and ethics, the choice is clear in terms of which way you go on that. i think. that's what all americans think of when they think hillary, integrity and ethics. anyway, thank you. we appreciate it. >> thank you. >> more "squawk."

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making the case for hillary. >> not me, not bill, nobody more qualified than hillary clinton to serve as president of the united states of america. >> agriculture secretary and former iowa governor tom vilsack is here to tell us why he thinks a hillary victory in november will bring the country together. plus we're going to talk politics, markets, and the fed with roger altman. john lechleiter announcing his retirement from the pharmaceutical giant at the end of the year. we have an exclusive interview with the long-time "squawk"

guest and his successor david ricks straight ahead. facebook earnings status update. shares surging on the results. we round up the big tech earnings and preview amazon and alphabet results as the second hour of "squawk box" begins right now. live from the beating heart of business, new york city, this is "squawk box." >> welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with andrew ross sorkin and kayla tausche. and kayla, i think the ford's out. go to phil. >> a lot of earnings. colgate out as well. first let's talk about ford. phil lebeau joins us now with those results. >> kayla, this is a miss and what i would call a soft warning from ford. we'll explain that soft warning in a bit. earnings coming in below expectations earning 52 cents a

share. they were expecting 60 cents a share. that's a pretext profit of $3 billion. revenue in line with what was expected. the total margin, the analysts were expecting ford to have a total operating margin of 8.2%. it came in at 7.7%. what was the problem in the second quarter for ford? look at the incentives in north america. it did make money in europe. it also reported a slight loss the first one in a long time in china. a loss of $8 million. and then when you look at that soft warning, this is what we're going to talk about here in just a little bit. ford saying its full year earnings estimate or its guidance prior to here is now at risk. they're not changing it. they're simply saying it's at risk. we talk about incentives and a

softening retail market. $438. that's how much it was up in the second quarter. the industry average per vehicle was up $254. they had $1 billion in higher incentives weighing on net pricing. that was the big problem in north america. and again, the company now saying that its full year guidance is at risk. ford falling short of estimates. 52 cents a share is what they earned in the second quarter versus the estimate of 60 cents. we have talked for some time about rising incentives and the concern about those rising incentives. now it's coming home to roost with them now giving a soft warning for full year earnings. back to you. >> okay. in other headlines this morning, facebook set to hit an all-time high when regular tratding opens this morning. facebook earned 82 cents per share for the latest quarter. revenue also coming in above forecasts. more on facebook in a couple of minutes with ed lee. we're also going to be

getting labor department's weekly reading on initial jobless claims. that's 8:30 eastern time. looking for 261,000 new claims for last week. up from 253,000 from the prior week. two high profile names on tap this afternoon. amazon and google parent company alphabet will be out with quarterly numbers after today's closing bell. to politics. michael bloomberg blasting donald trump on his track record as a business leader. >> through his career donald trump has left behind a well documented record of bankruptcies. and thousands of lawsuits. and angry stockholders and contractors who feel cheated. and disillusioned customers who feel they've been ripped off. trump says he wants to run the nation like he's running his business? god help us. >> joining us now from the dnc

in philadelphia is roger altman, founder and executive of evercore. we understand, roger, you will make the case for hillary clinton as the next chief executive of a country. in some of the nuance that we talk about, andrew's made the points a lot that i think one you'll say is when most fortune 500 companies feel comfortable with hillary clinton. considering that is an establishment sort of a take, is that what people are looking for when 70% think that we're headed in the wrong direction and business as usual isn't what the country needs? >> well, joe, i'm not sure that the american people are focused on what the fortune 500 or the business round table or the business council think. it's just the case that an

overwhelming majority of larger businesses in the united states or at least their leaders are opposed to donald trump. >> i mean, in the notes, those are the people that are associated with evercore, i would imagine. you haven't pulled the fortune 500 obviously. and a lot of -- you know, there are a -- i know quite a few business leaders that are hesitant to overtly talk about backing donald trump because of customers or for whatever reasons. but, you know, when they look at the -- you know, the proposals whether it's cutting corporate taxes, whether it's more deregulation, whether it's not some of the planks of the democratic party in terms of minimum wage and a public option and some of the anti-business stances. i mean, the democratic party almost became a socialist party, roger. so it doesn't make a lot of

sense unless it's for certainty that business owners would back that party. the plank of bernie sanders. that makes no sense. >> well, the reality is that they see it differently than you do, joe. there've been a group of people on secretary clinton's behalf who have been recruiting business leaders to support her and if i could use a metaphorical number because the number's a lot bigger than this, but let's just say that group has talked to a hundred chief executives among major corporations around the united states over the past four, six, or eight weeks. i would say that well over 90 of them to whom we spoke are opposed to trump. now, you may think that -- you may think this or that about the democratic party or about secretary clinton, but these business leaders don't agree with you.

>> well, the small business leaders in our cnbc survey last week that steve leisman brought us, donald trump had a nine-point lead for those people. so those small business leaders don't agree with you, roger. how about this? >> were they voting or were they saying who they thought who was going to win? >> they were -- >> steve leisman's was talking about who they preferred. and remember we called it that they were split. we didn't even characterize it that trump -- roger, how many of the people that you talk to supported president obama? would 90 out of 100 supported president obama's private sector stances? >> no. i don't think they would have. i don't think -- >> but you did. and many of your people in your immediate circle around new york city or wherever with evercore -- i mean, you're one of the most prominent friends of

bill. i mean, we're in the administration. so your perception of who supports hillary and who supports donald isn't exactly -- you're going bring us a certain spin. >> well, joe, all i'm -- you and i have sparred over this many times. and i've always enjoyed it. all i'm saying is that the leaders of the major corporations in the united states, i can tell you this directly, are overwhelmingly anti-trump. >> what do you attribute that to? >> there's no two ways about that. >> okay. that could be due to a lot of different things. right? that could be due to -- >> well, what do you think it's -- >> crony capitalism. how about liking the establishment. how about lobbyists that are tripping over themselves hoping donald trump is never elected because suddenly that's no longer going to be the way that business is done in washington, d.c. how about anyone who's not establishment and doesn't -- i mean, we know about the business

round table. we know about the president, a lot of people like jeff imil have tried to work with president obama over the past eight years. they'll be involved because there are good things that happen when you're not viewed in a bad light by the administration. i would be -- if there are some that are probably on hillary's side because they think she's going to win and they're backing what they perceive to be the winner. >> i don't think those are the main reasons, myself. >> what in the democratic plank would be appealing to business leaders? which parts of -- where's the pro-growth policies, the corporate tax reform, the deregulation? where are those things for a business leader to embrace in the democratic platform? where are they? >> first, you start with the economic record of both president clinton and president obama. and you contrast that to records of recent republican presidents. it's just a historical fact that

their records were strong records. you had 23 million jobs created under president clinton. 15 million created under president obama. we have a 4.9% unemployment rate right now. we're growing very steady at about 2%. >> you know full well the past eight years and whether you call it an unmitigated success or unmitigated disaster depends on who you are. i mean, right now there's some consternation from democrats whether to make this a third term by president obama. you have to listen to the way hillary and bernie went at it on how people have been left behind in the past eight years. >> well, i just think that -- >> why would we have a 70% wrong direction for people in the country if things are going so swimmingly? >> well, i -- they're not -- things are not perfect. but you start with the economic

records. then you focus on, okay, what will secretary clinton's priorities be? she's already talked to that. they're going to be an economic plan to start right off with. center piece of which i think will be infrastructure and college affordability. and that's a lot sounder than what trump is talking about. >> should be interesting. i don't know what anyone should run on on either side at this point with the mood of the country. i don't know whether we're in a dark place or whether we're -- you know, whether it's morning in america. >> well, you're never going to see a greater contrast between two candidates in the modern era than here. it's the sharpest contrast. whatever your preferences are, it's the sharpest contrast you'll ever see. >> all right. well, that's why we have different opinions on it, roger. appreciate it. coming up, facebook cashing in on its users posting a blowout quarter thanks to mobile

advertising business. check out shares of the social networking giant right now. that's going to be up about 6% this morning. ed lee joins us after the break. "squawk" returns in a moment.

welcome back to "squawk box." the futures right now, now they're down. now they're down. down 15. earlier up about 30, then up 15.

talking about the dow anyway. the nasdaq futures are called up 9.5. facebook's going to have a big day. yesterday it was apple. and don't forget we have alphabet after the bell. it's google if it helps. shares of chemical rising. >> you're thinking of woolworth. >> anyway. dow earned 95 cents a shore beating estimates by 10 cents. why stick with united airlines when you could have allegis? when you spent how many years building a brand. maybe not united. >> when did they do that? united. >> united turned into allegis for like three months. >> how long? three months? >> i don't know. not very long. it was like let's go back to

united. >> it's just branding making a lot of money. >> alphabet. i would fire them. >> was it blackwater that turned into she? >> that was another one. we got to go. we always got go. >> meanwhile facebook posted quarterly earnings and revenue. easily crushed wall street's predictions. briefly last night touching 131 bucks per share. that's the stock's all-time high. during regular closing hours is $121.92. here to talk tech is ed lee. i'm thinking to the headline when facebook went public on the front page of "the wall street journal" and it said facebook wants to be a blue chip. i think they're there. >> they're definitely there. there was a lot of questions about is this is a real business and when mobile became the factor for everything digital they're like can we make a

business out of mobile. they're winning on all these counts. >> and the question that the ipo was what if they don't get mobile right. it's approaching 90% of the company's total revenue. should we just agree that desktop is an another category at this point? >> that's right. i think the other thing that was -- that impressed me a lot with the second quarter earnings, their average revenue per user. they're taking more dollars out of each user in terms of the value of each one. like $3.82. what's interesting is that facebook is an advertising business. the amount of money they're getting out of that from the second quarter is better than the fourth quarter last year. that's when all the advertising happens. that's when advertising heats up. >> so the bigger question is how much can they ring from each user? what is that ceiling? >> they actually talked about the earnings call a bit yesterday. they explained, you know, there's only so many ads we can dump into the news feed before

people start getting upset. so we don't want to do that. there's a ceiling. there's how many adds they're going to show people. next up is get more people and charge more for adds. right? that's the only way they're going to grow on that front. you know, sheryl sandberg ceo, she loves saying we have a super bowl sized audience every day and night. they're trying to get the tv ad dollars. right now the ad dollars they're getting are mostly direct response ads which is install this app. they're great at that. but they want the big brands coming in too. >> so i'm not a bear on facebook at all, but i do wonder to the extent you think b the silicon valley bubble is going to pop if you thinks did, how that impacts their ad business. if you go through instagram or often the ads on twitter, they are many times for new apps. right? it's a lot of new apps out there. >> because it's a click through on mobile. >> it's a click through on

mobile. makes sense to advertise there if you are a new app. to the extent you believe some if not many of these new apps are going to disappear, what does that mean to the business? >> you've lined it up exactly right. a lot of the newer ads coming or the money being spent are download this app. if start-ups start fading because of the way the economy is going, that's going to hurt them. same time i think there's enough big brand advertisers still want to come in, still curious. facebook has a whole department set up. here's the best way to use these things. they're making it happen. i think it will affect facebook less than others. >> i guess are there enough delta air lines and starwood hotels to replace here? >> yeah. i think even though guys want an app too. i think there's a level of direct response dynamic as well

as good brand advertising me meaning look at us. >> are you saying prices are going down or there's a chance they go back up again? we had tim armstrong earlier this week where he talked about advertising had commoditizecomm. >> i think it depends on where you are. right? i think for that business where you're doing add placements, there's always going to be pressure on add rates. what you want to look at when google comes out later, we want to look at their cost click rates. right? because that's going to tell us the direction at least for online advertising where it's going. and i think it is right now i think there's still a lot of pressure. i don't know that's going to go up any time soon. i think the advantage of digital advertising is that you can have that. right? there's a lot more players and places i could put my add. i'm going to look for the best rates. i think that process commodi

commoditizcommodit commodityiz commodityizes. >> people talking about whether facebook is a smoke signal for alphabet google or if it's for time warner and disneys which are still down. >> some of the upfront for television we're seeing, it's doing okay. it's doing better than it was before. so a lot o the cmos out there are still weighing the tv versus traditional. they still like tv. you have the mass audience, it's a better way for my brand to look in a way versus the tiny phone thing. >> we love tv. >> of course. >> and we love seeing you, ed. thanks for coming in. when we come back, eli lilly's chairman and ceo johnlijohn li lickliter announcing that he'll step down. joining us in a bit. but first the shore shot unlike any attempted. the video next. >> guys, you know what? it was amazing!

in their 90th year of existence, the harlem globetrotters are still finding ways to keep their fan appeal. but this one just might take the cake. a star made a shot unlike anything ever attempted. he was lifted off the ground on a sky coaster ride in new jersey. swinging at a peak speed of 60 miles an hour. he shot a basketball into a hoop located on the beach below him. that's impossible. >> pretty cool. >> not including the 30 outtakes. >> i wonder. yeah, there must have -- right. but still, 30? >> i'm just kidding. i made that up.

it's incredible. >> and check this out too. just when you thought it was safe to go in the water this summer, a 13-year-old boy gets the catch of a life time. johnny caught this tiger shark in new jersey after a long fight and a couple pictures taken during the end the 200 pound shark was released safely back into the ocean. it's rare to see a tiger shark so close to the beach. congrats to johnny and his dad joe for the amazing catch and release and for the bravery to actually go after that shark. you see it that close and actually take it down. that's pretty incredible. >> you see that rod. i mean, you had to wear that shark out before you could pull them in. >> isn't their skin like sandpaper? isn't it rough to be able to pull that? when we come back, the fed gives hints about its next move. steve leisman will join us. as we head to break, take a look at u.s. equity futures this morning.

welcome back to "squawk box." among the stories front and center at this hour, shares of ford are under a bit of pressure now. higher incentives and lower profit margins contributing to an 8 cent miss. revenue did come in, though, above street forecasts. also talk about long-term debt. japan reportedly consideration issuing a 50-year bond. that'll be for the first time and another sign that extremely low rates are encouraging longer term borrowing. and the u.s. treasury will be selling $28 billion in 7-year notes today. the auction will get some extra attention after sales of 2-year and 5-year notes earlier in the week saw the weakest demand since the financial crisis era. now to today's economic agenda. there are also a few key pieces of data we're watching. jobless claims and international trade numbers, those hit at 8:30 eastern time. that's followed by the monthly

survey from the kansas city fed at 11:00. joe? >> thank you. the final major of the golf season tees off later this morning. with the pga championship being held at baltusrol. this is the second time they've hosted this event. including dustin johnson and jason day who is defending champ. also two-time pga champion rory mcilroy will also be there. the tournament comes two weeks after the british open. it's been moved up because of the -- >> a lot of those guys aren't going to the olympics now. >> right. my daughter is carrying -- >> what are you doing? why aren't you there? i don't get it. >> he will be. >> i like watching on tv more, honestly. i do.

but she's got darren clark and berger who just won at the st. jude. and tomorrow i think she has jimmy walker. but maybe we'll make a shot of this and take a quick look. i hope she can make it. that thing's heavy. >> and it's hot out. >> anyway, the fed says we'll see you in september. steve leisman is here with more on the -- >> i love this. you don't like this. maybe investors don't but this is great. this is good stuff. the fed. >> so the pga is happening and you like talking about the fed? >> joe, i don't golf. i fish on the ponds in golf clubs. >> my sardonic take, then i'll let you go. markets at new highs. maybe we'll raise now. we orchestrated what we want, if it goes down we can't raise. >> the tail wagging the dog kind of thing. i went in yesterday with sort of

a -- here was the question for people out there. which is can you stay on vacation or do you get back from the beach? this whole issue of the great september rate debate. they said consumer spending was growing strongly, said the labor market has strengthened, and the economy is growing at a moderate rate. all those are kind of decent preconditions. then they added these two lines, quote, labor market indicators point to some increase in labor utilization in recent months. and near-term risks to the economic outlook have diminished. the last time they talked about risks, they said the risks were balanced. that was a clue they might be increasing rates. now they're taking a half step towards the idea of raising rate. my best bet here is the federal reserve probably comes back in september and talks about an interest rate hike but doesn't necessarily do one in september. it's interesting to see the economic commentary which was all hawkish. i know you just --

>> it's an election. >> i know. there's that. and let me just -- there's a lot of economic commentary that said the fed was hawkish reaffirming a call for september hike, but look at the 2-year. the yield went down on the 2-year. yield went down on the 10-year. stocks modestly rose in the sense that the markets didn't take this as hawkish. kayla, what commentary did you see from folks? going to september for sure? >> they're leaving it on the table. they're keeping the door open. i wanted to get your take on why they removed a line about the housing market continuing to improve? >> which has been doing pretty well, right? we had a big existed home sales number. i don't know why they would remove that. people were curious as to why that happened. i will say, though, this sets up very important data to come in early august when it comes to the july jobs report. some people point to the gdp report. i think we're going to look to see how the third quarter starts

a you have spp it strong and it sets up jackson hole as one -- >> janet yellen is going -- >> was not going to be all that important, perhaps. i don't know how the rhythm of this happens. the folks at kansas city do quite a good job of putting good stuff on the agenda, but the timing is impeccable. whatever happens late august always turns out to be this decisive time for the markets. >> you know, steve, have you ever been frustrated when people talk about the end of the world? >> always. >> because correct me if i'm wrong, but it can only happen once, right? >> it's a trade you have to time. >> so when is prior to this last quarter point hike, how long was it? >> it was december. >> no. >> before that one it was like ten years. >> so we've had one hike in ten years. do you know how many times you've come here giving us an analysis on whether there will be a hike? >> a lot. >> so for ten years we have --

how many words have we talked about whether -- >> are you saying you want to see less of me? >> no, no. i'm frustrated that for ten years we've talked about imminent hikes and there's only been one. it seems like we should just assume that it's a rare event. probably shouldn't waste a lot of breath on it. and they're not doing it again in september. don't come in and say they're going to do it in september because they're not. >> i thought six months is the -- you can't have the same cycle -- >> you know what i like? i like a one quarter point tightening cycle. because there have been people that said it's already over. >> it could be over. >> a quarter point tightening cycle. >> now we're into another cycle. >> i love it that you like this stuff. more than the pga. >> well, i am sincerely interested in whether or not there's a better way to run this railroad. the idea that we go jobs report to jobs report and i asked this question of stan fisher last

year. i said you're going to do the first rate hike in ten years. how is it possible that it's all dependent upon the next jobs report? you would think there's be a broader framework. i think janet yellen has done a fine job running the fed. i don't think she's done a great job in terms of communicating and finding a framework to communicate -- >> isn't the problem that they're trying to communicate and they probably shouldn't be? >> i don't think so. i think there's a lack of a framework. >> i think you never mention it until they actually do it. then we'll talk about it again. >> the transparency has given us a lot more to talk about but not really. >> and then there's 16 guys talking every week about whether they're going to raise. >> we don't talk about it just because we want to hear ourselves talk. it moves the markets. and the markets are exquisitely tied to each of these things. >> and then it moves back. >> then it goes the other way like it did today. >> steve, appreciate it. when we come back, eli

lilly's succession plan. just one day after appearing on "squawk" to discuss quarterly results. he's back and this time with the man who will be replacing him. their plan for the pharma giant coming up next. check out the futures at this hour. nasdaq is the only major average that would open in the green. that's largely thanks to facebook. back in a minute. heo watson. ur analysis of social media and conversations on various trading floors, helps us uncer insights. you know, your analysis hahelped us improve our edictive accury by or 500%. 552, to be pcise, but we can alws doetr. our edictive accury i like yr atti watson.

leadership shakeup at eli lilly. john lechleiter announcing he will retire after eight years at the helm. joining us now john lechleiter and his successor david ricks current senior vice president of eli lilly. and wow, john. just a couple days ago it seems like yesterday that we did speak. but it wasn't. it was like the day before. >> right. we talked on tuesday, joe. and we made our announcement about our ceo succession yesterday morning. once again i think we'll have a very smooth succession process here. good continuity. it's important in the business. it has a long time horizon like ours. with so many things going on in the company. >> john, we had you on so many

times as you have tried to navigate over the past eight years replacing some best-selling drugs with things in the pipeline. and whenever that happens, we're not all going to make it through. and you had some setbacks. but eventually you've managed to do that. you're 62. i don't really understand just because you've gotten to that point, why is it the time to pass the baton to mr. ricks? >> well, joe, by the time i retire at the end of this year, i'll have served as ceo about nine years. remember my hair was jet black and i had a lot more of it about nine years ago. you might remember i had heart surgery three years ago, i think that was the point in time where i said maybe i don't need to go the distance to 65. but it's a great time for transition at lilly. because we've gotten through this period where we have these patents expiring. we're back to growth. i told you on the show on tuesday 9% revenue growth in the

second quarter. so we're launching new products. dave brings a tremendous background in the commercial part of our business. he understands product development well. and i think he's the best person to lead the company from this point forward. and really take advantage of all these opportunities that we have to put out maybe 20 products in that ten-year period starting in 2014. >> i wonder, mr. ricks, i don't know on a linkedin or application, i wonder what you look for now to run a major pharmaceutical company. i'm not convinced that a ph.d. in molecular biology is the guy who knows how to navigate regulatory and government and reimbursement and insurance. maybe that's why it makes sense for you at this point. because you have a business background really more than a science background, right? >> yeah, i do have a business background. one thing i share with john is we spend a lot of time at eli

lilly, know our way around. john's worked around the company. i started on the commercial end and most recently have been heading a big part of our development along with commercialization of some of our key brands. we've worked side by side over the last four or five years really working through that patent period. and here we are with a great chance in front of us. so you'll see a lot of continuity in our strategy. i think it is a good time to look forward. we're optimistic about the upcoming launches we have. >> in the press release i saw it was interesting that it's pointed out that in this environment where, you know, we always talk about drug prices and it's a political football that people kick around. there will be a time where your contracts are based on outcome and patience. and you'll go to insurers and medicare and whatever. and you will be drawing up a contract based on whether things actually work. based on the way things used to

work. that's becoming more prevalent as we try to improve outcomes. maybe you're right, john, maybe you are a dinosaur. >> joe, i think that is the future. a lot of health care is moving towards this idea of not paying for inputs but paying for results. at lilly we welcome that. we believe in the value of our products. and we think pharmaceuticals are one of the best deals going in health care. we do careful clinical trials to register our programs. we know a lot about them but we know more once they start getting used. that future's already starting to be here. we've announced we have a couple of these going already. and through a partnership we've created a anthem, we've called for policy changes in washington to allow the pharmaceutical industry in the industry to do even more of this. i think that is a big part of our future. you're right. >> you mentioned anthem. i don't know what the future looks like at this point. and we've got an election coming up. and anthem the latest. anthem now projecting losses on its affordable care act plans.

and it had been optimistic that it was going to be one of the exceptions to the rule that they couldn't make it work. now they're saying, no we can't make it work either. so what are you supposed to do? how do we get these guys if they can't make any money that's not going to work? >> i think we need to understand, you know, sort of what's going on in the insurance market in terms of the risk pooling, in the way insurance is currently structured. i think there are a number of changes we could consider making around the affordable care act including some we've been saying from the beginning with other things part of that legislation in 2010. but this is clearly what you talked about this morning an anthem situation is clearly a concern. you know, i think ultimately the idea of getting everyone access to insurance is a good idea. but i think we can't make it work through the private sector,

we've got problems. >> crownyou know, mr. ricks. i don't know if you had the benefit of a -- i know you didn't go to xavier university. we are willing to have you on a lot here on "squawk box" as the successor to lickliter. even though you don't have the same -- but are you willing to keep us informed on the company? >> absolutely. i look forward to following john in many ways. it's been a great school for me. if it's any consolation, my kids go to a jesuit high school. >> that's a good one. do they get home late some days? >> working incredibly hard. >> they are? if you do something wrong, they get home at like 6:00 at night. that's what i'm total. i never was jugged. >> of course not. >> not you. >> no, not me.

john, thanks. >> thank yos, joe. >> we look forward to seeing you, david, if you have time. >> thanks, joe. coming up on "squawk box," earnings in focus this morning. we have a lot of stocks to watch. and in the next hour, more on facebook's big beat and what's next for the company. mobile ad revenue up 80% year over year. can zuckerberg keep it up? we'll find out. shares set to open at an all-time high. we'll be right back. scoverow a lexus master craftsman turns

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let's take a quick look at stocks to watch this morning. harley-davidson reporting profit of $1.55 per share. revenues slightly above forecast. also lowered its full shipment forecast in the key u.s. market. also hershey came in 7 cents above estimates with quarterly profit of 85 cents per share. now, revenue also beat forecasts as they saw the first quarterly sales increase in a year. hersheys is the target of the takeover bid from mondelez international which so far it has rejected. finally a roller coaster ride for shares of alere. it took a hit yesterday. reports it received a justice department subpoena. but it's rebounding a bit this morning after it issued a statement confirming that record

saying it had to do with medicare and medicaid billing and it did not expect the event tho result in any material financial impact. also take a quick look at conoco phillips this morning. it lost 79 cents per share. that was wider than the 61 cent consensus estimate as it continues to be impacted by lower oil prices. conoco cut its full year spending forecast. and colgate beats estimates by a penny. it's pleased with its performance in the light of what it's calling challenging macroeconomic conditions. and the harry potter hype continues. harry potter a enthe cursed child breaking records in the u.s. being the most preordered book on both amazon and barnes & noble. the record was previously held by "harry potter and the deathly hallows" that was released in 2007. "the cursed child" is set to release on july 31st.

>> how old do you think you have be to read a harry potter book or have it read to you? >> it's fun to read it to your kids. >> what age is appropriate? >> i'd say 10. >> i think you can start earlier than that. >> you don't think they'd get scared? >> we're coming up on 6. i'm just wondering if it's too early. >> i think it might be too spooky. >> you saw the "lord of the rings" trilogy. that is scary. but i think "harry potter" is kind of -- i think that's okay. >> you're not having nightmares about harry potter? you're good? >> i was. i mean voldemort was kind of -- then he turned around with a face on the back of his head, too, or something? >> wait a few years. >> okay. going to wait. >> no, no. they're boys. or girls. do it either way. >> i think we're going to wait. >> really? >> yeah. >> your parents waited a long time to show you anything scary b i think. >> pretty much.

yeah. >> but you're okay now? have you finally read it? >> this is pretty scary for me. >> this show is scary. donald trump is pretty scary when you think of it. speaking of voldemort to the left. >> i watched chucky movies. that's scary. >> i never got scared of the doll. i was scared of the hockey mask. because he was big. anyway, a mysterious light streaking across the sky in california igniting a social media fire storm. twitter lighting up with videos with what residents from utah to nevada thought was a meteor shower or maybe like a smoldering satellite. experts said the streak was from debris from a chinese rocket that had been launched last month. another expert said it could have been a natural event. like a meteor produced by interplanetary debris. so the experts didn't really correct what it was. we just had two things of what

it could have been from the experts. so do we know? what the hell was it? i think ufo. coming up -- you know, hillary is a big area 51. big. your money, your vote. president obama takes the stage to make a pitch for four more years of a democrat in the white house. we're going to hear from mark galogli after the break. what's sure to be a political brawl right up to election day. then groupon ceo rich williams will join us. "squawk box" will be right back.

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business record beatdown. >> trump says he wants to run the nation like he's running his business? god help us. >> former new york city mayor mike bloomberg blasting donald trump's track record. so who is the best ceo for the united states of america? we're going to ask a top deal maker coming up. i want a new drug. earnings results on the tape. the numbers and market reaction are straight ahead. a good deal for groupon. shares of the daily deal company surging after a stock slump. the ceo will join us first on cnbc. the final hour of "squawk box"

begins right now. ♪ live from the most powerful city in the world, new york, this is "squawk box." >> with m back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with andrew ross sorkin and kayla tausche. the futures now down 31. they were up 30. now down 30. the nasdaq continues to be on the plus side up about six. the s&p indicated down about three. oil prices down $42 last time we looked. back above $42 now because they're up 13 cents. natural gas, you can see, wow, still a bargain. $2.66. today's top story is earnings. topping revenue estimates for facebook because of strong ad growth. topping 1.7 billion monthly users. stock up 4.5%. dow chemical rising after

beating estimates on the top and bottom lines. dow in the midst of preparing to merge with dupont. that stock up 1%. and a mixed quarter for ford. revenues beat the street. but automaker's profit margins closely watched metric about guidance as well. the stock in premarket trading is down 6.3%. >> looked earlier. remember ford rebounded from, like, single digits after the bailout? it got back to 13 million immediately. it's been dead money for seven years. it got back there in like 2009. it immediately discounted a much more positive future. but hasn't gone anywhere for seven years. other stocks to watch today, raytheon earnings and revenue topping estimates. also raising forecast. the latest of the government contractors to improve outlook. whole foods profits falling for the fourth straight quarter.

slipped amid competition. also gave a weak forecast for the current quarter. and iac interactives swinging the second quarter losses. adjusted earnings and revenue both missed forecasts. mr. leisman is here. we're going to talk the fed leaving rates unchanged for now. not big news. we're keeping a september hike on the table or is it? we keep saying it's on the table. >> i think it's on the table. i think they took a half step towards the possibility of doing it but didn't telegraph it. i want to show you guys the market reaction yesterday. and the outlook for federal reserve interest rate hikes as judged by the fed funds futures markets. and a lot of the commentary was very hawkish but not the market reaction. you saw that decline in the two-year yield. we're going to right to the commentary, i guess. i'm not sure what that is. there's a trump quote up there. i did not come to talk about this. would you like to handle this,

joe? or do we want to move on to something else? thank you. there we go. that's the much more interesting chart i was going to put up. the outlook of rate hike, 18% in september, 35% in december, 40 bureaucracy in february, you don't even get to 50% in march of 2017. certainly from yesterday there is no tremendous move toward the market expecting a rate hike. that's the way the market judged the words yesterday from the committee. let me show you some of the commentary over there. the market seems to be expecting a much more hawkish statement even though the fed seems to suggest a hike this year. and it's worth thinking about that the market may be somewhat underpriced here. but as joe says, we've been doing this for a very long time. and we talk a lot. he quoted ae song wasted words by the allman brothers. >> 20 minutes ago i said we're

finished talking about this. i'm doing it again. >> i'm doing it because they asked me to come and tweak you. they enjoy that in the back. that's a -- >> fine. keep talking about it. one rate hike in ten years and here -- >> here we are spewing more words. this fomc is in effect because watch the data because you never know. by all means don't take that forewarn too literally. that's what they're saying. i think there's a debate on the table. i don't think it's definitive. next stop, guys, the bank of japan which is meeting. they're in the two-day meeting now. question is how far they go. again, a question is do they meet, exceed, or miss market expectations? >> tell me the s&p. 2250 for a hike? 2300? >> how close do those odds get up to the actual meeting before they're treated as definitive?

>> they're fairly definitive about halfway to the meeting. but the outlook has been right -- >> it's not like the week before the tide turns and people get the sense -- >> no. if yellen steps forward and says something or fisher were to say something or some of the more centrist federal market members would say something. i think it's modest. i think there's a question not if they go but when they go. they all want to do it. they're waiting for the right time. >> she really wants to do it. >> but there's a lot of concern about, well, first of all, the effect from brexit. they're not certain that we're all out of the woods even though the market seems to be fairly about it. but there's perhaps some political uncertainty. they may be getting information from their business contacts saying, you know what? this presents an economic uncertainty. we need to be careful of. just before we go, be still my beating heart. there's a new data report at 8:30. >> another one.

>> a new one. >> they're always new. >> no, this is a new new one. never been released before coming out at 8:30. this is partly in response -- >> we don't do old reports do we? >> no. new reports. so this is new new. here's what it is. it's partly response to the work we've done on the trouble in the gdp data. they're trying to make it better and more timely. so they're moving ahead, moving earlier release of some of the data so that when they put out the gdp report on friday, it's more accurate. it's not really big data in terms of retail trade. but it's inventories and will make the subsequent reports more accurate for gdp. >> will they call it the leisman effect? >> they won't. but there's also -- >> for the first quarter, that could be you. >> there is more stuff coming out about that on friday, i can tell you. >> from you or from -- >> from the government. >> will they mention your name? >> no. but they -- i can't talk about it now. i was briefed yesterday on it. i can't talk about it.

but it is interesting. i'm sorry i can't. i'm sworn to secrecy. there are revisions to gdp coming out friday morning that have to do with how the government calculates. >> here i was going to watch the pga on friday. >> can't you miss the first couple rounds? >> it's all i can think about. wow. >> can't you miss the first couple rounds and then, you know -- >> thank you, steve. meanwhile, we are getting earnings from mastercard. 96 cents per share. that beats estimates calling for 90 krebtss. revenue also above forecast thanks to an increase in both the number of transactions and in dollar volume. the company citing a 14% revenue growth figure without currency fluctuations, process transactions up 14%. ceo and president banga saying we carried solid momentum into the quarter. stock is up currently up 2% and we'll keep digging through that. meanwhile, president obama,

joe, i believe this is you. >> you know what? i want you to -- i'm tired. i'm tired. it's another clinton person. can you do it? seriously. i'm tired. i'm exhausted. andrew, get ready. i'm going to ask just one question. >> go for it. >> president obama taking the stage at the dnc taking a swipe at donald trump's business record. >> the donald is not really a plans guy. he's not really a facts guy either. he calls himself a business guy which is true. but i have to say i know plenty of businessmen and women who've achieved remarkable success without leaving a trail of lawsuits and unpaid workers and people feeling like they got cheated. >> the gop nominee defending his campaign's message after the speech tweeting, our country does not feel great already to the millions of wonderful people living in poverty, violence, and

despair. joining us now with center ridge partner's cofounder and also member of the president's economic recovery advisory board. stay with us for one second, mark. because there's an acquisition i think -- >> just real quick. oracle buying netsuite for $9.3 billion. that's $109 per share. it's an all cash deal. oracle saying it sees the deal adding on a non-gap basis. and we should also say ellison originally funded netsuite. we'll let you get back to mark. >> mark, like so many things, i guess it depends not just which side of the aisle you're on, we really do have a -- we're not sure where we are in the history of the economic history of this country. i guess. some people, you know, we hear the case made yesterday that we're doing much better than eight years ago. but there does seem to be an undercurrent we're not doing as

well as we could. gdp has trouble getting up to 2%. do you as a business person are hillary clinton's policies and what's in the democratic platform, is that what we need to move forward in a better fast and get the 3%? >> well, look. as an investor and business person, i'm always looking at risk/reward. i'd say hillary clinton -- i'm not here to talk about the platform. but i'd say that hillary clinton's experience, her ability to reach across the aisle, the way that she's operated over years. when she was a senator, how she thought about upstate new york and small businesses, yeah, i think that's a strategy that makes a lot to have sense. she is someone who supports an outward view of american leadership. she understands even if you're not a business person you say we've underinvested substantially for decades. we need to spend more money on our infrastructure. for some of the reasons that you

talk about every morning, you know, you can do that on a basis that's historically unprecedently inexpensive. so i think that overall, i think she is absolutely the right person for that environment. >> because i could see someone making the case and someone in your position saying bernie sanders took this party to a place where it hasn't been, i don't know, in how long? took it farther. and she had to respond to that in the primaries. if she was fully embracing the bernie sanders style of how to run the economy, if she was not going to be what you think she actually is, more like her husband i guess. if she was going to be the person to respond to bernie sanders in kind by agreeing with lot of his policies, would you still feel that way if you didn't think in the back of your mind, she's not going to be like that. >> i wasn't a supporter of mr.

sanders. i look at hillary clinton and i don't think that she's her husband. i think she's herself. the economic issues the country faces are different than in the past. but like in all democracy elections, you're in a situation where you're choosing between two people. and from an investor's point of view, whether you're on main street or wall street, there's no doubt the country and the world doesn't need more risk. she's a proven person who does her homework, knows what she's talking about, is prepared. and i think she's also someone who listens well. so businesses historically have gotten along well with hillary clinton and can make things work with her. i think that's an important thing between her and her opponent. >> well, it's amazing, because i know you've seen the -- you know, the latest polls that have come out. there's an equal number of people on the other side saying what we need is some type of disruption from the status quo. and just having things remain

the same with business as usual, maybe we just get more of the same in terms of income inequality. >> i'm not suggesting that she's business as usual. i think hillary is someone who aggressively reaches across and tries to make things happen across the aisle. >> to the enemy? she's referred to her republican counterparts as enemies. how's she going to reach across? >> you know and i know when she was a senator, if you had any republican senator on your program, they would have talked positively about hillary clinton. that's just the way it was and that's the way it will be going forward. she's not going to agree with everyone on their side, but she reaches consensus and goes forward. if you look at it, i just came back from three days in europe. i go there regularly. how do they think about this election? this is your business question. >> mark -- >> if you look at her, she is consistently viewed as a person who makes things happen.

comes at the most important time in recent european history. he lands and talks about his small expensive golf course. he's not prepared to talk brexit. the number one thing for putin is to figure out how to dismantle or slow down nato's power. he seems to be in favor of both of those things. so i think if you look at stability, at confidence, at competence, she's got it all on him. >> i don't know. the world's not in exactly a great place after the last -- our foreign policy over the past eight years, mark. and she spearheaded things about that. i can't say things are going swimmingly. but that's why there's disagreements. it's why we have two different conventions. there was one and then -- >> very different conventions. >> anyway, mark, thank you. we appreciate it. >> you're welcome, joe. nice to talk to you. now we're going to get back to what is turning out to be the

deal of the morning. oracle buys netsuite $109 per share. mr. ellison is a little bit on both sides of this transaction as a shareholder in both. joining us on the line is jon fortt. jon? >> hi, andrew. this is a deal some had expected for quite some time given as you mentioned larry ellison's interest in netsuite. and he's been tracking the cloud for quite some time. we've seen quite a bit of cloud m&a recently. on this program a couple weeks ago we were talking microsoft, linkedin. this certainly fits into that. sol dags and those with cloud strength tries to augment that strength in whatever way possible. if you take a look at the things that have been able to gain a decent amount of momentum, netsuite is one of those properties.

the former executives over at people soft which oracle hostily took over a decade and a half ago. so the plot thickens. this continues to get more interesting as the powers in cloud and in enterprise starts stepping up cloud access. >> john, we saw from the linkedin filing that sales force was willing to bid even more for that company. so they obviously have an appetite to do something. given the connection between ellison and netsuite, do you suppose this is a done deal or that we'll see someone seeing the company in play? >> i would suspect this is a done deal. the ties between ellison, oracle, and netsuite are so well known that it will be difficult, i imagine, for somebody to get in between this deal. but i do think it's worth looking at what other cloud assets might be in play. what does sales force do now?

what does work day do now? the executives at workday and salesforce are close to each other. they're also on increasingly good terms with microsoft. of course microsoft has a big job digesting linkedin at this point. it definitely looks like an active chess board at this point in time when it comes to cloud and enterprise. >> okay. jon fortt, we appreciate you calling in this morning. >> absolutely. >> and the stock is unchanged but it is halted right now. >> for now. >> it had been up about 9% yesterday. there was some speculation in the market about potentially a deal. but it's halted for now. coming up when we return, earnings in focus. bristol-myers and other companies out with quarterly results. we'll give you a rundown when we return in just a moment.

welcome back to "squawk box." meg tirrell joins us with a roundup of this morning's big drug moves. >> hey, joe. four big companies reporting earnings this morning. basically beats coming in. let's start with astrazeneca.

people were looking to see thousand that quarter was going to turn out. they did have a beat and people kind of looking to see how they're going to manage past the loss of that big cholesterol drug. bristol-myers also a beat. their cancer drug opdivo. that came in line ahead of estimates. folks happy there. celgene also coming in with a beat. of course we got some not so great news from a phase three trial on their drug in another form of cancer recently that didn't pan out. but people looking to see how they're going to expand that as well. alexion. across the industry people trying to pay attention to what's going on in pricing with drugs. yesterday we had amgen come in ahead of estimates in raising guidance. but a lot of people saying that might have been due to raising price of their drugs instead of extra volume.

maybe concerns there. >> all right. thank you. had a busy week. >> yeah. >> a good one though. thank you. coming up, facebook, a blowout quarter for the company. we'll bring you comments from the company's cfo. that's next.

welcome back to "squawk box." facebook beating estimates on the top and bottom line sending

shares higher. julia boorstin joining us with more. >> hey. beating across the board not only did facebook accelerate the daily user growth but it made more money than expected from each of those users. the revenue grew 59% to $6.44 billion. while earnings grew 94% to 97 cents per share. in an exclusive interview, the cfo explained what drove the quarter. >> if i had to pick one factor in the quarter, it would be the strength of advertiser demand. it's really no longer a question of whether a business should market on mobile. it's a question of how. i think we've answered that with facebook and instagram. we're seeing good strength across, you know, across the board on mobile. we now have over 60 million active business pages and continue to grow the number of active advertisers on our platform. >> wehner warned the growth will

slow as the company faces tough comparisons. but he as well as mark zuckerberg talked about revenue opportunities from mobile video, search, messenger, and virtual reality. despite concerns about the likes of snapchat, he tells me engagement continues to grow and small business business chief dan levy says the offering is totally unique. >> if you think of new businesses that are being created today, some of the niche consumer products, facebook's really the only place they could target and reach an argument for specially designer socks or other things that would be hard to advertise out to a broad public. >> analysts have been talking about how facebook is no longer going after just social ad budgets but ad dollars that would have previously been allocated to local or even tv ads. guys? >> okay. julia, thank you. coming up, we've got breaking economic news. weekly jobless claims plus some stocks in the cloud.

more on the deal in the morning. oracle buys netsuite for $109 a share. stay tuned you're watching "squawk box" on cnbc, first in business worldwide. ♪ ♪ for decades, investors have used a 60/40 stock and bond model, with little in alternatives. yet alternatives can tap opportunities that traditional assets can't. and even though they're called alternatives, they're actually designed to help meet very traditional goals. that's why invesco believes people should look past conventional models and make alternatives a core part of their portfolios. translation? goodbye 60/40, hello 50/30/20.

we are just seconds away -- calm down. but it's coming any moment now. weekly jobless claims. the futures have been down for most the morning. we'll take a quick look. actually, we're not going to. rick santelli standing by -- there it is -- at cme. the numbers, please. >> we are up 14,000. up 14,000 initial claims from a slightly revised 252,000 up to 266,000. just a whisker under 2.41 million on continuing claims which is a small rise. and on the june read for the trade deficit, well, it's the trade balance. we know it's a deficit. minus $6.3 billion from a worse 61.1.

63.3 actually is a decent number. the low water mark by far. it was $55.9 billion. that's a couple of months ago. not a huge reaction in the market place. a little curve steepening. we could debate what that means in regards to the fed. but don't worry. the dollar is down well over half a cent and that gives you everything to know about the bank of japan. tonight will talk about the size and girth of added stimulus around the world. back to you. >> thank you, rick. in the meantime mr. leisman is back at the table. >> ooi'm still looking for the data -- there's new stuff that's out and it's the idea is it gives us an earlier look at the inventory data and the wholesale and retail inventory data. the idea is the government had

put out the gdp tomorrow. by guessing the third month of the quarter. now it's out in real data. they've been doing this with trade for awhile. it has reduced the error or revision rates in gdp. so this is going to give us better data over time. unfortunately i can't find it for the moment as anything new that comes out. i'll send you a guys a note on this. but later there's an improvement that's improvement that's happened in the economic data. >> okay. thank you for that, steve. netsuite was just acquired by oracle for $109 a share in cash. you're looking at that stock now trading at $108.51 with the expectation that that deal is going to close. steve, i know you're going to crunch through some of that new data so if you get it, let us know. meanwhile let's bring in dennis gartm gartman. good enough data for you? >> everybody pays too much

attention to the weekly jobless claims. it's been anchored around 265,000 for months. as i said in the news letter this morning, longs it's below 245,000 i'm going to yawn. that's what i did. the other thing i find interesting is people still pay attention to the trade numbers. i haven't paid attention to the trade numbers since the 1970s. we've been running an abundant imbalance. mr. trump continues to worry about the imbalance of trade. i worry about the fact are imports and exports both up. that tell mes the economy is growing. i would give you an imbalance in two weeks. throw on 40% tariffs on goods and services and we'd import nothing, raise taxes dramatically and export nothing. but does anybody really care? no. we're going to continue -- >> now the left is questioning our trade deals as well. so -- >> it is disturbing.

the left and the right arguing about our trade numbers. they have both come to the same conclusion that we need to do something about our imbalance of trade. i think we need to do nothing about you are imbalance of trade. leave it alone. we're doing fine, thank you very much. >> and the fed at this point, what role is it playing in the market's lack -- i mean, we were looking at the dow at four decimal points yesterday. >> when i started in the early 1970s, we didn't know when the fomc was going to meet. if we did, we didn't know who was on the committee. and if we knew who was on the committee, we weren't sure whether they were hawks or doves. now we wonder who's going to be on the committee next year, are they hawkish or dovish? we worry too much about the fed. the fed's responses, the bank of japan's responses, the ecb's responses have been i think outlandishly overe evaluated. let's look at the economy instead.

>> have we been worried too little about oil for the last few months? >> what's interesting to me is the belief generally on the street that as goes oil prices, so goes stock prices. that's nonsense. i put out a chart last week over the course of the last five or six years that showed as crude oil prices going down, stock prices going up, the correlation is negative, not positive. >> then we had that weird period three months ago. >> where they did move in correlation one to another. but on balance over broad periods of time -- >> it goes back to 35, stocks will have trouble making headwind. guarantee it. >> there would be another reason why stocks are going down. >> people will start worrying about global growth again. they don't look at the supply side of thing things. >> i'll grant that. and if you did get crude to $45, there's something going on economicic i economical

economically. it will be economic activity that is weighing upon stock prices. >> degrees of separation from each thing. and the you never know, sometimes the opposite happens because of, you know, like lower interest rates -- like lower gas prices indicate a weak economy but may spur consumer spending. so you never know which thing is more -- >> the first response was that should be terribly to the japanese. yen. on the other hand, two hours later it was supportive to e the japanese yen. >> who was your pick? >> for the presidency? >> no, no, no. for the pga. >> obviously. >> spieth if he gets his putting better will do fine. he seems to have lost his confidence. i'm not a mcilroy fan. >> you think jason can repeat? >> i think he's probably the better player out there right now. and this is from somebody who caddied on the tour. i know how ut goes out there. i am somewhat surprised by mr.

spieth's lack of confidence this year. >> number 12. he's not the only person that happens to. >> it has happened to many before. it shall happen to many in e future. tough like his attitude. >> highway has won since then, but we'll see how he does. >> we'll see. baltusrol is a heck of a course to play on. >> i've heard. but you can't see the ball when they go in the rough. on the tv. >> i've heard that makes it difficult to get the ball on the green when you can't see it. >> probably a three quarter penalty stroke, maybe. coming up, the street reacts to oracle buying netsuite for $9.3 billion my daughter is caddying for the guy in the lead. she's got three of them. darren clark also and berger who won at st. judy's. a good deal for groupon.

shares getting a pop after quarterly results topped expectations. ceo rich williams will join us. "squawk box" will be right back.

actually have a leaderboard, but i can -- an update where we are. the 2016 pga, that's the fourth major of the golf season teeing

up at a local venue. it's at baltusrol golf club in springfield, new jersey. for the second time the world's best players are facing off at baltusrol. last time you remember phil mickelson won. but we've got dustin johnson, pga championship winner rory mcilroy which some people are picking. and defending champ is in the lead. darren clark who is also in this special -- in the featured group today. i'll show you a picture of the featured group. there's blake. she's out there volunteering. you know, volunteers are -- don't get enough credit. >> really don't. although that looks like a fun day. >> but lingmerth, i don't know whether she knows he's in the lead right now. darren clarke won the british open a couple years ago.

and berger, he's 23. just a couple years older than blake. he won a tournament almost. but i don't know where you watch that. i guess it's on one of our competing networks. but i think the good coverage continues. >> the best coverage. blake, stay hydrated. >> yes. stay hydrated. they all have uniforms. got to have a khaki -- >> i don't put that in the -- i hope she has a great day. >> you don't call that volunteering. >> different business. talking about business, shares of groupon soaring after results reporting a lower second quarterly loss. also added more than 1 million new customers. the most in two years. joining us right now is rich williams, the ceo of groupon. so let me put it to you this way. there was a headline in march that said groupon and living social are fighting for their

lives. do you feel that way? >> i feel like we're fighting for customers every day. i don't feel like we're fighting for our lives at all. we're fighting to build a great business. we're fighting to deliver value to shareholders. and those are great fights to be a part of. >> how much of this, though, is about the core business and growing the core business that you currently have and how much is about finding new businesses to get into? >> so much of it is about growing the core business. if you look at our history, we've oftentimes talked a lot about finding new revenue streams. but our biggest focus now and i think it's exactly the right focus is to double down on the right business. it's really what is our core? it's local. locals have vast space. we're a leader in this space. and there's a ton of information in local that we're pursuing and that we think has, you know,

significant value long-term yet to be realized. >> what kind of innovation are you talking about? >> i think it's -- a lot of it is again making it easy for local merchants and small businesses to work on our platform and connect with customers. these are largely folks that want to provide great service to their customers. and, you know, that's one thing we've learned along the way that you have to have a platform that's easy to work with. and that's a spot where we think that there's a lot of room to develop products and services that are -- that allow those small businesses to focus on what they do best while reaching new audiences. and whether that's things like, of course, the delivery and takeout business and continue to develop that business really advancing in the ticketing space and making that easier and easier in the mobile enabled world. or even in -- you know, a big piece of our business as well is in health and beauty. and to make the whole experience around interacting as seamless

as possible. to innovate both on behalf of merchants and consumers. >> what have you learned who your customer is and who you're competing against? >> this is i guess kind of a benefit and curse of having close to 50 million customers just in the u.s. alone now at about 28 million customers after adding close to 2.7 million since we kicked off our new strategy to ramp up new come acquisition. our customers are all shapes, sizes, walk of life. they're a great cross section of every country that we work in. but our core continues to be, you know, they call it the 30 to mid-40s, you know, mom. and i think that's a great customer. it's a customer that a lot of people, you know, are out there competing for mine share. sfwu we find in the local landscape in general, it's an underserved market and underserved small business

landscape and customer landscape where there just hasn't been as much online and mobile enablement in that space. so there's obviously a lot of people competing for that customer. but we're playing it a little bit of a different landscape. >> when you guys are in a meeting talking about competitors, if you were sitting there today would you be talking about google and facebook and ebay? or talking about living social, a direct competitor? or all these new apps that have developed for all sorts of merchants to bring -- uber even? how do you think about it? >> yeah. you call i think a big piece of how we do think about it. you watch the big platforms. you can't deny the scope and scale but we spend most of our time thinking about the customer and where you win with a skm really in our world, a vertical basis. so we do look at the competitive landscape more vertical by vertical. so who's really providing great solutions in food and drink

besides groupon? who's providing great solutions in the health and beauty landscape? who's providing solutions in the things to do in activities landscapes. so i think you have to have great offerings vertical by vertical because that's how ultimately how customers experience your products. so we think about the competitive landscape more in that way than thinking about the broad platform oriented potential competitive threats. because we've been a part of that world for years. we've, you know, we've had competitors big and small in every shape that have come in the space. but we believe winning with customers is more vertical products. >> their enough. rich, we appreciate your time this morning. thanks for coming in. >> thanks, andrew. breaking news this hour. oracle buying netsuite for $9.3 billion or about $109 a share. that is among the largest

acquisitions in the company's history. joining us for more is joel from btig. did this deal come from nowhere or were there smoke signals bubbling up this week? >> there's been some smoke signals across the board. there's netsuite's one of the premieres out there. it's been rumored oracle was going to make a bid. we think this is a competitive situation. we think there were more than one bidder in there making oracle pay up for netsuite. >> does that give you the idea someone's going to come out again? look at the price right now. it's very close to $109. but do you think someone else comes? >> i don't think the process has been pretty baked. the reason i think that is because larry ellison's family through trusts owned about 47%. i think this had to be a really vetted process. i don't think they could have just, you know, came up, threw a bid out there. do i think somebody could try to

trump it? possibly. or try to drive up oracle's share higher. but i think this was a fairly vetted process. >> our colleague jon fortt earlier this morning said the cloud space is an active chess board. who moves next? what happens? >> they're one of the ones that reported last night. i think the consolidation is going to be more around scale now. companies that have a lot of revenue. we were predicting netsuite had $1.2 billion in revenue. we think company now is going to have 4 billi$4 billion in reven 2020. and possibly even the work day which is the other one that cloud company that may be on the block as well. but we think consolidation continues. >> do you believe there's any litigation risk around this? >> absolutely. that's one of our thesis that may have prevented oracle from getting involved in the first place. larry ellison is in his early 70s. both sides of this. even though it was a, quote,

independent committee. i think there's a big chance that, you know, either they didn't pay enough or they pay too little. one of those sorts of situations. that's why i think the process was fairly vetted. >> but from a valuation perspective, do you think it's too little or too much? or too ? >> i think it was a fantastic price for netsuite shareholders. significant premium, all cash. >> make it work? >> ike that they will make it work. i think this is their -- netsuite is focused on the market at the mid-part of the market, oracle at the large enterprise market. i think there's synergies here, a creed of -- >> anti-trust? >> maybe. maybe. although, you know, there's a lot of people in the market. sap is the largest player in the market, microsoft plays in that market, ibm plays in that market. you know, there could be on either side. so potentially. >> joel, we appreciate your insight especially at last-minute notice i'm sure. >> thank you. >> from btig. >> when we come back jim cramer joins us live from the new york stock exchange. we'll get his take on today's top stories. ♪

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let's get down to the new york stock exchange where jim cramer joins us now. facebook is what we're talking about. i guess we'll be talking about alphabet which i think is google, jim. >> indeed. >> right? >> yep. they have good enough branding with google, need a new name. you remember aleegis. >> that was fabulous. [ inaudible ]. >> exactly. >> october 89 and then they crashed. >> was it that long ago? don't tell me that. >> yeah. >> anyway, jim, what did you think of facebook? pretty good. >> any time you can almost triple your earnings, any time you're having accelerated revenue growth in a company this size, you see the future coming, it really is a rather remarkable company. i mean this company could earn eight bucks in 2018. it earned what it was supposed to earn in the next quarter this

quarter. that's very unheard of. we haven't seen that since the days when microsoft had just come public. this is one of the great growers. it's so, so impressive and it was a masterful conference call. they've done a lot of great things in a short period of time. >> we had gartman on that said oil and stocks never move in tandem. looking at much longer term analysis of whether they're correlated but they certainly -- oil and stocks were correlated for a while, we talked about that. >> yeah. not until this quarter has the correlation broken. the dollar has been broken in the oil -- and oil has been broken but the oil is uncanny. bottom in oil and the bottom at the s&p at the same time. we can look at different charts, but those look pretty much the same to me. >> oil to 35, market will have trouble, don't you think? >> i think so. at that point we will say wait a second, has to be a slow down in the world for that to happen. they're not going to say it's a glut. they will say it's a slowdown.

the demand side has been consistently better. it would mean that demand side has take an hit, not the fact that there's been a glut. a glut the whole time. >> where are you hanging your hat at night when you go home now? are you near the restaurant or are you out in -- >> i split. i've been -- i served at the restaurant a couple nights this week. i should get home for the tournament. >> you can't drive around there? that's what i'm saying. i wonder if you can get to your house, all the streets -- >> you can't. it's all walk in that area. >> all the roads closed. >> i know. >> summit. >> the week to not be in -- >> i'm driving around. you can't get there from here. i need to go there and then try the next street and i can't go there either. it's -- anyway, it's a big deal. >> the guys are in town and fabulous. >> it is cool, isn't it? >> i'm going for rory. rory is a good man. >> i agree. lot of people are picking rory, including darren clarke. anyway, thank you. >> thank you. >> when squawk comes back, today's biggest stock movers and

tonight, tune in to cnbc at 10:00 eastern for complete coverage of the dnc. including hillary clinton's prime time speech. announcer: they'll test you. try to break your will.

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. >> among today's top stock to watch check out netsuite. oracle buying that company $109 per share. all cash. you're looking at that trading almost at the takeout price. >> quick check on the markets before we go. the leaderboard -- we don't have time. markets down 22 on the dow. go ahead. take it. >> okay. join us tomorrow. watch some golf, hillary tonight. see you tomorrow morning. good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with david faber and jim cramer on the new york stock exchange. wondering what the busiest day for earnings is this is it. plenty of reports to unpack, software m&a, clinton accepting the democratic nomination, global stocks treading water, europe flat, kee