another leg lower when the boeing news came out. triumph supplies about 675% of the shares. you can see down by about 10% pap back to you. >> thanks, dom. headed 0 ut to vegas. and steve wynn, mark cuban and wayne newton singing on the show all tomorrow night at 5:00. thanks for watching "power lunch." >> big day. everybody, welcome to the closing bell. kelly evans at the new york stock exchange. >> how do you do too? snap. >> crack's, pop. >> no. the stock -- >> snapping because of snap. >> oh, snap. that's that comment there. >> not a lot of guys can snap their fingers. you're lucky. >> i don't know why that is. most talked about ipo of the year reporting earnings in about an hour. use it for advertising numbers, front and center. and we'll be talking about what to expect on those earnings from snap coming up next hour.

>> yes. a busy earnings day. also awaiting whole food reports in a major board shake-up. what to do with the grocery stock. shares fractionally lower now. >> and you heard, boeing halted flights of its 737 max jets because of engine issues that surfaced over the weekend. we'll have breaking details and the stocks suffering as a result of that anournnouncementannounc we begin with the story the whole country is talking about, fallout from president trump's surprise dismissal of fbi director james comey last night. eamon javers and amy on capitol hill. eamon, you first. >> sanders here at the white house finishing up a briefing within the past hour or so. she made a number of points including that the president is going to meet with the new acting director of the fbi today. the search for a successor is beginning today. she also said that the president's thinking on this began mucherer than we learned when this news officially broke

last night. what she said -- >> i think it's been an erosion of confidence. i think that director comey has shown over the last several months and frankly the last year a lot of missteps and mistakes, and certainly i think that -- as you've seen from many of the comments from democrat members including senator schumer they didn't think he should be there. they thought he should -- be gone. >> the president called reporters into the oval office to answer a question here on his decision. here's how he described his decision-making in terms of the fbi director. >> why did you fire director comey? why did you fire director comey? >> because he wasn't doing a good job. very simply. he was not doing a good job. >> the president there saying that comey was fired because he wasn't doing a good job. a fairly broad reason. sara huckaby sanders saying he was fired for multiple reasons

including his pace on the leak investigation. that a different rationale, a much broader rationale than we were told last night when given the letter from the deputy attorney general laying out missteps comey made surrounding the hillary clinton e-mail investigation last fall. that was a very narrow nationale last night. today we're told multiple reasons, and the president giving us a broad, he wasn't doing a good job. so clearly, an evolving explanation here at the white house as to why the fbi director was fired so quickly last night. guys, back to you. >> eamon, can be fired at will? not for cause? >> serves at the pleasure of the president. the president can fire, remove him at any time. typically a ten-year term and only the second to are fired for anything. >> comey's removing sparking fireworks on capitol hill. isn't it? >> that's right. in the wake of the surprise firing, in the wake of republicans and democrats, john

mccain calls for a special prosecutor to lead an independent investigation apart from the ongoing investigation into the russian interference into the u.s. election last year as well as potential ties to trump associates. senate minority leader chuck schumer took the floor and said what we need most is information. >> attorney general sessions and deputy attorney general rosenstein should brief all senators separately and in a classified setting if necessary and they should do it soon. because the questions are just swirling about there are more every day almost every hour. >> that's been a colic ohhed by both sides of the aisle. seven republican senators in the last 24 hours voicing their concerns, and just today ohio's rob portman putting out a statement saying, the white house should -- provide a fuller explanation regarding the

president's rationale. we will see if that happens and exactly what information comes forward about this. in the meantime, tomorrow, acting fbi director andrew mccabe will be here on capitol hill testifying in a previously. he's just one of a handful of agency heads that is testifying, but that was supposed to be a position, a chair that was fill by former director james comey. senator mark warner separately telling nbc news they asked james comey to testify in front of the senate intelligence committee, potentially next tuesday. we will wait to see what happens there. finally, interestingly, sarah huckabee sanders in the press briefing eamon talked about yesterday, she said what the president called nine lawmakers before the news of the comey firing broke. it is interesting for two reasons. first, it shows the president understands the importance of bringing congress on board with big decisions he was making, despite the fact it was unexpect

when it happened. the second question is why he chose to inform lawmaker before informing former director comey in person. that's a question that is still lingering here on capitol hill and that will continue to be asked. bill, kelly. >> before you go, kayla, as we know washington tends to focus on one issue at a time. everybody obviously is talking about this right now. is there a thought anywhere on capitol hill that this could crowd out the talk about health care reform or tax reform, some of the major issues on the president's agenda? >> reporter: well, the lawmakers will tell you, bill, that you can walk and chew gum at the same time, that there is band width to do more than one thing at once. but the calendar is packed, and it is very tight. there is just about a month for each chamber between now and august recess, and with the house out of session this week the senate was supposed to be taking up health care, and that was supposed to be leading the debate every single day at their policy luncheons, in the hallways, but of course this is taking center stage and it is hard to believe that this won't

push back the calendar quite a bit. >> all right. kayla, thank you. let's talk about that. the administration made it clear items like tax reform, health care and infrastructure are top priorities. some question whether they could get held up on capitol hill if white house investigations take center stage. >> let's talk about it more. joining us with insight, bryn in terry haines from evercore isi along with henry croft from asendo markets. good to see you both. terry, what do you think? that's the issue right now. does this crowd out some of the economic issues that the white house and capitol hill have been working on to this point? >> well, thanks, bill. good afternoon, kelly. briefly, today i think not. i think it doesn't mean anything negative for either tax reform or the affordable care act. kayla says and i think she is right, congress probably is going to try to walk and chew gum at the same time. you know, remember, none of these staffers, none of these

folks are in any way involved in any of the comey or trump/russia investigations. they will proceed. and congressional republicans really want to get these things done, not just for policy but political reasons as well. they want to show the country they've done something, something substantial going into the 2018 mid terms. so i think they will continue on as before. where this has a negative impact potentially is with some of the things in which you need bipartisan which is pretty much everything else, infrastructure, financial services reform, immigration. the one area where i think it might have a good impact though is on spending where republicans will probably redouble efforts to make sure that spending continues and there's no government shut down or no problem with debt ceiling. >> so, henry, is it possible that if lawmakers, republicans especially want to show they're making progress, they're not distract, maybe it could encourage them to move more quickly on health care and tax

reform? >> well, absolutely. that's definitely what the market is looking for as well. we have seen the rally since trump's election and, of course, his inauguration as well. markets running on both sides of the atlantic, so over here in london we have definitely seen in particular the tax reform and infrastructure taking the top billing. so we could see if we can get u.s. lawmakers in fact in accordance and pushing on with these policies because it will, in fact, help indices on both sides of the atlantic. of course, this is becoming a bit moreov overshadowed with th earnings seasons, so in the lorng term whether we see it impacting stocks, whether it impacts on future guidance after this quarter and we see it as a bit of a hangover rather than the immediate impact on markets. >> terry, very quickly before we go, you know, it is not just a timing issue. there's the issue of what this does to, let's say, moderate

republicans in both the house and the senate who we all remember, especially in the house, had to be cod willdled t the health care passed in the house. if they become disillusioned or upset with the way it was handled with jim comey, does it make the job that much more difficult on the other issues still to come? >> think it is a smart question, bill, but i would say to you that moderate republicans have every bit as much of self-interest in wanting to make sure that the affordable care act revisions happen, that tax reform happens, that a lot of these major things happen. remember that republicans, congressional republicans ran for seven years on economic growth issues and they very much want to convert. >> all right. gentlemen, thank you. i'm sure this is not the last we will be talking about this, terry haines, henry croft, thanks for joining us today. >> appreciate it. >> let's get to the boeing story. boeing lower -- other stocks are as well on the news of this

engine issue. phil lebow has more details for us. phil. >> whenever you hold flights for a program in development it gets a lot of attention and that's why stock is down today. here is what is going on with the 737 max program and boeing has decided it is at least temporarily halting test flights for the 737 max. it thoos do with potential issue with the engines which are made by ge and its french-based partner safran. the leap 1 dlrks b engine, the name of the engine, has a potential manufacturing issue when it comes to the low pressure turbines that are in the back of those engines. in a statement boeing says we are working with cfm -- that's what the joint venture is called between ge and safran -- to inspect the disks in question. the supplier notified us after discussing the issue as part of the quality inspection process. at no time have we experienced an issue associated with during

our ongoing testing program. first deliveries are supposed to begin next week. 7,400 of these engines have been ordered for this program, covering 3,700 airplane also. again, they're mailed by ge and its french partner safran. we should point out that we talked with ge commercial aviation a short time ago. they indicated that it is just 30 some odd engines that might be impacted by this quality control issue. nonetheless, ge as well as its partner safran, both of those stocks are feeling some pressure right now. guys, the bottom line is this. whenever you see a program halt flights, it makes people say, wait, is there a broader issue? at this point it looks like it is just these 30 engines. they're going to be shipped to a couple of locations here in the u.s. where they are going to inspect those engines but production continues with the leap 1-b, and theoretically we have not heard boeing plans to delay first deliveries which are scheduled to begin next week. >> phil, quickly, where does the

737 max fit into boeing's portfolio? >> it is huge. >> how big is it in terms of their production? >> it is huge. look, the 737 is the bread and butter plane. it carries the water, so to speak, with commercial aviation for boeing. that's not to say that the dream liner is not important or any of its other planes aren't important as well, but by far they sell more 737s than any other airplane and the max is that next generation of the airplane, again, with deliveries scheduled to begin next week. >> wow. >> whew. >> bad timing. thanks, phil. see you later. >> you bet. >> let's send you to seema mody at headquarters with a market flash. >> hi, kelley and bill. i want to draw your attention to shares of cal pine, quoting sources that the power company is exploring a sale potentially attracting interest from private equity and buy-out firms according to support investment bank is said to be working with

calpine on a possible sale. shares up nearly 13% on the day. other power companies in the space, energy and dynegy moving higher in sympathy. want to point out cal pine has not been a big winner in past 12 months, shares down 25% over past one year. we will bring you what we hear back from them. for now back to you. >> thank you, seema. niles sound bit. 45 minutes to go. dow is down 45 points today. s&p hanging on to a 2 point gain. you can see the divergence there. weighing on the dow are companies like boeing. the nasdaq is higher by 10, russell is up 8. wow, 1400 it is sitting on the small-cap. >> look at that. disney is one of the drags on the dow today after reporting weaker than expected revenue, and the continued concerns about espn as well. coming up we will hear from one top wall street analyst who is still very bullish on disney stock. that's coming up. >> then after the bell, snap

posts first earnings since going public. we will hear from 21st century fox and whole foods among others. we will driver the numbers and break it down with analysts as soon as they hit the tape. you're watching cnbc, first in business worldwide. it's great to finally meet you. your parents have been talking about you for years.

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t magazine publisher slashed dividend as it pushes ahead with cost cuts following that decision not to sell itself at this point. "time" appointed john fahey, currently the board's lead independent director as non-executive chairman. they're taking a haircut today, down shh% at 12.95. >> closing bell exchange. joining us rob morgan from sandy spring bank who is here with us. kenny from o'neill securities and rick santelli from the cme this afternoon. rob, so what do you make of this market? again, it is a little bit of a mixed bag and how about the move in oil we had as well? >> well, i tell you, kelly, what really concerns me is how low the vix is and most saying that's a great thing, but a lot of times that can presage

turbulence down the road. i'm hopeful that maybe we'll have a side ways market here as we enter the summer, but i am a little concerned by that. >> yeah, rarely is the vix -- i mean the fear indicator when it hits that low, that rarely signals a bottom in the market, right? >> 23 years ago, right? it is over complacency which makes -- catches everybody off guard. >> is this over-complacency when we consider what is going on? we know what is going on in washington, north korea, france. >> look what the market has done for the last three weeks. we have been in this 2375, 2400 range, we can't break out or down. it does nothing. we are kissing highs again right now. we just can't break through. >> we need the wall of worries. we need the wall of worry. >> we have plenty of bricks in the wall of worry, i just cited some. >> those are all headline bricks. >> but they're valid issues that should have an impact on the economy. >> sure. >> on some stocks individually. >> except they're not impacting

earnings. you know, kenny and i were talking about the comey firing and it is not impacting earnings, so everything that's going on impacting earnings is positive and all of the negatives really aren't. >> what signals are reading from where you stand? >> well, to me it looks like interest rates pretty much now convinced everyone that it is back in the thick of its range, that the small venture that we made under 225 to 227 was short lived. how do we know that? the dutch auction in 3s and 10s found little sponsorship. >> right. >> usually when you see prices sell off and rates tick off, especially a week and a half before an auction, usually it is considered a concession. you try to dance between the rain drops. you buy into that thinking that you're going to get a little bit of mean reversion. boy, there was no real buyers to be found and i don't think it has to do with politics or geopolitics because, in my opinion, that would bring more sponsorship, especially to yesterday's three-year note

auction. at the end of the day, i have many feelings about low volatility, a lot has to do with computerized trade i think. but let's keep it simple, folks. the vix is nothing but at the money straddles with s&ps. you measure volatility and the var yanls between close to close to close, there is no movement close to close. so it should be no shock that option volatility, hence the vix, is going down. >> quickly, let's make it meaningful to individual investors. where are you going to put money to work in this market environment right now? >> i still like stocks. >> what? >> and i would go into basically financials, technology and staples. i think those are most attractive, best visible earnings going forward and technically sound. >> where do you see money going right now? >> energy, financials and tech. >> financials and tech -- >> two out of three. >> two out of three ain't bad. >> mainly the big guys in technology? >> nose are the leaders at the moment. look what is happening.

i think you have to look within the tech space, you have to look at artificial intelligence and cyber security names within that space because i think it will be a big, big discussion as we move through '17 into 2018. >> in fact, apple is a big pick. >> i love the dividend plays and apple is a dividend play believe it or not. you get some growth as a kicker as well. >> so i'm guessing you're not a big buyer of snap here? >> i'm -- >> up 35% since the ipo. >> well, let's see how the report comes out today. >> all right. >> the jury is still out. >> very good. thanks, guys. >> thanks, bill. >> always good to see everybody. see you later. >> heading into the close, less than 40 minutes to go here, dow sitting on decline of about 50 points today, but everybody is positive. we mentioned some of the big names weighing that index but s&p is up about a point, russell up 7, about a half a percent. disney is one of the names weighing on the dow, under pressure after disappointing metrics at espn. we have someone who is confident espn can still grow and he will

explain why. >> up next, how big data can help you improve your golf game, kelly evans. >> i don't even think -- >> your burgeoning golf game. that's coming up. ♪ you totanobody's hurt, new car. but there will still be pain. it comes when your insurance company says they'll only pay three-quarters of what it takes to replace it. what are you supposed to do? drive three-quarters of a car? now if you had liberty mutual new car replacement™, you'd get your whole car back. i guess they don't want you driving around on three wheels. smart. with liberty mutual new car replacement™, we'll replace the full value of your car. liberty stands with you™. liberty mutual insurance.

all right. listen to this, kelly. microsoft and arcos golf have announced a new artificial intelligence platform to help

golfers make data-driven decisions on the course as they're playing. the arccos caddie is what it calls. they put sensors on each golf club to create a personalized strategy for the player as they step up to the tee. the app accounts for things like weather, wind speed, precipitation. it is designed to help players achieve a lower score, obviously. what it does is it remembers how far you hit a ball with each club. >> so it is a sensor on the club. >> which direction it is likely to go after you hit, the whole thing. by the way, arccos named microsoft its official cloud partner in january. >> do you know arccos? >> no. >> they're maybe trying to break in then? >> i guess, with artificial intelligence here. as we all know, i play golf. >> you're quite the golfer. >> and you are -- >> i'm really not. >> you are a beginning -- >> so we did go to the driving range. >> there i am. yes, it is true, i'm a lefty on the golf course. there i am at chelsea pierce.

>> keep in mind when you see what i look like -- >> watch this. it is all about form. that is good form right there. >> are you serious? >> the arm is straight, you know, and you are a natural athlete. >> no, i'm not sure we can say that. >> don't give me that. you will be able to pick this game up in no time. let me just say, not to speak ill of this new artificial intelligence thing, if you want to improve your game you get a bucket of balls and you go hit them. >> to the driving range or the course? >> absolutely. take a lesson. the way you improve your game is not with equipment, not with what you wear. >> there goes my plan. >> it is practice. >> i figured i would get a cute golf outfit and a fancy club, i'm sure to -- >> that's what we call dressing par, shooting 100. okay. >> it was fun. >> you don't want to do it. >> took me ten minutes to hit the thing. i kept going, i will swing and hit, and just nothing. nothing would happen. >> that still happens after you play a long time. >> thank you to door even and

arkie, and especially for door even for being a great instructor. i might have hit the ball 100 yards. >> i love that, good stuff. time for cnbc news update with sue herera. >> reporter: hey, bill. i have a golf story for you at the end of the news update. here is what is happening at this hour. dozens of demonstrators rallying outside the white house to protest the firing of fbi director james comey. the group wants a special prosecutor to investigate possible trump campaign ties to russia. a woman crashed her van into a mcdonald's restaurant and it is all caught on tape. it happened over the weekend in springfield, illinois. police say they're seeking the driver because she left the scene. and they are investigating it as a hit-and-run. luckily, no injuries were reported. and russian president vladimir putin took to the ice during a hockey game in sochi with friends and former russian hockey players. he showed off his skill, scoring seven goals.

putin's team won the game by a 17-6 score. and the 2017 players championship gets under way tomorrow. rickie fowler is ready to go because in practice today, take a look at that -- boom, there it goes. he hit a hole in one, on the famed 17th hole with its island green. fowler gets congratulations, of course, on the tee. took a picture of the ball in the hole just for good measure. see if he can do it again tomorrow. >> and that, kelly, is one of the most famous golf holes in all of golf. >> yes. >> and i don't know -- >> and most difficult. >> you and i work with a fellow in los angeles years and years ago, he was in the audio department at the old financial news network and he took up the game suddenly. >> yes, he did. >> after three months he got a hole in one and he quit the game. he said, i have now achieved, you know, a hole in one. i can die a happy man, and he never played again. >> at the pinnacle, the pinnacle of his career, right? >> he achieve willed it right there, yes. >> you got it.

>> thank you very much, sue. >> kelly, it is fun. i'm taking golf lessons. i will meet you on the tee. >> you got a date. >> you got it. we'll do it together. >> no one else is allowed to watch no. >> that's right, exactly. >> it could be painful for all involved. thank you, sue. i am here on the floor with gordon charles with rosen blat securities. mr. gordon, to talk about the market as we head into the close, what are you watching, moving oil? as i mentioned earlier it is going under the radar but i think one of the biggest in months. >> what you have to be focused on is try to understand the underlying, and right now we are trading in the tight range. you can't be fooled by the dow, obviously affect a little by disney. the s&p a doing well and everybody is watching 2400 as an upside breakout point. >> is it purely psychological, round number? >> yeah, i mean on some level of course it is an important number, but, you know, when you start to look at the action, we've been sort of like almost a coil, just tightening, waiting to explode i would way or the

other. 2400 becomes more than a number, but maybe an inflection point where there will be some capitulation on the sell and short side where they have to turn and retrace. >> quickly, do you get the sense -- because this is what the whole debate is about. is there any interest in this market or is there too much -- it doesn't feel like there's too much excitement. how would you describe the client flows you are seeing, especially retail client flows? >> you know, we're not seeing big money getting involved here. you know, they're being patient, they're sort of playing a little bit to the long side, but, you know, we're not seeing the big action. we're seeing sort of momentum playing and a lot of index-relate will index-related related trading going on here. kind of curious the behavior in the fact we had earnings seasons that have been good. until we really see that kind of conviction, then we're probably going the stay coiled, but we believe it probably will come and be to tup side. >> all right. there you have it. thank you, sir.

>> a pleasure. >> we're heading into the close of the last half hour of the trading session with the dow down 52 points at the moment. when you come back, despite what you may have heard brighter days may still lie ahead for disney and its espn sports channel. tell you why when we come back. also coming up, snap's first earnings report since going public. tell you the numbers wall street is expecting and break down the results the second they hit the tape, coming up. stay with me, mr. parker. when a critical patient is far from the hospital, the hospital must come to the patient. stay with me, mr. parker. the at&t network is helping first responders connect with medical teams in near real time... stay with me, mr. parker. ...saving time when it matters most. stay with me, mrs. parker. that's the power of and. what if we could bring you by having better values? at blue apron, we work directly with more than a hundred family farms.

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another one of those days where you're not getting a whole lot of action as far as the major averages go. certainly, the individual stock stories we've been highlighting, but right now the dow down 49 points. it was down 91 on the open this morning. it was up fractionally, the s&p is up a fraction. the nasdaq is in record territory, up about 4 points right now, and russell up about 6 or 7 points. and yelp is in the redd after reporting a quarterly revenue miss, and it cut its full-year outlook at the same time. mkm partners and rbc lowered ratings on the stock, but goldman sachs raised yelp from a buy to neutral citing user growth potential. that stock down about 19% right

now. >> which is better than the 27% initial drop it had yesterday. >> meantime, shares of disney falling today after the company reported that decline in espn subscribership and higher programming costs. that was in the earnings report that you covered last night. ceo bob igor addressed the concerns over at espn during the interview on "closing bell." >> we will eventually be in a direct-to-consumer business for espn product. we hope to launch one on our platform before the end of this year. we are increasing engagement with our app significantly. with that comes not only more brand affinity but more advertising, and we're running the business more efficiently. so we actually are confident in espn's future. >> let's bring in ben swinbern from morgan stanley who has a rating on disney and $130 price target. thank you, ben, for joining us. the interesting thing about your these ills is the extent to which you think espn is at a

positive turning point here. why do you say that? where do you see it happening? >> hi, kelly. thanks for having me. look, i think what you may be seeing in the march and june quarter for disney is the low point for espn growth as we start to see real acceleration in the back half of the calendar year and into '18. the reason i say that is the june quarter is going to be the highest year over year growth in cost for the business because of the nba contract they sign a few years ago. after the june quarter we will see expense growth slower, heading out really over the next several years. on the top line, what you are seeing now obviously is the impact of cord cutting, which shouldn't surprise anybody at this point and is a pretty well-known concern. what you are not seeing is the leverage disney has over their distributors like comcast and other mdpds. as disney goes into renewal cycle with those companies over the next several years, starting later this year, and then the one other thing you are not seeing is the impact of new streaming bundles like hulu,

like youtube tv, none of which have been in the market for any real period of time, all of which could provide some relief on espn, and relief would be powerful given how everyone runs around with their hair on fire whenever espn reports. >> isn't that where the real growth is, ben, digital and streaming and all of those other new areas of distribution out there? i mean let's face it, you know, all of the cable channels, we're the same. we have a huge dom-compre prese. so the model that took espn to the height of cable channels in the '90s, that's not there anymore. they have to adapt and move to areas where there is growth right now, right? isn't that what we're talking about here? >> well, for sure, absolutely. i think what you have to remember is that the distributors of espn, their core revenue streams come from big cable/satellite companies. they desperately need disneys

channels to compete in a fiercely competitive environment. disney's channels remain incredibly important to them which gives disney pricing power. but you have up to 20 million and growing households that don't have cable, and that is an opportunity for espn to tap into which i think they're just starting to take a shot at. plus, they're probably going to remain -- hold back the cost structure. >> having said that though, will they ever have the same number of eyeballs they had when they were the top cable channel in terms of the anymore ber of subscribers they had? >> eyeballs? i mean, look, fragmentation of audiences is going on, you know, for arguably 30, 40 years. the broadcasters lose ratings, have been losing ratings for a long time. they used to lose to cable and now losing to online platforms. there's nothing new there. i think any media will be -- have less share going forward than they've had in the past. that doesn't mean they have less earnings. you know, i'm highly confident espn is going to grow the business once we get past the

programming cost bubble in the nba. >> let me ask you real quickly, sounds like espn 2 is leveraging live sports strategy going forward, maybe across several of its channels, but doesn't it mean it is effectively a commodity product and all it does is offer you live sports which makes it very reliant on that, instead of being able to offer you the personalities, the shows you might have enjoyed so much in the past but aren't enjoying there today? >> yeah, there's no question from a content perspective espn has to somewhat reinvent itself, and i think part of the head count reductions and sort of the efficiency initiative have been about that. the value of sports center relative to live rights is clearly changing. that's a reality and the company realizes that. that probably creates an opportunity for a lower cost structure, probably gets reinvested into live rights. i would also push back a little bit, kelly, and say live rights is not a commodity but actually an incredibly powerful piece of content for consumers and advertisers and disney has tremendous scale. people should not forget about

that. >> i was hoping for a bob and george tie, too, but guess we can't go two days in a row. go generals. ben swinburne, thank you so much. proud fellow alum of washington university. >> way over my head there. 20 minutes left in the trading session here with the dow down 35 points right now. toyota's slogan is "let's go places," but investors and car buyers will not like where the automaker is going today. that story coming up. >> and wayfair shares surging after strong earnings and speculation about a potential merger. we will talk to the company's ceo about both of those coming up next hour. stay with us. ♪

. oh, the stuff you miss during commercials. toyota shares are trading lower right now, down about 2 1/3%. the auto giant's operating capital fell 30% in fiscal year-ending in march due largely to stronger yen and lingering currency effects combined with a slowing u.s. market lead toyota to forecast a 20% decline in operating profit for the current fiscal year. meanwhile, over at ford, ceo mark fields is reportedly under pressure to sharpen his strategy on electric cars and to reverse the company's shrinking u.s.

market share. ford is holding annual shareholders meeting tomorrow. some critics say fields' push into electric vehicles and self-driving cars is shifting too much focus away from ford's conventional businesses that drive the bulk of the company's profits. ford says it is unable to comment on any rumors or speculation, but the stock is down a fraction again today. >> and it is not often you see a report like that on the front page of the "wall street journal," wrapping up that speculation into tomorrow's meeting. snap is reporting first earnings since its ipo after the bell today. julia boorstin has a preview outside of the company's headquarters in california. >> reporter: hey, that's right, kelly. investors are watching to see whether their stock can keep growing user base and engagement despite competition from facebook and instagram. most important number to walk is daily active users. this after growth slowed in fourth quarter. analysts are expecting the addition of nine million daily active users for a quarterly

average of 167 million. analysts expect snap to lose 19 cents per share and revenue will be at $157.9 million, down from the fourth quarter but nearly four times the year ago number. we will be back at the top of the hour with those numbers, kelly. >> name a cooler spot for a company, corporate headquarters? >> you don't think it is trying too hard to be cool? >> name a cooler spot for a corporate headquarters. i know exactly where you're sitting right now, julia there. >> new jersey. >> no. >> very great out here. >> i can tell. another bright day in venice, california. >> the key was going to be daily active users and it's been amazing to see how quickly facebook has imitated its offerings and get to bigger user numbers than snapchat itself has. do you agree that will be the biggest focus? >> absolutely. it is about the daus. it is amazing, when you look at instagram, instagram copied

snapchat's stories feature with a similar format. instagram has 200 million people using stories. the question is, of course, how much snapchat will be able to grow in the face of instagram and facebook copying their most popular features. >> i think you need some snapchat spectacles for that glare, julia. >> julia boorstin, cool, venice, california. >> there's a dispenser here at the stock exchange. >> no way. >> yeah. if you go by -- i don't know, they're all of the different addresses. i will show you which one. >> all right. >> it is there. >> i would like that, believe it or not. >> 13 minutes to go, and now i know what i'm getting you for your next birthday. dow is down 36 points. the russell 2000 is up 8 to 1400. >> a board shakeup reportedly coming for whole foods. we have a debate on the supermarket stock ahead of earnings report which is coming up next hour. that's coming up next here. ♪

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cashin just happened by and whispered the market close orders show a bias to the buy side, 600 million to the buy side. a pretty healthy number. >> dow is only down 36 points

right now. about 10 minutes to go. whole foods set to report earnings after the bell. dow jones reporting today that the company is going to change more than half its board of directors. question is whole foods stock still a buy here. shares a little weaker on the session today. he is from oppenheimer. he has an out perform rating on the stock. how well do you expect whole foods to perform and is the current shakeup of board and to some extent management and the pressure part of this? >> i think in the near term, change report will be very weak from whole foods. what we've seen in the industry is high end competition, more competition from more brick and mortar players and now seeing online players like amazon and fresh direct enter the market. we expect another shortfall and we think management could lower guidance. >> they're in a lose-lose situation when you think about it. has organic grocery market peaked? no, it has gone everywhere. everybody is into this now,

number one. number two, the consumer is so price conscious, and we all know whole food's nickname for years was whole paycheck. how do they compete when they have a brand that speaks to organic and to high prices? >> yes, i think, you know, the management team gets it and they're going to focus on their core. they realize they can't branch out and try to get the costco customer, the kroger customer. i think last quarter was an inflection point in the company where they said we're going to focus more on real estate, close down stores and focus on core consumer through more marketing. eventually they will roll out a loyalty card program. we think the more narrow focus and try to get more spending from existing customers will help stabilize the business. you're right, it is natural organic continues to spread to more and more venues, they will not be able to gain the same share they may have thought a few years ago. >> how do you think they're going to do this? you mention you think the near term report will show more weakness. if you were to start something today in the sort of healthy foods industry, what would it be? whole foods was such a brilliant concept at the time, executed so

well for so many years, but now it is just a different backdrop. so they've tried the smaller format stores and different things. which strategy is it that's going to somehow look into the future and say, here is how to revitalize this idea? >> yes, i think it is going to be a hybrid strategy. we know their flagship larger format stores, columbus circle, new york, ryan park, they continue to do well and they said the larger stores continue to do better. the newest smaller format, 365 stores, i've been to the one in bellevue, washington, the goal is to have less labor, a lower cost structure and lower prices so maybe you can capture the customer that doesn't want to shop at a larger, more expensive whole foods store. >> do you like it as part of their strategy or should they stick with the money maker cincinnati. >> it is add good strategy. we have been to all three stores. the other two locations it is more of a real estate issue and i don't think they're aware. it is a still wait and see

concept. >> we know the whole foods has popped here. do you bet they will be bought out? >> from our perspective to get to the reported target, we have three scenarios playing out. one is a take out which we cite at 50% probability. the other is they get to positive next year, a low 40s price. the worst case scenario is they continue to struggle and the stock goes to the high 20s. >> very interesting. good to see you. thank you for joining us today. appreciate it very much. we will take a break. six minutes left in the trading session with the dow down 34. we have the closing countdown. >> we have 21st century stock record reporting evenings. we will bring you that analysis. you are watching cnbc, first in business worldwide.

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it's on all my mobile devices, so it suits my mobile lifestyle and it keeps my investments fully mobile... even when i'm on the move. sign up at etrade.com and get up to six hundred dollars. the "closing bell" is sponsored by e trade. start trading today at e tra trade.com. three minutes left in the trading session with the dow down 34 points. probably should be showing you the nasdaq at the top because it is trading at all-time high territory. we will show you the dow. sell-off earlier today. dow was down about 91 points but it has since come back here, especially when we had 600 million to buy on the bell today. this has just been a bullet-proof market. nothing is bothering it right now. wti crude, what a big rally today. the latest inventory numbers showed a huge decline in huge stockpiles. you get the gain of 3 1/4% but

still well below, we are at 37 1/3. the rates are going even higher here, especially when the fed meets next month. but we are still stuck in that range, comfortably in the range that the ten year has been in recently between 260 at the high and 230 at the low. the vix continues below 10. boy, it is just a hair below it. jeff gunlug a little while ago of doubleline said any time you see vix below ten you should buy it right there. so a buy recommendation from him. we get earnings, bob pisani, first one from snap, a stock that's done well since ipo, up 23%. 20th century fox, whole foods and elf beauty. >> elf.

the beauty manufacturers have done well. coty has done well. we've seen some of the other ones out there that have done very well this year. ulta has done really well. >> ul tau is on fire. >> we will get cohl's, jc penney on friday, and macy's as well. >> twitter is all aflutter. it is eyes, what the e is about. >> eyes. what did i say? >> you think you said ears, which can be very attractive but it is not what they're after. >> eyes, limbs and facps and fa. the important thing is 20% of the retail companies reporting this earnings season will lose money. 60% will have lower earnings than the first quarter of last year. this is according to ken perkins over at retail metrics. so it is a remarkable series of events that have been occurring in the last year or so. sometime inflection point, we want to hear what the retailers are saying. meantime, the big energy companies had a great day.

again, for the second day exxon and chevron were big movers in s&p. that hasn't happened in a long, long time. >> thank you, bob. the great charity city harvest is ringing the closing bell here at the new york stock exchange. stay tuned. we will be going back to julia boorstin in cool venice, california for snap earnings on the second hour of "closing bell." see you tomorrow, kelly. ♪ >> thank you, bill. welcome to the "closing bell," everybody. i'm kelly evans. there's your green eyed bull. the nasdaq at a closing all-time high and i'm going to talk quickly because these snapchat earnings will be out any second. the dow only one down in the averages, declining. the san mateo up, 6129 is a record close. russell 2000 having a strong day with more than half percent gain, closing shy of 1400. as mention, it is a super busy

hour for earnings. we are awaiting the first-ever report from snapchat's parent snap. we have results from whole foods, 21st century fox and el of beauty headed our way. that beauty category has been so strong. joining me for that is cnn markets commentator michael santoli. and j.p. morgan markets stralt gist as well. mike, quickly, thoughts on this market? we had comey, oil, a couple of different things going on. >> today showed the market does not price in political noise really. it doesn't need to. also, it is not contingent on policy quickness. so i think it basically same story. a flat market, a little stronger under the surface than the headline show you, but not grabbing at new highs. we're stuck here. >> samantha, what are you guys emphatic buyers of here, anything? >> we know we have to be more selective. the sectors we like are tech, but all parts of tech, not just social media.

we like consumer discretionary although little has not contributed the way we thought it would. >> let's get out to venice, california. julia boorstin has the results. the first one as a public company. julia. >> reporter: hey, kelly. thaertd, snap's revenue a hair lighter than expect. company reporting $149.6 million in revenue. thompson analyst consensus was for $158 million in revenue. of course, a lot of focus on that daily active user number. the company had an average of 166 million daily average users. that's an addition of 8 million from the prior quarter, a reaction sell ration after we saw a deceleration towards the end of last year. it is about one million fewer users than the average analyst's expectations as gathered by street account. now, average revenue per user was 90 cents, right in line with expectations and up 181% from the year ago quarter. in terms of earnings, we don't

have a non-gap eps number, which is the number we usually do, but adjusted even out earnings was a loss of 188 million, which appears to be a loss of about 8 or $9 million more than analysts expect. we will continue to work on the eps number. so overall we see revenue falling a hair light, but the user additions pretty much in line with expectations and showing the reaction sell ration. i will be talking to imran khan, the chief operating officer. >> julia, before we let you go, it is interesting here. if you told somebody what snap stock was doing, you might think it was all about the users. but you're saying actually that number, while it was a miss, was still an increase. maybe the bar is justine higher. >> reporter: i think that the real hope here with that snapchat was going to show significant user growth. now, the challenge of course in the quarter is that snapchat has been facing more competition

than ever from instagram as well as facebook who are copying the popular snapchat features. notice, last quarter they added five million users in the quarter, down from a ten million user addition in q3. we saw a deceleration of user growth torld the end of last year, raising colonels. now we are seeing a reaction sell ration, adding eight million users. analys analysts hoped they would ad nine million users. we also will here about engagement and hoiw much time people are spending on the platform. that will be a key factor as well. >> we will come back to it. snap shares down to about $19.5 right now. we have breaking news just out, u.s. steel. morgan brendon has that. what is happening? >> mario longhi has stepped down as ceo. he is being replaced by david byrd, effective immediately.

burritt became coo and president in february. before that he was cfo since 2013. that's after a long career at caterpillar. longhi will retire on june 30th. the board voted on monday to make the change. sources telling us that senior staff is hearing about it right now for the first time. the news coming just two weeks after the steelmaker had its 2017 profit out lied and reported a big unexpected q1 loss that sent shares plummeting in the worst single day drop since going public. sent stocks down 37, 38% in the past month, though i should note up 19% since he took the helm in cement of 2013. port to note longhi has been a member of the white house's initiative to grow the manufacturing sector. no word if he will remain or if burritt will replace him. that will be up to the white house. shares of u.s. steel in after hours are bouncing between losses and gains in after hours right now. back over to you.

>> thank you, morgan. mike, any thoughts here? >> hard to really infer that much. seems like accelerated success, but it is kind of continues knewity. you had the internal guy in line. stock has been under pressure for reasons beyond anything short term management was up to. >> u.s. steel down 1% on the news ceo is stepping down. snapchat a bigger mover after hours after reporting results. art hogan, i'm going to ask you for reaction there if you have thoughts on this one in particular. >> yes, you know, to the extent that your first quarter out of the box as a publicly traded company, your job is dependent on you giving realistic guidance. the fact that, you know, they miss by a fraction means they set the bar a little too high and didn't walk analysts down during the course of the quarter. it is not like they missed a lot. they're saying we want to see an increase to daily average users of nine million, got eight million. the problem is expectation set should have been lower. you should do much better coming out of the box. i think that's why you're seeing

a big reaction in stock. they have competition, remember. >> let me ask you about that for a seconds because a lot of first time investors holding snapchat. do they need to do sergey kislyak of the equivalent like when facebook went mobile, or are you saying they didn't message right? >> it is a combination of both. they're in a competitive marketplace. they need to message what expectations should be as a publicly traded company but also understand what their development plans are. so it is okay to have, you know, a bit of a miss on your daily average users but what is the game plan to get it up and how are you actually competing and what is the montization plan. that's where facebook and twitter had the stumble, but they were able to recover. >> oh, sure. mike, snap shares under 189 right now. >> yes, they went right down to the low from three weeks after the ipo. basically the lowest price they

trailed at was 18.90, they went down on the first reflex reaction and it is because they miss heed across the board. the question was can they have that effortless growth at this early stage they're supposed to have to justify the valuation and does management have an interest in delivering the short term numbers. i don't think that is clear. maybe on the earnings call they're going to give you some other metrics we're supposed to judge them on, but right now the street is saying, look, value today at 12 times what is expected to be next year's revenues. if you have a hiccup along the way, if you can't deliver on a quarterly basis we maybe have no hope about that projection. >> to your point about the revenues, they missed revenue by $8 million. >> it is small numbers but shows you can't turn on the spig got. >> i'm not going to ask you about the stock per se, but do you use snapchat? >> i don't. >> see. is it because, you know -- why? just not interesting? are you like me where you just kind of -- you were a little late on the snapchat thing and it never happened? >> i know there are users that love it. everyone has their preference

for social media picks and i think really the interesting thing in tech is the innovation. so it is not necessarily happening with social media, it is happening with other parts of the sector. that's where you're seeing lots of revenue growth for the sector overall. >> art t great thing about snapchat when it came out was it was so innovative, the disappearing messages, unique way people interacted with it, but, again, that's stuff people can copy and facebook has done so. >> there's a low barrier to entry, it is a great concept, but you can't patent the concept. we have daily active viewers in my house, but both are teenagers so i think that's where their dynamic growth will be. as long as it is cool they're going to be able to continue to grow their story. to your point about a young management team, newly public company, they needed to learn to get this messaging out there and do -- you know, are they going to be concerned every quarter with appropriate levels of growth or is there longer term strategies such that they have to explain on a conference call. >> and they're going big into the media space, art. they're talking about, you know, deemphasizing the disappearing

messages that got here in the first place. >> right. which is -- >> i don't know -- if they're going to compete against everybody else with a vilds yo hose, you know, that will be a tough one, too. >> certainly. go ahead, mike. >> i was going to say hardware, too. i mean it seems as if they're not trying to trail behind the established players like facebook. they think of themselves in a different way. the big question as i said is whether this management team really even cares to show the kind of short term performance the street can demand. >> julia boorstin spoke with the chief management officer in an exclusive interview. what did you hear, julia? >> reporter: i spoke to imran khan and he said he made good progress this quarter improving the performance and qualities of our snapchat application especially on android. we still have a lot of work to do and are excite willed about the potential for continued performance improvement. khan's chief strategy officer,

he also pointed to growth margin -- the fact that the gross margin has been positive for third consecutive quarter. i'm sure we will hear more about that as well as user engagement numbers in the call which is coming up at 4:30 p.m. eastern. a lot of anticipation to hear from imran khan as well as ceo evan spiegel. kellie, back to you. >> julia, thank you. shares down about 19% right now, so continuesing to move a little weaker as we get more about the results. >> as i said 1890 was the low before. you're not pinning it on anything in terms of financial metrics right now in terms of the valuation. it is kind of where you are going to find buyer hospital are saying, i'm going to overlook this, think about the longer term story. i think there's an interesting potential space that they can occupy which is, look, we are about photography, messaging. we're not pretending we're going to have people reading 3,000 word articles on our platform. we are something different. it is a distraction. but if the advertising is suited to that exact type of engagement i can see it actually getting

some traction among advertisers. >> samantha, do you think the excitement in tech is elsewhere these days? >> we do. revenue growth for the sector is up 10% for the quarter. energy and tech was main contributor to earnings this quarter and it wasn't much else, right? it wasn't in other parts of the s&p. so, you know, from a growth play, from a growth perspective and for long-term investors we like tech. >> let's get to whole foods earnings. they're out. susan li has those anticipated numbers. >> first go through the numbers and earnings and talk about the much talked about board changes heading into earnings release. running through the earnings. inline adjusted 37 cents a piece in the quarter. revenues topping and same store sales comps down 2.8 pergs. but guess what, that's better than analysts estimates. that does mark a seventh straight quarter of same sales stores decline. personnel changes, held line news. whole foods has announce willed appointment of five new independent directors.

they've also named a new chairman of the board. so gabriel solsberger is new chair of the board. they've announce lds a new chair of the nominating and governance committee, mariel enko, and a new chief financial officer as well at whole foolds. also in this earning release they told us they're going to bump up quarterly different denied by 29%, authorizing a $1.2 billion share purchase, a buy back program. one of the interesting names in this new rotation on the board, kelly, ron shake, chairman, chief executive officer, panera, will be joining the board of whole foods. back to you. >> that is interesting. what do you think about whole foods. susan, thank you. >> i'm going to tell you, kelly, there's a secular change going on that obviously affected whole foods over the last 24 months and i think that's why you're seeing so much change on the board. they need to make a decision. they were the middle man from the farm to the table. that was the only point at which you were getting fresh, healthy, organic. noup you can buy it everywhere. so basically they need to figure

out what their next strategy is, which may well be a merger and acquisition with somebody else, somebody larger with mo traditional footprint. i think that's why we're seeing a change of leadership at the top and seeing major board changes. they invented this game and the game moved away from them. they have figure out what is next for whole foods. >> i don't want to overly speculate but because he is on the board, would it make sense for whole foods to acquire a fast, casual fresh chain like panera, art? >> panera has been sold. >> oh, that's right. >> j and b suppose willedly expressed an interest in whole foods. that's where the intrigue is a little bit on this appointment. i do think it makes since too think about whole foods as having kind of a back stop in that takeover speculation, not just from that potential buyer. the other piece is the way partners has said, no, we're not taking a settlement here, it is a relatively aggressive stance and probably feels there's a plan b or c down the road if

they can't turn around the fundamentals on their own. >> i'm thinking about it because so much of the story already is prepared foods. >> it is a quasi restaurant, and arguably not the same one that's been operated -- >> quality that is not that great. >> -- that efficient. >> earnings to get you here. 21st century fox results are out. seema mody has them. >> reporter: that is higher than the wall street consensus of 48 cents. revenue though was a miss at $7.56 billion. analysts were looking for $7.63 billion but on the topic of revenue growth in the press release the company says it reflect higher advertising revenue at the television segment led by the broadcast of the super bowl and higher affiliate revenues at both the cable network programming and television segments, partially offset by lower content revenues at the filmed entertainment segment. when you talk about the sky deal, the company is confident that the sky deal will be

approved by the end of 2017. we will jump on the conference call in a second, kelly. for now looking at shares down about 2.5% here in extended trade. back to you. >> thank you, seema. yeah, it is funny, despite moving lower now down a little more than 3%. this is one i feel you need to wait to see what is said, what is explain, what is discussed for the future of fox news and for any -- you know, rupert murdoch, any offhand comment he makes about things being stable or otherwise is per seefld as extremely poured here. >> obviously talent losses and the idea that advertisers stick with did network and basically show some loyalty there. stock has been under a lot of pressure because a lot of media companies, cable heavy media companies have been as well. not received well. sky knews, news, if they're confident about getting approval by the end of the year, but don't know if that's incremental

or not. >> what do you do with 21st century fox? >> i think you have to wait to see how it plays out. they're obviously on a battleground with what has been going on at fox news. also when you think about the media bar set very low, viacom was off 7%, 5%, at the end down 20%, bounced off the bottom but media is a difficult investment because you don't know what direction we're going and where over the top ends up taking us. i think there's more questions than there are answers ee especially with fox right now and probably leave it in the category of no touch. >> all right. shares are down about 4% now. we will leave it there, everyone. art hogan, samantha asarello as we continue to go through the earnings that came out including snap, those shares sinking after reporting results for first time since going public. is it a buying opportunity. we will debate that coming up. netflix maybe king of video streaming but a startup rival has been raising cash and could threaten to dethrone it. we will have those details when we come back.

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we'll listen. we'll talk. we'll plan. baird.

welcome back. here's a look at big movers we have on earnings today, biggest being snap down 21% to just

above $18 a share right now. meantime, 21st century fox slid down 5% and whole foods hanging on to a gain of 2 1/2%. this time on elf beauty, how did they do? >> actually we have a good quarter here for e.l.f. if you look at comparison to analyst companies consisting. reporting 9 cents adjusted per share. analysts looking for 5 cents on revenues of 66. million. that's a bit stronger than analysts were looking for. full year guidance, elf beauty affirming its guidance for revenue, so bracketing what the street's estimates were. shares are down sharply, down almost 11%. perhaps there's some disappointment that the quarter wasn't even stronger. we know how strong bumty and cosmetics overall as a sector has been. kl kelly, back to you. >> exactly. they want to see big performance. courtney, thank you. those e.l.f. shares down 9

perlgs. fast take, first up is peanuts. charlie brown is part of the company we gist told you about at zone on monday. that was the favorite children's content giant dhx in the news with a big deal. >> i think it is big. it is obviously do you rememberable content, the whole character set and franchise. think there's a little question mark in terms much how much you can leverage it into younger kids. i don't know that the peanuts "metrofocus"y w movie was considered a huge block bluster. >> yeah, from the originals. >> we will see. next up, ge has broken ground in bean town but not what caught our eye as this quote from a city planner in the "wall street journal" today. he said, this is the biggest building boom in the history of this city. is this bubble time? >> i think there is a brewing bubble in cities in general. i think it is part of the story here, that kind of return it not just companies but people to cities. boston, you know, it is a cute

little town, a lot more skyscrapers. >> if it is people, it is fine. if there's a people bubble, they're building to meet the demand. >> that's true, yes. is there a speculative bubble in commercial real estate in boston? i don't know if that's the case or not. i think basically we are riding a high point of that wave cyclically no matter what. >> all i know is when i see the fed comments from rosengren, when they're talking -- how did he put it? he is in favor of rate hikes in 2017. he wants to make sure there's no over excitement. it does not always mean in the stock market, although it will show something, it could mean in the area of commercial real estate. >> without a fact. he is informed that the local area, the economy there is very financialized. let's be honest, it is the whole mutual fund and insurance business driving it. so he's kind of like leveraged with financial -- speculative risks, potential risks in his district. >> let's get to two now, i've never heard of this portal, tuby, the second biggest online

content library after netflix, growing like crazy in terms of users, just raised the money, and the catch is commercials. they have five minutes of commercials in an hour show. as "today's special value" an old style approach. >> the market is people who won't pay $9 a month. so how attractive is that advertising base to people who won't, you know, or want an additional option to netflix at $9 or whatever the cost. >> is the pie growing? is this just everybody trying to now steal share? >> think we have to think back to what reed hastings said, his competitors leap. i think eyeballs are pivoting in this direction and there's probably room for one. netflix is not trying to replace tv, just fill in the blanks. >> i'm on team sleep. >> you're still a potential market for netflix. >> exactly. shares are higher after yesterday's earning beat.

coming up ceo will break down the quarter with us and tell us how much impact could have on its business. first we will look at whether the controversial firing of fbi director james com comey could derail the trump agenda. you're watching cnbc, first in business world wild. can make all the from a frese difference. it can provide what we call an unlock: a realization that often reveals a better path forward.w.i.d.e. kind of insight that has lead us to become one of the largest investment and wealth management firms in the country. discover how we can help find your unlock. ♪ ♪ welcome to holiday inn! ♪ ♪ thank you! ♪ ♪ wait, i have something for you!

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welcome back. let's begin with seema mody and another earnings alert. >> reporter: hey, kelly. eyes on shares of situate man

tech falling after the security company reporting results that are bang in line with estimates. earnings of 28 cents, adjusted again, consensus was for 28 cents. revenue 1.8 billion and necessary nailed it. analysts consensus 1.18 billion. weak first quarter guidance. they see guidance between -- excuse me, earnings guide yajs between 28 to 32 cents. only thing i can see breaking out revenue here, enterprise security for this quarter, fourth quarter, coming in slightly shy of expectations. programs that's another reason shares are down. this is one of the stocks, kelly that has done well this year, up 20%. just the topic of security being something that is discussed quite heavily. back to you. >> seema, thank you. nearly a 6% drop for symantec. >> and not that much year-to-date but doubled in the last 12 months. >> wow. it is a pause. see if it refreshes. president trump firing fbi

director james comey, last night actually. eamon javers joins us to hawk about that, and the market intact. >> reporter: that's the big question, is what does it all mean for the legislative agenda of this white house. it is probably an unanswerable question this early on, but certainly if you are trying to run a smooth legislative machine here at the white house, more political chaos in washington doesn't necessarily help. sarah huckabee sanders, the white house spokes woman, was asked about it at the white house briefing and whether or not firing fbi director james comey adds to the partisan divisiveness in this town and makes it harder to focus on the things weigh want to focus on including health care, tax reform and infrastructure. here is what she had to say. >> frankly i don't think it matters what this president says. you will have democrats come out and fight him every single step of the way. i think that's one of the things wrong with washington and i think that's one of the reasons that we've got to get back to focusing on those issues and,

frankly, drain the swamp a little bit further. >> so what she is saying there ultimately is this was already a bitterly divided partisan town. they expect that to continue here at the white house in terms of the tax effort, other efforts. they weren't expecting a lot of buy-in from democrats anyway here in the white house, and the real answer to the big question is that there are probably republicans on capitol hill whose interests despite their disagreements with the firing of comey, whose interests still align with this white house very much on taxes, trailde, infrastructure and the other issues and they will be with him when it counts. that's my prediction at this point. we will have to watch how it unfolds and what the reaction is among republicans, kelly. >> that's the key thing, does the market remain as it was before, does it add urgency to those moves or distract? >> the fact you can play it either way and say it is going to bog the agenda down because it is going to consume all of the options in washington, or sincere going to accelerate things because they need to pivot to something else, shows you that the market is just not

going to price -- it is not going to rush to price in any outcome. i think it is another lesson that the market has not been principally dependent on policy. the kinds of stocks working have not been the ones you expect -- >> you have been saying this, an unpopular thing. the narrative, the trump rally and then it stalled, but you have been saying different things have been going on here. >> it was such a profound turnabout at the moment of the election that understandably that became the whole story. but it was about a five-week process of repricing things in that direction. since then it hasn't been the main driver of what is happening. >> is that because people think something is going to happen so i can ignore it or is it because it doesn't matter one way or the other? >> it doesn't matter that much. if something happens it will be positive. if nothing happens, we still have double digit earnings growth and more that half of the companies beating on the top line and other things to hang our hats on. it reminds me people saying, the fed is your friend, if anything bad happens the fed is going to come n you can't prove it is right, but psychology helps you

understand why you own stock and not selling today. >> eamon javers at the white house. time for a cnbc update with sue herera. >> reporter: thanks so much, kelly. bethune cookman graduates expressing their displeasure of betsy devos at an address in florida. booing and turning their backs on her. the school's president had a warning for the crowd. >> hey, listen to me. your behavior -- >> out west in california, the ready for wildfires expo was held on the grounds of the reagan library where officials demonstrated what they called the most effective tools for fighting fires. more than ten agencies participated in the event ahead of the upcoming wildfire season. and for 129 years captain's deli

has served new york with classic jewish style fair but is looking to broaden worldwide. they are going to deliver pastrami to pakistan and corn beef to colombia among other nations. they're in for a treat. that's the news update. back to you, kelly. >> thank you very much, sue. snap shares are hit hard in the market after hour. the company reported earnings for the first time and now a 23 drop. we are in a debate whether it is a buying opportunity next. how paul ryan is starting to sell tax reform plan to voters in ohio. find out how businesses are reacting to his visit, that's still to come on "closing bell." , warren, to help me deal. isn't that right warren? well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app, so you don't need a comfort pony. oh, so what about my motivational meerkat?

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. welcome back. big story in snap this afternoon. shares down more than 23% after their first-ever earnings report. the trading $17.65 right now. let's get reaction. we have a full cast and crew here to talk about this. ryan payne is here from payne capital management, a little bearish on snap. sean steeple here, a little more bullish. thank you for being with us. so let me start, sean, with you, and the prospects that you see

for snap and how much much a disappointment you think today is. >> i think this is an example where sentiment didn't match the reality. you had the syndicate firm coming out, basically telegraphing the quarter on every single metric, users, revenue, and reality is street expectation goes were too high. i think nothing here is new. there's nothing to change -- >> you made it sound like they knew what the numbers were going to be but actually they didn't. they were too high? >> no, the banks that were on this deal were spot on. if you look at their numbers. >> got it. >> they came in exactly where -- >> and everybody else didn't come down to meet them. >> everyone else was above for some reason. >> but that's not a big deal, that's recoverable. is there a fundamental problem here that they didn't post higher revenue for example? >> i don't think it is fundamental. i think it is technical and sentimental and i think that's why you're seeing the reaction here because people were position for a higher expectation. >> ryan, what would you say to that? >> i totally dils agree, with

all due respect, sean. i think the problem is facebook is eating their lunch. you know, instagram has this new stories model which has already since august 200 million active daily users, whereas it became 166 million active users for snapchat. it goes to show you they're already on it. anecdotally, most of my colleagues are millennials and seeing less and less people on snapchat and a lot of people migrating to story. >> are you picking up on that shift as well, matt? >> i have been for a long time. there's a story behind the story of the numbers. snapchat is a point solution for the young demographic. they use it for one-to-one messaging. once people parents and grandparents got on facebook, they jumped on snapchat. it was copying instagram and facebook which had a one approach. the other thing snapchat

discover which is a publishing media channel young people don't want to go to snapchat for that. it is a point solution and i think it is where the biggest misalignment is. >> we're talking shares down 25%. >> it is worth mentioning the ip itself priced at 17. >> that's right. >> base point -- >> you have gotten rid of the after market gain. i think the question to your point, is there a second act? if we're not going to have advertisers say, look, i don't know why this works but let me throw money because that's a young demographic we can't reach, if that is not going on what does the company need to do? >> there needs to be a second act because in a one to one messaging, people don't want advertisers in their message. is there a second act, much like facebook acquired instagram or google acquired youtube. >> what is out there? >> there's mobile, artificial intelligence, there are things out there. spectacle, it is a play, but i think more of a novelty right now, it is not going to drive mainstream revenue growth. >> it is a one trick pony.

at this valuation it is so over valued who wants to buy at this level? over $20 billion today, and they're bleeding money. >> what would you say? >> i'm going to push back and say when we get the new iphone and 3d sensing all of their tricks come out of the bag. they will start to see augmented reality, much more interactive and -- >> but what is snapchat going to offer on that front that facebook who did a developers conference about this won't? >> you see wins out of snapchat, you stee geo filter pattern. i point people to see imagine.com, an acquisition they mailed a little over a year ago he where you can bridge the inanimate and an mat and we will see that on the add site in filters and other pictures. >> shares above their ipo price above $17. >> where do you think this company should be value willed? >> i think at this price it is definitely worth getting your toe in if you're not tlchlt i think historically you have seen on most of the large hot tech ipos similar day one performance on earnings and most have done very well. >> what's your price target for

the shares? >> i think from here we go back to the mid 20s pretty soon. >> and so then i will let matt weigh in on that. if snap is able to come out with something a little more exciting and allows you to play with augmented reality and so forth, does that do it? >> that's an experimental marketing budget. most traditional fortune 500 markets are wiggling the way of broadcast television to go to digital. for them to go there we're talking five, ten years out. no roi proven model there and a programatic model of targeting joe peetz ah's, everyone within a mile that facebook and google has, that's where the magic in. all of the brand markets use google. i don't think anybody here uses snapchat, right? >> that's the issue. >> so many people calling -- >> let's not forget the live partnerships, toochlt they have the nbc universal investment. we isn't seen anything from that. they have 40 discover partners.

they've not good job of monetizing that. but we will see live content, nbc, espn, it is coming. >> in this stock, the bubble is going to burst, not if, it is when. there's a great opportunity to invest your money with lower valuations. >> thank you, everybody. ryan payne, sean stieffel, matt britton. appreciate it. >> great to be here. >> house speaker paul ryan helding to ohio to drum up voter support for his party's tax reform. we have details coming up. shares of wayfair on a tear. the chief executive will join us to discuss results and how you plans to fend off attacks on his market space from, yes, amazon. actually, we just handled all the priority threats. you did that? we did that. really. we analyzed millions of articles and reports.

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welcome back. share also of wayfair trade img higher, by about 4% after reporting strong first quarter earnings yesterday. the furniture retailer up more than 80% so far this year, making it one of the market's best performers, joining us is wayfair cofounder and ceo. welcome to you. thanks for coming down here. >> grad fob here. >> let's talk about what has been going well. let's talk about the stock performance itself. >> sure. >> you're up huge this year, but it is a heavily shorted stock. what has it been like as ceo to watch the drama play out in the marketplace? >> i tell you, it's been interesting to watch but i think we had the benefit of focusing

on the customers and building our business. we've been at it 15 years. i was lucky enough to be one of the two co-founders. i think taking that long view allowed us to succeed. >> how much of your comp is in stock so far. >> i own a very significant portion of the equity because i'm one -- >> you are straight up owner since one of the founders? >> correct. >> you must pay attention to the stock performance if you own so much of it? i know you are saying it is for the long term but -- >> i think that's the key. stock price matters on the day you buy or sell stock. in between, the price, yes, great, you know, you're going to keep an eye on it. but to be honest the price doesn't really matter. >> all right. let's ask a quick question about the quarter then. what do you think is going well at wayfair right now? >> the beautiful thing about the business is we continue to execute well. we have over tripled in size since we went public not even three years ago. what we did this quarter was the business grew really well, the u.s. was profitable, the growth actually reaction sell rated

whi which was exciting to folks. the investments were playing out well in terms of the international and u.s. we bit a large logistics network in the u.s. over the last couple of years. there's a lot of positive things. i think what's finally happened is a lot of the folks who maybe had different, you know, questions or concerns, they feel they're getting answered. >> i mean the questions and concerns thai guess you probably allude to is just the general one. it seems that, you know, any specialized online retailer in any category theoretically faces the larger threat, the amazon threat. so i know you have answered a million times, but why this category? why is it different? >> yes, so this category is different for a few reasons, one of which is when you think about these categories, furniture, decor, these times of items, these are non-branded items where people want to own unique items, not the same as everyone else. the way you shop for them, it is very visual in nature. a lot of folks don't know how to

put -- they know what they want when they see it and looks that they like. that nature doesn't lend itself to keyword search. it doesn't lend itself to comparing an item as a price, aa batteries, you know, whatever. all of a sudden the visual merchandising you need and the way a customer discovers what they want is different, and then the fulfillment and delivery is different. these are bulky items set up in people's homes, prone to damage. there's all kind of things, you need to handle them differently than perhaps, again, selling batteries, books and the like. >> let me ask you, do you know andrew left? >> you know, i'm familiar. >> have you spoken with him? >> i have not spoken. >> okay. he has spoken a lot about your company, as you know, including earlier today. here is what he said about how he thinks you guys are based up relative to competitors right now. take a listen. >> okay. >> i'm going to tell you what is working for me. giemg leave this enter swru and go play golf. when i play golf i have jeff besos and mark lure from wal-mart who have not competed in this space who said, we're

going to start getting more aggressive on furniture. they're working for me. so as for short-sterm stock price, what it does in the next five minutes i don't care. what i'm worried about is will the company ever make money, how is their competition and how is this space going to look 12 months from now? >> can you survive that onslaught, especially since a lot of the business for wayfair and others is -- i don't know the industry term for it but it is basically make sure you show up well in search results, for example. if people search on amazon.com and not go that route, what happens to wayfair? >> again, if you put yourself in the customer's mindset of how a customer thinks about her home and finds that perfect iemt item, knowing the selection we have, the wayfair brand awareness has grown dramatically over the last few years. >> do you think your market will fall over time because you don't have to remind people of hey, here is how we are? >> when we went public it was a question folks had and it has

come down remarkably, as we thought. we advertise a lot that helps us get new customers but the experience causes customers to come back, and our repeat orders and repeat business has grown faster than new for quarters now. so that model is working. i think model is working. i think customers as long as we keep providing logistics, customer service, visual merchandise and all the things we do today we keep making better, i think our customers will want to come back to us. we will always have competition. everyone always has competition. i think when you think about wal-mart, amazon, i think the primary competition, it's against each other for consumables and core home items like that, not home items like furniture and decor and these types of items that have a specialist opportunity there. >> wayfair co-founder, thank you for coming on. >> thank you both. >> thank you very much. paul ryan courting voter support for the gop tax reform for business leaders in ohio today. we will see if the house speaker

can when them over. that's next. coming up, the trump trade is over says one competition, we'll tell you the sectors you need to get out of right now in ten minutes. stay with us. you have access to the right information at the right moment. and when you filter out the noise, it's easy to turn your vision into action. it's your trade. e*trade. whoa,i just had to push one button to join. it's like i'm in the office with you, even though i'm here. it's almost like the virtual reality of business communications. no, it's reality. intuitive one touch video conferencing is a reality. and now it's included at no additional cost

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with welcome back. the republican leadership doesn't need to sell other lawmakers on their tax plans. they have to get voters on board. house speaker paul ryan is working on that very thing today. >> reporter: kelly, that is exactly why o'ryan is out in ohio today the swing state, he is talking to locals about the benefits of tax reform. he has a corporation that was founded by kara abraham and her husband. they are talking about laying the playing field for american

businesses. >> one thing that should not be the big barrier stopping you from doing even more or having new success stories like the abrahams should be our tax code. and so that is why we think it's really important to make sure that we make it make sense to keep your businesses in america, keep your manufacturing in america. >> so this meeting is supposed to be ryan's big pivot from health care to tax reform or as one analyst called to me, paul ryan's happy place, but squarely with the firing of fbi director james comey, we can see how hard it is for him to get the public and even his own party to if cuss. now the senate gop theorist is at the white house right now talking tax reform with treasury secretary steven mnuchin. the senate finance committee were over there yesterday. lawmakers are all over the map on this issue. ryan did not come out swinging for the border adjustment tax while he was in ohio. utah senator mike lee is looking

for plans to get rid of the corporate rate altogether. instead, he would tax investment income as ordinary income. so a lot of work to be done internally before they can convince the public to get on board. >> that's for sure. that's an undertaking. thank you ylan mui in washington today. up next, where momentum is mick i picking up after a very slow 2016. stay with us.m picking up after a very slow 2016. stay with us. picking up after a very slow 2016. stay with u

welcome back. here's a look at these movers after hours. 21st century fox down around 4% right now. still awaiting details if any are to come. beauty is down 4%. it's moderated its decline. whole foods is down the biggy snap is down 24, let's round ut to 25%, just above $20. now speaking of ipos, the market is kind of heating up, there were reports surfacing that the fast casual chain is looking to go, i was there today had a chicken avocado salad.

>> it's an urban grab-and-go type of thing. they were mentioning people eating multiple breakfasts. people popping in, a lot of runway, up against panera at some point. axa have to rationize the business and create capital. >> i'm pretty excited about manger. >> everybody knows the bitcoins have been surging, the coin offerings are getting more and more attention smr it's almost like a kick-starter, using bitcoin and when you contribute the bitcoin, that also is used as kind of the raw material that you are backing if i understand it correctly. >> you are ahead of me. >> it seems as if it's all a little bit too much like let's lean against each opts and pretend this is real money. but it's interesting people are

open to it. >> they are looking at capital out of chain and the issues if we cover those as much as ipos. >> they're not going to ring the bell go that does it for "closing bell" today. "fast money" start right now. >> i'm melissa lee the traders are pete najerian, karen finerman and guy adami. tonight, the trump masters are hard at work. he'll explain why he is calling for stocks to hit new high, plus another day, another airline brawl. get this, airline customer satisfaction is at an all time high. so what does that mean for the stocks? we'll explain. later one under the radar retail stock is soaring. we'll tell you what it is and if it's too late to get on the trade, first we start off on a snaps earnings review. stocks are getting slammed