followed that by says, diggy, diggy, said the boogie, said up jump the -- >> greatest rock and roll songs of all time. >> he's been planning that all show >> fantastic >> i know it, but i didn't know the lyrics we've got to go. make sure you join us tomorrow "squawk on the street" is next good thursday morning, welcome to "squawk on the street." futures are steady as they chase for more record highs continues, it is the busiest day of earnings season, results from verizon, twitter, and of course, amazon intel starbucks tonight slight moves in europe this morning. the tenures has durables,

strongest print in nearly three years. busiest days of earnings the ceos of dow chemicals and ceos are with us >> higher in the big market. we have more clarity on media nma as it reports to via come. >> futures in the green following a day where they all posted record closing highs. so again, it is the busiest day for earnings this season, two tech joints we're keeping an eye on, twitter. users were flat quarter on quarter. facebook beat the streak last night. boosted by greater advertising revenue for the mobile app twitter's down 10% this morning in the premarket, jim. >> i'm not one to take the other side of the trade. stock was running for heaven knows what reason. because i think the daily average users were pretty good, and i think it might be an inflection point, the revenue's been going -- let's say, we'll call it the second derivative, they've been going down less and the pramting is looking up

i see advertisers coming towards it the new programming is doing well they have burn off on the others if you reverse and got rid of the division that they're closing, you could see a flat revenue number, which would be the beginning. now, the stock we're in 15, it would be up too. >> i spoke to one large media tech investor this morning who said, twitter's nothing short of a disaster i'm not paying a multiple for better monetization without growing users. they need to grow users. they're not done >> monthly users were not good, daily users were better. i think you have to start taking into account that they are doing data minding, they are finally doing the machine learning i urged them to do and that's a very good -- >> if they don't grow the user base, jim, what's the point of it ul? what are you willing to pay? >> up 12 year on year, it was the third quarter of growth. >> thank you. >> but they don't give you the absolute number. >> i think that the researchers pretty much right about the daily average users.

obviously i am taking the other side of the trade because the stock is down. nothing short of disaster. that fellow was given than hyperbole is my middle name, i can recognize it when i see it >> in the u.s., slight dip in maus, quarter on quarter, 70 million, now averaging 68. is the president turning people away >> in my discussion with them, i talked about that. and i think that the answer is, is that there is a bit of a backlash, this is my own view, but the fact is, he's twitter in chief, and he's become an indispensable news source -- if you view this thing as a data-minding company that isn't the mouthpiece for the president, it is a company that you might think of as a different than media company it's not growing fast enough, i say -- i agree with that, but what it's doing in programming and sports, what it's doing in e sports, let's stay focussed on e sports, that is something they've drilled down on. i am saying it's not as bad as

it looks now look, you could say jim, not as bad as it looks, what does it matter when i look at proctor and gamble, anheuser-busch, they make a lot of money off growth >> that's not true pge grew 2.1%. >> we'll talk about that in a minute. >> doesn't give a scrap about that >> facebook seems to be growing a bit. >> facebook has a problem. >> they're growing too much. >> the total addressable market is 7.4 billion, and they now have 27% of that don't you think they'd bump up to a limit at a certain moment can i tell you about the call i have heard this year even with the original, listen to this one line that energized the call just dropped he goes, start showing ads. i want to see us move a little faster here. that's it. all anyone asked about the start monetizing messenger if they start -- when you use

what's app, i mean, i am talking about -- i will press on any ad, if they know she's in cambodia bam, zuckerberg has got the next five years figured out this is an independencive stock. >> if you don't get -- different investor i spoke to this morning says it's almost like it's such a profitable business, they can't even control it. they apparently took down operating exopinions, margins are better, free cash flow was much better -- >> raised the price. >> and kudos, facebook, that's a gap number they're not doing any of this. it's a gap number. clean number >> a source of some confusion last night around 4:00 >> i know, these guys gaffe, they're thinking, the guys selling it they should create stores which is stupid -- >> thank you for doing that, facebook all right jim -- >> can they do $8 a share next year in earnings >> oh man, why do you -- why do

you ask me that, michael this is the problem with that. here's the problem -- here's the problem with that. they can do what they want they're a little amazon yan in that, but if they can monetize -- if they can push messenger -- if they can do what zuck wants -- he tells his team to move faster you better all be looking at facebook on mobile and that is the key to the next level. can i just say, when you're raising a price of ads, you know what they are like, they're a newspaper where you need more copy, but you don't have to pate darn writers they have two, they have twor billion people who write and they pay them nothing. >> they pay nothing for most of their content. >> google is figuring that out >> what are they going to do about it >> game, set, match -- >> i know, i know. >> they actually have to have -- one thing they need, they need the population to be more -- >> right

>> yes it's a fa kundty problem >> right. >> and when you get on -- the pipeline here, issue with what is is it the creative destruction of twitter that your guy has. >> my guy? >> i speak to a lot of guys. >> big guys. >> couple of girls yeah >> can i just say that monthly average users have been a pipeline the daily average users are going to grow. the guys that shorted it and sold it right before -- >> ouch. >> they're not in the business >> you didn't like the $8 number though what's the multiple, 25 times? i'd be -- i was going to use that though. it's something people are talking about. >> zuck is not talking about that >> no, video and the ad use, and one of the things he's done -- you know how we figure out half the people look at the ads, but we don't know which half

his ads are something you want to watch you want to do i mean, i remember when it first happened, when i asked my daughter who loved the red hot chili peppers. do you press on ad how did we get ten t-shirts? that's not an ad, that's something they provide to that helps you. >> by the way, facebook is now a ten bagger from the all-time low. >> yes yes! >> beat earnings in sales above estimates as cost cuts accelerate nelson pelz, he has a statement this morning over the past ten years, turn to share holders is less than half of it's peers and has been at the bottom of most recent time frames, he believes p & g needs to address the root causes of this consistent underperformance >> i think the response from p & g would be, come on, we just did a top line, better than colgate,

a better than a lot of competitors. margins were strong. 85 cents versus 78 cents. it was a clear quarter and what are you proposing though you're saying put me on the board, because why not we don't think it's the appropriate time we think we're showing the momentum and again, i'm speaking for p & g here, not saying this myself and therefore, we continue to believe that we are justified in saying no, and fighting you at some point along the way by the way, this is not really going get joined as any sort of a be thele it's going to be a gentle one -- >> i think it will >> after labor day is when it really gets going. tough road ahead tv with 40% of these shares being held by retail >> uh-huh. >> but this argument is why not me why not give it my track record, give it to what i know and p & g is going to say our strategy is working. it may not be great, but look around it's as good as anything else.

>> you know who's running that board? >> yes >> and boeing the best stock in the dow, and that stock could go to 250, he's not to be tiefled with have you met him >> i have. >> hitter. >> yes >> hitter. and he may just say look, i love you, come back after you've been a shareholder for a while, i agree with you, the quarter was good and going to get better there are many other packaged good companies like a colgate which was rumored to be the next target i know, but look, the bogus journalists do that, the fake media. he's up against fake media okay, that's a term i learned, from twitter, but i do think that proctor is not as bad as others, how about that >> all right you're giving them that. >> twitter is not as bad as it looks and proctor is not -- glass half full today? >> yes yes. and it ain't head block. >> p & g, i'm anxious to see what it's going to do.

up >> 2%. >> look, they're fighting strong dollar, weaker dollar. >> there will be >> give it to them, nelson they admit they have problems. it's not like they're saying what are you out of your mind? >> they truly believe they're creating momentum here following taylor's plan. >> i think they are. >> and they continue to say listen, there's no real thesis from nelson in terms of what we should necessarily be doing that's different from what we are doing. he wants to be part on the board. not know don't spoil our momentum >> right many people will -- they believe many people will argue that why not? why not add him? so the board >> why not >> from his point of view, even if he loses, may be win-win, he'll own it, make the points. if he doesn't perform, do it again and get on without a proxy fight if they don't perform. p & g, spending money on advisors, goldman, centerview,ly zard, lord, mckenzie df king on

the solicitation >> that's ridiculous >> a lot of people advising them on this proxy fight. >> they could take all of those fees and save them and put this man on the board that's done more homework and i'll give you this homework to free. memo to proctor and gamble, he's cheaper and knows the space. >> yeah. >> why not have him on he's a great guy and funny he's really smart. i'm asking him in a personal plea here. >> really? >> yes >> you're getting involved in this personally >> you're like iss >> better than iss >> sent a bolt of the b29 to my dad because when that b29 came over, my father was in those ridiculous nine islands that he hit, boeing, great american company, it's time for mcneverny to say, smoke some peace pipe. >> get to comcast, verizon -- i hear you >> outlaw jesse wales.

>> imus asking shannon i wish the camera could focus there. she does the gifts for twitter i mention that only because twitter is really on my mind today. >> i don't think we're going to get a shot of shannon. >> anthony noto db. >> of course >> anthony noto is doing a better job than your man thinks that twitter self-destructed. >> really? >> yes >> really? it's only about monetization stick with that. you go ahead >> dana mining, margins are huge. >> what's snap going to do today on that twitter number. >> that's artificial, whacky inintelligence >> we'll get to rer vie zon as david mentions andrew liveris is going to join us look at the premarket. jeff bay zoes may become the richest man on the planet today. more "squawk on the street" in a minute

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what's next for him with the moergeer coming up because you're not spending all of this. listen to this >> i will. >> the portfolio review led by the directors will determine the best possible answer for shareholders we're very committed to the portfolio deal that we struck, late '15, but we're not blind to

new facts. we'll look at new facts, mckenzie driving that process. we'll have better answers to that question in the next month or so. what's important is we execute the execution you've seen from dow these last five years. the execution you've seen from dupont recently, we're going to keep that going so we don't distract 125,000 as we don't do that that's one, to, and three, we have $30 billion of new value coming out of these declared synergies. and two, with respect to myself, i ain't done by a long shot. >> and david, the reason i asked that is because they're going to go more of a dan lobe play i think there's more companies than just three. i think there could be five. that's why i said stay focussed. >> they've been under pressure, not just lobe, larry robins. >> really small people >> continued tenure at the company given his previous statements to the contrary in this terms of staying. >> i think that's going to be a

battle royal stay tuned to the idea that there's more wealth creation of dupont it's not like i'm getting in denial there's a lot of stuff also ask livers i about his relationship with president trump following his stance on climate change he's anti. climate change here's what he told me >> it's a much more listening environment than any of the press gives them credit for. we're very engaged on that topic and other topics i am -- look, i see tail winds i see tax reform in our future the infrastructure program, regulatory reform which is going on as we speak the announcement yesterday out of the white house shows jobs coming back. we are putting manufacturing jobs back in this country. this coming monday, we're ground breaking on a new facility here in midland by the way, knocked it out of the park when we integrated into the dow.

we are tripling that company thanks to the hand and glove hit with the integration machine this machine you're talking about. so that unit and what we're going to do with that, we're going to grow it and put a new facility here in michigan. we're adding jobs. so i'm very confident that, you know, the engagement on climate change is still going to be direction-positive, but it has to be done as we keeps saying on u.s. terms >> i think it's interesting to keep track that manufacturing america has done very well this quarter. dow good you're not going to see it scream up. they are merging to dupont boeing yesterday, one of the themes of this earnings period is job creation. >> how about foxconn yesterday 65 estimate 39 >> and bowing is shipping a lot of planes. boeing crushed airbus. i mean, i'm not being zen phobic here, this is real training. weaker dollar's just going to make it better and better. i'm liking what i'm hearing

industrial part. >> which is why it was weird when they blamed it on currency. did you think that was suspect >> whirlpool is -- they nefrl close that brazilian business. whirlpool, there could be no buy of whirlpool because of the consolidation of that industry too many times that that stock has been one step forward, one step back. and yeah, i was disappointed >> disappointed. >> after a nis run >> exactly right >> kramer's mad dash count down to the opening bell looks like we might get a record on the naz dock. othetwo e t r hir arnofabend back in a minute hey, i've got the trend analysis. hey. hi. hi. you guys going to the company picnic this weekend? picnics are delightful. oh, wish we could. but we're stuck here catching up on claims.

but we just compared historical claims to coverages. but we have those new audits. my natural language api can help us score those by noon. great. see you guys there. we would not miss it. watson, you gotta learn how to take a hint. i love to learn. watson, you gotta learn how to take a hint. ray's always been different. last year, he said he was going to dig a hole to china. at&t is working with farmers to improve irrigation techniques. remote moisture sensors use a reliable network to tell them when and where to water. so that farmers like ray can compete in big ways. china. oh ... he got there. that's the power of and.

we're going to talk verizon this morning so many earnings we didn't get to that and we'll get to comcast later. this stock doing something it hasn't done in a while, jim. on better than expected numbers, the bar came down very low, but they did exceed it, in fact, they added 358,000 retail post paid net editions. churn seems to be quite low for the entire industry. perhaps people not doing anything while they wait for the new iphone >> that's a good thesis. i didn't count on that i was focussing on data.

is there dirt? we've had a quarter from verizon now, and quarter from at&t i'm going smart and smarter. and you know that's a twist on the gentle legend. >> it is, you're going after them a little bit. >> you are. >> dumber and dumb >> smart >> the bundles seemed to help. verizon is all about the network they continue to be. everybody's talking about deals and will they do this and that by the way, it's not like the top line is growing, it's not. >> but -- >> this is a power house, david. if they can go back and get growth -- david, unlimited work for them >> unlimited didn't seem to stress the network as people thought. >> slower. it is slower, but i will say this, david. the days when t-mobile has a big upside like it did and stock went down. you know why because what have you said people aren't switching like they used to >> no, they don't seem to be people could be waiting for the iphone 8 >> still, i'm leading with a 5%

yield, at&t, verizon, david, gone from being bonds, illinois muni bonds to being growth stocks that's saying something. >> well -- >> at&t was. verizon's not growing. >> time warner deal with at&t, i have to mention it is a great american, is going to make it so hbo on your hand held, it's going to be universal. it's not going to be what we see from facebook. it's not going to be netflix, but at&t is we're going to have to rethink that company. i'm rerating it up and t-mobile, smart, smarter, and good >> oh. all right. verizon by the way continues to invest in the network and is counting on five be a differentiator for it >> and they wear suits they look like us, doesn't mean their losers. >> man oh boy, you're taking it to ledger i bet we'll be hearing from him on twitter, but nobody really eroks at twitt >> no one goes to twitter

anymore. >> opening bell after this hey gary, what are you doing? oh hey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade.

you're watching cnbc "squawk on the street," busiest day of earnings season, the macro data came in pretty good.

people reflecting on what the feds said yesterday in it's statement. you guys, did verizon at the wall, comcast beats by four cents. film revenue up 60, thank you fate for the furious oh, look, it was -- there had been speculation that it was going to be a weaker quarter, and that is not true >> no, it's not true in fact, when you looked in their slides, our parent company, it appears guided up forward margins a bit. the buyback was a bit ahead of expectations there's metrics though, we're slightly below in terms of losses, but generally speaking, given that especially that focus on forward profitability, that seems to be encouraging investors this morning >> on the call, brian roberts was asked about mna, we really don't feel like we're missing anything, then steve birk, our boss at nbcu was asked about the snap investment. says it's not just about a investment, it's also about investing companies from whom

you can learn things >> i think the company is the work form, but there is a technological aspect to them that others do not have. and i think that's driven a lot of revenue >> let's get to the opening bell and the s&p at the bottom of your screen. and the big board, a wholesale market in the media area and financial energy and commodities market at the nasdaq celebrating a recent ipo providing business banking services to chinese american communities in southern california >> we're going to talk to gary kelly of southwest in a few moments. you had revenue up 1-5, it's not quite what some comet or its say. >> and the transports have been pretty much of a downer here another tough day. really interesting to take share away because you never think railroad is louis to railroads, airlines losing to airlines. i think the group is pausing after a big run. we've got hear from gary

tells it straight as it is they're in the best position because they don't have to be against the international low costcariers, at the same time, price of costs are higher. i think it should make more money. he knows thousand run an airline. i will defer to him. >> snapchat did not report earnings you mentioned it in relation to the comcast investment more or less a new low snap, you've got the lock-up, i think it's monday, i think it's next week. >> 711 mill there. >> important to keep in mind that was a very difficult stock too short, and by vir which you of sellers being out there, you also increase the float, the ability to short the stock as well and so that is something a lot of people are focussed on. >> and they're also focussed on the two classes of stock keeping them out. >> yes right. >> that's not what you want to hear if you're in their shoes. >> so they're not going to have any index buying. >> in the russell. >> no, not index buying. >> look, is there a read through

from twitter to snap/or from facebook to snap >> just about to go twitter saying that, you know, you now have to say that twitter was left for dead. i think it's not dead. at the right moment, snap will be left for dead and we'll be possibly talking about it. you have to have every one of the shares that's wishful thinking. >> the pharma astraxica. that's going to take you back to levels in march. >> i wonder who they have to buy, i mean, that was, that was their bedrock drug this was the hope which was the lung cancer drug, by the way, there's a read through there to bristol, bristol would say, listen, ours is different, but this was a shocker incredible cancer-franchise. david, i am telling you there's more mna because the bioteches are doing well 20% growth relives out of nowhere, accelerating, and i

question, you know, i would have thought that insight would be a natural. >> don't forget, there was a time when pfizer was trying to buy that, but that was also part of it's desire to invert pfizer or was desperate to move out of our tax jurisdiction, then agreed with a deal which was then specifically targeted by the u.s. government. >> is fooiz aerobond i see it always trades at 32 high yield bond or something >> reporter: what's the yield on that, 3.9%. >> it's at 32, it's kind of like fly paper. in the meantime, it's going to report, but it is an inexpensive stock. it's going to get the stock that it'll be able to sell, but at the same time, it's biotech that's moving here the biotech stocks really have the mojo although they did not report a number that people liked i do think this group -- what's matter, facebook come and get you? >> we haven't gotten to charter which is off nicely today. >> tell me >> i think people are responding

to the numbers, frankly with just the complete dell yuj, it's been difficult to get to everything today >> people are saying, why haven't you mentioned -- >> i'm doing my darn best. >> we're only human. >> look, we didn't mention buffalo wild wings which is obviously there's something the matter there and the fact is, upa, i mean, i thought that ups, there's a lot of e commerce, but it all seems to crew to the richest man in the world. right? >> bezos is now officially the richest man on planet earth. that'll stay true as long as it holds above 10.63. it's hard to value his other assets this is mostly looking at am don holdings surpassing bill gates. >> surpassing bill gates wow. he's a very private man. >> gates puts a lot of money in the foundation, diverting his net worth, it's amazing he's

held on as long as he has. >> bezos has not done that he's not putting his money in a foundation >> not yet, anything could happen this evening, it could be that -- don't forget, amazon prime, the second biggest holiday now in the country, did boost him. they don't tell you how many prime people there are >> interesting that twitter's losses are accelerateding, jim it's down about 13% now, it was only down about 10% -- >> change my mind. >> when you were defending it earlier. >> it seems i'm charged here over there one and you're the pennsylvanians and i went up against you. you're chamberlain right? fore score and seven years ago, is that what you're going for? >> i'm surprised that you're saying -- typically, as you say yourself, you tend towards a high pesh bli, i thought it would have gone more in my direction. >> based on my reporting from people reviewing this quarter

negatively. >> right now you're winning. right now you're winning. >> it's not a competition. >> it's a little bit like that scene in "witness" when the woman asks harrison ford, you said you'd be safe on twitter. then you have to come back and say, well, i was wrong >> a lot of good lines from that film. >> we should play that again jim, some research this morning, rbc on boeing, upgrades from underperform. we are capitulating on the underperform the production maturity argument went wrong, they were looking at historical results, that's quite the mea culpa. >> he's not the only one what were they thinking? boeing upgraded to buy from neutral bank of america. what they were thinking. and i think what they were thinking, basically it's been a real big run and there's nothing left, but you know what, there was tons in the tank gave him a good hand

let's not forget that. he didn't come in and turn on the jets so far, if you bought the stocks that trump picked on, that's a good etf that's a killer etf. >> it is >> what would we call that >> trump reversal. reversal trump -- >> cross hair, yeah. >> i like that >> we put together an etf which is like at -- anti-trump i don't know you could put it together and make a million dollars doesn't everyone that does an etf make a million dollars write me a check. >> they should for phang >> does exceed $500 billion. right around there, it is not as high as the premarket indications at least, stock up back about 4% on 49 top line, right? 49 right? yeah >> 45 year on year >> this is a billion dollars it's hard to have like a huge spurt in the stock that's as big

as this. i think people will be trying to sell it or short it here, but in the end, the $8 number makes the stock very inexpensive >> still, so few employees, they put everybody to shame on an employee -- >> now you're really starting to annoy me. >> why >> do you know how many employees they have? >> two billion two billion employees writing copy every day for that. now that is real good business >> you're right. >> average compensation for employee is pretty low >> it is low >> we don't get paid as much as we should. there should be a facebook writer's strike. >> that's a key point and it's worth making again and again they don't pay -- all the content is created by users, thank you. >> i added facebook when we went to harvard, what did i do? i looked at the women in the facebook i'm an idiot this guy looked and said he dreams dreams like the bobby kennedy speech

>> all right >> please do >> yeah, let's talk a little sni and scripts. it is the symbol for scripts and discovery. it's going to bes deal going to be a deal very close. could be, who knows, maybe tomorrow, but certainly one would expect by monday morning you'll will have discovery announcing it's acquisition of scripps. asives tweeting last night, feverishly given all that other people chasing the story, it's going to be at least 90 bucks a share. journal reports 70.30 is the cash stock make up, i have not been able to confirm that nor been able to confirm a specific price, but this was, as we reported a few days ago, heated battle in which via come, people tell me expected it would emerge victorious and seem to think it's bid was going to be there perhaps in the high 80s. all cash from vooi yacom,

willingness on the part of the company, reporting on would they be willing to lever up their balance sheet to an extent that would at least -- even though they will delever quickly. discovery which is going to use cash and if viacom had succeeded, leveraging up to 5.25 times. they were willing to do that perhaps didn't to want issue any stock any way, not that the scripps family wanted it, but didn't to want dilute down national amusements as well. but the question now, simply as they pay for over the deal and get other things done is how will the market react once we see it once we know exactly what that price is, but it'll create a far larger company for discovery, of course, all of those networks being combined, the ability to offer some sort of an over the top platform as i said very strong fan bases for each of them. the hope is that you create a much larger company. energies are said to be very large. i'll let others decide what that

means. massive is the word that's been uses, 300 million, 400 million, could it be 500 million? that'll figure prominently as you watch that right now the other question though guys is will this set off more consolidation? is it sort of the match that lights a fire to a certain extent and i don't know, you know, when you look at an amc which is controlled by the dolan family, feel like now is the time? we talk so often of course about the continued unbundling, the disconnections of video, the proliferation of over the top platforms or the skinny bundles being offered by your cable provider and whether or not companies such as a viacom will be able to be a part of them. do you have must-carry networks so to speak. not using must-carry as in the must-carry old networks, but just simply -- do people want to see them and that's the overriding theme right now. and discovery clearly deciding this is the route we want to go

because we believe that we can ride this out by being bigger, being more diverse, being focussed on women as they will be as for advertisers to get to. and it's a good fit, many would say discovery and scripps, perhaps better than viacom and scripps. >> how well they did with groups they've subdivided women in their 30s, women who read summer books. women who cook -- yes, trying to glom on to some of that. in the meantime, you mention that consolidation pieces. this is 1.80, i can't dismiss that comcast was down, there was just a fever pitch again of deals about to occur is it -- put a stake in it that this is -- i mean, viacom can't go buy and somebody else, is there something going on that disney can't go it alone i find that ridiculous >> of course they can. the speculation with disney

always revovls around two differents would apple ever seek to make -- i just don't see it, ever seek to try to do something enormous in content with malone's idea that you spin espn off and, you know -- or would disney try to do something to try to buy netflix? even though it would be massively dilutive, those are the deals involving disney, but they don't need to do something. then get to viacom -- but we were talking earlier, if this quarter is at least a sign of what may be to come. maybe thap won't feel as much pressure as verizon to move to the content arena the way that at&t has aggressively. >> it's in the air you know what's lucky we have? gary kelly, because this is the worst stock. i'm dplad we have them because i've never seen southwest down this much >> yeah. >> stock got below 54 this morning. bounced right off 2900 -- >> that's not that bad for goodness sakes >> gary, good morning.

>> i assume they are looking at unit revenue up 1-5, which is not what peers have posted, what do you tell them >> it was a great quarter. it was right in line with our expectations all quarter long going back to april. and we did 1.5 over last year, considering that we had a brand new reservation system which was a flawless execution i'm very proud of our people but, in addition to that, there was some drag from that new system that we'll get remedied here shortly, and you factor that in, and it was just a very solid performance and actually better than what we thought. in that regard and we're looking at a strong third quarter as well. >> they said the impact from the reservation hangover slightly greater than anticipated, but largely expected to be implemented by the end of the year why, why was the impact more

than you thought >> oh, i think there were just some items that we didn't anticipate our people having such difficulty with so, we have an upgraded boarding product at the gate as an example, it's a little bit more cumbersome to sell than our previous systems, so we're addressing that. and that's just an example of a handful of things. but, overall, the system implementation went well we did have some benefits from the new system already in the second quarter also. but, we're still looking forward to -- oh, $200 million annual run rate improvement from the new system by the end of next year. and all things are proceeding pretty much as we had planned. so i am very pleased >> jim kramer, if that's true, you had five years ago you had 757 million shares, you going to

put your money where your mouth is obviously the people who own stocks do not agree with you that this was a good quarter >> well, again, we're in line with our expectations. in fact, beat them we beat the consensus by four cents. we were lower than our cost guidance and we're looking for an improved year over year comparison in the third quarter. so we're very much on track. and very pleased with where we are. >> but gary, has the the industry changed in the last six months it's almost like we've decided, international carriers up are against the low cost, no frills, there's a lot more competition in the united states are you seeing anything which indicates that that house of airlines is over >> oh jim, no, earnings per share was a record we're looking at, again, we're ahead of our plan for the first

half of 2017, and very much in line with our plan for the ambulance of the year, we're working on our plans for next year we'll have some fuel price tail winds, we hope, in 2018, so we're, you know -- there's nothing different at southwest today than three months ago or one month ago. other than we did better than what people thought. and we're looking forward to a great third quarter. >> you talk about energy tail winds, gary. i know the hedging portfolio was materialed this quarter, can you just walk people through the impact of the quarter and how you see that affecting the rest of year? >> well, we were, we were heavily hedged in 2015, 2016, and again in 2017 to support our strategy and our strategic growth plan. so, we're -- we have a much better hedge position relative to the market in 2018 and '19.

so we'll expect to see about the same kind of hedge penalty in the second half that we did in the first half with market prices where they are. >> and then finally, overall fair environment going into the back to school, fall holiday season, how does it look >> well, you know, the fare environment has improved from a year ago it's the first quarter in about eight quarters as i recall that we actually had some welcomed fare increases they're modest which we like, but nonetheless, we've arrested that trend, and that's also in line with what we expected in addition to a very solid fare environment, we have record low factors, so the bookings are very, very strong for the third quarter. so after kids go back to school and there's that natural, seasonal softness, relative to the really busy, busy summer season, i think we're going to have a strong fall and hopefully

finish this year strong. >> we always appreciate you coming on, adding color to the quarter, gary, good to see you again, thanks. >> thanks for having us. >> gary kelly of southwest >> i'll be telling club members about that interview that you should buy southwest and be frozen i think he's basically telling you, it's all system's go. that is an obliteration of the stock of the best airline company in the world i think that's actually one of the few opportunities you've gotten this earnings season. >> i think he's right. >> interesting >> we do have a triple play on terms of record high ares let's get to bob >> good morning, carl, happy thursday mixed open, verizon, boeing leading boeing again, big mover. right now look at the leadership it's very similar to what we've seen through the year. we've got biotech was on the leader right at the open slightly negative. semiconductors, another leadership day generally all the leadership groups recently from the downside, materials, industrials, energy not doing much the oil is climbing towards 48 in the last couple of days we're going to enter a new phase

of the earnings season we're through the first third, almost 40%, and it's going to turn to energy now and energy's very important because it's the biggest contributor to earnings for the second quarter and even the third quarter as well more than a quarter of all the earnings we're going to get, increases are going to be due to energy, tech and financial is going to be there too. and there's a big three. everything else is just 25%. so that's why we spent a lot of time on tech and financials and we're going to look at energy right now. now tomorrow, exxon and chevron are going to be reporting, the big guys, and the numbers have been coming down dramatically for these guys because the oil isn't going anywhere in april, we had a dollar for the quarter for exxon, and it keeps coming down even through july after the quarter ended, they keep taking the numbers down say they have been for the third quarter and taken the numbers down same thing happened with chevron, the reason this is happening, no one gets the price of oil right no one, not a strategist, analyst, in january, analysts had the average price for oil in the third quarter at $56 folks, oil is over $50 at the

time that's hardly a bold call, but they couldn't get the direction right. oil kept going down and down, 42, now it's around 45, 46, going up, you get the idea they've got telephone so wrong the analysts numbers were so high, they've taken the estimates down and look what it's done to the stock prices. there's your green line, s&p # 00 were up 10% year to date. and that's chevron and exxon, they're down 10% because the numbers keep going down and they've been getting the numbers so wrong so this is a big issue can we get some movement here from them and what are they going to say the good news is shell and khan co. reported this morning, they did better than expected on the numbers. and they too had their numbers taken down as well you could see they're up, but not that much. the key here is capital expenditures, both said they would be very careful with spending, khan co. said they're taking down capital expenditures by about 4%, 5%, that's about $200 million that's a significant i think you're going hear that

from a lot of people >> finally the foot si numbers here the ftse numbers here, they're including 5% voting rights in the hands of public shareholders, that's going to affect companies like snap and blue apron, about three dozen others this is important. stock ownership should be based on more than just economic ownership. we should have input into management that's what they're saying i think it's a good idea i hope the others follow suit. right now the dow, up 53 points. guys, back to you. >> bob, thank you for that let's dmek with rick santelli in chicago. busy morning, hey, rick. >> yes, busy morning lots of data points, a few more still to come. if we look at a two day, we're crawling back almost exactly to the area that rates dipped from right as the statement was read yesterday. but if you open the chart up to the end of may, so we see june and july, what's interesting is, for the most part, july is

completely above june in terms of rates, of course june contained the low yield close of the year around 212. here's something fascinating, on the week, we're up four basis points on fives. we are up seven basis points on tens and we are up 11 basis points on 30 there's a curve steepening aspect to this let's look, tens minus twos, currently around 94. we've held the mid-70s you know, that is a big area, but maybe once again, take a perspective, open this chart up to three years, really jumps out at you whatever signal you think this curve has, there's a directional to why traders look at it and it certainly looks like it has bottomed now let's look at a big chart euro versus the dollar listen, we can get in and we can talk about timing, but if you forget that a minute, 120 is the number you're going hear from everybody. it certainly looks like 120.

we'll get stock trading with jim after this short break

time for kramer and stop trading. >> congratulations i want to focus far moment on the paypal tree. palpal tree meaning that john donno left to go to service now. fantastic blowout. and let's talk about paypal. dan shulman once again, this time deal with bank of america

this is about there's only credit card use. i should have realized this yesterday when michael from citi told me that only 20 or 30% of people use credit cards in transactions offline, but 100% use credit cards online, paypal the biggest beneficiary. he proved a lot of short sellers wrong, including a nice young gentleman i was supposed to debate and i didn't have the heart. that's not the way i play it >> tim, what is tonight on mad money? >> researchers has had a reversal here. e sports is probably the fastest growing. it's going to help twitter work with my assistant deb on this one, i think it could be good. and you know, i've got to tell you, united reynolds is the definition, cat tar pillar is one of the great untold stories. is there a theme here?

american manufacturing do i want to be that for a moment yes. >> sure. >> jim, we'll see you tonight. mad money, 6:00 p.m. eastern time twitter shares are down, almost 12%, we're going to talk to a former ceo this morning. dow's up 51. when this bell rings... ...it starts a chain reaction... ...that's heard throughout the connected business world. at&t network security helps protect business, from the largest financial markets to the smallest transactions, by sensing cyber-attacks in near real time and automatically deploying countermeasures. keeping the world of business connected and protected.

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good thursday morning, welcome back to "squawk only the street." markets up 56 points on the dow, record highs across the board. that is the busiest days of earnings season. >> our road map begins with facebook's big beat. stock surging after a strong quarter. fueled by boost and ad revenue twitter shares are going in the opposite direction >> markets continue to set record highs we'll talk to howard lutnick with his thoughts on the rally >> rise in comcast, proctor and gamble, all moving this morning. we're going to bring you the latest all three with record highs this morning, it is the heaviest days of earnings season. slew of major companies earning this morning forecast by a wide margin. boosted by a big jump in ad revenue. twitter down nearly 12% as the companies user growth is essentially flat and probably 500 other names we

just didn't have time to get to. >> not mention europe as well overnight. for more on facebook and twitter, let's send it out to our own julia who did speak with facebook's sheryl sandberg after the company's reports, what are some of the highlights, good morning, julia >> it's a tale of two very different social media companies. twitter shares tanking on the company's failure to add more monthly active users in the quarter. the company's better than expected earnings and revenue and twitter ceo jack dorsey's focus on a 12% increase on failing to turn around twitter's stock. now it's a very different story for facebook shares soaring more than 5% after adding nearly as many monthly active users in the past year as twitter has in total facebook beating expectations on the top and bottom line as well as on that user growth i spoke to sheryl sandberg last night about what's driving results. >> people are using our products and services to share and community and build community on

their mobile phones. we're excited to announce today that we have over 15 million businesses using business profiles on instagram and that joins our 70 million pages on facebook so for facebook and instagram are places where people are connecting with each other, but businesses are connecting with their consumer >> sandberg as well as mark zuckerberg on the commitment to be a destination for original, professional video content saying it'll be a big area of investment to engage with consumers and grow ad revenue. >> our goal is to be a platform for content providers to find their audience and to monetize right now, we are making some early investments in kick starting the ecosystem to promote or episodic vid ye viewing on facebook. not of this type and we think developing that ecosystem is important our approach and our strategic goal remains the same. if over the long run we want to

be a platform for all content providers to publish >> now facebook did warn there are fewer ads in videos than the news shift this will allow facebook to compete in the $70 billion television ad market guys, back over to you >> julia, thank you very much. let's talk more about facebook and twitter. brian wheezer joins us, who covers both of the stocks, good morning, brian, thank you for being on the line. as far as facebook is concerned, there's a lot of highlights including the ad growth and expense management, what stood out to you >> nay and google together rule the universe of advertising. this is not new, but the fact that they can continue to do it. it's still impressive. that said, i think the streak certainly got overly excited on this because again there wasn't

anything meaningfully new and talking about messenger, you know, it is early days as the company said that's not a reason to change expectations on the company. video, i mean, the problem there is going to be a meaningful player in video, they're going to invest significantly, and that's margining even more than i think the to see the would expect >> this why you're still on hold you missed this move up, another 5% this morning. >> yeah, i mean, i would say the street is overly enthusiastic rather than that >> especially when google is going in the other direction when operating expenses can be disciplined and continue to go down, something that people were worried about. that's all the recipe for growth, not to mention, they're

teasing messenger and video, and i don't know, did it come up this time, instagram >>. >> on my forecast, and i'd like to be realistic about this, the two would have 92%, that's 92% of digital advertising outside of china by 2021 the reality is that the market is getting saturated the two of them are taking the shared digital advertising and there are limits to growth they cannot realistically tap into marketing budgets that is a fantasy. and so, there are real limits to how big they can be, regardless of what they do with their inventory. and i don't think the street has accounted for that

>> you know, it's rare that -- to hear an analyst be negative in the sense of so many are positive i mean, then what does that do -- we're still talking about a company with a 45% top line growth rate that the pe would seem reasonable given that, not to mention as sarah said, the generation only growing because they seem to be keeping op eks in check what's an appropriate multiple then, brian? >> you know, again, i'm all dcs driven in everything i come up with, the short answer is lower than what it is. the reality is that, if the street thinks that facebook and google together can sustain this growth for years to come, they're sorely mistaken. and that's the difference. i consider myself to be optimism they're one of the most impressive companies on earth. i think what they're doing is sustainable. i see risk to the downside that maybe the street also isn't considering.

i think that there are still real problems around feasibility. i don't think advertisers realize the company with only 2, two, with a single digital are considering viewable most advertisers are unaware that's presented with that fact. that's a real risk too as advertisers start applying more tools and scrutiny to their budgets, they may or may not retain all the budgets it's a risk. there are so many things out there that are just not accounted for and all the optimism is getting in without the downside considerations. >> brian, just to put this month into perspective for facebook, it is now the best month for the shares in about four years you've got to go back to december 2013, it's up 15% plus for the month of july. how much of a discount would you want to see before you change your tune? >> well, my price tag is $40 >> and it doesn't sound like you're changing that any time

soon thank you for come on to make your case and talking about the stock. which is surging brian wieser >> dow, s&p, and nasdaq amid the slew of earnings howard lutnick here this morning. >> we're talking about fang in this case, but it could have been copper, it could have been oil, it could have been industrials, manufacturing, what is not working now and what does it mean? >> well, look, you have such -- you have a slow-growing economy, low interest rates, drives people to make investments and that's what you're doing you're seeing people really have a risk on policy what else can they do? you can't buy bonds. sure, i'll buy ten year treasuries, maybe make 2%. come on, get throughout and do things and the fed continues to say, we're sort of bumping along, bumping along you've got to love real estate you've got love real estate

again, these kind of assets that do really well in a long-term low interest rate environment, it's going to do great >> we started the year talking about the trump trade and policy bets and what could we get this year what could we get by the first quarter of next year is the market unat the timered from all of that now >> no, i think what's happening is you had this negativity in the past and now you have positivity in the future there will be a cut in the rule. there will be a reduction in regulations so you go in and see the financials, have a nice bump coming you know, everyone was hoping they'd get in the first quarter, hoping in the second quarter, but it's going to come i mean, because the republicans are in the house, the republicans are in the president, and the republicans are in the senate. you have all three, they're going to get stuff done and it's going to be positive for financials and that is going to happen. i'm not being bulled it's going to happen >> you believe it will happen?

>> yeah. it's certain >> despite what has been the failure thus far during the first six and a half months to get anything done. when it comes to legislation. >> well look, well, i wouldn't say got nothing done, right. he has health care done in the house. in the senate now they're talk health care. let's face, let's say anybody was the president, any republican was president, you try to repeal health care, you're too far in the middle, the guy's on the right don't like it. get too far to the right and the ones in the middle don't like it this is a difficult task for any president, period, but it will get done, they'll get some tax work done. but you are certain, and i'm here to tell you, we are certain, we are going to get regulatory reductions done because that does not require all of that sort of political mature nations you're going to see companies do well, drop the vocal rule. could add 10 to 15% in the financials alone so our companies really hitting

on all cylinders it's really nice >> as someone who's an optimist clearly on the trump-republican agenda do you not worry about these stories, the stand off with, the attorney jeff sessions, the russia investigation heating up from many different angles and some of the other scandals surrounding this white house >> well, look, the white house's view is that the people who didn't vote for him, right, have a lot to say, and they continue to say it. right? but the concept of getting nothing done these are hard topics, health care repeal is a hard topic for anyone, right, and they need to do health care repeal before they do tax reform because health care repeal will save between 80 and $100 billion. and he wants to spend that in tax reform, and you're going to get regulatory reform. you're going see financials do really well in the second half of this year -- >> just on rex you don't need to see a tax cut necessarily. >> no. >> the economy wants a tax cut, that's for sure. no one's arguing that, right but for financials and for

trading. remember, the rule says, a bank's not allowed to buy something because they think it's cheap i mean, when was the last time you heard of a wall street firm. look where we are, people buy and sell because they think it's cheap. facebook, good or bad? imagine not letting a bank do that to help it's clients out. it seems irrational, when the rule goes away >> do you believe it's going to go away? that's not what we've been hearing. certainly there may be some changes. >> that's why you had me here -- my opinion and i am telling you, the rule is going away because it's an oddity the banks have the capital now, right? they're all passing their stress test they have the capital. if they want to buy something, why shouldn't they be allowed to buy something? why shouldn't they be allowed? it's intellectually challenging to say you're not allowed to buy something, unless it's for a customer afghanistan all of these banks buy to sell to customers later my view, the rule will go away

two simple words financials will improve because of that. >> sounds like you're having conversations with gary or manuchin the fact that i know all of these people. >> i know you know them all well exactly and you seem definitive. are you hearing this directly from them? >> i don't talk about all the things i talk about with all the people i know. the resume was a regulatory constraint issued by the prior administration who had a completely different view of banks than this administration does this administration thinks that the banks are helping an engine to help drive the economy. if they let the banks do more business it's going to help the economy drive and grow they're going to lend more, do more business. i fwhie. my company is set up for it. bgc partners will do well when the rule goes away low interest rates is why we went into the business in the first place. that's why -- >> too low, cap rates sort of capped out >> well, sure. i mean, interest rates are so

low, where are they going? but if they stay here, right, and you get tax reform -- what people haven't thought about with real estate, you get tax reform, you're going to see real estate now, it's like a whole other thing. okay, cap rates don't have to go, but my taxes just went down, so where's the real estate going? right. the velocity of selling and buying raels will just kick. i am really excited about the prospects of if, and that's a dream, if there's a reduction in capital gains tax. you're going see real estate pop in a way -- and because we're big in the selling of buildings. and, you know, it's sort of like, little party hats on >> yeah. >> one last thing, on overall sentiment, vix below ten for i don't know how many days howard marcs memo, period of laxness is followed by corrections when in which penalties are imposed. >> that's bold >> he even says, if you make a call like this now, you'll lag

in terms of return, and you'll look like and old foegy. i'm willing to do this basically he says despite that. >> here's my contrary view to that, which is, people go back in history and they look at, you know, the expansions of nine years, the expansions are ten years, we're at the edge, edge, edge, how long can it last if you told all of us and the people watching today that interest rates were going to be nil, nil and we were going to be in the easiest monetary policy in the history of thought, and then when normalization by the fed happens. and when that's all done, what's the next thing that happens? that's the easiest monetary policy in the history of modern world will begin because whoever thought of the fed buying four trillion worth of everything so the moral of the story is, there's a different set of rules here and that, that's why this, you know, continuing expansion is going to break all the rules because the rules have all been broken by central banks being so

accommodative, they're going to keep it going. >> the next fed chair? >> who is going to be the next fed chair? if gary wants it, gary gets it the question is does he really want it? i'm not sure that gary really wants it i think they like to talk about it i'm not sure the job he wants. if you were going cohen, is the that job you really, really want right. i don't want it. >> take your name out of the running. >> thanks, very kind. >> howard, we can talk for the whole hour, but we've got to move on. good see you >> great to see you. when we come back, we'll talk ups and enis arngbeat the ceo's with us and the dow's up 69.

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that's a good question however the stock down this morning and down more than 5% for the year joining us with more as always, richard chief financial officer of ups and a member of the cfo council. it's good to see you again as always, thank you for joining us. >> good morning, good to be here >> quarter has everything, operating profit up 13, margin expansion. you talk about international revenue gains year on year we're a little puzzled why the stock is down 3% >> so are we you know, we did have a good quarter and it was really right in line with our expectations for the year

you know, when you look year over year, there were some things that helped us in the second quarter that we nund our plans, specifically, fuel prices last year kept going up and we couldn't keep up with the revenue because we had a two-month lag, but this year, all of that came together. we've changed the fuel surcharges and at the end of the day, all three segments performed well, had good, positive leverage. and overall, our earnings per share are about 11% increase >> obviously we talk about e commerce here all the time we know the consumer is migrating that way year to date cap x, two billion. can you describe just the trajectory and the environment for cap x as far as you're concerned? >> sure. you know, right now, we are in an expansion of our facilities we've now had four quarters in a row in the u.s. of almost 5% or more revenue growth. and by building additional capability, we can increase capacity right now, we have about -- just

over 7.5 million square feet under construction the total networks just over 32 million square feet. so we're putting a meaningful amount of new technology in these buildings that allows us to continue to grow the business next year, we'll open over 5.5 million square feet of new buildings. >> but why specifically is with the growth of e commerce shipping becoming so much more expensive? i noticed your operating expenses did jump 7.5% where does that go and for the fuel social security going up on a cost per piece basis about 1.6% when you then think about our expansion of saturday where we're now in 35 major metropolitan areas and that's a new service we open this year, you adjust that out and costs over 1%. from an inflationary on a unit basis, cost is right in line

with where we would expect it to be >> we're watching wage growth every job's friday, richard, and you know, for the quarter so far, we haven't heard companies talk about wage inflation as a material mover in their cost structure. >> is it for you and when will it be? >> as we grow, we put more people on. and many of us stay for our careers at ups in fact, over the last few years as we hire people for our christmas season, almost 40% of them end up staying with ups in permanent jobs so we believe that believe that because of the wage package along with the benefits and we have something called earn and learn for part timers which is a tuition-assistance program that makes it attractive for people to come to work for ups and make a career as they complete college. >> was just going to ask, richard, how you are preparing for the all-important q4 peak

season of shipping and what you've learned from recent years and how you're changing it around the strategy this year >> well sarah, one of the big challenges when you think about peak season is how many workdays there are between thanksgiving and christmas. this year will have the most number of days which makes the planning a little bit easier we started the year planning in early february and we've had meetings, weeks in throughout the process. i will tell you, customer demand is a little different than we expected if you look at the forecast for industrial production and retail sales, they've come down a little bit from their original forecast, just three months ago. so that means we're seeing more online so we're making the adjustments, but we're also know that between now and, in the third quarter we'll continue to make the necessary adjustments. we're talking to our customers, we're getting the assets ready there are a few businesses in mt. world that conflicts almost

100% for six to eight weeks and provide the service and keeping the service at high levels and so we're ready for peak season to look forward to christmas season coming. >> one last question, richard. as you know one of the big stories of the summer has been amazon whole foods, not just that deal, it's about how e commerce is moving into product categories that are erishable. we have mcdonald's on yesterday talk delivering through uber is ups making a big push to deliver stuff that can go bad within a few hours >> you know, our network is really not set up for that kind of delivery, but i will tell you, we have thousands of packages every day that are commodities in the grocery area. things that are shipped through the ups network that go to the home where this prepared meals and the right kind of packaging, and so we participate in that area, we participate in the seafood area so there are many different categories in the grocery commodity area that we are

seeing our network, but ups is not participating in a meaningful way in the next hour or the next two-hour delivery. we did put a minority investment in a company called delive so that we can continue to monitor and look at how that market continues to evolve. >> it's changing fast as most consumers can attest richard, always good to talk to you on the quarter appreciate your time as always, thank you. >> thank you speaking of earnings, strong results this morning diageo. i did have a chance to talk to the ceo about an hour ago. and asked about the u.s. market in particular, which is the the biggest for diageo >> we are seeing the high-end brands do better, people are drinking better in many america, and that's helping the premium end of our portfolio and spirits is taking share away

from beer and wine and that trend continues as young americans turning 21 have a greater share of spirits and cocktails in their repertoire than the co. hordes before so the spirits category is in robust grit and very healthy and i talk of the u.s. as the world's biggest emerging, developing market because the demographics are so attractive and the taste profiles are changing so as you pointed out, this is the most profitable market in the world. >> i wanted to ask you about your recent acquisition, it was a big deal here. how much was george clooney a factor behind the decision to buy this company did you meet him how did it all come together >> this is first really sits in the sweet spot for him high end tequila is hot in america. that skargt doing really well. it's one of the fastest growing in the u.s. spirits market

we have a wonderful brand that's growing north of 20% which is doing very well but we are underweight in tequila. so getting a stronger position in tequila strategically made a lot of sense >> referring, of course, to the founder george clooney there did say he met the founders. the littles coming as we also got anheuser-busch beating estimates. the story here what is the maker of vodka, johnny walker, is in part a weaker british pound which is really helmed the results. they've also benefitted from the shift to spirits which you heard ivan refer to there, and then got that surprise one and a half billion pound buyback, david, which i sort of asked him, look, activists, investors in nestle and proctor and gamble, the slowing consumer staples environment. was this a preemptive step, he said absolutely not, it was a

reflection of performance. both did report results today. we'll talk about that in a moment may be adding fuel for him there. >> yeah, i had not noticed that anheuser-busch had a positive response to earnings, yeah >> both of them. up 6.5%. >> yeah, saw that. as we head to break. this drug maker under pressure this morning after a failed drug trial for lung cancer treatment. those shares down 15.5%. more squawk on t seerit afr is teth hetrt gh whoooo.

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good morning, everybody, i'm sue herrara, here's your cnbc news update this hour. israel removing all security infrastructure that it had put in place at muslim entrances to the mosque in jerusalem's old city it's an attempt to diffuse political and religious tension that has engulfed that city. thousands of muslims returned to the holy site for prayers after muslim leaders gave the okay french authorities say they are close to bringing under

control one of the fiercest blazes in france's four days of wild fires that blaze caused the evacuation of more than 12,000 people hillary clinton has written a tell-all book, entitled, what happened it reveals personal details of the 2016 presidential campaign, the book is her third and it is scheduled to come out on september 12th and justin bieber accidentally struck a freelance photographer with his truck while trying to drive away from an nooechbt beverly hills last night. the pop singer offering assistance to the man who was hit. he was taken to a local hospital with just minor injuries that is the news update this hour, sarah, i'll send it back downtown to you. >> sue, thank you. let's go now to jackie deangelis for a report on natural gas, jackie, good morning. >> good morning. natural gas prices are pop ogen this report. we got a build in inventories of 17 bcf now that was less than what people were expecting. less than what we saw this time last year and well under the

five year average. trading 293 before the report. trading about 296 now. but i do want to point out, these prices have come down about 3.5% in the last months or so coming back under the critical $3 mark. and that's because we've seen unseasonal temperatures in some parts of the country here on the east coast, it's been a little bit cooler, so, people probably using less fuel to run air-conditioning in their home at the same time in the south it's been a little bit hotter and that's probably where most of the demand is coming to get us that the 17 bcf number. but you can see natural gas prices, 1.3% move today. back over to you, david. >> all right i'll take it, thank you, jackie deangelis. we want to do more earnings for you this morning things are moving and our parent comcast, both reported better than expected numbers, the least one compared with what analysts were expecting outperforming estimates on revenue comcast surge fueled by the company's fuel unit which increased nearly 60% from a year ago. verizon added 358,000 retail

post-paid phone net additions. that was better than people expected for the quarter verizon, comcast, could they ever get together. that seems beside the point. morning certainly, whether it's a possibility in the future. well who knows, as for verizon, 6.3% in part because of the lack of revenue growth there their service margins of 62.5%, the highest on record for any u.s. wireless operator, all of that at least making verss feel a bit better about the prospects for the company, even though there still remains no real top line growth of this company. nonetheless, it did do better than what had been lowered expectations

as for comcast, morales across the board. a positive quarter, one in which certainly met expectations the stock had been hurt a couple of weeks back by downgrade or at least a negative comments from the firm nathanson which did pressure the shares for a bit, but ultimately, comcast coming in with a strong quarter for the most part, got it up forward margins, buy back was a bit more than people had anticipated. it submetrics, lost about 45,000 residential video customers during the quarter that may be one spot that people would say is not the greatest, but overall, seen as a positive quarter on the call. verizon and comcast and charter were also working on something similar it would seem with sprint brian roberts, the chairman's ceo said listen, i like what we're doing. it's just very, very early

with anything having to do with our strategy and i don't see something happening in that industry being wireless that we envy. it's a position that we don't have today doesn't seem to be a great deal of interest in entering the wireless business in a more robust way than they currently, sarah. >> so that was the clue on the deal, i guess. speaking of earnings, a dow component reporting p & g out this morning posting stronger than expected results with the bottom line helped by cost-cutting measures. of course this coming amidst a looming proxy fight with nelson peltz for a board seat for more, let's bring equity analyst of morning star research erin, thank you for joining us i was on that call, i had to get off at 10:00 because the show was starting, it was a long one. so far, it does appear that h & g impressed investors with the outlook, with the results, it's

clearly trying to prove that it's current strategy is working amidst this looming proxy battle has it accomplished that were you convinced >> we've long thought that p & g has been righting it's ship. it's just closed the books on it's efforts to rationalize it's brand mix, and we think now it's poised to drive accelerating top line in volume gains kbhiel also working to extract a significant amount of cost from operations to fuel further investments behind their brand portfolio over the last ten years, the company's not moving fast enough with the cost cuts, not moving fast enough with cultural changes and to accelerate top line growth. you don't buy that >> we think that a lot of these efforts will take time we didn't think that there would be traction realized overnight obviously the 2% organic sales

growth that they reported in the fourth quarter and for the full year was lagging similar growth than a year ago. they are realizing margin gains on top of continued input cost inflation. and so we think that they are starting to realize some modest transaction from those efforts it will take time though for, i think the market to be more convinced that this is proving sustainable. >> erin, the company is citing these results as showing the success of it's strategy and the momentum that it believes it'll continue to generate i'm curious, of course, nelson peltz will come from a different perspective. we saw some of the things he's saying this morning. what are you hearing from investors when it comes to peltz and whether he should be on the board? >> you know, frofbl our perspective, you know, we see little to suggest that he is going to accelerate the change obviously as we've talked, you know, p & g is attacking the

challenges that are facing the business from a number of different angles and so we think that they're doing the right things for the long-term health of the business and don't necessarily foresee his position on the board as accelerating and driving further change or more meaningful change over the near term >> but why do you think the company has been and the board specifically has been so opposed to adding him? they only have 11 members, and zpl and have their strategic road map play out, which arguably it hasn't had time to do given they just closed the book. nas not a significant amount of time to realize the transaction and drive the monumental change that they've been working towards over the last few years. >> finally, shares are only up about a third of a percent they were up a few percentage points on the initial reaction,

erin, what is the hesitation you're hearing from investors at this point with p & g which is lagging year to date a lot of it's competitors like church and dwight and colgate and the other consumer products companies? >> again, it gets down to product innovation and accelerating that top line performance. you know, are the products they're bringing to market truly going to continue to resinate with consumers are consumers going see the added value in the products they're bringing to market and is that going to enable them to drive accelerating top line gains over the longer term transaction in those efforts, obviously they spent a significant amount of time talking about the gains from individual dose laundry within the tides business there has been transaction within u.s. diapers, but china diapers continues to lag and so i think it's going to be more of an across the board effort >> yeah, beauty was also a strong point in the earnings today. we'll leave it there, erin, thank you so much for joining us morning star research.

and when we return, some big movers in pharma with others reporting earnings this morning. we'll bring you the latest from their reports, next, some of those stocks moving lower. also let's check on the markets. record territory, dow, s&p, and nasdaq, trifecta led by the nasdaq up half a percent being 'lbeig bk.eboo k. k. wel rhtacgoing on here? um...i'm babysitting. that'll be $50 bucks. you said $30. yeah, well it was $30 before my fees, like the pizza-ordering fee and the dog-sitting fee... and the rummage through your closet fee. who is she, verizon? are those my heels? yeah! yeah, we're the same size...in shoes. with t-mobile taxes and fees are already included, so you get four lines of unlimited for just $40 bucks each. the price we say is the price you pay. what?pony neighing] hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade so i brought in my comfort pony,

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take a look at the heat map this morning up five points or so we'll keep an eye on that as we work to the afternoon session. let's get to the group get to the santelli exchange with rick, hey, rick. >> yes

hi carl. on friday eve, charles, aloha, thanks for taking the time >> aloha, ricky. >> all right king of flows. give me the around the block on what investors should be paying attention to to what you're monitoring globally in flows >> well, we're seeing huge in flows into bond funds. we're seeing huge in flow into global emerging etfs, and we're not seeing much money going into the u.s. etfs the last few weeks which is surprising. and also the largest outflow from commodity, etfs, in quite a while. mostly due to oil. even though oil prices have been going up in the last couple of weeks, we've seen 14 out of 15 days worth of outflows >> all right you know, when it comes to commodities in particular, and oil to some extent being a subset therein, the dollar index is down almost 8% on the year.

and the crb is down 6% on the year a bit difficult to square. give me your observation >> well, not really, consider that ecb is printing 60 billion u.s. or 50 billion euros. >> i'm looking at it the wrong way. looking at all of this in terms of euro. continue, charles. >> and also consider that with all the money going into like i said before, there's a huge amount of new capacity going on and all kmadties since zero interest rates means it doesn't cost anything to add capacity as long as the current market price is higher than the break even price. and everybody always believes that like gravity, kmadty prices have to go higher, you know -- but if china, the ponzi scheme called china breaks, kmadty prices are not going to go up. >> got you and if you're looking to be in a currency, it seems though

investors have made their call so far for 2017. they like anything the first of the euro they like the euro verse the yen, yur voe verse the dollar, what are your thoughts on the long-term strength in the euro currency at least for the rest of 2017? finish it up, charles. >> well, at some point, the euro, ecb is going to stop printing >> yeah, but that could be years away couldn't that be years away, years away >> it's possible and then we would have an ever rising market until they stop. at some point, they will stop, and prices will crack. and you're right, who knows how long they could keep el vagt this -- the word ponzi keeps coming up for me, scheme, regarding printing money to keep prices up. >> listen, as fascinating as that conversation is, for many watching that are investors, sometimes you just look, decide

which way the markets going, and you place your bet in terms of the ponzi nature to this, in the end, that will make a difference, but i don't know if you have to worry about its much anymore charles, thanks for taking the time today david, back to you >> okay. thank you very much. ricky. let's send it over now to john forest, look at what's coming up on "squawk alley." >> facebook up 5% plus on numbers that blew out in every category, except for what, payments, nobody cares what are the implications for alphabet, for snap for twitter which also reported and numbs ater't serth weno good we're going to cover all of that coming up on "squawk alley."

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citigroup ceo sitting down with jim cramer. jim asked him about an unlikely competitor take a listen to this. >> do i have to worry about amazon and your credit card business >> you know, people talk about the amazon effect. one thing i say there is what people missed is when you think about the amazon effect and cards, card usage has gone up. sure, amazon's benefited but other on line retailer benefit. today only 20% to 30% of purchases in stores happen on credit cards about 100% happens online with credit cards so we benefit from that. if you think of our partners, home depot, american, costco and all of those, we definitely got a benefit from that. >> citi shares just above 68 today. $68.45 a lot of pharma movers to day as well the big moves coming from some drug trial results our meg terrell is following all of that. hey, meg >> hey, carl it is a huge day for biopharma

earnings a lot of those overshadowed by the news of astrazeneca. there are two oncology drugs and it is a new and exciting way of treating cancer. you unleash the immune system to try to better fight it so astrazeneca was far behind in this race particularly in lung cancer following merck and roesch and ahead of it with drugs on the market. so they're trying this combination approach n results this morning, the trial didn't show that this combination extended what is known as progression free survival. that is how long the patients were living without their cancer progressing compared with the standard care of chemotherapy. so you're seeing the shares really get hammered on that you're seeing an impact in bristol-myers as well. it's testing a similar combination in lung cancer but you're seeing merck up because the immunotherapy drug is approved in that lung cancer population some people will be reminded of

last summer when we saw very surprising negative results for bristol-myers in this lung cancer population driving that stock down, driving merck up and the divergence continued over time, guys we are going to see more data from astrazeneca on how this extends overall survival whether it helps patients live longer that is an important metric. today pretty bad news, disappointing investors. >> you have your handsful between the earnings, drug trials, meg, and now the trial where it appears we're going to be getting closing arguments on both sides today, right? >> that's right, carl. from a drug clinical trial to a prosecution criminal trial, we're here at the case the trial going on now the closing arguments have gun the prosecution is in the middle of the closing argument. the prosecution then gets the chance to rebutt and then it will go to the jury. so maybe that could happen as soon as tomorrow

>> meg, back to astrazeneca for a second there were takeover speculation around that name pfizer was interested it in in part because it would have allowed pfizer to invert with a move like this, is there an expectation that that comes back to the fore or is it damaged for some time as a result of the failure in this important part of the franchise? >> that's a really good question, david. jeffries in a note this morning said after this failure, the attention from investors is going to shift to astrazeneca dividend and the consolidation target this would have been a huge value driver making it more appealing to somebody that could potentially could take the over. it is still a huge business. if taxes, if there is still that benefit in inverting which we don't know yet because we don't have tax reform figured out, there's a lot of questions about that >> meg, thank you for. that meg tirrel. meg whitman stepped down from the board of hp. the move is effective

immediately. chip bird will take over as chairman whitman will remain the ceo of hp enterprise. and that move comes amid reports that she was being evaluated as a potential ceo of twitter, david. we'll speak across -- >> uber. >> yes >> that board -- or had considered her they have been making calls. >> i don't know if there is real truth to that from their perspective, it checks a box in terms of a woman, a high powered person i don't believe that's going anywhere, at least based on what i have heard and the stepping down from the h.p. board, remember, it's hp inc. >> the closely watched executive search right now in america. hard to think of another one one last check on the markets. dow closed at session highs. up 70 points of course, the earning paz raid has been busy this morning it will get bezyer as we await amazon, intel, starbucks,

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welcome back to "squawk on the street," everyone. i'm seema mody we're watching the tech sector on pace for a new record closing high 18 tech stocks hitting new 52-week highs in early trade this on the back of facebook's strong quarterly results, macron, paypal, akamai adding to the gains. it is heavily weighted in the s&p 500. it is also this many and this year's leading sector come ago head of amazon and intel's reports this afternoon now back town for the start of "squawk alley. carl >> seem yashgs thank you good morning, it is 8:00 a.m. at

twitter headquarters in san francisco. it's 11:00 a.m. on wall street and "squawk alley" is live ♪ good thursday morning. i'm with jon fortt and sarah eyesen business insider hedgery blodget. it is a tale of two social networks twitter shares dropping as they added zero new users and then there is facebook hitting all time highs joining the half a trillion dollar club. the company blowing past