good morning, it's 8:00 a.m. at qualcomm headquarters in sand yag and iego and 11:00 on wall street. welcome. ♪ turn and face the strange, changes ♪ ♪ gonna have to be a different man, time may change me ♪ ♪ but i can't waste time >> good news morning, welcome to

"squawk alley. the president announcing rex tillerson is out as secretary of state. let's get to eamon javers at the white house with more. good morning, eamon. >> a lot of moving parts at the white house. the secretary of state is out as you say but it looks like he didn't want to be out. here's the statement we have from the secretary of state's office suggesting he hoped to remain in his position the secretary of state's office saying the secretary had every intention of staying because of the progress made in national security he'll miss his colleagues at the department of state and foreign ministers he has worked with throughout the world andrea mitchell of nbc news is reporting that rex tillerson found out finally he'd been fired today via the tweet the president of the united states put out today. the president speaking to this as he was departing the white house on the south lawn getting in marine one on his way to california here's what the president said about his relationship with rex tillerson and how it evolved

over time. >> i've gotten to know a lot of people very well over the last year and i'm at a point where we're getting very close to having the cabinet and other things that i want. >> so the president there saying, you know, a year or more into his administration that the way he wants it. he's appointed a new director of the cia and we're learning the president's bodyman has been dismissed from the white house we're working on figuring out what that's about as well today so a lot of moving parts as we say but dramatic developments a president white house today. >> eamon, thank you for that for more on the changes in the administration, we talk to former ambassador to nato ambassador nicholas burns. good morning, mr. ambassador.

>> good morning. >> a guest of ours last hour called the combination of cohn's departure and tillerson's departure a crumbling of the internationalist wing of the white house. do you see it that way >> it's hard to know director pompeo, the but in secretary of state designate, he's an experienced person he's been director of the cia. it's going to be interesting to see what he does on iran because president trump has to make a big decision in may on whether or not the u.s. stays as part of the iran nuclear deal. pompeo has been hostile to it in the past i think north korea has to be the biggest national security concern we face. the president will be having these historic talks, we think, with kim jong-un he's going to need a secretary of state beside him and probably actually to go ahead of him to north korea before that meeting so pompeo will have to start very quickly in this job. >> i would assume his experience in intelligence qualifies him imminently to lead those talks or at least lead the president into them.

would you agree? >> oh, i think there's no question he's qualified for the job as a member of congress he was involved in foreign affairs and defense policies also a west point graduate, i think. and as cia director he's got experience that's not the question at all the question is what will the differences between rex tillerson and mike pompeo be the more immediate task for president trump is how do we react to this story from british police that the russians attacked an ageattack ed a former spy with a nerve agent. the president's response was a little equivocal and it will be interesting to see if he stands up to nato in the next 24 hours. >> what is the lesson for the next secretary of state i guess the way rex tillerson didn't suck seat ceed in operating unds

president the way the president wanted how can the next secretary of state communicate differently? >> it's two-way relationship as i have observed these secretaries of state and presidents in the past very successful secretaries of state have had a strong personal and professional relationship with the president mike pompeo has a trusting relationship already with president trump. the trick will be the other way around president trump repudiated rex tillerson publicly on tillerson's wish to negotiate on north korea so the president needs to give that respect back to the secretary of state in public in order for people around the world to take the secretary of state seriously i think that was the problem that rex tillerson had he did not have a close relationship with president trump and president trump often disagreed with him publicly which we have not seen in the pas past i think president trump needs to

be more supportive of his secretary of state. >> ambassador, the person we seem to know the least about in this equation is gina haspel her taking over as cia director. what does that mean for that agency >> well, it's going to be a first. she'll be the first female director of the cia if she is confirmed by the senate. obviously an experienced person. the cia and the fbi have been under a lot of pressure in this administration because president trump's been so publicly critical of them so i would think that when she does go in, if she's confirmed, she's going to have to rebuild morale there just as director pompeo will have to build morale at the state department there's been 30% cuts proposed by the trump administration. it's unusual but i think fbi, cia and state feel beleaguered as federal agencies because of the way they've been treated by the president publicly

>> i'd love to get your take on broadcom and qualcomm. where is that headed and how much do multinational companies, especially those in wireless and cyber security need to rethink how valuable they may be to their country? >> i think we're seeing a distrust of china, a distrust of companies that are either chinese or aligned with the chinese government being able to invest successfully in some kind of u.s. technology areas the cfius process in washington is a key process the company has to go through and we've seen a tightening of that process and it's welcome given the predatory nature of the chinese government in key areas and broadcom

qualifies there. >> the way cfius talked about the importance of 5g to national security, the next generation of wireless networks and qualcomm's influence struck me as interesting. is that different from the way the federal government has looked at the strategic and national security implications of wireless networks in the past >> there's a sense 5g will be a critical area for both the united states and china in the future there's no question there's open competition between the united states and china now on quantum computi computing, certainly in the south and east china sea where the chinese have been pushing that with their military and the federal government beginning under president obama and certainly under president trump is taking a much more skeptical look at the ability of china to invest and take over american companies critical to our technology future so this is a

dramatic intervention and to have the president announce it obviously puts a lot of strength behind the process that is normally not so transparent. >> one last question before we let you go, did you consider the prime minister of -- prime minister may's comments regarding russia explosive and then the russian response today saying that they would not make a response unless they were to get a sample of this toxin >> i thought prime minister may was very clear in the house of commons yesterday, britain is going to come back with an accusation within the next 24 hours that the russian government was likely behind this nerve agent attack in salisbury, england that's going to put a lot of pressure on britain's allies to be fully supportive and i don't believe the russian government -- the russian government, of course, doesn't tell the truth on most days but particularly pertaining to intelligence issues. we're not going to get the truth out of them but i do trust the british government, a very

careful government here. they think that they have the goods on russia therefore they're going to need the full support of the united states and na nato. >> thank you, mr. ambassador, appreciate your time. >> thank you so much. >> ambassador nicholas burns the other top story of the morning, president trump stepping in to block broadcom's $117 billion proposed takeover of qualcomm. our david faber has been following the story and joins us with more. david? >> john, this would have been an interesting enough story if it had simply been a takeover battle as the one we were following for so many months in which broadcom and its aggressive ceo were trying to get six directors elected to qualcomm's board of directors. it was only last sunday when advisers and teams from both sides were assembling in saying

g -- san diego when like a thunder beebolt we heard from te committee for financial foreign investment in u.s. saying you're not holding that meeting, we may have an issue with this deal that followed, of course, with a letter that we were able to share that was sent by treasury on the fifth of march that detailed to some extent their potential objections to the deal namely this idea, for example, that if broadcom were successful in acquiring qualcomm it would cut the company's r&d and perhaps then impact its overall ability to compete worldwide as 5g, the next generation of wireless services gets implemented throughout the world. and then yesterday we shared with you on this very program as well continued potential objections from cfius in the form of the interim order that had been issued that they say had already been violated by broadcom, so perhaps not that big a surprise that late yesterd

yesterday the committee said no, sent it to the president who issued the degree that said you cannot buy qualcomm, broadcom, not now and not ever, not even when you plan to become a u.s. company on april 3 and not even if you were to be acquired by somebody else who went to acquire qualcomm neither directly nor indirectly. this has set up qualcomm as a national champion. here's what derek scissors who we interviewed "squawk on the street" had to say about that that. >> i think the national champion was creating years ago i'm not blaming cfius for this it's the correct call that qualcomm has become a national champion and cannot be acquired except by a narrow set of firms the u.s. government is willing to deal with so i think we've got to the point where we have national champions and this's not ideal we need more competition in this space, more competition for qualcomm but right now it as a

national champion and we have to treat it as such. >> never fully understood, of course, the objections and we may never. they did bring up in their initial letter broadcom's relationships with third party foreign entities and the national security effects of broadcom's business intentions with respect to qualcomm, john, but we don't know a lot more there. then it becomes classified and then they went to the argument about r&d spending and the private equity model. >> it's an interesting dynamic where one of the only companies that probably could be allowed to acquire qualcomm, intel, wouldn't be allowed to for antitrust reasons. there are a couple others, apple, microsoft, et cetera. but what investors might want to ponder is what the impact is on this battle between qualcomm and apple. really qualcomm's licensing business what i read into cfius and the president's reaction to this potential deal was an implicit endorsement of qualcomm's licensing business model that's been so under fire for the past

several months and caused the stock to be under pressure apple not paying the licensing revenue that -- >> apple suppliers not paying. they don't have the contract with apple specifically to make the funds. >> but apple directing them not to pay and qualcomm put pressure on the suppliers to pay. they don't have the money, they get it from apple. so interesting to see where this goes from here because it seems like the federal government has in effect drawn a line and said, hey, qualcomm is value to believe 5g, the arguments qualcomm has been making in white papers for the past several years, the u.s. government effective lly backed them up. >> you're raising an interesting point and one we discussed on that first day when we started to think about qualcomm in that national champion sort of setting. does apple want to run afoul of the u.s. government by continuing to hold out it's working its way through the court courts to your point, perhaps they get a settlement done.

they got one done with samsung and i'm told if they were able to get a deal done with apple on the same terms they would feel more strongly about being able to hit that $7 per share target they put out there for 2020erring 2020errings. >> david, thanks. >> sure thing. still ahead, walter isaacson will join us with the white house's decision to block the largest takeover in tech ever. plus apple hits $929 billion, leading the market cap race to a trillion dollars by a landslide. we'll talk about that, more on the move when "squawk alley" comes back so close. yes, but also all... night through its entirety. come on, all... the time from sunset to sunrise. right. but you can trade... from, from... from darkness to light.

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two big stories of the morning on trade and u.s. relations with the world rex tillerson out at state following gary cohn's departure last week. and, of course, the trump white house blocking broadcom's bid for qualcomm citing national security concerns. listen to cramer weighing in on the president's moves. >> how many times can we think that what's going on here is a wholesale shift to block china, weather it be steel, whether it be aluminum or whether it be intellectual property steps? this is all the piece, pompeo has equated china with russia. this is about chinrson not being the -- can it work towards north korea solving?

i don't know it says to me china you are our enemy and anything short of that is a mistake." >> for more on tillerson's departure and the deal climate under the president, we're joined by walter isaacson, president and ceo of the aspen institute. walter, great to have you. thanks for joining us today. >> thank you very much. >> let's do some 30,000 foot perspective on all of this whether it's cross border mna, pressure on china and ip, whether that ties to talks with north korea, how does this all fit? >> i think jim crimer is exactly right. what you're seeing is a forceful push by this administration against china. it's a complicated relation sshp you have to have people in business understand it well where you can be a competitor but also collaborate and cooperate in certain fields as most businesses do with each other. we have to do that with china.

it's not exactly part of donald trump's strength and his deal making mentality to be able to collaborate as well as compete and we're now seeing a really strong push to push back against china and making it an adversary and that's behind the broadcom deal and i think jim cramer said it correctly. >> what do you think the lessons are for investors, walter? investors buying individual names based on hopes regarding mna, based on hopes they can one daybreak into chinese markets. how much do you worry about their capability to retaliate? >> yeah, i think we could have an intellectual property war with china and especially it makes it bad in my opinion that every other country has -- is in a trade agreement, the tpp trade agreement that gave an alignment to compete with china, the u.s.

didn't enter that. i also think, though, that there's something very specific when it comes to chip makers when you're going to have a secure internet, if you can find ways to do cyber security, that has to begin with the chip and in the end if we create a new form of security or for that matter a new form of spying it will be an end-to-end process that will not only include the network and the routers and the pcp/ip protocols, it will include what's embedded into the chip and i think that's some of the thinking behind the fact that you're not going to have takeovers of a national champion like qualcomm by a foreign government >> walter, i'm glad you brought that up because if you look at the most recently published reports from the department of defense, it's china at the top of the list in terms of geopolitical risk and threats to u.s. security. getting into sort of this deal

and the blocking of this deal and what this means for the chip makers, how much of a risk is it to u.s. security when you have a company still expanding its reach in places like europe among our allies >> i think that if the u.s. doesn't lead in 5g technology and if the u.s. doesn't lead in chip technology and in cyber security as it relates to the chip, we will be deeply at a disadvantage if you look at the past 60 years, we've led in the development of package switch networks, then the internet, personal computers, chips. this has given us an enormous advantage. at once 5g networks and the coding that comes at the beginning of any networking process from the microchip are controlled by another country, this is very bad and this is why

basic research development and basic science is so important this country and i think we decimated that in the past few years. >> walter, it's interesting, there were rumblings months ago about people in the white house perhaps considering nationalizing 5g now we have this statement effectively from the white house about broadcom's attempts to buy qualcomm emphasizing 5g basically as infrastructure critical to national security. we haven't talked too much about 5g and how its low latency, its treatment of battery life is so important but out in barcelona at mobile world congress just a few weeks ago it was top of mind and china and the u.s. were in front as far as developing that trillions of dollars at stake over the next decade what other companies do you think are potentially important in this space? we might think of them as tech companies. there's huge potential for how they can grow in the 5g future apple is one that comes to mind.

>> obviously apple, google, facebook, amazon all are going to need to help be part of the standards for a 5g network but i think it's most important to figure out how this falls into a national security realm which is what the administration and the cfius order, the foreign investment order, just did. in the next five years there are two things, someone 5g, the other is finding ways to do more secure packet switch networks so they're less vulnerable to attack all of that comes from the chip to the network and you're going to see a moon shot by any administration but this administration to figure out how to build a secure network and how do you build a 5g network and make sure china or another

country doesn't build it first. >> so just to underline it, walter, it sounds like if you were leading cfius you would have written a similar letter. you think they are being somewhat forward-thinking it sounds like? >> i think i would have. i think i would have let's leave the politics aside, this is truly national security. >> a fascinating look. that's why we're paying these guys to think about the health of the country years from now. walter, thank you so much, good to see you. >> definitely give them credit good to see you. thank you so much, bye-bye when we come back, a big hardware player here at post 9 fitbit stock has struggled since its ipo. 's lncng nitauhiew products today. the ceo james park is next that stock is up 1%. stay with us alerts -- wouldn't you like one from the market

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shares of fitbit down 6% despite the double digit surge in march the company announcing the fitbit versa, right here, $199 smart watch and the fitbit ace, the company's first wearable for kids also announcing women's health tracking the ceo of fitbit and co-founder james park joins us here at post 9. great to have you here. >> thanks for having me. >> so i'm wondering about how this positions you how do these products help get you to where you want to be? >> for us to develop a recurring revenue model around software, we need a large base of users who use our hardware so our strategies are to reach new users and part of that is to enter more aggressively into the smart watch category which is the fastest-growing segment of the wearables category overall which is expected to double by

202 2021. >> you're acknowledging the ionic missed the mark, it was designed for performance more than mass appeal this looks like it was designed more for mass appeal and it's at 200 bucks. how do you expect it to perform differently and how does it target a different customer? >> ionic did not meet our expectations that said it was meant to replace our fitbit surge product in the performance category and it's outselling fitbit surge at a similar stage in its life cycle. so it's doing well, just not as well as we expected. the great thing about the versa is it is our mass appeal mainstream smart watch, the right price point focused on health and fitness, long battery life, the right balance of smart features and cross-platform compatibility. so i'm excited. >> i'm fascinated by the ice because i think there's a big population of parents who have

young kids who what's the parents' motivation >> child obesity in the u.s. is a huge problem and tech companies are exacerbating the problem. they want kids to become more addicted and spend more time on their screens and our goal is to use technology to do the opposite -- get kids off the screen and more act ive. and our goal is to get the whole family involved? >> what are the security concerns if i had a kid who wants to put a fitbit on her wrist, how do you keep her data safe >> fitbit ace complies with copa, the regulations that govern child safety atsz it relates to digital online services so fitbit ace is

compliant with that and we have measures in place so that the parent that sides her kid up for fitbit ace and the associated service, children are isolated from the greater community of 25 million users on fitbit and we restrict the stats they see so they can see stats, active minutes and their sleep and not the more adult-oriented stats such as body fat, calories, et cetera. >> we're talking about broadcom's blocked bid for qualcomm this morning. i know you're in the consumer space, kind of far from the networks and enterprise space but as you look at your road map into connectivity and 5g, you're thinking about the importance of networks how does the white house's response to that coming technology strike you? >> i think connectivity is obviously important to our future strategy. what i can say is that international is over 40% of our revenue today. it's growing very quickly.

my hope is that the conditions that enable that growth continue >> meaning >> it's a pretty stable environment. we're operating in 78 countries. and so the things that allow us to do that, my hope is they continue. >> your r&d costs more than doubled i believe between 2015 and 2016 the devices sold dropped by more than a quarter what's going to balance that out? is it your expected rise in revenue and devices sold like this or are you going to have to cut more costs to get things in line. >> we've got investors to about 740 this coming year down from about 96 last year which is below the target of 850 that we set for investors so we've demonstrated we've been disciplined in our operations. but we're hoping with this launch we made a huge upfront investment in critical software

and that is something we'll leverage with fitbit versa in future products as well. >> disappointing fourth quarter earnings according to wall street, disappointing guidance one of the things analysts said is there's an opportunity for medical and health care applications how far out are those? >> we're taking concrete steps to build our health care business we just made an acquisition of a company spun out of m.i.t. media lab called twine health which combines aai data and human code chain to deliver health outcomes around diabetes management and hypertension so i think that demonstrate ours commitment to growing our health care business investors can break even on a cash flow basis. >> are the health care opportunities a 2019 story >> it is but we'll be taking specific steps in 2018 to build that business. >> investors eager to see what

you come up with next and how it sells, james park, ceo of fitbit thanks for being with us. normally we bring you the european close but because of daylight saving time the close will happen during half time tod today. s&p has gone negative, nasdaq has gone negative putting its seven-day win streak in jeopardy about half past the hour let's get to sue herera at hq for a news update. >> good morning carl here's what's happening at this hour russian foreign minister sergei lavrov says moscow will only cooperate with britain on the investigation into the poisoning of an ex-russian spy and his daughter if it receives samples of the nerve agent that's believed to have been used this comes in response to the british government's demand for an explanation hillary clinton her visit in india speaking at a conference in mumbai. she answered a question from the moderator on whether the u.s.

deserves trump as president. >> i would have to say no, we did not deserve that [ applause ] but i think as i mentioned, he ran the first reality tv campaign and he was the first reality tv candidate. >> a judge ruling that a new hampshire woman who won a $560 million powerball jackpot can keep her identity private. the judge says she met her burden of showing that her privacy interests outweigh the public's right to know that's the news update, back downtown to "squawk alley," morgan, i'll send it back to you. >> thank you, sue, sue herera in hq when we come back, what's next for chip makers now that the white house has blocked broadcom's bid for qualcomm. as we head to break, a check on the major averages at this hour it is a mixed picture. the dow hanging on to gains up

ten points but both the s&p and nasdaq have turned negative. more "squawk alley" straight ahead. ♪ feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it.

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breaking news on cvs/etna. bertha coombs has more. >> shareholders of both companies overwhelmingly approved the deal. it had been recommended by the proxy services institutional shareholders and glass lewis and

others but this comes as this continuing landscape shifts in the pharmacy benefit management and insurance sector in addition to this deal which is still under regulatory review we have cigna and express scrips tying up wanting to form a similar pact and this morning centene getting involved with a cloud based pharmacy benefit deal that's chaired by john scully, the former ceo of apple who will remain as part of the leadership team so things continue to change we'll see how regulators look at all of these deals as the landscape in health care continues to point towards more vertical integration back to you. >> were that, thank you for that bertha coombs at the nasdaq. the president blocking broadcom's bid to buy qualcomm saying national security concerns the nasdaq hit another record

high this morning, its second in two days for more on the fallout for broadcom, qualcomm, and other tech stocks we are joined by raymond james managing director chris casco and susquehanna equity strategist chris roland it's chris squared looking at the trump administration's move to black broadcom's takeover of qualcomm, does this throw cold water on the broader consolidation story we've been seeing? >> yeah. i mean this started with cfius' reject of the canyon bridge lattice deal it's going to be hard for a foreign entity to take over a u.s. entity and this from last night is entirely new uncharted territory as broadcom did want to come'll in the u.s. so we haven't seen this before. >> were you surprised by cfius' report ahead of this move? >> absolutely. this is uncharted territory and

there are ongoing acquisitions, for example marvel and cavium. we think the risks overblown but this changes the landscape for semiconductors that have been under consolidation for years now. >> and chris, i'll ask you the same question, do you think this throws cold water on the consolidation we've seen >> i don't think it throws cold water on consolidation i think this was a special case. i think with regard to the technology that was involved most of the mna that's happened has been simply the reduced cost and we're in a slowing growth landscape and consolidation has been a great way to drive earnings. >> >> what are the next targets?

>> too many to mention one that's happening now we have an interest in is microchip micro semi microchip has been one that's been a sconsolidator microsemi has been the latest. we're positive on that. >> chris roland, what does this do to the calculus around qualcomm some people are saying there's a licensing distance model that's dead they have to change, apple hates it but the u.s. government seems to have given an implicit endorsement to qualcomm's approach funded by that licensing model. are the odds better qualcomm works this out and ends up looking like the qualcomm we've known today? >> i think it's going to be the qualcomm that we know today.

i don't think there are going to be a ton of changes here has a percentage of revenue given their scale. they probably do spend too much on r&d this is an interesting approach with the president said the r&d spend is of national interest and we don't want somebody who is a cost cutter to come in and take this over it's new days here. >> with the qualcomm stock down 4% right now is this a buy, where do you stand >> this is about right for qualcomm maybe over the next 12 months it could move higher but they have challenges going alone if qualcomm has the tie up, broadcom could have put this on the right path towards real profitable growth but the same changes that have always existed continue to exist here with 5g at least a year and a half away. >> chris casso, when we look at

5g and the companies investors should be paying particular attention to as having a lot to gain from the rollout of the technology, at&t has said they're rolling it out in three cities in the u.s. at the end of this year. where should investors be focused? >> well, there's two others that i point to in that space also in the space -- the radio that is connected to the 5g network. sky works and corvo are two in that space, to res stocks that underperform late ly the expectation is that 5g, it starts having somewhat of an impact in 2019 but 2020 is when 5g starts to take hold and those are two that would participate in that. >> we're having this conversation at ts the smh hits all time high.

thank you chris casso and christopher reoland. >> we'll tell you about what dick's said about their plan to limit gun sales. markets off the high as those indexes are off of their individual highs the stocks now down about a third of a percent rick santelli, what are you watching >> i'm watching relationships between tensnd a boons widespread pressure is growing we'll talk about that after the break.

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washington's impact on mna continuing to make wave this is morning. ylan mui has new comments from senator chuck schumer on broadcom qualcomm. >> that's right, john. schumer is backing the white house's decision to block the merger of broadcom and qualcomm, a very rare point of agreement between chuck schumer and president trump. schumer saying that china is looking to supplant the u.s.'s dominance in 5g while he was speaking on the senate floor a little bit ago >> let me say unequivocally, president trump and his administration made the right decision on blocking broadcom from taking over qualcomm. we all know that china has been rapacious about trade and very smart. they look for places where they can steel our best technology.

>> so senate democrats have been pushing for another committee in addition to cfius that would review these types of deals on the basis of economic as well as national security. meanwhile, senate republicans are alsoprocess. that proposal is still sitting in the senate banking committee. guys, we'll let you know if any of these ideas move forward. back over to you >> thank you very much for that. keeping us honest on it. let's check in with rick santelli >> hi, carl. we've seen interest rates ease up a bit but still within the range. we'll get to that in a minute. equity markets have given up some of their gains. that's not unusual a lot of issues going on whether it's in d.c. or trying to handicap the growth of the economy. i love to watch this spread. it's super important this starts in '98 this is a 20-year chart.

around 223 basis points separating these yields. 235 is the high. what's interesting is the wider level of 235, you have to go back to 1989 i had to really work last night to do this it is backing off a bit. should that spread widen and take this out, there would be a problem. let's not get ahead of ourselves. something else is going on that may affect that spread treasury yields were in consolidation mode this could be the 13th session since the high was made on the 21st of february at 295 that we've been in a 280 range. the point is the same. 60 level is huge in bunds. 280 level is huge in the 20-year note should we both get below these levels, first thing that's going to happen is that spread is going to go the other way. the main point of this is that

if this holds and this one doesn't and that spread widens, they may have to quicken the pace of taking away stimulus back to you. >> rick, thank you rick santelli in chicago as we head to break, looking at the major averages right now it's a mixed picture dow is hanging onto gains of 25 points s&p and nasdaq lower after the nasdaq hit a rorecd intraday high more "squawk alley" after this you're here to buy a used car, truck, suv.

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shares of dick's sporting goods slipping on disappointing sales reports. courtney reagan is watching that for us >> dick's sporting goods share under pressure after a mixed quarter. the sporting goods retailer putting up stronger than expected profit margins, weaker revenue in comparable sales and a disappointing forecast e-commerce growth slowed partly from glitches on line. the company says many of those have been fixed. the impact was discussed from the changes it made to its firearms policy on the earnings call saying the company was surprised by the outpouring of support initially saying it's too early to see the impact. >> we've seen a bit of a difference in the hunt business. not a lot. it's too early to tell how this will be impacted >> but as the call went on, stack was more assertive about

the negative impact from the changes. >> the announcement we made two weeks ago regarding our firearms policy is not going to be positive from a traffic standpoint and a sales standpoint the change in our firearm policy is not insignificant >> stack called out weakness in under armour several times now, stack expects strong product innovation to come this year which should help margins even though comp sales are still forecast to be flat to down below single digits. carl >> pretty good on a day where retail is hanging in there thank you very much. dow is losing momentum this session. session high was up almost 198 we've whittled that down to 30 weakness set in in tech names tea ceafr ni run

more "squawk alley" continues in a moment talk to your mom?o what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley

tech stocks have lost some of the wind after a nice run some discussion about whether or

not a good chance to take a breather all of these would be m&a pressures. good excuse to ring the renl st register >> not a lot of people saw that strong action coming >> we'll see what the afternoon brings let's get to the judge >> welcome to "the halftime report." stocks are volatile today perhaps reacting to major developments out of washington secretary of state rex tillerson fired by president trump and our own larry kudlow moving close cr we'll get to the markets in just a moment first we go to the white house >> reporter: a dramatic day in washington as you say with rex tillerso