the job next week. it's wednesday, may 23, 2018 we're praying for 7:00 a.m. when the sun comes up "squawk box" begins now. ♪ live from new york where business never sleeps, this is "squawk box. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at u.s. equity futures. yesterday was a down day, down about 178 points for the dow the futures this morning indicated down by a similar amount another 176 points indicated down right now s&p looks like they would be down by 17 points. the nasdaq off by 62 all of the things that buoyed stocks earlier this week that the trade war with china was on hold, that got put to the test

yesterday with some comments from president trump concerns about what might happen not only with the china trade deals but whether or not there will be meetings with north korea. all of that put into play in comments from the president. it looks like we're indicated down by 171 points for the dow now. overnight in asia, when it comes to the nikkei, it was down by 1.1% the hang seng ended down -- fared worse yesterday, down 1.8% shanghai composite down by 1.4%. in europe, again, red arrows across the board the dax off by 1.5%. also a decline of more than 1% for the cac in france. ftse in london down by 0.6%. check out treasury yields, you will see this morning it looks like the ten-year is yielding 3.014% >> lowe's is out

we normally wouldn't rush lowe's they are getting a new ceo that switch was made yesterday 1.19 is the bottom line number versus estimates of 1.22 the revenue estimate on the street was 17.458 billion. and the posted number 17.4 so both are below. both the bottom line and the top line for the year the company still sees 5.40 to 5.50. the estimate on the street is $5.47. not a lot happening. same-store sales up 3.5% for the year first quarter same-store sales up 0.6%. it looks to be an improvement.

>> as you mentioned, probably not a coincidence that we got the news yesterday about the new ceo coming in. that's the news that wall street will probably focus in more closely. >> doesn't look -- looks not as bad as campbell's soup here's the new gentleman on his way in, marvin ellison, well thought of, i think he spent 12 years at home depot. >> right >> then he's feeling good about how he did at home depot, said i can fix jcpenney he said i'm getting the hell out of here. i'm going back to lowe's >> back to home improvement. >> yeah. like whoa, he got there there and said i'm -- he closed like 130 stores or something. finally in the towel section, he threw one in maybe he's getting a great deal here well thought of. knows home improvement maybe lowe's mitigates any of

the downside today >> okay. we are going to return to the topic of china, which may be weighing on markets this morning after buoying them yesterday new developments in the planned meeting between the u.s. and north korea. president trump casting doubt that the meeting will take place as scheduled, this after north korea's kim jong-un threatened to pull out of those talks altogether president trump seems to blame china for north korea's new tone >> i think that president xi is a world-class poker player and i'm probably maybe doing the same thing that he would do. but i will say this, there was a somewhat different attitude after that meeting and i'm a little surprised now, maybe nothing happened. i'm not blaming anybody, but i'm just saying, maybe nothing happened and maybe it did. but there was a different attitude by the north korean

folks. >> we'll get a live report from beijing at the bottom of the hour all of this guys, it's the north korea piece, zte >> all related one thing i was trying to make sense of in my head, our conversation with steve mnuchin. was he on the same page with the president? was he not on the same page? there seemed to be so much light between what the president said later in the day and what mnuchin said earlier in the day, then there were reports, denials around the zte piece of what the "wall street journal" put out. >> then he also said if there was a deal it would look similar to the "wall street journal" piece. >> it was complicated. >> my guess is this is a moving target we don't know what is happening. they're all interrelated if one piece of the puzzle falls, the whole deal doesn't

work >> i am surprised that it appears to have impacted the administration and the president, the criticism of the deal on all sides, things written in the "wall street journal," on conservative sites, saying what you're doing with zte is wrong, you're not getting a good deal. but it was interesting i wonder whether that unto itself undermined a little bit of where he was. you agree with that? >> i just -- i think everybody tries to put the best face on it initially. wow, the trade war is on hold. that's mnuchin's job he was the chief negotiator. he wants to look like it's paying off the president starts hearing from everyone else about what -- >> everyone telling him it's not such a great deal. >> then you got a guy -- i don't know what's going on between north korea and south korea, listening to -- i watched that

whole thing. their worse off -- north korea -- one of the president's, maybe it was a south korean official said before the president talked that it was 99% sure that the june 12th -- june 11th >> june 12th singapore, right >> singapore the same day as the judge with the at&t time warner come on! can't be >> worlds colliding. >> those dates are the same. he said 99%. trump yesterday said 50/50 >> that may also be part of his version of playing poker >> right >> i will say trump really lays it on the line he says -- basically said you will die as president at 110, mr. kim jong-un. if you do this with us, you'll be there until you're an old man, you will still be in

charge you will be presiding over the land of milk and honey you will be just as successful as south korea he said look, the same people. look how well they have done economically we'll have the same thing happen in north korea don't know that it will be yune f unified. i'll protect you he laid it out >> but the same thing, obama cut a deal with the iranians, new president comes in -- >> gadhafi, that wasn't exactly the same thing, he died in the streets in a horrible mob. >> which is what all these dictators look to if you want to take their nuclear power away. >> dying in a mob-related incident -- the worst way to go, with a wild animal >> i think any way is a bad way. >> if you're ripped by wolves or something. >> why do you think about this stuff? >> or a bear

did you see di leonardo dicapri- >> in the movie? >> yeah, it was dragging him around >> we'll return back home -- >> to reality? >> to washington, d.c. >> did i go off topic? >> this is not a movie this is what happened in congress yesterday they voted to roll back some of dodd-frank's restrictions, easing restrictions on small and mid size banks the legislation excepts financial institutions with less than $250 billion in assets from stress tests and living wills. it is the biggest rewrite in banking regulation since dodd-frank passed in 2010. the bill now heads to president trump's desk he is expected to sign this into law. the financial times reporting that barclays has been quietly exploring a possible merger with some rival banks including a big one, standard chartered. there was no formal or informal

bid made barclays has been under pressure to shrink its underperforming investment banking unit. the question is would regulators approve it it may actually help both institutions in terms of actually giving them some strength we'll see. 50,000 casino workers could walk off the job after their union voted to authorize a strike t it's representing housekeepers, cocktail and food servers, bellman and more 25,000 workers showed up in person at university of reno to vote 99% approved a strike if needed. they work at 34 las vegas casino resorts. the union is pushing for contract language that ends harassment in the workplace, increases pay and consideration of job security against automation >> had to plug his throat.

it was -- >> people are eating breakfast >> look at andrew. >> that's going to be my thing today. i did that, kernen's corner, that's what i'll do. does that work for you did you come up with anything? >> i have a quick take on something. >> you do? sorkin guns >> oh, no, i have one, too you know what we're talking about later? the tax laws and how they're impacting prenups in america >> you love your watercooler stuff. >> if you're talking about movies from five years ago, i will talk about the news of the day. >> five years is current for me. i usually go back to -- >> who is the score keeper >> when was the movie out? >> three years ago >> lowe's, we already mentioned

lowe's, we'll talk to someone who may know something about it. lowe's out with first quarter results one day after naming marvin ellison as the new ceo. joining us is brian neagle from oppenheimer. was it a bad quarter >> definitely a soft quarter i don't know if that's totally unexpected given the weather disruptions. last week, we talked about home depot's softer results as a result of weather. we saw that same thing in lowe's almost every company i follow talks about weather issues now >> so was it a coincidence they announced the change yesterday maybe they were just ready to do it you like this guy coming in? will that help >> this is a huge step forward for lowe's marvin is a good executive you mentioned in your opening he spent a number of years at home depot, running the stores at home depot

i studied lowe's for a long time my issue is the stores are not as well run as they could be it's funny that they announced a new ceo yesterday and results today. to me and i was telling clients yesterday, i think that did suggested that results were going to be a bit soft four years at jcpenney three years for a movie is not long i thought he just got there. >> you're old, time moves faster >> it does it's 1/50th of my life 1/40th -- >> right >> -- of your life did ellison work for frank blake? did blake bring him in >> i don't know. he was there at same time as when blake was there >> blake got credit for the way the stores were run at home

depot. this guy had a lot to do with it >> i think so. frank blake was the architect of the recovery strategy at home depot for a number of years. he had a number of key lieutenants under him, i think margin wvin was one of them. i studied jcpenney for a while, he was in a tough spot there >> he had to retire 1.4 billion in debt while there. >> he came in after -- who was it ron johnson. remember ron johnson >> the surf guy. >> formerly of apple apple's retail guy -- >> ran surf shops. >> got credit for doing something right at apple then goes off to jcpenney and people think it's a retail god does that -- if you're talking about frank, they thought he was a retail god >> you still have your ackman buttons? >> you remember those? >> the bill ackman buttons

>> thought that would work with those pisayings. >> back to lowe's, if he thinks the stores have been poorly run. what are the quick, low-thanking fruit things he can pick up? >> today's results were another perfect example. lows about a 0.6% comp, 0.5% comp in the united states. 3.5% weaker than home depot put up both companies were contending with the same weather issues, the delayed start to spring. home depot merchandises around that better. >> they also have stuff in supply, stuff this stuck my experience with lowe's, when i walked in there, tried to buy things, it's not on the shelves. you find things you want and you can't get them that suggests there's a bigger problem with stores. that could be the back office and how do you manage inventory and get things on to the shelves in time. >> i agree that's a bigger issue.

i think a lot of is store level execution. one key positive, we looked at lows, this turnaround discussion has been going on for several months one key positive here is that traffic to stores is good. it's a conversion issue. people are coming to the stores but not finding what they want or enough of what they want, so they're not buying as much as they should. that's an easier problem to fix in retail than a traffic issue talking about jcpenney, that was a traffic issue. lowe's is different here we think about the potential for the recovery, that's a positive. you believe they can hit their new forecast for same-store sales? they didn't come anywhere near it, and they gave a full forecast of 5% that's a lot of faith to think they can do that do you have faith in that? >> i do. q1 was weather impacted.

so they said in the release business got better in may they'll probably give numbers in the conference call. my suspicion would be if it wasn't weather, you would have a 2%, 3% comp in the first quarter. >> all right thanks for the quick analysis. >> thank you you're in san francisco this morning. >> yeah. thanks >> take it easy. beautiful city city has some problems let's talk about the broader markets, joining us is karen cavanaugh and michael tyler is also with us good morning we've been having lots of conversations about china, about

whether we'll have an overhang on a po tentential trade issue r not. we thought it was cleared up yesterday morning, but it was not. does this a change how you approach the markets >> uncertainty is never good for the markets. as long as this wrangles on, that doesn't bode well for business planning. things are still looking good. earnings trajectory for 2018 is about 20%. there's a lot of good things today we talked about the deregulation of banks. that's going to help the financials helping small businesses still a lot of good. we seem to be concentrating on the bad. uncertainty is never good, but i don't think we'll come to a trade war. investors have to concentrate more on the good >> you mentioned the banks and

deregulatory effort. this was telegraphed we knew this was coming. i would argue it's already baked into the cake for the banks. would you? we're showing some bigger banks, we should probably show you different charts, but nonetheless. >> the smaller bank also be the beneficiaries and also small businesses not financially related, thee depend on these banks for their funding. they're not issuing stocks and bonds. so small business is the backbone of the u.s. economy this will have a ripple effect it has not been seen yet it's not baked into the economy or the estimates >> michael, where are you? >> i think to a degree it is looking at small caps setting records while the big caps are lagging behind, part of that is the tax cut, which is having a big impact there part of it is also they're getting somewhat easier financing. karen is right, it's small

businesses that are dependent on the small community banks. those banks have been putting millions and millions of dollars into regulatory effort, but they can redeploy into issuing loans to small businesses. >> but therefore, as an investor in the public markets, what's the play >> the financials still look good but that's more of a play on interest rates and what the fed is doing the dodd-frank rewrite is a positive, i wouldn't want to overstate the importance in terms of what's driving stock prices to me right now, the financial sector and a lot of the economy is hinging on what the fed will say in its minutes this afternoon and whether or not we're looking at four hikes this year instead of three and so on. >> either of you want to jump in and give us your take on how to think about the f.a.n.g.s? the reason i ask, mark zuckerberg from facebook getting -- i don't know if you saw this, this was raked over the coals in a way to make what

took place in washington not even a dress rehearsal it was a different level of harshness. do you think that signals something much harsher to comfort tech giants at large in terms of the entire silicon valley >> i think there will be more scrutiny look at the revenues, look at the earnings growth, and follow that stock prices are doing well because earnings are doing well. i think there will be more skrutd scrutiny >> all right michael, final word in. >> are we as users changing things no there's nothing anti-competitive about what they're doing there will be a lot of talk but not a lot of action. >> thank you both. ♪ voya voya

>> what is eastern bank got? nothing. do they? >> i don't think they have a song ♪ >> what is that? ♪ voya >> i'm getting drunk on a plane. dierks bentley great song had ticket to go to mexico with his fiancee, she breaks up with him. he keeps the tickets, goes to cancun >> more useless news >> yeah. yeah unlike you that brings us such salient stuff. when we come back, if you have travel plans this summer, pack your patience a new travel forecast says the airports will be busier than ever details after this

we have a question about your brokerage fees. fees? what did you have in mind? i don't know. $4.95 per trade? uhhh and i was wondering if your brokerage offers some sort of guarantee? guarantee? where we can get our fees and commissions back if we're not happy. so can you offer me what schwab is offering? what's with all the questions? ask your broker if they're offering $4.95 online equity trades and a satisfaction guarantee. if you don't like their answer, ask again at schwab. with dell small businessout your technology advisors you get the one-on-one partnership you need to grow your business. the dell vostro 15 laptop. contact a dell advisor today.

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crowded this summer it's not your imagination airlines are expecting the busiest summer in the history of air travel more than 246 million passengers are expected to fly from the beginning of june to the end of august that would be a 3.7% increase from last year's air traffic total. >> just under a quarter billion by my calculations >> you're so smart here's the story of the morning for me the new tax law could up-end prenuptial agreements all over america. >> i don't see how >> this is according to bloomberg. morning money also citing it the issue is this, alimony currently is deductible. >> that's right. >> alimony is deductible or was deduc deductible until the new tax law

took effect. 2019, you can't deduct that. >> that's a big deal >> that will be a big deal unto itself judges typically when they look at a prenuptial agreement look at the laws in effect at the time the curreagreement was rea. a lot of people protest the agreements when they get divorced, they say, you know, i was under duress the other thing you can do is say the laws are different rules changed. so therefore the judges can actually undo some of these agreements therefore there's a whole world of divorce lawyers and other people who are running in circles about how all of these agreements reached may now come undone that's my story of the morning >> a 1%er -- >> it's not.

>> who does prenups. >> anybody with a divorce decree who is paying alimony now. >> who made alimony tax dedu deductib deductible >> they say it's money going to you. i think the spouse ends up paying taxes on it >> the spouse pays you don't want to double tax it. now it will be double taxed it >> person who gets it paid >> now it will be taxed as you give it and as you get it. >> yeah. as you give it and get it. >> okay. >> good reason to stay married separate issue >> just by definition the prenup is a hard thing to brin up >> i would think so, too >> i would like you to marry me. it might work. it might not right. >> i should have done it when i got married. we were splitting up debts you'll owe half of these

>> i don't know. you know who is the biggest advocate for prenups in america? >> who >> our president he says you always have to have a prenup >> so romantic >> you have to get the prenup. i don't know how he does it. >> not very -- well, he had something i don't have nbc's sunday night football 2017/'18 season ends officially today. it was top rated into prime time it will kick off the regular season thursday september 6th with the philadelphia eagles hosting the falcons. i see this conjecture that

kneelers may get a 15-yard penalty. they're considering that that's a strange way to -- goodell, i don't know about the whole wave >> it was a tightrope. the owners feel one way. players union, players do you throw a flag? is it on the kickoff it's just crazy. coming up, the president casting doubt on a meeting with kim jong-un. more after the break right now a look at yesterday's s&p 500 winners and losers ♪

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are ready for today. welcome back you're watching "squawk box" live from the nasdaq market site in times square. welcome back to "squawk box. good morning lock at u.s. equity futures at this hour. we have some read to tell you about. the dow looks like it would open down 162 points. nasdaq down about 57 points. s&p looking to open down as well, 15 points off. some of this might be a bit of a

turnaround in terms of overhang, worries about china and trade all over again retailer target out with earnings earnings coming in at $1.32, 7 cents below the forecast revenue shy of the forecast. comp store sales were up 3%, better than the 2.9 consensus estimate i want to take time to dig through the numbers more the stock is off by 3.25%. adjusted number earnings is 1.32 it looks like. street not liking what it's seeing we'll talk china trade and north korea with eunice yoon in beijing in a moment, first eamonafteamo

javers in washington with his take >> the president at a speech in d.c. suggesting that the white house wants to push an additional round of tax cuts before the november midterm election elections. >> we're going to be with kevin and the group, we'll be submitting additional tax cuts sometime prior to november it's going to be something special. you see what it's done for the country. something very, very special >> another development this is a small but potentially significant development. an associate of michael cohen, the so-called taxi king of new york, pled guilty yesterday. look at some facts here. pled guilty. this is an associate of michael cohen who pled guilty to a low-level felony yesterday essentially stole $5 million of mta taxes in new york.

he agreed to cooperate in state or federal investigations. he has been linked to michael cohen. if he is cooperating into federal investigations, that could implicate michael cohen and be additional pressure from prosecutors on michael cohen to flip on what he knows about president trump and his activities we'll see whether the taxi king plea has implications on the president and his political fate ado the a lot of developments on that front. >> i can connect the dots. >> you get the low level guys to flip, put pressure on the mid level guys, see if you can get them to flip and then put pressure on the top guy. >> they're squeezing cohen already, you get this guy to rat out cohen, he's looking at hard time or something, he flips. >> the question is whether they

squeezing him enough, an additional squeeze on the toothpaste tube, so to speak and how much time would cohen be looking at and how much is he prepared to do >> the other thing is, wow, they really got cohen now that's the other way i could see it all of his taxi -- whatever it was, ill legalities there. so they bolstered the case to get him. they did not do it themselves. they gave it to the prosecutors in new york, right >> right two separate tracks here new york prosecutors and the special council team are those things connected there's a whole lot we don't know here. >> yes what the special counsel knows, including when all of this will wrap up. rudy giuliani out there suggesting that the special counsel's team told him that they'll wrap up by september 1st. the special counsel's team has been quiet about that and

everything else. >> did you get mohawk mail, eamon? >> i got a couple of tweets yesterday. >> twitter comments? >> it's a career high point for me glad you did that. >> good look all those networks pulled their offers after that. >> yeah. yeah >> be happy here we're happy you're here. >> i'm happy here. >> thanks, eamon north korea starting to dismantle a nuclear test site as president trump says a visit from kim jong-un may not work out. eunice yoon joins us with more from beijing markets over there are taking it hard >> absolutely. a lot of big question marks about whether this summit will happen i would say there's growing pessimism about whether or not the june summit will take place. president trump said yesterday that there's a substantial

chance that it won't happen. he also seemed at least in part to blame china suggesting that north korea's attitude hardened after a recent meeting between president xi and the north korean leader kim jong-un. this is what president trump had to say >> i think that president xi is a world-class poker player and i'm probably maybe doing the same thing that he would do. but i will say this, there was a somewhat different attitude after that meeting and i'm a little surprised now, maybe nothing happened. i'm not blaming anybody, but i'm just saying, maybe nothing happened and maybe it did. but there was a different attitude by the north korean folks. >> today the chinese government refuted president trump's comments the foreign ministry said the only effort china has made regarding this issue is to encourage both sides to make peace and to have talks. our influence is purely

positive however we will be getting a better sense as to how serious north korea is about this summit because this week they're going to be dismantling a nuclear test site a lot of people believe this is a test to just how committed north korea is to continuing its negotiations of denuclearization guys >> all right, eunice yoon from beijing. i still can't believe we can do that thank you. coming up, senators from each side of the aisle will join us to talk trade, the economy and banking reform democrat hide by heitkamp and republican rob portman will join us and duolingo is a game-based learning app that wants to expand free education word wild. the ceo will be with us at 7:40

eastern time it's a cool thing. we'll see you on cnbc. let's get started. show of hands. who wants customizable options chains? ones that make it fast and easy to analyze and take action? how about some of the lowest options fees? are you raising your hand? good then it's time for power e*trade the platform, price and service that gives you the edge you need. alright one quick game of rock, paper, scissors. 1, 2, 3, go. e*trade.

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welcome back to "squawk.

time for the executive edge. we learned this month that walmart is paying $16 billion for a 7 7% stake in flipkart. now softbank says it will sell its entire flipkart stake to walmart. softbank didn't say why it's cashing out or disclose the size of the stake it's selling. earlier this month masa son said the investment was worth around $4 billion so the first exit from that investment fund. if you're looking for work, consider this. south florida is paying between $50 and $300 for every python captured there burmese python is not native to the area, has no natural predator the species flourished and is believed to be responsible for the loss of small mammals in the region some of them not that small. the program to save native species and protect the

ecosystem has been successful. last weekend the 1000th python was captured >> i think these are ones that people had as pets and released because they don't want them anymore. >> yeah. friendly little uys. >> like to hold on tight, cuddle >> they don't hold on loosely. that's a song we play a lot. the 1000th python. they find each other we hear about the little crocodiles >> the perfect place for them to live >> i always liked them my wife -- >> ugh >> we can't go to places where -- >> agree >> i think guam, is guam big on snakes they got a few another way to -- there, you don't die right away you're in there. let me out let me out >> inside the anaconda >> yeah. >> after they swrallow you whol? >> might suffocate, i guess.

>> might be painful. >> when we come back, retailers reporting this morning we'll talk to dana telsey about the numbers from lowe's, target and tiffany, that's next. as we head to a break, a quick check of what's happening with the european markets right now. the biggest decliner is the dax. germany down by 1.5% at&t provides edge-to-edge intelligence, covering virtually every part of your retail business. so that if your customer needs shoes, & he's got wide feet. & with edge-to-edge intelligence you've got near real time inventory updates. & he'll find the same shoes in your store that he found online he'll be one happy, very forgetful wide footed customer. at&t provides edge to edge intelligence. it can do so much for your business, the list goes on and on. that's the power of &. & if your customer also forgets socks! & you could send him a coupon for that item.

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all right. welcome back, everybody. retailers target and tiffany's out with earnings moments ago. target down by 7%. target came in with numbers quite a bit lower than expected. also talking about what it sees for the second quarter $1.32 versus the $1.35 the street was looking for it is backing its full year guidance to 545 a share. as you can see, there's some concern about the quarter they just reported. then take a look at tiffany. shares of tiffany sharply higher a that company reported a blowout quarter. it beat forecasts by a wide margin i had to do a double take when i saw the numbers. $1.14 a share in earnings well

above the 83 cents the street was expecting. they are raising their guidance for the full year based on this big beat maybe not as much of a raise as you might anticipate given how big that beat was this time around, but the comp store sales, same store sales 10% versus the 2.7% the street had been anticipating. something really happening there in terms of sales at those stores and right now that stock is up by $8. that's a 7% gain both those reports coming after tuesday's announcement that jcpenney ceo will be leaving to go to lowe's that news of the new ceo being the thing the street's been watching joining us right now is ceo and chief research officer at telsey group. let's talk about the numbers that just hit. let's talk about tiffany those comps are really strong. what happened? >> those comps are much better than expected. i think you have a couple of

things happening tiffany's getting new merchandise in their stores. they're bringing in an accelerated flow of new product. it's just beginning with the paper flowers launch but take a look at e the comps they had t so impressive, the international luxury tourist consumer is definitely coming back we heard about it from macy's with a pickup in that international luxury tourist customer and it seems it's continuing to tiffany's too. it's product, marketing, new engagement i think that's what the new management team is bringing. new ceo? his to cfocus is on comp store s growth >> what about the dollar when the dollar got stronger, that was a bit of a concern for some of those international sellers that have been -- international buyers does that matter at all on this or do you think it's a straight merchandising game >> i think there's more of a straight merchandisiing game

going on here. the only weak part of the comp happened to be in europe when you see the asia comp and america's comp, that was all very encouraging i think it's reinvigorating the brand that's going to allow the comps to work at tiffany's going forward. >> all right let's talk about target because that's a story that the street is kind of selling off this morning. didn't like the numbers that came in. target still says it's standing by its full year forecast, but obviously more weakness than anticipated in the last quarter. >> definitely. those numbers were below expectations whether the gross margin coming in less than expected. the number of transactions accelerated from the fourth quarter, but with inventories being where they are, they're having to mark down some goods what we're seeing is that buy now, wear now customer that lower to middle income consumer that weather really hurt and the acceleration that you saw at the end of the quarter, you've heard about it from other retailers like children's place talked about it. you're hearing target talk about it too so not a great quarter missing certainly on the eps

they have ground to make up. and the fact they're guiding to a wide range for q2 has to suggest that their start to the second quarter was better. we should get some more details on the call. >> dana, the weather excuse, a lot of retailers have used that. is it a valid one? >> i think as long as we can see comps continue to hold at the end of the second quarter, at the end of the first quarter and accelerate into the second quarter and the fact you're hearing from so many across the board. if it was one, it'd be wait there's something there. but the fact you have company after company for the low to middle income consumers, i think there is something to say about that and if you're not picking up at the end of the first quarter into q2, then there's a product miss out there >> very quickly, what do you think about marvin ellison headed to lowe's >> it basically is a benefit to lowe's marvin has a great familiarity and obviously great experience with hard goods having come from home depot so his ability to make change at

lowe's should be effective i think now jcpenney, who's going to be the next person there? because they have to get the apparel assortment back intact >> we've got about ten seconds left buy sell or hold on tiffany, target, and lowe's this morning? >> i'd buy tiffany, put a hold on target, put a hold on jcpenney >> thank you for joining us. great to see you >> thank you coming up, much more on today's big retail report still ahead. plus we're expecting numbers from ralph lauren at 8:00 a.m. eastern. also we'll talk about the move in crude and the banking system with senator heidi heitkamp. president trump won her state by 36 points and she's up so we'll talk to her about her chances in the election this year in the midterms as well we'll be right back. ♪

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market alert futures under pressure right now after president trump down plays trade talks and the north korea possible meeting earnings coming in from lowe's, tiffany, target. plus a sin city union shows its hand vegas casino workers say to strike if necessary. what tourists and investors need to know as the second hour of "squawk box" starts right now. ♪ live from the beating heart of business, new york, this is "squawk box.

>> good morning, everybody we are live from the nasdaq market site in times square. i'm becky quick with joe kernen and andrew ross sorkin and the markets have been down yesterday the dow was down 178 points the nasdaq down by 55. kenny rogers talking about knowing when to hold them. president trump talking about the poker playing taking place and the results on the markets in the last day or so. here's what else is making headlines today. shares of lowe's and targets are both lower this morning. let's start with lowe's. $1.19 a share for the first quarter. that was 3 cents light of what the street was expecting revenue also a little bit shy of the forecasts. same store sales increase

of 0.6% was well short of the 3.1% consensus estimate. lowe's also said that bad weather was a factor also target reporting first quarter profit that missed the mark by 7 cents. revenue also just short of the street's forecast while a comp store sales figure came in with an increase of 3%. that was just above the 2.9% consensus. target also citing bad weather for delaying some sales. the stock is down by 6.5%. bucking the trend this morning is tiffany tiffany reporting quarterly profit of $1.13 a share. comp store sales well above as well something like 10% versus 2.9% that the street had been expecting. authorizing a $1 billion share

repurchase that stock is up by 8% in other corporate news, the financial times is reporting that barclays has been quietly exploring a merger with rival banks. one of them they're talking about is standard chartered. the paper says barclays and standard chartered spoke about a merger but no formal or informal bid was made neither would comment on the report barclays has been under pressure to shrink its underperforming investment banking unit. cujo your husband came up with that. >> noknock's worse than jaws. >> cujo, i mean -- a st. bernard? that's worse than a python >> with rabies >> you have to tune in at 6:00

let's look at stocks to watch. shares of burger chain red robin plunging this morning. the company's earnings and revenue missing analyst expectations also saw same store sales fall shares of urban outfitters lowering this morning despite an earnings beat -- do you want to do this? >> the birds no. you said red robin >> results driven by strong spending hewlett-packard. let's talk about hewlett-pack d hewlett-packard. strong demand for its servers, storage, and network equipment hp also boosting its full year guidance and then an earnings beat this quarter. the maker of turbo tax raising its full year guidance then watch shares of snap. leaving the company for tesla. what kind of title is that anyway he's going to join the electric car maker as vp of engineering i'm talking about the title at snap it's like a long, very strange

title. nordstroms upgraded to buy from hold at deutsche bank. take a look at futures right now. we have a triple digit loss at the open at least that's the way things look right now stocks selling off late yesterday after president trump played down what seemed like some optimism on trade talks which we had heard from steven mnuchin who came on our air and said maybe a deal is on hand maybe it's not on hand andreas a garcia is here good morning to both you guys. >> good morning. >> what did you do with this china news one way or the other? >> i know what i'm doing i'm watching our fund manager survey that just reported cash of 4.9%. the long-term average is 4.5%. so what all of this noise back and forth in washington is doing is making investors concerned they're staying in we think the

fundamental backdrop remains positive on -- there's a concern that there's a peak in earnings. but we still look for strong earnings going forward so we think that's a positive. we're looking, you know, at capex. capex is continuing in the lead. my background is in technical analysis the advance decline just hit a record all time high >> you think eventually they'll have to put it to work >> the interesting thing is for institutional offenders, they have to get back into the market but for the consumer, cash is actually now a viable option to somebody i talked to last time something i'll continue to talk about. over the next year money market might give you 2%. right?

i don't necessarily think it's a question of cash and equity. it's a question of -- you think that's going to be an interesting dynamic. what will happen to consumers. >> it's been so long since you could get anything in a savings account or money market. >> that's right. i do agree earnings is going to be key the earnings grew 24%. we're electric done with this earnings season that grew 24% year over year even if you look outside of energy, tech was up 18%. the question is why are stocks not beating going up even when i was just looking at the stocks from this morning, right? on average, when a stock beats, it's up 1% over the next three, four days. when you look at the last 30 years. for this earnings season, they'd be flat. >> because people were concerned that with the guidance, the guidance is not going to be strong enough.

>> it could be that's where i was going to a certain degree which is the bar has been lifted. right? when you're delivering year over year growth, what -- >> the rumors anyway it was up 40% in a year. >> but that's definitely -- or how much more can you deliver, right? >> you know, it's not unusual -- right from the very beginning we talked about a reversion of the mean on january 1st. it just didn't happen in january. started happening february 1st >> that's right. >> let me ask you. there have been a lot of concerns about low to mid-level consumers. right now retailers saying this is the weather do you have any concerns that the consumers are kind of holding onto the money just like some investors are holding onto cash >> i don't worry about that. the biggest link to consumer spending is whetheather part of? i'm sure it's part of it but online sales is still a growing part and that's not necessarily

weather related. but as long as consumer confidence remains strong, i would expect spending by the consumer to remain strong. >> can we talk about fang stocks >> sure. >> i watched a little bit glued to the news yesterday on mark zuckerberg in europe also "60 minutes" with the head of the eu commission there on terms of what's going to happen. do you have any sense of what's happening in europe is going to happen here and have a material impact on any of the tech giants >> well, i don't know if anything happening in europe will happen here we look at global portfolios and look at what stocks are concentrated on a global scale what was absolutely astounding to me is fang stocks are not there. one of the most underweighted stocks is apple. so fang is not a crowded position on a global skacale i view that as constructive. >> what's interesting, i don't

know if you've gotten e-mails from companies saying we are revisiting our prievacy policie. if they're global companies, they might as well get ahead of the curve. it's a dynamic where people used to pay a high multiple for those who own the data, had access to everything now it's this pendulum swung of maybe that's not a good thing. we saw apple talk about this saying we don't own your data. >> you think there'd be a premium on apple if that is the case >> that's a fair point maybe the pendulum hasn't swung the whole way. >> i would also add even with all the news surrounding facebook, how well that stock has held up. i think that says something as well >> okay. thank you, guys. >> thanks. in the meantime, new numbers on weekly mortgage applications just hitting the tape. diana olick join latest >> that spike last week took a

toll on finances seasonally adjusted and refies really drove that. but 27% lower than the same week a year ago dropping to the lowest level in eight years. now, so many people already did the refie when rates sat at record lows that now it's not as big of a benefit jumped to its highest level in seven years. 4.86%. and that's for loans with 20% down payment now, mortgage applications to buy a home also fell down 2% for the week volume is just 3% higher than a year ago and while rates are sidelining some potential buyers, the severe shortage of homes for sale is a far greater deterre deterrent. jumping to $320,000. that's a sign that there just aren't as many lower priced home for sale so that is skewing higher.

the share of borrowers applying for adjustable rate loans also rose you missed any of these numbers, they're up now on cnbc.com >> diana, thank you very much. when we come back, the retail roundup this morning's big earnings reports plus marvin ellison going back to his roots getting home involved in the home retailer this time it's going to be lowe's you can find out what he brings to the table from the home improvement giant. then $5 a gallon for gasoline believe it or not, it appears to be a reality in at least one city we will take you there and it could be a big gamble for workers. the story on a vegas strike vote still ahead. stay tuned you are watching "squawk box" right here on cnbc pah! that will never work.

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welcome back to "squawk box" this morning we have red this morning in large part as new worries about whether we will in fact have a tra trade war with china or something worse. dow looks like it would open 163 points

nasdaq off by 53 points. an update from a helpful bureau that knows about this a story we told you about in the last hour. we mentioned the 1,000th python has been caught as part of a bounty program in south florida. it wasn't just pets escaping a helpful viewer called in to provide additional details on the story. turns out the pythons invaded the region as a result of hurricane -- of all things -- andrew back in 1992. that hurricane destroyed a reptile breeding warehouse and then the python population -- >> you're blaming me >> -- ballooned shortly afterwards since then, officials have taken steps to prevent such escapes. >> when i blew in there, i felt like, you know, i didn't think i was going to be responsible. >> why were they breeding them in the first place pets >> pets, i'm sure. i thought it was just

irresponsible pet owners >> andrew was one of the worst >> i remember it i do >> that part of miami with all the house -- that was a really bad one. the way it went across -- >> the entire state. right. all right. also check this out. believe it or not, gas is fast approaching the $5 mark in parts of new york. and filling a tank is costing some drivers $100. one gas station is charging $5 per gallon the current national average for regular gas is $2.93 new york's average is $3.70 -- $3.07, i should say. i'm not sure where this gas station can get off with $5 a gallon, but the u.s. energy information said gas prices would be at their highest level in four years. that's because we've been following crude oil prices. >> by the way, fyi for those new yorkers, you can try to avoid that it's on 11th avenue.

>> you know which one it is? >> this is the 11th avenue hell's kitchen there is another mobile, by the way, if you want to get cheaper gas. you got to go to the east side and the 96th street. >> there's one that's cheaper too. >> i think it's in the $4 range now. >> word to the wise, fill up before you come into manhattan >> i remember the few times i had to get gas here, it's, like, not normal it's too expensive there's, like, a -- so many jewelry, these high -- what's the name of that one i don't know >> i wouldn't know >> yeah. asprey >> once you pay the toll across the bridge, it's a tax on your gas too. >> though i don't see it it's on ez pass. >> i think it's more >> i think it's $14 if you're going off hours. >> we'll get you that number

too. >> we didn't talk long enough to avoid the story about women in finance. i reread it before i was going to read it it says a new report from merrill lynch finds 61% of women would rather talk about their own death than money where do we find these i'm glad we -- >> you're glad you didn't do that. >> are you going to float it somewhere else yeah, she's going to put it somewhere else >> i want to talk about that that's fascinating >> 61% i don't like the "d" word at all. >> when they say talk about your own death, it probably means planning funeral preparations because women don't want to leave those things for somebody else to have to figure out >> whenever we talk about gender-specific things, it's not a good idea. just in general. and i usually just -- i'm going to stay out of it. you can do it. >> you're not going to bring it up even though it wasn't in the prompter to begin with >> let it lie. folks, it's been a big morning for the retailers.

target and lowe's both posting results. joining us is michael lasser from ubs weaker than expected on both counts here. lowe's not getting as much of a hit because of the news of the new ceo. the numbers were weaker than expected, but again, people are looking at this saying what do we do now with the new ceo what's your thought on this? >> it's twofold. number one, not only about the new ce ox. it's also about the weather as we've heard repeatedly we're going to see how much of that deferred demand that was going to hit in march and april will now hit in may and june and i think they'll bring some really positive attributes i see marvin ellison as an agent of change. culturally, executionally, tactically and i also see him as being

someone who's going to be more dedicated to a strategy. which i think are both issues have ailed lowe's up into this time so i think they're performance will improve and the stock's a buy here. >> no question weather has been cited by a lot of retailers, but lowe's had particularly weak comp store sales and that was not the case for home depot if you've watching the results of these companies over a long period of time, leads you to believe there's some other existing issue at lowe's you hint to that what does a new ceo need to change there >> i think they need to change the execution. you know, service levels, the dedication to the pro customer and the focus on the pro customer i think they need to focus more on their onmni channel initiatives. if we look at the gap between home depot and lowe's performance on a same store

sales basis, that's a little lower. about ten basis points than it was last quarter no one's arguing that's a change or an inflection point but what's going to happen here is as the new leadership team sets in, we do think execution will improve, that gap's going to narrow, and lowe's shares will rally. >> what do you do with a recommendation for buying either lowe's or home depot on this news >> on this news we're buyers of both stocks. we think the home improvement cycle still has legs we're mindful of the fact rates are rising inventory levels are low in the housing sector what that's doing is pushing up home prices. as a result, feeling more confident about investing in their existing asset they're also staying in their home longer. and we have an aging housing stock. so fundamentals in the home improvement sector remain good assuming that the leadership team, the new leadership team at

lowe's can affect change, the story can add an idiosyncratic element by execution all that and it's trading for less than 16 times earnings. it's a buy here. >> let's talk about target very quickly. came in with earnings that were light of expectations. $1.32 versus the $1.37 the street was expecting in earnings per share. they are still standing by their guidance for the full year what do you do here? >> well, what you do here is wait and see we're going to have to hear more on the conference call they cited e-fulfill mitt comens that's going to continue to pressure the business. and so we think that's a wait and see right here >> okay. thank you for your time. it's good to see you today >> thank you coming up, tens of thousands of las vegas casino workers could walk off the job for the first time in more than 30 years, three decades

big company, big name companies could feel the pain. that story from sin city when "squawk box" comes right back. time now for had today's aflac trivia question. when was the palm pilot first leedreas the answer when cnbc's "squawk box" continues break a leg! aflac?! not that kind of break. oooh! that had to hurt. aflac?! not that kind of hurt. yeah, aflac paid us cash in just one day to help with our car payments and mortgage. aflac! perfect timing! see how aflac helps cover everyday expenses at aflac.com.

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now the answer to today's aflac trivia question. when was the palm pilot first released the answer 1996 coming up, changing the rules of the game. congress just voted to roll back financial regulations and president trump expected to sign the bill we're going to discuss all of it with senator heidi heitkamp. first, take a look at u.s. equity futures at this hour. we are in iptrle digits territory in the red dow looks like it would open off 158 points we're back in one moment or built to last? etfs are only part of a portfolio. so make it easy to explain. give me a quality fund that helps me get clients closer to their goals. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence.

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you guys have xfinity. you can do this. what's a good wifi password, mom? you still have to visit us. i will. no. make that the password: "you_stillóhave_toóvisit_us." that's a good one. [ chuckles ] download the xfinity my account app and set a password you can easily remember. one more way comcast is working to fit into your life, not the other way around. ♪ good morning, everybody. welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. among the stories front and center this morning, mortgage applications falling by 2.6% last week according to new

reports. financing activity fell as the average 30-year mortgage rate rose by nine basis points to 4.86%. that's the highest level in more than seven years the government is out with its april read on new home sales. economists are going to be looking for a 2.2% decline reversing part of a 4% jump we saw back in march. then the u.s. banks had record quarterly profits during the first quarter. according to figures from the fdic, the banks earned $56 billion from the january through march period that's up 27% from a year earlier. that driven by increases in revenue. also the new tax law las vegas is bracing for a n contessa, are you a hockey fan

i want to talk about -- >> let's do it >> okay. >> let's get to this strike first then hockey. these votes results came in early this morning the union gave near unanimous approval for a strike. this union is the backbone of las vegas tourism. it represents housekeepers and cocktail and food servers, bartenders, bellmen, kitchen staff. i could go on. 25,000 so half of the union showed up in person at the arena to vote they work at 34 las vegas casino resorts on the strip and downtown the union is pushing for contract language that ends systemic harassment in the work place, increases pay in consideration of the increasing casino profits and the tax breaks, and ensure job security against automation the union says a strike is the last resort but it's urging visitors not to cross picket lines to stay at hotels if the walkout happens. now, more than 3 million visitors head to las vegas roughly each month a strike would causethese

massive disruptions to the tourism industry las vegas hasn't seen a strike since 1984 it lasted 67 days, the city lost an estimated $75 million in tourism revenue, millions more lost in gambling revenue consider in 1984 they had 13 million visitors annually. last year they had 42 million. i just got off the phone with mgm. they said they're confident that this is just part of the process. that they can work out a deal on the issues in fact, they told me they have talks scheduled with the union and the next too so they're hoping to get a deal done >> all right we'll follow that to see if that happens. anyway, the final -- there's a game seven tonight as you know >> incredible. >> between -- to see who the vegas golden knights are going to face d.c. or tampa bay. >> do you know when you go to las vegas now and see the statue

of liberty at the new york new york, it's wearing a hockey jersey >> it's this fleury guy i was watching the other day unbelievable goalie. he's already got three stanley cups, i think, from pittsburgh not to digress, but i'm thinking of gambling. somebody told me it was 500-1 at the beginning of the season for the knights to win the stanley cup. if you put down $100, would that be $50,000 >> you're going to do math on the fly? >> i think it was. now, my friend told me $25,000 you could bet on the other team and you're hedged. i never thought about that gambling, you can do some interesting -- and now we're all allowed to do it on sports anyway i got to get my strategies ready. >> there is so much to cover with you. >> it's gambling >> if you got the $50,000 they'd have to win for you to get the 50,000 but you could put down $25,000

on whoever they're playing. >> you can't think of that odds. >> if you're lucky enough to put down -- no a hundred bucks and win $25,000 on a hundred bucks all right. thanks i never thought about that intro eamon, andrew. he's a gambler, i think. >> you know, i don't know if he gambles this way we're going to washington where i don't think gambling is legal at least not yet maybe in a dumpbt way. eamon's got the headlines investors should be watching this morning eamon? >> yeah, good morning, andrew. i'm trying to make a gambling segue on the fly can't really do it but the president meeting with the south korean president at the white house. president moon yesterday talking about the prospects here for this north korean summit remember, that had been scheduled for june 12th in singapore. although things have looked a little bit more dicey recently the president appearing yesterday to cast blame on chinese president xi jingping suggesting the chinese president met with leader of north korea

in secret. and then persuaded him to take a tougher line in his negotiations with the united states here's what the president said about that yesterday >> i think that president xi is a world class poker player and i probably maybe am doing the same thing he would do but i will say this. there was a somewhat different attitude after that meeting and i'm a little surprised maybe nothing happened i'm not blaming anybody, but i'm saying maybe nothing happens and maybe it did there was a different attitude by the north korean folks. >> so the president suggesting yesterday that the reason the chinese would have done that is because they are in negotiations with the united states over trade. they wanted to take a tougher line and get more concessions from the united states on trade. therefore persuading the north koreans to take a tougher line on the nuclear negotiation so all of this intertwined here

wu which leaves an open question on whether that summit is going to happen at all. here's what the president said about those prospects. >> there's a chance that it'll work out there's a chance, there's a substantial chance that it won't work out i don't want to waste a lot of time i'm sure he doesn't want to waste a lot of time. so there's a substantial chance it won't work out and that's okay that doesn't mean it won't work out over a period of time. but it may not work out for june 12th but there is a good chance we'll have the meeting >> so the president there calling president xi jingping a world class poker player so there's your gambling segue after all. >> all right stick with the washington beat here in other washington news, congress voting to roll back some dodd/frank regulations. joining us now senator heidi heitkamp of north dakota a member of the banking committee who for quite a while has been in the corner of small banks and small to medium sized

banks. i didn't realize you grew up in a town of a hundred people is that -- did you even have a bank >> joe, it was 90 people >> 90 people >> and my family was 1/10 the population >> there's no bank there, was there? >> no. but there used to be back in the olden days but we banked at lincoln state bank still there, still serving its community. still trying to do the right thing to make sure that we get mortgage lending in small banks. and so it's an exciting day. when the president signs this, we put community banks back in the mortgage lending business which is exciting for me >> and it's been something as i said that you've been, you know, advocating for years now and it's finally happening who voted against this there was still some people that didn't want to do it, right? they just think it's going to cause another 2008 is that the argument >> i think that's part of it they also thought that it went too far.

it wasn't the community banking provisions it was the provisions for the regional banks, the mid-size banks. you know, we raise the presumption from 50 to 250 we did that and i'll be honest, when you look at growth in banking, the growth in banking has been in the largest banks. my argument is too big to fail has failed it's become too small to succeed. let's get some competition out there. that competition is going to come from our regional bankers and we're hoping they will now secure some additional deposits and do what dodd/frank was supposed to do which is prevent too big to fail. >> we -- guys like jeb hensarling didn't get everything they wanted. i guess they thought it didn't go far enough. but you're satisfied you think it's just, you know, not too hot, not too cold? it's just right? >> well, it's what we could do there's provisions that chairman hensarling would want to advance that we could agree on i don't think they would have --

they would have tanked this bill when it came back to the senate. that's the challenge i think the point is we take what you can get, run to the daylight, and declare victory on this piece of it for a small community banks for our regional banks and then start talking about some larger issues you know, the thing we should be turning to is housing finance we form you just had a segment on what's happening in housing right now i will tell you affordable housing is slipping through our fingers. we've seen homeownership becoming elusive especially for younger generation we need to fix those problems. we need to talk about affordable housing as part of our workforce development. >> you know, all politics are local, we've heard that. i'm just wondering if you give me a straight answer here. is $80 a barrel oil a good thing? >> it's certainly good for north dakota and i think it will help drive domestic production. which i think is a great stabilizer if we didn't have domestic production and if we didn't have

the good work that i and several others here did in opening up oil exports, i think we'd see prices -- international prices much higher. i think we would see shortages drive those prices up. and so anything that encourages the growth of our domestic drilling industry is good for north dakota but i think ultimately good for the country looking at energy security >> i don't want to make you uncomfortable. and you know -- >> yeah, right >> we go way back. so trump won north dakota by, like, 36 points. >> he did. >> and now you've got this guy cramer you know, we got our own cramer here but you got this guy cramer that you're facing. is it beyond you to wear a make america great again hat? could we ever see you do that? how close do you need to get to trump to win re-election this year in. >> you know, the group that i need to get closest to is north

dakotians. i will tell you i've been very a aggressive on trade. i know you guys have been too. this has been difficult. we're a large equipment manufacturer the aluminum and steel tariffs have hit us hard the disruption and potential disruption in soybeans, ethanol. these are all big factors for north dakotians. i'm not going to agree with the president every time on things like this bank deregulation. we can work together it's great so at the end of the day, my allegiance is to the people of north dakota, joe. >> but senator, most democrats, you know, dependsing where you are, they don't agree with him on anything. zero so just you saying you won't agree with him on everything, you might have just doomed your chances right now. to acknowledge you might agree with him on whether, you know, the sun's going to come up tomorrow. >> she says she cares about north dakota >> i know. there's something happening. brian sullivan is there right now. >> and he's lucky because it's a

great and beautiful place. tell him to go north to the canadian border and see some of the most beautiful land in america. >> you bet ya. >> okay. >> oh, stop. >> okay. okay 90 people. that is -- everybody knew everybody else >> we were all related for goodness sakes >> you're all related. hopefully you went elsewhere to find a husband anyway thank you, senator >> he's from eldridge. >> he is all right. maybe not far enough away. is this me or you? >> you >> coming up in the next hour, we'll head to the petroleum conference in senator heitkamp's home state that's where the aforementioned brian sullivan will sit down with legendary oil titan harold hamm that's at 10:00 a.m. eastern time coming up, we'll show you a language learning app and the

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cnbc releasing our 2018 disrupters list this week. this morning we are introducing you to number 35 on the list duolingo is an app and website providing free and accessible education. they've managed to grow revenue by 1300% in 2017 joining us now is the cofounder and ceo. luis, thank you for joining us today. >> hi. thank you for having me. >> first of all, let me introduce you to our audience. you're somebody who has been very successful as a creator, investor, and entrepreneur you sold two companies to google before you started duolingo. for people who don't know what it is, it seems like a rosetta stone but fun because i'm playing games and it's tricking me into wanting to learn more. is that the case >> that's the basic idea it's a free way to learn a language usually you can use it on the apps on either iphone or android

device or you can do it on the web. and the idea is it's fun >> it's fun and it has lots of people who have jumped onto this at one point, you were named the best app of the year for apple a few years ago. and bill gates has talked about how he's used it too you mentioned it's free. that's important this is something you're trying to make sure anybody can learn another language but you have two tracks on this. you can do it for free or buy a premium subscription how do you make money and how have you raised revenue? >> yeah. it's been very popular like you said. we have interesting statistics for example, we have -- there are more people learning a language in the united states than -- and you know, the way -- it's important to us our mission is to provide free language education and the way we've been able to make revenue is at the end of a lesson, we put an ad so we're ad supported. and if you want to turn off the ads, you can buy a subscription and a lot of people buy

subscriptions. by now most of our revenue comes from the subscriptions rather than the ads. >> if it's at the end of the lesson, why not just turn it off before the ad runs >> since it's so addictive, a lot of people want to do multiple lessons and it turns out, you know, they prefer -- i think a lot of people also buy the subscription to support us. because, you know, usually language classes or language education has been extremely expensive. whereas for us it's free so i think a lot of people feel like they get the value out of this >> i've read you expect to be profitable by next year. is that still the case >> yeah. that should be the case. so our revenue last year was about 15 million bucks then this year we're going to be between 30 million and 40 million. >> what's your long-term game plan i mean, obviously you have a mission about bringing education to all people. is that something that could also exist in a public company >> yeah. that's the hope. i mean, we're hoping that to

become a public company in the next two to three years, you never know exactly depends on a lot of things but that's the hope. >> you only have about 110 employees yet your product reaches over 200 million people in countries around the world. that's kind of an amazing phenomenon what do you think about in terms of that? it's a new way of doing business it's not the way you used to be able to do things 20, 30, 40 years ago. >> yeah. i mean, well, technology is amazing. we do have -- it's about 110 employees. you know, most of our users are actually throughout the world only 20% of our users are here in the united states and, you know, it's a very efficient way of doing things. generally, you know, for example, we only spend teaching people here in the united states, we probably spend less than $10 million whereas the -- you know, the public school system probably spends billions of dollars reaching us >> well, luis, we want to thank

you for being with us. congratulations on making the disrupters list here we hope to talk to you soon. >> thank you and thank you for having me. >> thank you also later this morning, the chief strategy officer at lyft raj kapoor will be our special guest. that's coming up at 8:40 eastern time coming up, we've got stocks to watch plus a real life episode of "walking dead" almost played out in one florida town this week. we will explain coming up next for more on this year's disrupter list, head over to cnbc.com/disrupters. it's the place to learn about start-ups and private companies on the cutting edge of consumer technology and businesses. and they are already worth billions check it out, only on cnbc.com/interrupters. if this is what you think a mercedes-benz for under $34,000 looks like...

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♪ it's always good to run that video. a real life episode of "the walking dead" almost played out in one florida town. a power outage sent out this mobile alert power outage and zombie alert for residents of lake worth and terminus there are now far less than

7,380 customers involved due to extreme zombie activity. restoration time uncertain they apologized for the alert saying, i want to reiterate that lake worth does not have any zombie activity currently. >> nice that he threw in currently. >> it's all funny. and it was a -- it was deliberate and if you mention terminus, the person that composed the original -- >> it's a watcher. >> they did it on purpose. and now currently. very unlikely. if you ever see that but not zero >> there were some drugs people with the bath salts >> and you only got 16 million people living on top of each other here >> i think it's 12 million during the day 8 million at night >> i'll see them coming.

that's all -- that's my only point. i've tried to sell you on the garden state a few times but i'll see them coming but you've got a doorman right? among today's stocks to watch, shake shack was downgraded to neutral from buy still positive on the restaurant chain but notes the stock is now above its most recent price target of $54 a share. celebrated novelest phillip roth has died. roth was one of the most decorated in literature writing more than 25 books exploring themes of sex, assimilation, and identity he won the pulitzer prize. philip roth was 85 years old when we come back, president trump playing down china trade talks and raising questions about a planned meeting with north korea. we will get reaction from capitol hill when senator rob

portman joins us that is next right here on "squawk.

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futures drop after fears of a trade war with china >> there is no deal. we will see what happens >> the dow pointing to a triple digit decline at the open. is the bakken back a line of ceos gathering in north dakota we'll take you there for an interview with oil billionaire harold hamm. lyft taking the number five spot on cnbc's disrupter list. we will talk to a top executive from the ride share company as the final hour of "squawk box" begins right now ♪ live from the most powerful city in the world, new york, this is "squawk box. >> good morning and welcome back to "squawk box" on cnbc. i'm joe kernen along with becky quick and andrew ross sorkin

a late selloff yesterday, it's continuing today down triple digits all morning 166 right now. but there is news. >> we have news crossing from our parent company this morning. want to tell you about it. comcast now officially saying it is in advanced staging of preparing an all-cash offer for fox. comcast emphasizing a final decision to make an offer has not yet been made, but an interesting decision to make public that they are, in fact, considering this at this level and are pursuing it. >> they already said that, though we knew that >> no, no, no. it's been speculated about in terms of reports >> but they fill -- >> they never said they were going to do it this way. >> right but they were considering an all-cash offer this is more -- they still aren't making it they're still saying they're considering it but they give a

lot of background on whether they think it would -- regulatory issues, how long it would take and it may -- >> here's the other part of this they are at the point to make the all-cash offer and make the filings for advance. that means they have it lined up sounds like that's in order. they also say this would make the key regulatory filings that that is also in well advanced stages i guess that's a signal to anybody watching this that just because disney has a head start on this, it wouldn't mean that deal would necessarily go through more quickly it means that comcast is working along these lines on the same sort of time frame >> the other major thing -- >> the other major point here, though, is they are pushing back on the idea that comcast is like at&t in the at&t/time warner transaction. so what i wonder is whether they would pursue a transaction like

this irrespective of the outcome of the at&t/time warner deal >> although the at&t/time warner deal we'll hear about that in the next few weeks >> there's been real pushback. >> but what's also happened since the last time comcast said was iger said we're not even going to respond to that that's not official. we think ours is better. regulatorywise, we think we've got a better shot at it. that was -- you know, he more or less just said i don't have to respond to this. now they're coming back saying, oh, really it's going to be above and then rupert supposedly can choose stock. and that was the other thing >> he can choose stock >> iger was saying it's up to rupert anyway. this is hard -- >> if you're going straight to the voters, rupert murdoch only has a 17% vote this is really up to the shareholders of 21st century fox. because if a deal has come, it's the shareholders who have to vote that in

the murdochs have a 17% vote this says the structure in terms of any offer by comcast including with respect to both the spinoff of new fox and the regulatory risk provisions and the related termination fee would be at least disfavorable as the disney offer. so what they're saying to any 21st century fox shareholder, it's a breakup fee we believe we have a regulatory view through this merger and any deal will be at least as good as what you get from disney if disney goes ahead and pushes this, that's a way of signaling to the shareholders, wait. let's see what we have for you too. >> and we pointed out that even if comcast doesn't prevail, it would be nice since comcast does compete with disney, it'd be nice for them to get them to pay more. >> whether it's going to push

iger to make a call at some point. >> comcast is the parent company of cnbc. just making that clear >> don't know how many times comcast stock can go down. it's down 50 cents but based on another comment they're serious about this it seems like there eventually comes a day when people that it's not going to be in the long-term. >> if you were to look at this, obviously see what's happening in silicon valley. where guys like apple and netflix are getting bigger and bigg bigger then if you look at the international components of this, it's something like 70% of this is an international deal. it would increase greatly what we would have as comcast would have internationally not only with sky but also with star >> you don't think there was

ever a question they could get the money. >> there was never a question. last time when they said it, i thought they basically said they got it >> i think this is a further indication to say to disney holders and 21st century shareholders, we're coming we're serious. >> if it's only 17%, why did so many people including iger seem to indicate this is up to rupert >> i don't think a lot of people realized that. you had to read deep into the proxy on that. >> look. what could happen, if rupert wanted to make a -- take a fight effect ily to the shareholders, if there was a situation where comcast had a higher offer and somehow rupert murdoch could still -- the board could still decide that they are going to recommend to shareholders that the disney deal is a better deal then it becomes a very complicated mess of the

situation zbp that situation. that's it, right >> doesn't mean the shareholders would go along with that who knows what rupert murdoch thinks at some point he may re-evaluate too. >> he wants stock though >> for tax purposes in particular meantime, want to get you caught up on some other news this morning got some earnings reports to tell you about lowe's earning $1.19 per share for the first quarter. same store sales increase of 0.6%. was well short of the 3.1% consensus estimate the home improvement retailer said bad weather, a key factor there impacting the quarter. nonetheless, that stock up about 3% this morning. also target reported first quarter profit of $1.32 per share. revenue just short of street forecasts. comparable store sales increase of 3% was just above the 2.9% consensus target also citing bad weather for the delays in its sales. that down in the premarket

check out shares of tiffany this morning. well above the consensus forecast of 83 cents revenue also beat forecasts and comparable sales were well above stimts estimates. tiffany's also authorized a $1 billion share repurchase all right. the futures have been in the red all morning. president trump announcing the north korea summit might be pushed back hinting that china might be behind it as u.s./china tensions remain over trade the president just tweeting, our trade deal with china is moving along nicely but in the end we will probably have to use a different structure in that this will be too hard to get done and to verify results after completion joining us now, ohio senator rob portman. he's a former u.s. trade representative was it -- senator, it's good to see you. >> you too >> was it when we heard from mnuchin, we got sort of excited that trade war is on hold.

they've agreed to reduce the trade deficit. was that all sort of -- was it hyped by secretary mnuchin or did people talk to the president afterwards and convince him it wasn't as good a deal as it was made out to be? what happened? three steps forward, two steps back that kind of process >> look, i think it's a negotiation. and our president is a negotiator he likes to do it in public sometimes. i think what mnuchin said was consistent with what lighthizer said it was sort of two sides of the same coin. secretary mnuchin saying we've got a breakthrough here. secretary mnuchin was more positive than lighthizer said yes but we got to verify all this and of course that's required. but it doesn't mean they aren't making progress. i think it was positive. you know, i think it's moving in the right direction. there was new news this morning about car tariffs as well. that the chinese are willing to lower the tariffs on the

wholesale price percentage of automobiles going to china so there's some positive indications. >> but he -- what we saw yesterday, the president's comments squarely saying that something changed in the second meeting between north korea and china. here we are in the middle of a trade dispute with china i mean, is the president implying that president xi is tying the trade talks to the kind of pressure he exerts on north korea and -- i don't see how it couldn't be related and it's bizarre that, you know, nuclear armageddon and, you know, tariffs are being discussed in the same context. >> yeah. i guess that's real politics, they call it but we've got to separate the two. this is a long-term opportunity for us to adjust our trading relationship with china. and it's not so much about the deficit for me, joe. it's about the fact there is an imambulan imbalance. there's not a level playing field.

not playing by the rules in terms of opening their market allowing companies to have ownership of certain industry sectors. and obviously the ip issue, they are stealing intellectual property there's no question about it there's some things that have to be resolved. this needs to be done over a period of time with verification and the other issue -- >> is it straight on zte because here it comes. >> the question is whether you're comfortable in using zte as a chess piece in this game. >> no. i'm not. i guess that's the point we need to keep the national security issues on one side and the trade issues on another. understanding that, you know, the chinese leadership and president trump's negotiators are talking about other issues this is a trade decision that ought to be done separately on and its merits i think in the interest of china long-term as well. that point the president has made they're a mature trading partner. and they ought to live by the rules. >> have you made that position

clear to the trump administration are you suggesting they should take zte off the table >> they shouldn't conflate the two. they're very different we've got to make sure our national security isn't compromised by having zte issues here which the president's intelligence officials are saying is a concern. they ought to be kept separate >> and your sense is they are being kept separate or they're not? >> well, i think the people that are negotiating on this, secretary mnuchin are -- larry kudlow are not focused on the national security issue. they're focused on the trade issue. >> i mean, nafta the people that are -- they really mucked this up. that there's a chance to do it and at best you get some type of skinny nafta now did we get too focused on china?

how does this play out the nafta deal >> we will see we hoped it could be resolved about this time frame. by that we'd be able to take it up in the lame duck session of congress my view as you know, joe, and we talked about this before in the show we've got a lot of balls in the air right now. too many i think you need to focus on one issue at a time. we've got the issue with the steel tariffs, obviously nafta negotiations that are coming to a serious point given the elections in mexico and what's going on here in terms of our calendar so it's a lot to do at once. we're making progress in all areas, but it's better to i think have a little more focus >> we've got to let you go, but i mean, stop the press the reds won yesterday i don't know what happened did you see that they won are you a capitals fan now since you don't have a hockey team >> no. i'm a huge cavs fan though

watch tonight. it's the critical game 2-2 going in >> not as critical as the capitals game which is game seven. anyway, thanks, senator. >> thanks, joe good to be with you. when we come back, an exclusive interview with billionaire oil man harold hamm. he will join us live next. but first, cnbc's brian sullivan is in the bakken we find out what he's been finding. listen up. >> we came here to talk about oil, but when you're in this amazingly beautiful state, you can't ignore the other natural resource the bison. more from north dakota when cnbc continues. there's nothing small about your business. with dell small business technology advisors you get the one-on-one partnership you need to grow your business.

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welcome back to "squawk box," everybody. some news just crossing the wires in the last few minutes. it looks like cnbc parent company comcast says it is in the advanced stages of preparing an all-cash offer for 21st century fox. they go on to say that this is a situation where not only would

it be at least as good as what disney will offer. we're going to talk more about this disney shares down by 0.8% as it looks like things had are heating up for the prospect of a bidding war. we will talk to david faber about this in the next half hour meantime, a lineup of oil ceos joining at the petroleum conference in bismarck, north dakota our own brian sullivan is there and he joins us right now with a special guest. brian, good morning. >> yeah, becky good morning >> if you had said they were drilling in the bakken, that would have been a headline i'm joined by harold hamm. thank you for joining us we appreciate it >> good to be here >> are you surprised at how strong oil prices have been? are you surprised we're sitting at $72 a barrel? >> i'm not surprised it's been a long time coming

back, rebalancing of supply and demand you know, we, it seems like forever to us. coming from high 20s at one point to where we're at right now. about $71, $72 we certainly like these prices a lot better than we did the 30s and 40s. i'm not surprised. certainly it's worked out just like we thought with supply and demand >> the only thing i've learned in my time covering oil, we don't know about the price of oil. we could go back to $30 or $130. is there a rough point at which your investors will know you're making money is it 50 bucks a barrel? roughly where is it? >> we said this year would be a breakout year for continental. certainly it has we're dependent on higher prices a lot of people rej their production, you know, $50 or

something like that. continental didn't do that >> why not >> we're participating in higher prices we felt like if prices were going to go up and they have, higher yet, and we still think it's going higher yet. but, you know, we're not looking at $100 oil in the future. or probably $90 oil. but certainly could be in the mid-70s and low 80s. >> let me ask in a different way. i assume you are well free cash flow positive. is that a fair statement >> we are. we've forecast $800 million, $900 million free cash flow this year looks like we're seeing about a billion dollars. >> what's the best use of that cash is it continuing to expand you're sitting on what 4600 wells that you could still tap. is it returning that cash to shareholders >> well, the best thing that we can do right now is pay down debt we've done that already. you know, our debt is about a

billion dollars lower than it was. and so our goal's about $5 billion. and so we're going to apply that to debt. >> your stock is up this morning. do you think investors are finally getting and i've got to ask this carefully because we've got a lot of friends and viewers in texas have they gotten past the sort of permian centric view? do you feel like bakken assets and resources are a little bit ignored? >> well, you know, like a lot of new fields, and let's just say permian has been around a long time but the horizontal drilling down there is a new aspect for them like a lot of new fields, you've got all this infrastructure problems that go with that we had that up here, as you'll recall certainly before we got adequate pipelines and systems in but now that we have it, our cost structure is much lower and they still have head winds in that area >> well, pipelines

we talked last week how the pipeline is creating that there. the pipeline opened up a couple years ago. there are so fewer trucks on the road but how has it changed the cost game getting most of the oil out on pipeline versus truck and rail >> you know, we saw a differential change of $3.50 that was huge. easier getting that to market. i think you mentioned earlier, you know, that change. from 73% rail to 73% pipe today. >> flipped >> it flipped. certainly that's been a huge change >> a little bit better mood than last time we were here mr. hamm, we appreciate you sitting down here with us. we'll see you at opec. >> you bet >> joe, back to you. >> okay, brian thank you.

and say hi to mr. hamm for us. this is the cover of "the post." the parents sued the guy to -- >> saw this story. >> he's 30 years old and the judge sided with the parents >> he's 30 years old, his parents want him to move out and get a job. he is asking the judge to not make him move out. yeah he wants six more months >> he wants six more months. so he's moving out and moving into starbucks that's my joke for the day coming up, a record number of passengers going to hit the skies this summer. what would it mean for airline profits? that story is next

welcome back to "squawk box. coming up, we're going to get back to our top story of the morning. news breaking in just the last couple of minutes. our parent company comcast confirming it will make a bid for fox. hasn't said it's going to absolutely do it, but it has now given us a lot of information wee t e ta 'vgothdeils straight ahead.

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♪ we have some news to bring you. cnbc parent company comcast now confirming it's in advanced stages of preparing an all-cash offer for 21st century fox assets the first time they have confirmed that this is moving at least it appears ahead though they have not obviously made a formal bid.

for more on the story, want to bring in ed lee. he's a managing editor at recode and a cnbc contributor and jessie hempo is here good morning to both of you. how does this change the dynamic? >> i think the timing is important to note here comcast is saying out loud, hey, we are interested, fox shareholders just hold on and that's in anticipation of a possible meeting when is the fox meeting going to happen to rule on, to make decisions on the disney bid? >> fox have a board meeting, do you mean or do you mean putting it to shareholders >> putting it to shareholders. that's what i think comcast wants to make sure before you make any rash actions in their minds, hear us out. >> do you believe, is there any chance they could pursue a transaction like this if -- and we all think this is contingent on the at&t/time warner decision is it? >> it is my sources tell me they're waiting for the june 12th

decision on whether or not at&t is allowed to buy time warner. thap sort of clears a regulatory concern, regulatory challenge for comcast to buy fox assets. if they see that happening, they're like, oh, we've got a pathway to clearing this >> what's your sense on the regulatory challenge on a comcast deal relative to a disney deal? >> well, i mean, i think that's a comcast question they've been sitting back and watching obviously this is a signal that comcast seems to believe that the regulatory challenge is surpassable. that it can essentially mount it at this point. what i think is interesting about this, andrew seeing this come the day after we saw zuckerberg in europe yesterday. when we're looking at tech companies saying they're just too big. and that too big opens this other question, are they too powerful are they evil? and at the same time, the media companies are getting bigger and in fact, they're getting

bigger because -- >> they're trying to challenge. >> we're sort of building up to the same problem wouldn't you say >> i think, first of all, the thing about facebook, the concern is they're getting so big, they're drawing all the eyeballs, the ad dollars also coming their way so i think that's where -- that's why this deal is happening or in terms of at&t/time warner >> i want to get faber's take on this david, you with us at the stock exchange >> i've been here listening. making some calls too. >> where do you stand? >> what do you mean where do i stand? >> no, i -- >> how are we supposed to think about this >> how where we supposed to think about it and do you think -- >> help us understand. >> do you think this is a -- do you agree with ed? i mean, is this basically an effort to tell 21st century fox board to stand down if you're planning to do anything rash >> i don't think they were planning on doing anything rash. i think as we said yesterday, they're going to set a

shareholder vote on this for the middle of july you've got the ruling on the at&t case june 12th. seemingly a decent amount of time to weigh the merits of this comcast bid. that perhaps not enough time in the mind of brian roberts to sort of make sure they understood what was coming we got this release this morning that fully indicates what is coming although we don't have a number. i think important things here to keep in mind are everything i hear indicates that roberts is extremely focused and aggressive in terms of wanting to own these assets as much of course for the international assets which comprise, what 70% or so of the overall ebitda of the company or of the assets being sold as he would also want to own the studio and cable nets and potential rsns there maybe be some regulatory issues what i think is going to be most important to a certain extent and there is language that indicates this and we've

indicated it in our own reporting is a willingness on the part of comcast to offer regulatory assurances. to go very far in doing so to make sure that fox and its board and its shareholders understand that they will take on the burden of regulation as opposed to having to share it in any real way or giving that list to fox holders. >> is an old media behemoth as problematic as a new media behemoth to regulators that's my question you know, we just heard that a big old media company is just as in the target of regulators as much as a facebook or a google after that "60 minutes" report that's assuming this is like an offensive deal just to conquer the world instead of a defensive deal for old media to even try to stand a chance against google, amazon, netflix, whatever would it still be -- i mean, would regulators ever come into the 21st century and realize that --

>> i know. i understand what you're saying. listen a lot of this depends on what judge leon decides on the 12th we'll see. i think, joe, if he as everybody seems to expect sides with at&t and time warner and lets that deal go through as is, i think that opens the -- certainly opens the possibility that while there might still be strong regulatory scrutiny for a comcast/fox deal or a disney/fox deal, that both of them would be potentially allowed to move along. make arguments that comcast has mored a stake. but comcast would fire back and say we're not a national carrier the way directv are. we're only regional. so these horizontal issues are not real or vertical issues are not real you know, we'll have to wait and see, joe, what the real number is there's also other issues. >> every movie we're going to see will be a disney movie what if disney are evil? what about that problem? about 50% of the movies we see

are going to be from disney and we're all going to be thinking the same way god help us. >> what about netflix spending $8 billion a year? are you going to tell me that's a closed market in terms of studios? >> it's worth it if we get good obama scripted series. >> or amazon the company spending more on content these days you can't judge it by market share of the -- >> david, to the extent comcast is going to offer some type of concessions in advance or say they're going to work with regulators, what do you think they would offer and put on the table? >> i think they will certainly match all the regulatory structure that was currently there in the disney deal reverse termination fee at least the same i think, you know, the question is how far do they go in terms of the language that they're willing to use, andrew in terms of assuring that, hey, if they say we've got to sell the rsns we will they seem to be willing to do

that what about the movie studio? or the cable networks? you can make an argument that they'd still be left with a lot of the things they want especially to get control of hulu what comcast has been focused on is direct to consumer and international. do you think those are -- >> do you think there's any chance that at some point bob iger picks up the phone, calls up brian roberts, and says okay enough >> yes i think that certainly is always a possibility. that's not something fox holders want to hear they seem to be in a position to benefit from a war between these two. right now emotions are running too high ichk the same they when they were in bel air and visited after we first reported the disney talks in november and try to get him so agree to something. and perhaps they have to offer more stock or some stock because

of the tax ramifications for his deal but you certainly want r want murdoch on board the fox vote that will take place. you can't force him to sell the company to you even if you succeed in preventing that deal from going forward and then don't forget sky obviously. where comcast potentially has at least a bit of an advantage right now given the regulatory approvals. >> if you're going to split the baby, those are key assets to fight over. >> what were you saying? >> i'm looking forward to watching movies on netflix that's, joe, to your question where we're going to see them. >> that's where we see them now, right? netflix and chill. i found out what that actually is i'm mortified. >> yeah. >> you know the other phrase netflix cheating >> what?

>> it's when you cheat on your spouse by watching ahead in binged episodes you agree you're watching something and then you go ahead -- >> i'm watching this if you're not watching this with me. it's too late. >> i thought -- i don't know i thought that was during the netflix and chill if you're still watching the movie or something. that would be cheating on -- >> that's a whole other conversation david faber, we will see you in just a little bit. >> david, we don't even -- it's like a different language for us now. are you hip to this? >> i'm hip to the netflix and chill thing, yeah. >> you are >> i know a couple of young people yeah >> i know a couple of young people where do you run into these? >> we got a few who work with us they're around have you noticed, joe? we have some 20-somethings my wife works with a bunch of them so we pick this stuff up along the way. >> can you when you hear something that you think i'd benefit from knowing about, can

you just send me a little e-mail you used to do that. and i'll do the same for you >> would you do that for me? okay >> thank you >> i'll do it along the way. >> all right >> all right, guys thank you very much. good to see you all. when we come back, lyft taking the number five spot on cnbc's 2018 disrupter list lyft's strategy, chief strategy officer raj kapoor will join us right after the break.

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welcome back to "squawk box" this morning shares of ralph lauren are higher in premarket trading. reported earnings 7 cents above estimates. revenue was also above forecast. and you're looking at that stock up about 3% in the premarket at this year's cec in las vegas, lyft debuted self-driving cars in partnership with tech giant aptive it earned a spot on our disrupter list came in at number five this morning, lyft announcing a $100 million investment for driver sport centers where drivers can get things like low cost oil changes and serviced car washes joining us right now to talk about all of this is raj kapoor. he is chief strategy officer at lyft thanks for being here today. >> absolutely.

glad to be here. >> let's talk about the news first. this $100 million investment in the service centers for drivers. what exactly is it and why >> so, you know, we had a great year this year going from 20% to 35% market share and a lot of that is because of the experience that both passengers and drivers have. this is our way of doubling down especially for drivers we talk to drivers and we know that what matters to them is to have a place that they can have park and rest and have access to bathrooms and be able to figure out what their next move is. light services and maintenance these are things we want to provide to drivers it's important >> how much of this is a game where you're constantly looking at the competition uber and thinking we have to take them on? or do you think this is a market that can really over the long-term supply -- have enough room for more than one big competitor in the space?

>> we don't just talk about our values we've been acting on our values proactively without thinking about what other people are doing. whether it's the roundup and donate program, providing relief rides. now every ride on lyft is carbon offset 100%. those are steps that we've been taking proactively is we are still at a very infant stage of this ride sharing market we have a long way to go our vision about making cities around people versus cars is happening. on demand rides. that's what the vision is. we were just scratching the surface. >> i see you've more than doubled your rides that have been taken since 2017. part is you're grabbing market share. it's now about 35% market share you have how much have you benefitted from uber's missteps and the big problems they've had >> you know, the key for us is to focus on our values

we're founder led. they've had those values before they started the company they continue to be there. it's reflected in what we do and the experience so i think our awareness has grown as we've grown there's a virtuous cycle more drivers mean better times more passengers means more drivers. so that virtuous cycle has been working for us >> the big problem with all of these companies that offer ride sharing services like this has been the amount of cash burned when do you think you become profitable >> so this is something that there is a lot of cash spent in this category. because there's so much growth there. if we could accelerate the growth there and our penetration is so low it makes sense to continue to invest into growing passengers there's so much innovation to bring to market. whether it's autonomous or numbers of rides being shared. >> just getting back to the point, the reason so many companies there are will be to

burn so much cash in the early stages to gain growth is because it may be a situation like amazon where the biggest player wins right? the guy who is there and able to take most of the market share and be most forefront in consumer's mind is the one who's going to win at the end of the day. is there fault in my logic there? >> well, we are absolutely going towards winning and we're well on the way that's there. but if you look at the market, you'll see that on a regional basis, there is more than one player that's typically succeeding and thriving there. i don't think this is a monopoly i think there are more than one that can succeed >> let's talk about autonomous vehicles how far down the road do you think that is? at least for it to be used by lyft >> you know, what's exciting is we -- you mentioned earlier that we have a partnership with aptive we have an on the part approach to development and with magna. what we've done with aptiv as an

example is already launch in las vegas. today you go into las vegas and you can get an autonomous lyft with a safety driver that will take you from hotel to hotel there. so it's already started. it's going to be a slow and gradual rollout. but it has began partners like waymo have started in arizona all of that is continuing. you will see the rollout begin >> congratulations number five on our disrupter list we appreciate it >> thank you for more on cnbc's 2018 disrupters list, go to cnbc.com/interrucnbc.com cnbc.com/zrucnbc.com cnbc.com/disrupters. and when we return, we'll check in with jim cramer as we count down to the open down 155 now on the dow. we'll be right back.

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time for the stat of the day -- another record high on monday monday and history says it co i'm dianne feinstein and i approve this message. i support the affordable care act, and voted against all trump's attempts to repeal it. but we need to do more. i believe in universal health care. in a public health option to compete with private insurance companies. and expanding medicare to everyone over 55.

and i believe medicare must be empowered to negotiate the price of drugs. california values senator dianne feinstein making headlines wpp lost one of the long time accounts. wall street journal reports that hsbc has awarded the media

buying account to omnicom. the fed released the minutes of the most recent meeting this afternoon. that's at 2:00 p.m. eastern time the fed did not raise interest rates at the meeting but investors will be looking for clues on how fast future rate hikes might come breaking news this hour, cnbc parent company comcast confirming its in advanced stages of preparing an all-cash offer for 21st century fox assets we'll get to the new york stock exchange where jim cramer joins us now in your heart of hearts, jim, do you think if comcast really wants to do this, can they eventually prevail over disney, if they want to and at&t, for example, does go through would comcast end up winning >> to the certain point you have to think fox, which

definitelin'definitely wants to partner with bob iger wants to do it i think at a certain point there's too much pain. but i'm listening to david david sounds like brian roberts wants it what he wants he tends to get. >> and you have noticed the stock, as well when does the stock or when do traders say, god, what a great move for comcast for the future? whether it's two years, five years, ten years, you know, for sky to go international and hulu or whatever. when do they say that and say i'm going to stop selling and start buying. >> that's the question i've been saying it's a win win. either they go and take some of that borrowing capacity and buy back the stock or get incredible properties that disney wants but what is happening it's taking too long. and, you know, i hope we're not

talking about this thing in let's say 2019 that would be a recipe for multiple months of underperformance things got to get done we have to figure out what is going to happen with the time warner case and figure out how long it takes. as long as it takes, comcast will be lower. >> so the mueller investigation in first or does it get resolved first? which is first >> well, it does seem like mueller give me a little bit of a deadline. >> i don't know. how do you know? and if the president agrees. >> and i don't -- i'm not going to say fake news i look at what i hear from one side versus the other and i'm reading alternate facts all the time i don't know whether it's a constitutional crisis or worst than watergate it's bizarre we live in a triable world, jim. >> yeah. i think the watergate analogy is

wrong. i lived through the nixon world. there was no alternative facts it was just bad. here there are alternative facts which makes it, to me, a better situation for the country than nixon. where it was just every single day you heard a republican break ranks. finally you recognized, you know, nixon is a goner none of that is happening. november 2018 is coming before we know it and all bets are off after that. >> i think if employment keeps us strong, people -- employment is very strong could be adding seats for the gop in the senate and lose the majority in the house is possible, too, i guess. >> it's possible i think people vote you get 3.5% growth i think it could be possible i don't know i've never seen anybody get thrown out when jobs are so

present -- plentiful. >> i saw the generic reuters the republicans were up. anyway thanks, jim. >> absolutely. >> back to comcast and disney probably at 9:00 with david. tomorrow on "squawkbox" a big interview you don't want to miss ornni rometty will join us f an interview at tomorrow at 7:00 a.m. eastern time. ♪

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all right everybody. a final check on the markets this morning yesterday markets down across the board. a lot of concerns about what was going to happen with trade talks with china and the potential for a meeting with north korea between the president trump and the head of north korea. you can see this morning things are still under pressure dow futures down 151 points. we were lower at the beginning of the show. you can still see that the s&p 500 is off by about 15 points. and the nasdaq is down by about 54 then there are oil prices. and oil prices have continued the decline this morning, too all of following yesterday wti down by .5%. but you're talking about prices

well above $70 with expectations, some think being on our way to $80 a barrel brent now trading 49 cents and the ten-year note, at this point, yielding 3.017% don't forget to join us tomorrow we'll be joined by gin ginni roemetti right now it's time for "squawk on the street. good wednesday morning welcome to "squawk on the street." i'm carl quintanilla and jim cramer and david faber the president throws cold water on both the china trade deal and a north korean summit. retail earnings come with scars, as well. 1% sell-offs in europe and asia overnight. global pmi at multimonth lows and ten-year yield