good morning 11:00 a.m. at the fcc headquarters in washington and 11:00 a.m. on wall street. "squawk alley" is live ♪ ♪ good friday morning. welcome to "squawk alley." i am carly fiorina with morgan brennan and jon fortt at the new york stock exchange.

a big show this morning. the president tweeting about 5g and beyond, one of the people leading the administration's charge, brenld and carr joins us, and intuit ceo, his first interview since taking the job door dash raising $400 million in a funding round, valuing the company more than $7 billion, nearly deductible six months ago. the ceo with us coming up. big show >> big show indeed you mentioned, the dow notched 26 k, on pace for nine straight weeks of gains for the dow bob pisani is here >> i think the important thing is this week is we're basically flat on the s&p 500 and we are seeing global markets outperform that's a little surprising we're up 18, 19% since december 24th low all of a sudden europe up 2% and we're flat, haven't seen that in

a while. china up 5% for the week, certain indexes there. germany up several percent i don't know if this is a pause but a lot of people have been saying a long time it is time for a little catchup another thing, value has been outperforming growth a little this week, that hasn't happened in a long time we have a little pause and rotation one thing to watch, health care stocks have been down. they were big outperformers in 2018 they have been down awhile now you have merck, pfizer, lily, even some management care stocks, humana down this week. that's one of the reasons the s&p 500 is flat. health care is a laggard this week modest moves up in some technology names overall >> tech has been okay, feels like some of the guidance, solid but not exactly inspiring. how are investors reacting to that >> i think the problem now is if you look at the semiconductor

space, for example, consistent take downs in first quarter earnings expectations because of what's going on, you have been reporting how competitive it is, what oversupply has been, so the competitive pressures have been reducing earnings expectations in the semiconductors. then other industries had problems, why earnings are coming down. last year, oil was coming down, everybody slashed 2019 earnings estimates for big oil companies it recovered, which is why they're up but earnings numbers were cut in anticipation of a down year. everybody wonders why are we going to flat earnings for 2019, well, you get problems with competition in certain spaces or oil dropping and analysts cut numbers. i personally think the earnings recession everyone is talking about may be much ado about nothing. it is easy to say see the stock

market was down last year, earnings are going to drop, or reverse it, earnings are going to zero, therefore the stock market will be down. none of that is necessarily true you could have a flat earnings year and market goes up. if you believe there will be a recession in the end of 2019 or in 2020, heck yes. 20% decline in earnings and in markets, absolutely. if you don't have a recession, we could have flat earnings and move up. >> bob, thanks you're getting banners on the bottom of the screen that's the federal reserve monetary policy report in anticipation of house testimony next week. ylan mui has more on that. good morning >> reporter: good morning. we are getting highlights from the report, and the fed in that report reiterating that it will remain patient on interest rate moves in light of softer global growth the fed also saying that the u.s. economic activity has been

continuing at a solid pace, and it does expect gdp to come in a little under 3% last year. however, it did warn that the market's appetite for risk has decreased, it brought up recent trade tensions with china, saying that financial conditions tightened abroad in part because of u.s. trade policy, and that growth concerns and u.s., china trade tensions are part of what are putting markets on edge. the monetary policy report also addressed inflation, said that inflation has been restrained by recent declines in energy prices that's something that's been on the agenda here at the conference, u.s. monetary policy conference we heard from new york fed president john williams and san francisco president mary daly saying the fed needs to be vigilant on both sides of the inflation target too low or high are a potential risk new york fed president also

saying the fed may have to adjust framework for thinking about inflation because of how low it has been and how long it has been that low. meantime, the balance sheet is something that also came up in the fed monetary policy report balance sheet declined by $260 billion around mid 2018. we hope to get more information on the fed's plans for ending the runoff on the balance sheet later today. back to you. >> i have to know what you made of william saying to stay vigilant against too low inflation expectations and the idea that phillips curve is alive and well. >> reporter: it seems to be a little conflicting information here on one hand, fed officials here so far have said that they do believe that this sort of fed policy remains in place, they think it works but need to think about how it is working

differently than before. there's discussion how data that feeds into the phillips curve may be different because of ways that employers are compensating workers and adjusting worker compensation these days. so there's a lot of questions about are we using the right data in order to measure inflation, but that they fundamentally believe there's still a link between inflation and unemployment the question is if you don't have the best data, how do we make policy. that's something they're trying to navigate through now. >> good stuff. thank you. ylan mui watching the fed for us today. >> this goes back to 1978 when they created this whole thing. i think this was the fed pivot, the first word out of her mouth, patient, is a keyword. these are essentially expanded fomc statements on the state of the global economy normally the chairman, there's nothing controversial that comes

out of here. the chairman is certainly not going to front run any testimony before that by releasing some startling commentary, and i don't hear it. i think the word patient is important. i think the number one question they're going to ask powell is not necessarily rate hikes or the balance sheet and where it will end up, that will certainly come up. if i had one question, i would say describe the state of the economy now in the united states i think these economic numbers we've been seeing i wouldn't say alarming, but i'm a little concerned. numbers have been terrible wait a minute, we're supposed to get terrible nuchmbers in europ, china is slowing down, these numbers are surprising in the u.s. they clearly put part of the problem on the china trade issue. okay, if that issue goes away, do we get better economic numbers? that's my question >> thanks. turning to tech, two names going opposite ways.

drop box down on weak guidance, roku surging after a beat on top and bottom lines mark mahaney, good to have you back >> good morning. >> what kind of grade do you give the new round of numbers we have been getting? >> we're all over the map. a slew of earnings announcements last night the most positive reads and fundamentals were roku, and also the trade desk these are two interesting fundamentally based names that are drivers off advertising, whether trade desk and program i can advertising, with roku, the ad supported netflix or it's streaming that isn't netflix i think those are great growth areas. dropbox is going a different direction because of bottom line, not top line issues. 13 million paid customers, net ads were better than expected, no change in growth rate

they surprised people how much they're investing, particularly in the headquarters build. i look at that as a one time spend. we continue to like the stock, even with the pull back today. >> mark, what do you take away from the tone of guidance? can't help but notice zillow, roku both had strong revenue guides, but profit guide, eh does that signal anything to you? investors are responding to each differently based on the other details of things they reported. >> jon, you're right to point those out. zillow, we have a lot of news. spencer raskof who built and ran that company is stepping down at ceo, the original co-founder, rich barton coming in who has a great track record with expedia. in the past was the first ceo of expedia, founder of expedia, founder of zillow, a huge track

record when news came back he was coming back to be ceo, that's what took the stock up the issue with zillow, the core business, advertising real estate business is slowing down and slowing down materially, 1 to 3% revenue growth in the march quarter, that's scary. and the company making a big bet on the i buyer market, home flipping market. nobody has proven the economics of that yet. if anybody can make it work, it is rich barton, it is a big swing and risk sort of surprising the stock is up as much as it is. i am skeptical of the move respectful of rich, we're not buyers of the stock, i want to see him bring his magic back to the company before we get constructive on shares. >> in terms of that movie into home flipping, do you think upped rich barton that will continue or they do away with it, look at other opportunities for growth >> no, i think he is going to accelerate it. i think he is coming in to double down on that bet, exaggerating a little bit.

zillow started off as a company, a lead generation model, selling advertising to real estate agents they want to go down the funnel into the home buying and selling process and do it through the i buyer market, home flipping.com business rich and zillow have been doing this 6 to 9 months in all fairness rich is here to double down efforts on this segment. a big, bold bet. he made two of them in the past. this will be the third we'll see if it works. >> mark, of names we have gotten in terms of would be ipos later in the year, which ones do you anticipate folding into your universe, how much attention do you think they'll draw from names we already know so well? >> i'm going to punt on the first question it opens the question in terms of stocks that are still out there, faang names, bookings and expedias, when people talk about

these names, uber, lyft, pinterest, airbnb, if any of them go public, are they drawing dollars from current growth assets, you know, maybe. we haven't seen that the last few years as twitter and snap went public. it is possible that it does. you're looking at a market there's a dirth of growth, a few sectors, maybe two, that offer premium growth internet is one. software may be the other one. in that environment, i think people take money from nongrowth sectors, move it into secular growth names, if they have good management stories, et cetera. >> on the heel of roku numbers, earlier this week julia boorstin reported on in addition to the streaming services that the next big terrain is companies that are able to aggregate services and become the gate keepers in terms of offering them in one

place as a one shop stop to consumers. is roku proving that's on the end of that next new front >> roku is proving it is one of the players in the forefront in terms of ad supported ott, they're putting together the package, few other companies are doing it, google with youtube, despite recent problems that they've had, they shot themselves in the foot again, but i think roku is one of the companies. the best data point out of roku was what we call the double double they say video ad impressions sold more than double in fiscal '18, think they're going to double again in '19 this is rarer a of growth. when you find it, you step in on the stock. roku is one of the top three stocks year to date, so is trade desk and wix >> year is getting more

interested talk to you soon when we return, intuit beating expectations on earnings trading at all-time highs in the most important quarter, the one we're in the new ceo will sit down with us exclusively next, his first tv interview since taking the role stay with us [cell phone rings] where are you? well the squirrels are back in the attic. mom? your dad won't call an exterminator... can i call you back, mom? he says it's personal this time... if you're a mom, you call at the worst time. it's what you do. if you want to save fifteen percent or more on car insurance, you switch to geico. it's what you do. where are you? it's very loud there. are you taking a zumba class? your daily dashboard from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech.

only from fidelity. you need decision tech. we sunleashing the promisegas of clean energy. at emerson, when issues become inspiration, creating a better world isn't just a result, it's a responsibility. emerson. consider it solved.

welcome back shares of intuit hitting all-time highs on pace for the

best day in nearly two years, behind products like turbo tax and quickbooks it beat estimates for the recent quarter, stock has been on a tear, better than 20%. joining us, his first tv appearance as ceo, intuit. sasan goodarzi good to see you. >> good morning, thank you for having me. >> so you talk about tax season, it is your super bowl because in general the irs seems to be off to a slow start, it is an interesting dynamic. you have a change in tax law that increased the number of free filers, turbo tax live which has potential to bring in more revenue what's your lever to pull to make sure that live off sets free >> thank you for your question first of all, this is a very important time of year for our

customers because they're looking for the largest tax refund really our goal is to expand our lead in the do it yourself category, while we transform the assisted category. one of the biggest challenges customers face is confidence, and they look to talk to experts. what we have done this year is we bring experts on the platform to help customers answer a nagging question they may have lacked confidence in we like what we see so far product recommendation scores are increasing which means customers like what they're seeing >> you said also that you're taking steps toward becoming an ai driven expert platform. tell me how is that going to actually show up in numbers? is this about up selling existing customers to higher value services or is it about reducing churn >> first of all brad led us

through a phase of being north american desktop company to a cloud driven company the next phase is about an a i driven expert platform there's a couple dimensions to it one is a platform where we and others solve the most questions. but accelerating artificial intelligence that learns from growing data through experience with customers and ensuring customers have access to experts when they have any questions, whether consumers, self employed or small businesses. we believe it gives us the opportunity to create additional benefits for our customers and continue to drive long term growth >> i have to ask you about the economy in general your cfo on the call said you are getting questions about the downturn, you have tons of data on consumers and small businesses and payrolls. you said you're not seeing evidence of a macro inspired

slowdown but i wonder are you seeing stagnation? >> there are two things we look at that indicate the health of customers and the economy for us one is charge volume how much are consumers spending with small businesses. the second is number of full-time employees or contingent workers that small businesses have. in both areas, we see strength and don't see signs of a slowing economy. >> sasan, i want to go to the idea of bringing more experts on the platform a, has tax reform increased the need for that as people are more uncertain this year filing taxes, and b, when you talk about building out more ai, how do experts in ai longer term fit together, work together? >> sure. first of all, as we look at tax simplification, we're huge supporters of it the simpler the taxes become,

the more consumers can do taxes themselves the reason we are now looking to significantly accelerate bringing experts on the platform is whether you're a small business or consumer, you always have that question, whether it is you bought a new house, whether you just got married, you wonder am i doing my books and taxes right. bringing experts on the platform allows our customers to use the platform with confidence but to be able to immediately have access to an expert to answer one question the combination of digital platform leveraging ai and experts is revolutionary when you think about the service industry, it is in the early innings of being digitized we believe we have opportunity not only to solve that confidence problem for customers but accelerate digitizing the service industry, software and service together can create magic for customers. >> it is a truly interesting twist on the ai issue around

jobs and productivity. ai helping connect people to other people thank you. sasan goodarzi, ceo of intuit. >> also interesting given the tax commercial that got so much attention during the super bowl with the child robot as we head to break, take a look at the worst performing stocks in the dow so far in today's session. we have a lot more "squawk alley" straight ahead. don't go anywhere. have you ever worked with dr. francis? oh yeah, he's ok. umm... just ok? guess who just got reinstated! well, not officially. nervous? yeah. yeah me too. don't worry about it, we'll figure it out. i'll see ya in there! just ok is not ok. especially when it comes to your network. at&t is america's best wireless network, according to america's biggest test. now with 5g evolution. the first step to 5g. more for your thing. that's our thing.

and everyone i've ever opioloved away from me.thing everything. i blew my ankle out and i got prescribed pain pills by my doctor. if making my detox public is gonna help somebody i'm all for it. i just wish i would've had a warning. servicenow put our this changes everything. you're right sir... everything. well not everything, i mean you're still blatantly sucking up to me gary. ahhh... stop it. servicenow. works for you. ♪ ♪ let's go from plans... to full-blown production. ♪ ♪ let's go from being on-call... ♪ ♪ to being on-line.

american express can help move your business forward with loans, vendor payments and buying power. chat with one of our 4000 specialists and let's make it happen. the powerful backing of american express. don't do business without it.

welcome back to "squawk alley. european markets are set to close in a few minutes seema mody has a look at today's action >> happy friday. european markets set to finish the week mostly higher all five major country averages did close off their highs, following that the eu could put tariffs on caterpillar and xerox

if president trump follows through on auto tariffs. new data shows the german economy missed falling into recession in the fourth quarter. higher spending helped with exports. reports showed business confidence dropping to a four year low the indicators as volkswagon issued a warning on 2019 after reporting 't reporting disappointing results. head winds in key markets are expected to strengthen further in 2019. on the wake of kraft, heinz news, unilever and nestle are lower. they withdrew a bid for dove soap maker in february of 2017, and since that time uni dleleve outperformed now the divergence between kraft

and unilever is more stark. kraft down 65% since withdrawing the takeover offer and unilever is up 10% let's get to leslie picker for a news update. >> thanks, jon here's what's happening. producers of fox tv show "empire" releasing a statement saying they decided to remove jussie smollett's role from the final two episodes of the season this after he was arrested and charged with staging a hate crime attack on himself. he was released on a $100,000 bond thursday. house democrats introducing a resolution to block the national emergency declaration the president issued to fund his long sought border wall. speaker nancy pelosi says the house plans to vote on it on tuesday. a moscow court extending detention for american paul weiland who was arrested in december for alleged spying the

he arrived under escort by a masked man, will be behind bars another three months pending investigation. a rare 1997 michael jordan nba trading card set a record as the most expensive basketball card eversold on ebay. it sold at auction for a whopping $350,000. there were only ten cards made that's the cnbc news update this hour back to "squawk alley. >> that's amazing. so cool. thank you very much. after the break, the president's 5g charge, bre brendan carr joins us. we're back in a minute see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you

through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade

welcome back mobile carriers race to deploy next generation 5g networks, president trump is calling on american companies to step up or risk getting left behind the president tweeting yesterday, quote, i want 5g and even 6 g in the united states as soon as possible, adding that there's no reason that we should be lagging behind on something that's so obviously the future i want the united states to win through competition, not by blocking out currently more advanced technologies. joining us from washington, fcc commissioner brendan carr. great to speak with you. thanks for joining us.

is the u.s. lagging behind on 5g at this stage? >> we're actually in good shape now in the u.s., thanks to regulatory reforms we have been engaged in in the last two years, and the white house has been helping lead the way by prioritizing 5g. a report out this week said the u.s. is projected to have twice the number of 5g connections as asia by percentage basis there's more to do but we're headed in the right direction. >> what's 6 g? >> there's a lot of talk about next generation platforms. 5g will be a big piece of that, there are other technologies on the horizon, new generation of low earth orbit satellites coming online, raw networks are being upgraded we are focused on getting the regulatory playing field right and let the private sector bring whatever new technologies you can. >> glad you brought up those low

orbit satellites the fcc has been green lighting applications for. what's your expectation for companies that move forward with that, what it would look like, how it would fit into broader internet infrastructure. >> we're at an interesting point in time for broadband for consumers across the country we have never been this close to true convergence on the wireless side, you have 5g deployments that give a lot of people a first or second choice for competitive high speed broadband. satellites we talked about, hopefully a new generation that will launch in the next year to add another competitor to the space. we have fixed wireless providers as well that are out there i think we're on the cusp of significant technological breakthroughs, it is happening at the right time. we're getting regulations right as well. we cut a couple billion dollars in red tape, particularly on the infrastructure deployment side to make it easier for all providers to put broadband technologies out in the market to the benefit of american

consumers. >> commissioner, last year there was some concern about whether all of the necessary spectrum had been cleared in the u.s. for a full 5g roll out, mid band, low band, high band. i wonder how that's going and i am wondering how do you see your role shifting as 5g moves into the implementation stage, especially as enterprise deployments begin? >> great question. three key pieces of the 5g deployment the first is spectrum. we need to push more radio waves out to support the next generation technologies, and starting in 2017, the fcc put the hammer down on that. we now freed up and allocated more spectrum than any other time in history. we're in good shape there. the second piece is infrastructure that's where we are cutting red tape to make it easier to get next generation networks out there. the final piece is 5g jobs

companies that do physical work needed to deploy networks, they're looking to nearly double the work force these are solid middle class blue collar jobs, a great jobs story here as well >> when you talk to consumers and try to describe benefits of having no latency, what examples do you give other than you can upload a movie in four seconds >> great question. there are two key pieces of that first, you think about your home high speed broadband options, a lot of americans have one or none in terms of choices, and with 5g you can now receive wirelessly that same experience that before you could only get with a wired fiber connection. the second piece of it is a new network will enable all the cutting edge innovations we are hearing about now, connected cars, internet of things, smart city, virtual reality, all of the interesting innovations, we have to upgrade the network to 5g to make those reality

>> in terms of implementing 5g, commissioner carr, is this going to be u.s. companies or, and i say this because we have u.s./china trade talks continuing, there are reports that maybe the stands on some of the chinese 5g providers and suppliers may be softening could you see some of those companies coming into the market what's the policy there? >> yes, we have an active proceeding at the fcc looking at the global supply chain for 5g equipment and we're taking comment, talking to different agencies as well to make sure the networks as they're deployed are secure but more broadly there is this global race to 5g, and china is one of the biggest competitors they have a very different economic system than here in the u.s., they can snap their fingers through central planning and deploy new networks virtually overnight. in the u.s. we have a free market system, we rely on the private sector that's why it is incumbent on

those of us in government to get unnecessary regular lations outf the way so wecan approach a level playing feel with a country with a different economic system. we won the race to 4g doing that, getting government out of the way. we are doubling down on efforts now as we push to 5g >> commissioner, we appreciate you coming onto talk about the efforts. thanks for joining us today. >> thank you. and monday, guys, don't miss the oracle of omaha, warren buffett on "squawk box," 6:00 a.m. eastern. send your questions via twitter, facebook, instagram, #ask warren buffett. before the break, rick santelli, what's on your mind? >> trade and brexit are on my mind this morning. many guests come on and say x percentage of trade is already priced into the market they could be right. maybe not though it's difficult to understand what's priced in

'shawel lkbo aut after the break. nes getting to patients in record time. at emerson, when issues become inspiration, creating a better world isn't just a result, it's a responsibility. emerson. consider it solved.

time to get to the cme group for the santelli exchange. good morning, rick >> good morning, carl. you know, carl and the gang are great. we discuss every morning all the issues that are going to effect you, the viewer, the listener, the ultimate investor, whether you go through institutions, whether you try to manage your own portfolios, big events

matter today i'm going to concentrate on two of the biggest, brexit and global trade on brexit every day i read more and more wild preparations certain entities and businesses are making for worse case scenarios, and i don't mean to make light of this, but really intense things happening as they get ready for the march deadline the other thing i continue to read is how intransient europe is to make the deal any more beneficial for the uk side, and theresa may is stuck between a rock and a hard place not only on whether there's a deal or a hard brexit, whether she can get any of the mps to go along with her, or the political environment she will leave in the wake no matter how it turns out, but the overall consensus is that the down side is pricing in and there's more to come. i personally believe the down

side is overpriced in. these are my opinions. i do think that the eu should be kinder to the uk because after what's already transpired, you look at other countries, they're nervous about leaving, i don't think this episode will give the italians any more bravery about leaving, if they get kinder to the uk remember, the uk has its own currency, they still have the pound. it would be more difficult for currencies sharing the euro. you could say they could run it parallel and go right back into the lira not that easy. ultimately i think brexit is well overprizced to the down side, i would pursue it were it the day after november, '16 elections. i wish i had more time on trade, definitely the up side is under priced. i think it is very difficult to ascertain how the character of the united states with regard to all of the global trade as a

character in that novel is so underpriced. to me all the notions of less capital spending after all of the stimulus, after all of the good economic news we had, i think much of this is based on the long view of uncertainty on trade, and i believe there will be an agreement, and i believe that will make markets do much better when i hear 75% priced in, i'm pretty much 75% sure it is not morgan, back to you. >> that certainly is the longer term bull case for all of the trade talks. rick santelli, thank you up next, door dash getting a new round of funding, valuing the company over $7 billion. the ceo will join us here next ost 9. "squawk alley" is back after a quick break. so, servicenow put your workflows in the cloud, huh?

mmhm. your employees must love you. [ chuckles ] thank you. you could say that. i love you. servicenow works for you. ♪ -it's all about the big picture. with miguel, our certified financial planner™ professional, we looked at business insurance, our mortgage, even our plans to adopt. -it's not about this fund or that fund -- it's about us. -welcome to our complete freedom plan. -it's all possible with a cfp professional. -find your certified financial planner™ professional at letsmakeaplan.org.

[ ding ] show me just add magic. financiahey toothless.fessional [ ding ] [ gurgling ] [ ding ] show me cartoons on netflix. [ ding ] [ cooing ] [ door closes ] [ cooing ]

♪ [ ding ] show me fish on youtube. say it and see it with the x1voice remote. from netflix, prime video,youtube and even movie tickets. just say get "dragon tickets". welcome back food delivery startup doordash announcing it raised another $400 million in a series f funding round, giving it new valuation over $7 billion. that's up nearly 80% in just the past six months. joining us, tony xu. great to have you here every time you're here the value doubled. they have a new term for startups that raised more than a

billion, a different mythical creature you have data from second measure suggesting you're pulling ahead of uber eats now in the delivery game is all of this money necessary because you think it is a winner take all market? >> well, doordash has been pulling away from the entire crowd the last fifteen months. the fastest growing in the space, on pace to be number one. ambitions never started nor do they end with restaurants, so this capital we announced yesterday, $400 million financing, is really about pulling forward and serving all businesses on the streets. >> meaning what, delivering not just food but all kinds of things >> yeah. today doordash offers the widest selection with restaurants, delivering 300,000 restaurants, 2.5 times more than any peer out there, we do it with the most exclusive brands, but doordash's

capability can go beyond it. we are walmart's preferred partner for delivery delivering 70 markets for 550 stores of groceries. >> asking about lyft they're filing for ipo how do you see that coming to market and others like them in the delivery game, more people than items having an effect on either your valuation or path to ipo. >> i think a lot of people recognize the convenience economy, whether it is in ridesharing or in delivery of things i think that we are still at the early innings of the industry. you look at delivery, only 5% of restaurant sales are delivered if you compare to where online travel is, 40% or e-commerce, 13%, we're at the earliest inning doordash many ways is allowing these brands for the first time to build their own e-commerce

channels chipotle can sell it through the doordash app and your app. and a dasher willful fill it just the same. same will be true for retail doordash allows retailers to compete against the likes of amazon. >> what's more exciting to you question have we have a lot of merchants services to help the businesses grow one is dash pass where for $10 a month you can get unlimited deliveries that is the biggest by our estimates in the on demand food space today. certainly the fastest growing adding 30,000 customers every week we want to give that to all merchants in the u.s in canada, we cover a small percentage of the population we want to serve every address so we're focusing on that about that and search with door dash

drive that will go into grocery and beyond food. >> i want to go back to the fact that you have this partnership with walmart we talk so much with delivery and logistics about the amazon effect we have recently seen them part ways with some of the other delivery companies that they are working with what it like to work with this company and what is your expectation moving forward >> walmart has been a great partner. we started small in a pilot and today we're serving them in 70 markets. so walmart has really grown its relationship with door dash and they have been fantastic partners in getting both the technology and as well as the operations ride to get something complicated like grocery deliveries to work

>> i have to ask you about the tip thing. there is a controversy about what happens when a dasher delivers me food and i say i'll give him a tip i understand that they garn tie a minimum payment even if the order itself doesn't cover that. but if i decide to give a certain amount of continue to the driver, i expect that to go into their pocket, not cover a might minimum payment. and it feels like you are breaking my expectation as a user >> we built the pay model at the beginning of about 2017 after months of extensive testing with dashers and we rolled it out after taking into account the feedback and the dashers have spoken. they are making more with the new pay model and a actually under both pay models, one that accounts for tips and one that

doesn't, door dash's contributions are exactly the same to daeshshers. so dashers are making more, retention is higher and customers are getting their orders faster and more on time >> so if i just start tipping in cash, that is okay >> that is okay. customers are getting their orders much faster because dashers are accepting more orders more consistently as a result of this pay model >> there we go door dash $7 billion valuation, around the same as grub hub the public company tony, thank you. in> dow trying to hang on to the gas. squawk alley back in a few minutes.

♪ ♪ let's go from plans... to full-blown production. ♪ ♪ let's go from being on-call... ♪ ♪

to being on-line. american express can help move your business forward with loans, vendor payments and buying power. chat with one of our 4000 specialists and let's make it happen. the powerful backing of american express. don't do business without it. now you can, with shipsticks.com! no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. shipsticks.com saves you time and money. make it simple. make it ship sticks. on car insurance? did the little piggy cry wee wee wee all the way home? weeeeeeeee! we we weeeee!

weeeeeeee! weeeeeeee! weeeeeeee! max. maxwell! yeah? you're home. oh, cool. thanks mrs. a. geico. fifteen minutes could save you fifteen percent or more. getting breaking news on rob dero robert kraft >> tjupiter florida police conference has just concluded a press conference where robert kraft is being charged wit solicitation of prostitution after hundreds are arrested in

an investigation or a sting operation are are regarding human trafficking at massage parlors. we're going through some of the details right now. but this particular instance here, we have reached out to the patriots and the nfl for comment and that is what we know he for right now. we'll try to pull what we can from this particular press conference, but obviously a very high profile name celebrating their super bowl victory certainly not a good situation given what has happened with robert kraft we'll bring you more as we know more but obviously a very stunning development here again, being charged with at this stage we'll bring you more as we know more. back over to you >> streets stunning it is stunning to say the least. local paper reports that detectives said acts were captured a surveillance video. it seems like a sting that has been in the works for some time. obviously implications for, i don't know, eric, one of the

most power heful owners in all of professional sports >> yeah, you think about the patriots could be one of the two most valuable franchises in the nfl and all of the country robert kraft has a great ra rep great reputation so tough news to hear. we'll have to see what happens going forward with it. >> six month investigation sebastien police department is saying involving multiple jurisdictions. culminated by charging nearly 200 subjects with over 200 counts of so he police taking. the main targets of the investigation also charged with various counts of violations including racketeering, driving support from prosecution, and transportation for prostitution. this is wide ranging we barely know anything about it, but this is wide ranging >> and it just came out so we're still going through it

and we know one name if there is 200 other people, we'll probably hear about other names and usually when wealthy people are involved, it is not usually one, there are others so i'm sure we'll find out other names that we're familiar with for sure. >> and it seems that which is issue here, every year around the super bowl, a big deal is made about sweeps for human trafficking around the game itself so however you feel about the issue of prostitution, legalization of it, for the nfl and around nfl events, this is a serious issue. >> that is true and i'm sure that they will try to distance themselves like hey, this is one person, what they do in their pin al li personal life, not a league thing. of course the super bowl was in atlanta this year and this is a court florida court situation. although the nerk supnext two ss will be in the state of florida. so that will have implications a

well >> and we're looking for a press conference by the way scheduled for 1:00 sorry, further details i guess will still be pending. we'll see how the information comes. obviously breaking in just the past minutes big week next week with powell, lights horizhizer and sh >> and the dow has crossed 26,000 for the first time since november, index on its longest winning streak since 1995. the question now, how far can the rally really go. it is noon and this is the "halftime report." the stealth rally dow jones and nasdaq on pace to do something they haven't done in years. plus fed leaders and policymakers gathering in new york city to discuss future fed strategy we'll bring you those headlines and how they could impact you. and u.s. trade officials