"squawk box" begins right now. ♪ live from new york where business never sleeps. this is "squawk box." good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with andrew ross sorkin and wilford frost. you are going to see right now that things are weaker dow futures down by 15 points. s&p futures off by one, and the nasdaq is down by just over two and a half points. this comes after a mixed day yesterday. you did see the dow down by 48 points 48.5 points. that's about where it was at this time yesterday morning. indicated down by that much. the s&p was higher it was up by almost three points, and that was helped in terms of crude oil prices. you saw crude oil prices up 2.5% sitting at a six-month high after trump cracked down on the

iranian exports. you can see this morning that the energy markets are up once again with wti up another -- brent crude up half a percentage point to $74.43. then take a look at what happened overnight in asia.

the range end wanted down 50 of sort of again in the middle of that range. >> did you see the story about the worry gauge shows investors are still potentially going to push things higher you know, the fear factor still out there. people have been worried this whole time that we're going to drop again as we watch stocks climb. because of that, you know, you look at the counter indicator to that that means that there are still people who will capitulate and throw in >> the vix is still low. earnings has been fine and hasn't derailed anything and hasn't set things alight so far so good. nothing too negative.

sometime probably around second quarter of next year. he admits he has missed some of the announcements. much more on the comments from phil lebeau later this hour. they'll report earnings tomorrow >> i watched the whole thing >> you watched all of it it was long. >> it was so long and so riveting >> it overlapped >> i had multiple screens going. it was riveting. it was impressive.

>> nobody believes that. and the idea that he has a chip that's better than the nvidea chip and anybody else's chip in the world, he says it's certifiably better the second he said that, then nvidea said you're comparing it to the wrong chip. other people are saying -- other people are saying it's actually some kind of adm chip cloaked. it's manufactured by samsung, the chip which he described during the session it was very impressionive. they do have good tech there i don't want to say they don't have good tech i think it's fabulous tech the whied that every tesla could ultimately actually become a

robo-taxi is -- >> that is possible. >> i get that. >> i think the regulatory -- >> in a year or two, that -- if waymo isn't saying they're going to be on the road by next year, this sounds -- the other factor that a lot of people have written up about today is him saying that when this happens, it's going to make us so profitable when people -- the start of the year were thinking, well, if you deliver on these model threes, you're going to be profitable, and if he is changing what it is that makes him profitable the day before the earnings comes out tomorrow, the q1, it's a big warning sign >> why the stock was down, just the idea that we're changing the metrics, once again. >> those numbers tomorrow will

be key >> yeah. >> i think more important than this announcement. >> he at least said during this -- i don't want to call it a press conference, autonomy day, he said this is the future of the company we're staking all of our money on this. this is how we're -- we're going to talk to phil lebeau a lot more about this, and also the debate between simply using cameras and lidar. it's effectively one of the radar systems that runs -- if you look at a waymo car, there's that little siren on top that's basically a laser that's drawing a map around itself. everybody else is using that technology in addition to cameras. he is only using cameras he says that everyone is a fool who is using this other technology i think there's a lot of people in the business who think that it's the opposite way around autoi'm not a computer scientist, so i can't speak to some of the technical -- >> one of them said he was being quite sort of instructive.

he made these proclamations about lidar being a fool's errand and this and that you really got to understand, especially for a lehman. i would encourage people to go on youtube you can go waup the thing all over again you can see just how this technology actually works, how what they call edge cases work on the road. sort of what the computer is thinking, how the computer is going to have to think >> that was something. >> the advantage i totally agree with you on that once they get the technology right at uploading it to their existing cars that are already out there. great advantage. wamo, who is not directly

attached so uniquely to a single automator, can't they roll that out to every car that's already out there and not have that allegiance to only one actual car on the road? again, i just wonder who gets there first. >> he is arguing that the technology is actually in virtually every car that's been manufactured -- that's actually currently being sold today that basically all he has to do is upload new software that basically in the future, yes, could wamo do it, but they would have to do it with only vehicles that have the tech in the car already. you need the hardware. it's a hardware story. >> auto manufacturers have this believe out and put tut over time >> it's expensive. >> separately, we're going to talk a lot more about that story. another tech story, reuters now reporting that samsung is retrieving -- it's not just dlaeg. it is retrieving all those galaxy samples that it distributed to reviewers as it investigates reports of broken screen that news coming a day after we told it to you yesterday i think the mart phone maker

postponing the launch of the fold for an unspecified period of time. some speculating it could be weeks. some people say it could be longer you know, if they're going to have to remanufacturer these things, it will absolutely be longer a handful of tech journalists reporting blanks, bugs, and broken screens in some cases reviewers peeled off this layer of film, which they mistook for a disposable screen protector they say the retail versions are supposed to have actually a label on them that will say please do not take this screen protector off. cnbc's tom hazleton did not make that mistake, but you can see it right there. his sample still failed after just two days. >> he brought this on to "closing bell" 12 hours before that happened, and the first question i said is is it robust? do you feel like this will last and it won't break on set we both thought it was. we were loving it. 12 hours later that was it >> i think that's the interesting part his review, todd's review, goes into great detail how this is seeing the future before it fell

apart. giving them kud owoz whether they can manufacture it to make it morrow bust is a big question >> it's a big blow for the brand image. >> a $2,000 phone. >> they have such a big broad fleet of phones. it probably doesn't -- no one had got this in their hands yet who had paid the money, has lost the money now, et cetera they can probably survive it >> the question among tech users, are they remanufacturing the phone or are they just adding signage to the phone about how delicate it is that means just effectively warning that the owners -- i do think that the reviewers who used it, some did peel it off. other people literally took the hinge and went like this 100 times. >> i do that on a regular basis. >> i know. >> 100 days, you will do that a million times. >> the question is whether they're really actually fixing the phone. >> it was a day or two >> or whether they're going to redesign the packaging >> i hope they do sort it out.

not so it can allow you to have an ipad size screen, but -- >> i love the idea of a foldable screen i do >> so you can have a current size iphone, but smaller in your pocket that's the way i think about it. >> we're going to get video in the next hour. >> i want a -- >> i'm still not going to sit there and watch a movie on it. >> you might on a phone. auto an airplane >> i want you to see -- >> then you have a bag with you anyway it doesn't need to be in your pocket i'm not concerned about that, whereas i do think iphones just -- each time they get a little bigger and -- >> it's replacing the ipad huawei, but out a video of their version of the flip phone, and it is mind-blowing >> they released that a while back, didn't they? >> just the last week. i think. >> those guys have caught up where. >> are you going to buy one? >> the huawe iphone? >> no. i'm hoping -- >> because you have your 5g network. >> i hope everybody else are

looking at that thinking we're going to have to make that >> apple always likes to sort of make sure they get it right, don't they >> sometimes people say apple is slow, but the good news is that they're usually close to perfect. they may be a year late. we'll see. in the meantime, herman cain has withdrawn from consideration for a post at the federal reserve. he faced opposition from democrats in at least four republican senators. cain said that he had planned to defend his nomination, but he said taking the post would mean a decrease in there you in pay we'll talk more about potential counties candidates for the fed's board of governors later this hour where. >> the pay point is interesting. i don't know if it would decrease his influence >> was that news to him? >> no, no. complete side point. central bank -- the fed governors, including powell paid nothing. >> he just found that out? >> no. i'm not saying that's the reason just to pick up on a point you know compared to bank mark carney >> how much does he make >> he gets close to 1 million pounds >> really?

>> i think he gets 600 base and a couple -- >> that's more money than the u.s. president makes >> i know. >> not a lot of pay in government work. at least not in the united states >> to attract a successful foreigner to the rule bank of england, i guess >> the speaking fees that come after on the board >> more than the speaking fees i'm not now on the advisory board of x, y, and z bank is the way forward. >> when we return this morning, nearly every time you make a transaction, you are contributing data points that are then packaged and sold to somebody we're going to take a closer look at who is buying that data and how they are using it. that's when we return. right now as we head to a break, take a look at the biggest premarket winners and losers in the dow. disney leading the way up by about $1

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has people who are criticizing it from both sides of the aisle. this is going to be helpful obviously with half of those critics. facebook also naming john pinette. he held the communications job for microsoft founders bill gates and paul alan, and then more recently he was with pershing square. facebook shares are up 5 cents 181.49 >> they were bought wednesday. >> we want to continue our discussion this morning about data security going to a store or something we do pretty much every day. some people do it on-line. i don't know the simple act of shopping spurg a legion of data that is often aggregated before getting sold the end user often its hedge funds who are spending $1 billion a year on data that are help them get a trading edge the web of transactions from you to the hedge fund is complicated and transparency and disclosure is limited the data supply chain using the simple premise of shopping for a pair of pants. you know more about who is

profiting off of your data and how. >> they say consumer traffic can give them an early sense of same-store sales and revenue ahead of earnings. it doesn't end there there are at least 100 apps, including weather and traffic apps, that are selling geolocation data a firm called thasos buys information about foot traffic and spits out insights like how many customers visited a store in any given day and sells that to investors when you purchase those pants, companies are tracking that, too. there are consumer aps provided on some of the banks and often gets access to their customers' credit card transaction history and it then sells those to

investors. your e-mail receipt for those pants is also valuable it's pulled through services like intelligences and roll.me this software rids your inbox of junk, but in doing so, the software gets a look and can gather information about purchasing habits to sell to hedge funds. it says their technology can automatically recognize commercial emails and doesn't look at or share personal ones if you post about your new pants on social media, you better believe a whole host of firms are scraping through instagram, facebook, and twitter to gather sentiment data about the top retail brands. there are more than 400 firms collecting so-called alternative data and selling that to hedge funds. some data sets are more helpful to hedge funds than others as hedge funds continue to underperform the markets, they're becoming more inclined to use this alternative data guys >> creepy. >>. >> i have used unroll me before,

and that got rid of all craziness in my e-mail box i did not know that. >> i have used other services that will combine your contacts from your inbox so you that can -- >> are these free services >> free services is. >> hello what did you think >> sometimes those e-mail services are trying to get a huge number of users so they can sell themselves to -- >> you should get a huawe iphone >> there's no such thing as a free lunch >> when he this say based on my channel checks, is this what they're doing. this isn't actually them putting out proprietary research and doing service. this is just taking the data which is available to lots of people >> this data isn't available to a lot of people, which it's what makes it so interesting and why hedge funds have been spending a lot of money on it hedge funds are, you know -- in

different types of data is worth different prices the aggregated analyst style when a company pulls that data and provides you insights as a trader, that actually is worth even less than the raw data itself larger hedge funds are the ones who are able to get the advantage because they're the ones who are actually able to pay for this data. >> the jp morgans and goldman sachss aren't bothering to pay for this it's just a few unique hedge funds that are >> they're probably pay for some of it. by and large, it is the larger hedge funds using this >> how much does this cost >> that's an interesting question each data set obviously everything is different. the raw data -- we weren't able to get an exact amount for each of those firms in terms of how much they cost, but it can cost anywhere from, you know, a couple hundred dollars for something that's on the lower end to hundreds of thousands of dollars for a specific data set. >> can i ask a philosophical question on the table?

people talk about inside information and people also talk about whether the playing field is flat and fair for everybody one of the things i think we try to do here at the network is try to democratize this for retail investors and anybody who is out there. one of the things i worry about when i hear about this types of stuff is i don't put this on the inside information category because it's available to anybody. however, it's not really available to everybody >> only if you can pay for it. >> that's always been the case they just have better information now than they used to i look back when i was a reporter -- i used to be the shopping bag >> it becomes -- oh, sorry it becomes even more complicated when you hear about exclusive agreements that are seeigned wih some of these data vendors we spoke about a bunch of lawyers, and that's where it's a gray area. >> irt's only available to certain vendors. >> hedge fund x, we are signing ab exclusive agreement on foot traffic to, say, macy's, and we are only giving you this data that we see.

one could argue that the data is faulty anyway. it's -- >> that's what i would say with any of this stuff. i don't think this is any different than what's always happened on wall street. you are always going to have people who have an inside edge and people who spend more time researching before you even had the sbpt you had people who had to do the legwork to go find the documents in lean rathers or go look up the extra filings. >> 100%. the station between a person -- one person doing the legwork that anybody can do, meaning that if my mother really wanted to do the legwork can stop what she was doing and go to do it, and shepd to stapd outside of a macy's as well that's another thing if it costs $10 million a year to get the satellite information which you can't get. it's just an interesting philosophical -- >> i don't know how accurate some of the data is. >> that's my question. >> that's still not having district of columbia -- i totally agree. it's not crossing any red line i agree, it's an interesting question >> it's an interesting issue anyway, leslie, thank you. what a fabulous story. thank you.

still to come, ex-theanos ceo holmes appeared in court what we learned about the case a flood of earnings set to hit the tape in the next hour or so, including four dow components. the numbers and instant market insight coming up. "squawk box" back in a couple of minutes. i'm working to make each day a little sweeter.

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elizabeth holmes was in court yesterday facing fraud charges. the founder of theranos, once valued at $9 billion, accused of misleading patients, doctors, and investors about the company's results and financial health the judge will decide on the trial date in july defense attorneys requesting more time due to the mountain of documents the government plans to use in the case against holmes the judge joked it's only millions of pages. what's the problem holmes and her former partner both face 20 years in prison more than $2 million in fines. this is one of the first images we've seen of her in quite some time >> the first time i haven't seen her in a black turtle neck >> the only other time i've seen here recently was "inside edition" did a true what they call, you know -- cha wha is it when you knock on the door and do a true sort of -- >> doorstep. >> a doorstep is what they call it maybe a gotcha they did a doorstep with her and her fiance or boyfriend.

they were walking a dog. maybe the weather was better >> from dow components, united technologies and coca-cola coming up in the next half hour. get you caught up on everything as we get those numbers. plus, we will tell you why herman cain is out and other potential picks for the fed. right now as we head to a break, take a look at yesterday's s&p 500 winners and losers

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live from the market site at times square >> dlook at u.s. equity futures. a number of big earnings reports. some in the dow that may move things around. also stocks to watch shares of whirlpool are surging. the appliance maker better than expected quarterly results profit jumping five-foal as the company hiked prices to offset weak demand. also, three new analyst calls out on lyft. both steifle and jeffreys with a buy, while key bank is taking a more cautious approach initiating coverage with a neutral rating lyft share at 62.85. down from the ipo price. they climbed hearted in the backup 72 of course, they went high spew the 80s before falling back.

a lot of people continuing to watch these shares ahead of the anticipated uber ipo next. >> you got to wonder, that announcement from elan musk yesterday. my first thought was, okay, i don't think this is going to happen any time soon. >> a lot of competitors out there. >> meantime, earnings season kicks into high gear with four dow components on the day's docket let's get a check on markets and the possible effects of first quarter earnings kbhoe oit every i'll start with

you yesterday flat session same could be said of last week. do we need strong earnings beats to get performance for the upside for equities? >> that would be helpful we had a great run already this year, but that basically puts us back to close close to the highs. >> so far they're not great. we have one-fifth of the s&p 50000 reporting. 2% or 3% top line growth that's not bad at all.

>> midcap earnings are coming in a bit stronger, and also interestingly, the margins already declined in midcaps and q4, and western that midcaps underperformed for the past five quarters in a row. maybe some of the pain has already happened in front of that in the s&p 500. >> i started too conservative. right along benchmark weights, and we've been adding to the equity exposure around the word. especially in the u.s. and emerging markets efa lagged a bit wrrn valuations looked quite attractive, and there will be a derivative beneficiary if you do see faster growth on the u.s. and china >> efa europe asia and far east >> with which spots of that. there's a lot of different sort of strategies at play there.

>> if china does grow faster, it may be the biggest benefits from a stock market perspective are not in china, but outside of china, which chooirn has already seen a -- >> i get that for far east, but what about for europe? >> germany is a huge exporter, and a lot of their economic troubles have been because of weak exports to china. >> for an investment point of view, you might actually do better buying the cheaper -- we're not quite there yet, but we're giving that serious thought. >> what do you like? >> i think the dark horse is the u.k. remember, there's 17%, 18% energy in the ftse 100

that's more than triple that in the s&p 500. prices are beaten way down from all the brexit concerns. there's a real opportunity there. >> do you think energy stocks can catch up with the oil price gains. they have laggedbroadly. >> i think they can. >> the number of wells was actually done. it's down because people still aren't ready to buy in >> that may be the lagging piece. the broader energy folks could catch up to energy prices, and that's a lot in the ftse 100 >> we have a barbell approach. i still own a big chunk of treasury bonds to offset the risks in the energy portions of my portfolio

we have been trimming that, taking duration down also, within fixed income adding a little to risk we've added a little bit to high yield bonds, for example, and cut a little bit of our position in treasuries. >> fixed income? >> yeah. if you look at high yield and investment grade, the interesting issue right now is the yield curve is very interesting in the corporate space. you're only getting spread if you take full duration that, of course, is a challenge with interest rates so low one opportunity is to take those full duration high yield bonds that have 2%, 200 basis points higher spread than on the short end. you can henl out the interest rate risk. the hedge is almost free because the yield curve is flat. i think that's very interesting opportunity in the fixed income market >> we'll leave it there. thank you both very much when we return, after herman cain withdrew his nomination to the federal reserve, who will president trump choose as his replacement? we'll talk about that next and we are awaiting results from coke and united technologies just in the next few minutes we're going to bring you those numbers and the instant reaction as soon as they hit.

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right now it's time for the executive edge let's turn to the fed for that

former presidential candidate and pizza executive herman cain withdrew his name from consideration to federal reserve -- to the federal reserve board yesterday. who might the trump administration consider next let's bring in deano, chief regulatory officer at cls, and, of course, he is also a former official from the new york federal reserve. it's great to have you here. >> good morning. >> interesting times watching the debating between -- once he lost the support of enough republicans he couldn't get through, president trump did the wise thing and withdrew the name having said that, there was a message that was sent to the fed. received, i guess.

>> wants to see them relaxed even on quantity takive easing when you this i about the traditional republican candidates, that's kind of counter to that. maybe there's a short list of people who might fit the bill. >> you know, as they say, you know, where you stand depends on where you sit. president trump was in favor of higher interest rates. president trump is in -- most president, that's what they're in favor of. it's not that surprising you know, i mean, there's been a lot of commentary about qualifications to be a fed governor you don't need to be an economist. you can be a haur. jay powell himself is a lawyer you can have really good picks and not necessarily be an economist. peep forget the fed does monetary policy, yes, but they also do bank supervision and regulate banks and they oversee the payment system people forget that.

>> the first four fed nominees that went up went through the treasury department. they went through the vet willing, and they got confirmed. these two happened through some other means, and you can see what happens when an important pick like this doesn't get the right vetting because they can run into trouble, and you get the kind of commotion that you

see now with both of these picks. >> has more of a record. he is not an economist per se, but you can make the case. we'll sort of see what the politics are >> would you make the case for him? >> well, i would not, but that's -- you know, that's one person's view. i mean, again, you know, you don't need to be an economist to be on the board, as i just said. i don't think that the fact that he is not -- that does not disqualify him does he bring a set of expert e expertise, experience, a bod of work that's commensurate with what's required in that job? again, this is -- a lot of people seem to think that he doesn't. >> a couple of lawyers were just fewably on the fed board why does steven moore not qualify? >> if you think about a powell or a quarrel, these are lawyers

with private equity experience fwhoet worked in the u.s. treasury they have a history of policy making expertise and have accomplishments they can point to you know, with some of the other picks, hard to make that case. >> thanks for coming in. >> thank you >> good to see you >> critical in a very politic kind of way. >> i think realistic trying to figure out what's actually going to happen >> the key thing for cain have four senators are against him. jack lu said last week on "closing bell," look, elections have consequences. if that's the rez and the republicans want to pick, then so be it zloot republicans, it wasn't an election that was not an election consequence. that was just the republicans saying we can't do this. skrup on "squawk box." we're going to talk about the

implications for investors and what to believe and what not to believe from that day. next as we head to a break, what's happening in european markets right now. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from managing inventory... to detecting and preventing threats... to scaling up your production. giving you a nice big edge over your competition. that's the power of edge-to-edge intelligence. (vo) ♪ i know what you're thinking. electric, it's not for you. and, you're probably right.

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found that "uptown funk" is the most consumed song amongst trump supporters and among trump detractors the research on contemporary music taste -- >> it's the most popular song, then. >> no matter what your political taste is but like some songs are popular with one side or another, this crosses that divide. at least one thing can unify us, music. they used streaming and sales data to get this information and also found that country outperforms with trump supporters duh. while hip-hop and r&b performs better with listeners who have negative views of the president. >> i hate that song. >> you hate that song? >> it's been so overplayed. >> you freak >> i mean, maybe i liked it originally when did that come out, three years ago? and it's still played. >> like at the super bowl three years ago, but it was out before that. want to get to chicago and phil lebeau, before we run out of time. elon musk out with a bold promise yesterday, saying there would be a million tesla robo taxis on the road next year and phil lebeau joins us with some

of the highlights. i watched it, phil do you believe it? are we going to have robo taxis in a year from now >> we're not going to have a million. he may have one approved to work in a certain area, in a certain jurisdiction -- >> in arizona? >> maybe arizona or california, maybe geofenced in a certain area here's what he talked about yesterday, and andrew, it was vintage elon musk. he pretty much said, nvidia's chip eh, we're better than that those who use lighter? eh, we're better than that he's promising one million robo taxis, at least the technology in the vehicles to be robo taxis by next year if they are robo taxis, however, the autonomous ride-sharing would have to be done through the tesla app. forget about uber, forget about lyft it has to be done through the tesla app and the technology, according to musk, way exceeds the competitors. here he is >> the fundamental message that consumers should be taking today is that it's financially insane to buy anything other than a tesla.

it will be like owning a horse in three years i mean, fine if you want to own a horse, but you should go into it with that expectation >> vintage elon musk so, what's the reaction of the analysts who were in the room out in california for this event? cowen out with a note today saying that "the tesla network robotaxi plans seemed half baked with the company appearing to either not have answers to or not even considered pretty basic questions on pricing, insurance liability, or regulatory and legal requirements." waiting to see what other analysts have to say as you look at shares of tesla, we should found out, this stock premarket is down again, and it's now under $260 a share. guys, there are some people who said, look, after this event you're going to see a pop in tesla shares, which we often see after these events with elon musk outlining technology. didn't see it yesterday. you're not seeing it this morning. >> so, phil, is that an expectation that the earnings are going to be worse than people are expecting is that a warning about what happened yesterday and people

saying i just don't buy it mind you, by the way, lyft shares went up, if you believe that -- >> right. >> -- if you believe they're getting in the robocar business, you would have thought lyft shares would go down. >> exactly, exactly. i think it's a little bit of both, andrew i think a lot of analysts are saying we want to see just how bad the numbers are for the first quarter. and again, it gets back to this question of demand do they understand what the demand is worldwide? and then there's also some reaction to these plans, people saying some interesting technology, some impressive technology you're not ready to launch a million robotaxis by next year. >> phil, thank you see you later. >> you bet. still to come, results from p&g and twitter expected in a couple minutes we'll have the numbers and after that bring you analysis of those numbers. p&g's cfo will join us

investors bracing for an onslaught of quarterly results a breakdown of some of the biggest names, including dow components coke, verizon, and united technologies. plus, the cfo of proctor and gamble joins us to talk about the quarter and the state of the consumer and it's the rise of the machines

elon musk's bold prediction about robotaxis and what investors should take away from tesla's autonomy day those stories and much more. the second hour of "squawk box" begins right now ♪ ♪ domo origato, mr. roboto >> announcer: live from the beating heart of business, new york, this is "squawk box. ♪ welcome back, everybody. dow component united technologies just out with its quarterly numbers, a beat on the bottom and top lines it looks like $1.91 on an adjusted basis the street was looking for just $1.71, so that's a beat of 20 cents. when looking at the revenue number, $18.4 billion versus the $17.98 billion that the street was expecting. so again, beats on both the top and bottom lines also raising its full-year guidance the company now saying that it sees $7.80 to $8 on an adjusted

basis per share. the street was already at $7.91, and this is even with this 20-cent beat, so maybe they're being conservative here. they do talk about what helped them they said sales were up 20% with all four of their major businesses contributing to what they saw, and they also saw robust 8% organic growth in the quarter. that's a really strong number. talking about what was helping things, they say the eight points of organic sales growth and 15 points of acquisition benefit were offset slightly by three points of a foreign exchange headwind they were dealing with, too. but again, strong numbers. the company saying that they're raising their own guidance, even though it's really just getting up to date with where the street was for the full year. and that stock right now looks like it's up by about 1.5% united technologies is a dow component. the company also saying that they are on pace to be spinning off some of the businesses that they'd talked about before otis and carrier, going to be spun off as independent companies in the first half of 2020 but again, they say all four of their major businesses

contributed to the growth they saw in this quarter. and that dow component is now up 1.5%. meantime, another dow component also up nicely this morning. coca-cola's numbers just hit the tape, earnings $48 per share, 2 cents above estimates and revenues also coming in above forecast, coming in at $8 billion, expected at $7.9 billion. they reported a 6% increase in organic revenue. the guide was for about 2.8% we'reexpecting 3.4% sales growth, of which 2.8% organic sales growth, but they hit 6%, and they've guided for a further 4% organic sales growth for the rest of the year ahead that amongst the eps beat as well leading to a nice jump in those shares, up i think 3.7% in the premarket. >> i think what's important in both of these stories are the organic growth they're talking about for the company. for coca-cola, i think you said 4% growth in 2019 organic revenue is what they're seeing for the full year. that's impressive when you look at organic growth numbers. same story with the united

technologies, where the growth was 8% organic growth. and it's going to be an important story for proctor and gamble, too. we're waiting on those numbers to hit this morning. proctor and gamble has been something that's been kind of watching that for a while. >> the p&g ones are out as well. their eps 106, forecast at 103, revenue 16.5, forecast at 16.3, and organic sales there -- >> 5%. >> 5%. so that's -- >> that's strong organic growth. and proctor and gamble showed us this last quarter, that they showed us organic sales numbers. the key for their organic growth we saw for proctor and gamble, at least for the last quarter -- they're on a different fiscal quarter, so it was second quarter for them while it was fourth for everybody else. the key is that it's not coming, or hadn't been in the last quarter -- i have to dig through this release to find out more -- it had not come from price increases, but rather, product innovation and that's a really significant thing. that's why the proctor and gamble shares have been up versus a lot of their peers over the last year. >> product innovation, a bit of em and online sales as well.

the last two quarters they hit 4% organic growth and they were hoping for a repeat of that, so 5% better than expected and good momentum for them. they had seen -- they had been guiding 2% to 4% and they hit 4% the last two quarters, clearly a 5% beat there, up about 0.5% in the premarket. >> quickly on proctor and gamble these are comments from david taylor, the chairman, president and ceo of the company, saying they delivered another quarter of strong organic sales growth, enabling them to further increase their outlook for the year got to look up what that outlook is they are now saying they're raising guidance for both sales growth and adjusted free cash flow productivity for the year cash generation also remains strong, supporting an increase in our cash productivity target and extending our long track record of dividend increases we knew about that they increased the dividend earlier this month but it was also across just about all of their segments that they saw this last time around this time it says the health care segment, organic growth was up by 5%

oral care organic sales was up midsingle digits again, they say strong volume growth and positive sales mix in developed markets because of premium toothpaste and toothbrush innovations fabric and homecare segment organic sales up 7% for the quarter. baby, feminine, and family care, organic sales up by 2% versus a year ago so we'll go through this on a line-by-line basis, but we'll be talking with jon moeller, the cfo, in a little bit. >> that's up 0.2%. of course, in volume still. meantime, twitter hitting the wires. julia boorstin has the numbers. >> twitter growing its user base faster than expected as ceo jack dorsey says his efforts to reduce abuse and make twitter more conversational are working. the company reporting non-gaap earnings of 37 cents a share, beating estimates of 15 cents per share. revenue also growing stronger than expected, 18% to $787 million. that is a hair stronger than projections. the company reporting for those

all-important user numbers -- 134 million monetizable daily users, that's the new metric the company introduced last quarter, and it's 8 million more than the prior quarter and more than 4 million more than analyst projections. mobil active users -- that's the older metric we're more familiar with but they're trying to phase out -- 330 million, up from the prior quarter, also surpassing expectations by about 12 million. now, the company's second quarter revenue guidance is coming in at the lighter end of expectations, twitter giving a range of $770 million to $830 million, so that means revenue's expected to grow between 8% and 17%. that is slower than the current quarter, but i'm sure we'll hear more about that on the call coming up at 8:00 a.m. eastern we see twitter shares now up almost 10% premarket with those better-than-expected results back over to you. >> julia, can you remind us why they tried to push everybody towards monetizable users compared to overall users?

the reason i ask is in this case, both of those numbers went up this quarter, but is the anxiety that long term they won't, meaning it will be the monetizable number that will go up but not the total >> well, look, the monetizable daily active users went up more from a percentage basis than the monthly active users i think this is part of their whole effort to clean up the platform, to be more accurate by cleaning out the bots and the fake users and also being more accurate about exactly what advertisers are getting. so, certainly, advertisers pay for reaching a certain number of people, so this didn't change anything in terms of advertisers, but in terms of transparency to the investing community, this is all designed to be more accurate. >> what was the delta between the monetizable users and the total user number? >> so, it's interesting, because international daily active users grew faster than domestic daily active users, but daily active

users in q-1 was 134 million, up 11% year over year it only grew 8% in the u.s., but it grew 12% internationally. monthly active users -- actually, this is what it was, andrew monthly active users decreased year over year but increased quarter over quarter so, they, both of those metrics were better than expected and did increase between q-4 and q-1, but the monthly active users did decline when you look at them versus the year-ago number, and part of that is really just the -- >> the cleanup effort. >> yes, exactly, and more transparency, getting rid of the fake followers, fake users, duplicative accounts. >> right it's interesting because if they're not monetizable, are they really users at all i was trying to look at the monetizable user number versus the total user base, because i imagine the total user base is going to come down much closer to the monetizable one, ultimately. >> well, so, really for daily users, they're only reporting monetizable. it's either monetizable daily or it's monthly, and this is the

last quarter they're going to be reporting monthly users. and i think the key thing is, there are some people who are accessing twitter via basically sms, just via text those are people who don't see ads. so, almost everyone who accesses twitter on a daily basis is seeing the service with ads. that's why they're splitting it into the sort of daily monetizable and monthly on the other hand, and we won't be getting the monthly number after this. >> got it. okay thank you, julia appreciate it very much. all right, proctor and gamble, as we mentioned, just crossing the wires the consumer products giant earning $1.06 a share for the quarter. that was 3 cents better than the street was expecting revenue also beating forecast. and joining us right now to break down the numbers is cfo and vice chairman jon moeller. jon is also a member of the cnbc global cfo council great to see you this morning. thank you for joining us >> happy to be here. >> so, it looks like the numbers were better than expected on just about every metric. looking through organic growth, that's probably one of the most

important measures, you saw organic growth up 5% in the quarter. what really drove that >> well, this is the third quarter in a row of very strong volume sales, consumption, and market share growth, being driven by our strategy of superiority, of product package, communication, value, go-to-market, across the ten categories where we've chosen to compete, fueled by productivity to fund investment and superiority as well as to build margin you know, core earnings per share in the quarter on a constant currency basis up 15% we're also focused on cash flow productivity free cash flow productivity 100% on the quarter we increased our dividend, or we're going to pay a dividend for the 129th consecutive year this will be the 63rd consecutive increase so things are moving pretty well behind this superiority strategy fueled by productivity and strength in organization design and culture. >> yeah. you know, jon, the stock has gotten kudos from the street for that organic growth that you

have been delivering for several quarters at this point, and the reason is it's not just coming from price increases, it's coming from product innovation, too. can you kind of walk us through and tell us where you've done innovation, what have been some of the more successful launches that you've done that's really driven things? >> well, the real measure of success for innovation as we look at it is can we move markets? can we inflect the rate of market growth? and with that, disproportionately grow our business and our share and do it in a profitable and sustainable way. and a good example of that, that we've talked about for some time but still has tremendous legs is unidose laundry detergent -- tide pods, gang flings, aerial pods in europe -- took a market detergent that was declining about 3% to 4% per year and it's now growing about 4% per year. that item is 2x the price per wash load, and it's driving both retailer margins and

profitability as well as ourselves, and importantly, growing the whole category so that all boats rise. another good example in that same general category are laundry scent beads, which have taken the fabric enhancer category, which is now growing at high singles, and our business, which is growing in double digits. again, same story -- consumer-relevant innovation in categories where performance drives brand choice. >> you know, it's interesting that you bring up those tide pods, because i do feel like you've been talking about that for years. i mean, years at this point, about that being an innovation tell me about something new that's happening, like oral care i saw that the organic growth there was very strong, and part of that is because of premium organic oral care in developing markets, i think i read. what's happening with that >> oral care is growing very well, as you said, behind both innovations on the pace platform, but also very importantly, strong innovation on the premium power brush platform, including power brush

9,000, which uses the internet and other digital tools to aid the user brushing experience in every category we're in, we're focused on bringing breakthrough, meaningful, relevant information that grows the market and grows our business with it feminine care was another good example. we grew feminine care the last quarter 7% and the primary driver of that growth is always infinity, which is a premium, highly absorbant product in feminine protection, and our adult incontinence business, which has taken that market and doubled its growth rate since it was launched several years ago. >> while we're talking, i'm looking at this, and like i said, every number, every metric i've looked at looks better than anticipated. however, the stock is down 1%, a decline of just over $1. what do you think the street is seeing here that maybe it didn't like >> again, it's a very strong quarter. we've got a long day ahead of us

and we'll see where we end up at the end of the day. >> i will point out, the stock is up and has outperformed its peers for over the last 12 months, too. >> correct >> jon, just want to ask about the sort of macro outlook and where you think the consumer may surprise you to the upside or downside across the quarter. >> generally, the upside across the globe. so, if we look at market growth rates in dollar terms as a symbol of consumer confidence, consumer health, it's generally ticking up we've seen that in the u.s we've seen that on a global aggregate business china, which everybody's been concerned about, continues to grow extremely well. we just had an 11% growth quarter in china i mentioned the u.s., we had a 4% growth quarter in the u.s so, in our categories, we generally see very good health and strong consumption >> jon, one of the things you told us last quarter is that in terms of china, you had not seen any downturn in the markets

there, and that was in juxtaposition from what we saw from the main companies like an apple, and i'm trying to think of who else. a couple major u.s. companies did see a downturn in china. what have you seen to date >> continued strength. that's a market that's growing high singles to double digits, depending on the category. baby care, for example, is growing strong double digits skin care is growing strong double digits. and talking about the market and orr business with it so generally a continued strong consumption. >> jon, there's been a number of big direct-to-consumer players who we've talked about over the years that have competed with you, some of which you've acquired how do you see that dynamic, the sort of start -- i don't know if we'd call them start-ups anymore -- but playing in your space? >> well, first, we want to serve consumers however and wherever they want to shop.

if that's direct with us, that's great. if that's through an online aggregator like amazon, that's great. if that's at their local walmart or target or cvs or walgreens store, that's great. and we need to be relevant in each of those instances as relates to the shopping experience and product availability for our consumers direct-to-consumer itself is still a relatively small segment of the overall market. i would estimate less than 2%. that doesn't mean it's not relevant it's very quickly growing and it's something we're increasingly competing in. as you said, making small acquisitions to build our capability as well as developing that capability internally. >> how much of your brand -- i mean, long term, how many of your brands do you think are going to have a truly direct-to-consumer franchise and obviously, i'm thinking of the dollar shave clubs and the harrys and all of that in that space. but in terms of your own brands having that same type of relationship

>> i think the majority of our brands will have one-on-one consumer relationships, both from a communications standpoint and a purchase standpoint. but you know, again, i think the more prevalent growth engine is going to be the online aggregators. there aren't that many families that want to purchase 100% of their household care needs by going to single product manufacturers direct, going to 20 different websites with 20 different passwords and 20 different delivery dates and 20 different packages it will be relevant, more relevant in some categories, and we'll be fully present there it will always be relevant to a certain subset of consumers. but again, we need to be broadly relevant across all shopping experiences. >> and jon, in a similar vain, since you mentioned amazon, there seems to be so much commotion around amazon politically and elsewhere. i'm curious what you think of the idea of these white-label

products that effectively compete with you white labelling has gone on forever. costco does it, walmart does it, everybody does it. >> yeah. >> but there seems to be increasing concern, at least in washington, that some of these white-label products are ultimately competing with people on the, quote/unquote, platform. how do you think about that? >> well, as you've said, own-label competition has been a part of our industry for as long as i've been involved in our industry, which is over 30 years. and you know, we intentionally focused our portfolio two years ago -- we went from 17 categories down to 10, 175 brands down to 65, to focus on categories where performance drove brand choice and where usage was on a daily basis and in those categories, we feel very comfortable competing against own-label products we need to deliver a superior

experience for the consumer, who is choosing a brand based on performance. that's somewhat different than some of the adjacent categories to us, but we feel very good about our standing as long as we do our job and deliver a truly superior experience. >> jon, really quickly, we've got to run, but we did just hear from twitter where is proctor and gamble putting the bulk of its advertising right now, and are you looking at any new channels? >> we're constantly looking at new channels we're pretty well distributed across both traditional and digital spending it depends on the market and the category china, for example, a huge portion of ourbusiness is now online and a disproportionate amount of our advertising is digital or social in nature. >> here in the united states, are you going back to traditional more, though >> i wouldn't say we're going back we're taking very careful looks at what each platform offers us,

not only in terms of perceivable return, but in terms of brand integrity and safety, and ensuring that we're putting our money to its best use. >> jon, thank you for joining us always good to see you and we appreciate your time today >> thank you have a great day. >> you, too. still to come, a closer look at coca-cola earnings. what the soft drinkmaker's saying about the state of the consumer ceo james quincey will be on "squawk on the street" at 10:00 a.m. eastern time. and later, reaction to verizon's quarterly results. craig ffofmoett moffett nathanson will join us stay tuned so with xfinity mobile

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including twitter. >> we had some others as well. dow component united technologies reporting beats on the top and bottom lines, reporting earnings of $1.91 per share, 20 cents above estimates, also raised its full-year outlook. >> i think what's important with these utx numbers -- i mean, again, this is a dow component up more than 3% on this, which has pushed the dow into positive territory, up by about 26 points above fair value utx talking about the shale's being up 20%, also saying all four businesses helped with that then the big number is the organic growth they had 8% organic growth, and that's pretty impressive. also, harley-davidson's latest results are in. adjusted quarterly profit coming in at 98 cents a share, well above the consensus estimate of just 65 cents. revenue was just above forecast and harley increased its u.s. market share during the quarter. that stock is up by about 2.2%. coming up when we return, a breakdown of coca-cola's earnings cnbc's sara eisen spoke with the company moments ago and she'll join us right after the break.

"squawk box" returns in a moment

dow component coca-cola reporting just moments ago, and cnbc's sara eisen joins us now i think she just got off the phone with the company about the quarter. sara >> good morning, andrew.

coke continues to prove it's in growth mode right now. it's clear from the 6% organic growth there's a caveat, though, with that number. there's some funky timing issues skewing results this quarter ceo james quincey told me to think about it really as a 5% organic growth number. wilfred, you'll love this. it's brexit's fault. remember march 29th was supposed to be the deadline for the uk to crash out of the eu if they couldn't come up with a deal well, coke overprepared for that scenario they stockpiled cases. they manufacture in ireland and ship through the uk, actually, to europe as a transport route they may have to rethink that, depending on any deal. so they were left with more inventory. as for the actual business, here's some highlights coke launched the new orange vanilla coke this quarter. quincey told me it did very well coke zero continues to grow double digits, especially doing well here in the u.s as for the new diet coke flavors launched this year, strawberry guava and blueberry assiie,

quincey says they did pretty well, but not as good with the excitement last year china and india continue to show growth, despite fears of a slowdown so, overall, the quarter painted a balanced picture of growth on volume and on higher pricing finally, what quincey called the downer of the year -- got to mention it for this company -- currency it shaved 11 points off of that bottom line because of the strong dollar. but importantly, quincey did tell me, this is the worst quarter of the year for a forex hit, so it should get better we'll talk a lot more about all of these issues with him at 10:00. he joins us first on cnbc. but remember, wilfred, andrew, and becky, last quarter, coca-cola was actually a big disappointment because of the guidance number. it was all due to a strong dollar today we got a real taste of why they are feeling that so hard with that big hit to foreign exchange by the way, they kept the outlook unchanged. >> sara, brexit and currency, there's something in there for both of us. >> i know.

>> but what about proctor and gamble this morning as well, which i know you look at, and the fact that these staples companies, kimberly-clark yesterday, they're kind of doing pretty well? >> they're doing well, and we've seen that reflected in the market so, last year, consumer staples really underperformed. i think they were down 11% or so, worse than the overall market so far this year, they're still underperforming the market, but they're doing much better than some of the other traditional defensive groups like health care, for instance, up about 12%, 13%, and i think it's a combination of two factors one, they are considered safe, always, and the international picture has brightened a little bit this quarter a lot of these companies are internationally exposed. but also, you've really seen them turn up growth a notch. and i would point to a few specific companies -- proctor and gamble and coca-cola are two good examples of that. they've got new leadership in place. execution is thought to be very good, according to wall street analysts there's some new innovation, as i mentioned. i think i would point to pepsi as well. and kimberly-clark yesterday,

whose stock shot up because they are implementing those price increases better so you've got a few specific examples that wall street is really attracted to, not only the safety play and the cash flows and the dividends, but also higher growth, which is something that took years for some of these companies to achieve. >> can we quickly interrupt you, sara i have a question for you, but before that, i want to bring you verizon shares verizon also out with earnings right now, and they just are saying they came in with adjusted earnings of $1.20 a share, the street was looking for $1.17. revenue in line with expectations at $32.1 billion. verizon says it is raising its earnings guidance for the full year just digging through this press release right now, taking a look at it. some important numbers, though, that the street tends to look at -- wireless retail, postpaid, 1.12%. net fios customers up by 52,000. net fios television customers down by 53,000 we'll take a look at all of those numbers. did you see --

>> 61,000 retail postpaid net additions, that includes 174,000 postpaid smartphone net additions. on the wire line side, verizon added 52,000 fios internet connections and the fios revenue growing 6.2% capital spending for 2019 expected to be in the range of $17 billion to $18 billion that includes what they're saying is the expanded commercial launch of 5g. so, we will keep our eyes on that as well. >> that's still a question, that launch of 5g is it a marketing gimmick? has it really got something behind it or not people are still uncertain about that. >> very quickly, the guidance they're talking about, the numbers for this, they say they're raising their guidance for the full year. the company is now looking for low single-digit percentage growth and adjusted eps. excluding the impact of the new lease accounting standard. they say it's an increase from the prior guidance for adjusted eps to be similar to 2018, excluding those same impacts of the accounting standard.

verizon shares up by 1.5%. sara, i want to go back to what you said about coca-cola, just talking about the 11 points of currency headwinds, because currency headwinds has been a big one for all of the international companies. it was three points for utx. why did quincey say that this is going to be the worst quarter and they expect it to improve? >> because analysts don't have a good handle on how and when the strong dollar cuts into profits. so, the more the company can give guidance on that, which really does suck out the momentum that a company like coca-cola's seeing on the top line, which they are -- and i would say a proctor and gamble as well -- he needs to be transparent about that, especially because the guidance last quarter was so, so disappointing and the stock really got hit on that. >> so, it's not necessarily that it's going to be less of a headwind it they'll just be more clear with the analysts and it will be less of a miss than what they were expecting? >> no, i think he was suggesting it will be less of a headwind, that this quarter is going to be the worst hit, that 11-point hit, and that it's going to look

better as they get through the year >> even as we look at the fed -- i mean, if you try to figure out why the dollar's so strong, the fed's very dovish. i don't anticipate that's going to change any time soon. >> well, i don't think they're forecasting the dollar i think what happens is the strong dollar actually hits companies with a lag, so you kind of have to look year over year it's basically up about 8% from where it was last year and figure it's a combo of that and how their hedges have been doing -- >> oh, got you. >> -- which are clearly not well at coca-cola because it's a big hit. >> right. >> and that's why it's so important to hear his guidance on that, because it's not a direct, well, the dollar did this this quarter, meaning it's going to hit the company like this it's kind of a year over year -- it's not a precise timing metric so, based on what they had seen from the dollar over the last year, they can predict now will be the worst of it for this year if the dollar continues to strengthen, all bets are off and it could definitely hurt even more going into next year. >> sara, any update on when i can get a cup of costa coffee

stateside? >> no update except they did finally close that deal this quarter. every time i've asked quincey that question for you, wilfred, he said let's wait until we close the deal so the deal closed and remember, they're not going to open costa shops and cafe as like you're used to in the uk, but -- >> i know. >> -- they will try to put it in the supermarkets. >> and maybe for once, sara, you'll buy me a cup of coffee back you owe me 97. >> maybe for once you'll actually go to a supermarket. >> we'll leave you there sara, see you later. just to recap quickly, we have heard from four dow components this morning, all four -- coca-cola, proctor and gamble, utx and verizon -- beating expectations three of them are trading higher right now, coca-cola, utx and verizon. utx is up pretty sharply we'll talk more about all of this because it has pushed dow futures into positive territory this morning, up by almost 40 points when we return, the earnings parade continues we'll hear from defense contractor and aerospace giant lockheed martin. plus, instant reactiono rin'relt aad t internet that puts you in charge.

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welcome back to "squawk box. let's see some earnings just out from lockheed martin after so many others reporting this morning. a profit of $5.99 per share,

beating the consensus of $ 4.44. revenue also above forecast. now we've had a string of earnings that have really beat across the board we are in earnings mode this morning and earnings central mode, of course. and dom chu is earnings central himself. he's got a breakdown of some of the other names that are reporting earlier this morning dom. >> i mean, andrew, there are so many of them you've got the big dow stocks certainly covered. lockheed, like you said, they're getting a lot of headlines some of the other reports from earlier this morning are really moving the shares as well. we'll start with some of the fun and games aspect of it shares of hasbro up around16%, over 15,000 shares premarket volume toy-maker posted a surprise profit, better-than-expected sales. hasbro was helped along by strength in its franchise brands and gaming segments, improvements broadly speaking in the u.s. and european markets, so those shares up pretty big. shares of jetblue also, we'll call it upon flying higher, around 1% to 2% on about 10,000, 15,000 shares premarket.

the airline posted better-than-expected profits and sales and also said it expects capacity to grow by 4.5% to 6.5% for the full year of 2019, so those shares moving a little bit there. and shares of twitter. the morning mover here, up around 8%. over 2.5 million shares at this point. they're reported better-than-expected profits on slightly better-than-expected sales. monthly active users also came in better than anticipated, though this is, remember, the last quarter twitter reports those stats. it will replace them with monetizable daily active users those shares up 8% and we're going to end with shares of lyft so, get a check of these they're just up around, call it 2% to 3% right now, on roughly around 125,000 shares premarket. the ride-hailing company's fall from grace has led to analyst coverage initiations by a slew of teams -- jpmorgan, ubs, credit suisse, canaccord, ray jay, jeffrey, stifel you get the idea keybanc, though, says it's

neutral. shares down 14% or 15% from its ipo. wilfred, back to you guys. >> a little easier for guys to put buys on it by having had the share price decline since the ipo. >> absolutely right. just take a look at that chart, right? and we're not even showing the intraday high, which is $86 or $87 at that point day one. >> dom chu back at hq, thanks. >> you got it. joining us now to discuss broader markets, mona muhajen, portfolio manager at allianz global investors very good morning to you thanks for joining us. >> thank you. >> in terms of the broader market, seems to be treading water but close to highs what's going to be the next catalyst, earnings season? >> yeah, i think generally speaking, we set ourselves up nicely for a benign equities environment. we took the fed off the table. rates are low, inflation intact, gdp growth in line with potential, perhaps somewhat above potential. that's a nice backdrop for equities i think for a next leg higher here, one, you need the earnings story to work. and two, you need a nice second-half recovery globally. we're starting to see that in

china a little bit we'd like to see europe stabilize and we'd like to see the u.s. continue to show this momentum. >> we always talk about the big run we've had year to date, and clearly, that has been very strong and questions whether we can go further in the short term that said, on the other side, you think cash levels are still quite high for most portfolios. >> yeah, you know, it's interesting. we're up about 23% now since the december 24th lows, almost in a straight line here but when you look at some of the fund manager surveys, one, cash levels remain high and two, managers are somewhat underinvested in equities still. so a lot of these managers are continuing to watch for a pullback, a dip. they're looking to get more involved here, especially as we're seeing earnings come in above expectations and, you know, china starting to show green shoots, et cetera. >> larry fink said he thinks a stock market melt up is more likely than a meltdown do you think that's the case >> you know, it's funny, i don't think we're seeing excessive greed or excessive optimism right now, and in that

environment, markets tend to do well they have to climb walls of worry here, and that tends to help markets grind higher. so if we can climb the earnings wall of worry, if we can climb u.s./china trade, if we can climb brexit eventually, i think these are things that will help the markets move forward i don't know about a melt-up scenario because i'm not seeing the excessive optimism, but i think we're at the buy side to the up here. >> when we look at some of the results, coke, kimberly-clark, proctor and gamble, do you think the u.s. consumer's pretty strong >> yeah, you know, i think that's one of the things we're watching in depth this quarter especially we're seeing signs that the u.s. consumer has remained resilient. we heard it initially from the likes of jpmorgan, jamie dimon talking about a strong consumer. we've been hearing it from fed officials as well, and now we're seeing it in earnings results. we're going to be watching the staples company, companies like walmart and target who reported earlier this year actually said the same message so we're hopeful to that front. >> the one thing that surprised me is the strength of the overseas consumer. >> yeah. >> and you get that from all of these companies, too proctor and gamble talking about

how it's able to get organic growth because it's coming out with new, premium products. >> yeah. >> that is something you might not have anticipated three or even six months ago. >> no. >> looking at china, india, any of these markets. >> yes i think the gdp slowdown a few months ago was worrisome what we are seeing is labor markets across the globe remain tight. so it's not only the u.s. where unemployment rates are very low. it's similar in asia and in europe, so that's actually supportive of the consumer broadly. what we're seeing in the u.s., wage growth starting to accelerate, could be the case elsewhere as well. so, i think that strong consumer is a global phenomenon. >> when you talk about wages increases, you're talking about the healthy aspect of it, not the inflation potential spiral that comes down the road >> yeah. i think that -- >> fed back in or other central banks. >> right i think from a consumer perspective, very healthy. great to see rising wages, even oil prices which fell last year, stronger dollar, all supportive of a consumer. the flip side of all of those are inflation is, you know, perhaps the bogey in the second

half of the year will we see that creep back upwards? not seeing any signs of it right now. like i said earlier on, this is a great environment when inflation's pretty benign here, earnings starting to accelerate. so yeah, good story right now. we'll see what happens in the second half of the year. >> thank you so much. >> thank you. when we come back, craig moffett of moffettnathanson will break down verizon's results we'll talk streaming wars and much more. meantime, check out futures at this hour as we have heard from four dow components, albeiting expectations today and three of them -- coca-cola, utx, verizon -- trading higher i have to check on proctor and gamble all of that has helped move the dow futures and the other markets higher dow futures indicated up 56 points, s&p up by 1 1/2 and the /2s aq up by about 1 1 a stick around plants capture co2. what if other kinds of plants captured it too? if these industrial plants had technology that captured carbon like trees

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still to come on "squawk box" today, reaction to dow component verizon. craig moffett of moffettnathanson joins us with his first take on the numbers. we'll also talk streaming wars and a little sprint/t-mobile as well and much, much more

then at the top of the hour, twitter on the mov in the premarket. a breakdown of the social media network's results. and later, elon musk's bold prediction he says robotaxis by next year do investors believe it or not a breakdown of yesterday's autonomy day straight ahead. "squawk box" returns with all of that in just a moment.

welcome back to "squawk box. verizon just out with quarterly numbers, earnings of $1.20 per share, 3 cents above estimates

revenue slightly below forecast. verizon also raising its full-year outlook. and here to talk about all of it, he's our verizon guru, craig moffett, senior partner and analyst at moffettnathanson. appreciate you being here. >> thank you. >> looking the athese numbers, good in one way, bad in another or good across the board >> they're pretty good the beat was mostly below the line they came in a little bit light on revenues but better in wireless revenues. again, these are pretty small variations >> right. >> if there's something to quibble with, it's in the wireless business margins were weaker revenues were actually pretty good on the wireless side, but margins were weaker, so you're seeing some costs perhaps associated with the 5g rollout, higher than expected and then, so they missed a little bit on ebitda but beat below the line you know, it's a result that's not far from what you expected. >> they say they're going to spend in 2019 between $17 billion and $18 billion,

including in terms of capital expenditures, including the expanded commercial launch of 5g where did you think they were going to come out, and do you think this is the right investment >> well, again -- >> it's going to happen. >> because they say it's including 5g, they haven't put a lot of meat on the bones about how much is 5g and i think if you were going to quibble with something in a sort of press release type of statement like that, it's you can't realistically do 5g, particularly in the way they're doing it, with millimeter wave spectrum, so very short propagation distances, without a much bigger capital budget than that. >> all right, what's more likely, verizon rolls out 5g really promptly or elon musk puts a million of these autotaxis on the road? >> i would put them in the same category. >> really? there is zero chance there are a million robotaxis -- >> and there is zero chance 5g is a ubiquitous technology -- >> by when >> by 2021 or something like

that remember that where we are right now -- and the question swirling for verizon, perhaps in particular, because they've made the loudest bet on 5g, is, is 5g in millimeter wave spectrum -- again, i want to emphasize what we're talking about is the spectrum band that they're doing it in, not the technology itself. >> which is only a very short band -- >> that's right. >> effectively -- >> and it's 40 times faster than what we see right now essentially -- >> well, yes and no. so, try to step back from some of that for a second. >> okay. >> the promises around 5g being insanely fast are partly because the standards for 5g were set for insanely wide blocks of spectrum well, you can't find insanely wide blocks of spectrum anywhere except in these kind of stratus feerkly high frequencies -- >> so it's a fairytale anyway? >> in broad, ubiquitous distribution, yes. >> you've always been a 5g skeptic, though. is that fair to say? >> i've been a millimeter wave spectrum skeptic, and the problem is those two things get

conflated, and arguably, appropriately so, because where the u.s. right now has spectrum made available for 5g is in millimeter wave spectrum bands. >> let me ask you a question, and this goes back to eve the elon musk comments my understanding and one of the reasons why everyone's talked about the promise of 5g is actually when you do get to autonomous vehicles and the like and the internet of things, you need 5g to make the whole thing work is that not right? >> no. again, first of all, think about an engineer designing an autonomous vehicle what self-respecting engineer would ever put mission-critical functions of an autonomous vehicle in the wireless network? >> the cloud, yeah. >> so that, what, if you drive up to main, you're going to drive off the road and into a tree you can't do it. so, the mission-critical functions of braking and steering and things like that have to be on board. >> so, in the united states, just so we're clear, you think we have a bandwidth problem, a wireless bandwidth -- band problem relative to, by the way,

china and elsewhere. >> yeah, so, interestingly, china's not betting on millimeter wave at all they're betting all on what in the industry they call subsix, which is frequencies below 6 gigahertz for 5g most of the rest of the world, in europe in particular, they're looking at a mix of subsix and millimeter wave. the u.s. is the only part that is doing -- >> this is so deep in the weeds at this point. would you buy verizon today or not? >> it's a fully valued stock i think the reason people have been focused on verizon is because it's better than at&t, but that doesn't make it more -- >> sprint/t-mobile, does the deal happen? >> odds do not look good. >> when could we know one way or the other? >> you could know very soon. the s.e.c. clock is still more than a month away, but the doj could decide at any time and it looks like that be deal is very much on the ropes. >> we need to say thank you, craig. it's a longer conversation i do want to get back in the weeds. >> i do, too, you've got to come back. >> i would love to. >> thanks. when we return, a recap of

this morning's market-moving results, plus tesla's robotaxi promise. will elon musk deliver we'll talk about it again coming up in a moment futures this morning are indicated higher after all of the dow components beat expectations dow futures up by 56, s&p up by 2 1/2, the nasdaq up almost 5.

earnings extravaganza. four dow components out this morning, all moving ahead of the open. twitter takes flight the social media mainstay scoring a top and bottom-line beat as it works to grow its user base. and robots on the road >> we're going to do the robotaxi thing, too. >> tesla ceo elon musk says autonomous taxis are on the way next year. is he right or is this another example of musk overpromising? the final hour of "squawk box" begins right now ♪ on the road again, just can't wait to get on the road again ♪ >> announcer: live from the most powerful city in the world, new york, this is "squawk box. ♪ i can't wait to get on the road again ♪ good morning, everybody. welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with

andrew ross sorkin and wilfred frost. joe's out today. i'm guessing we're playing this for tesla? "on the road again." anyway, futures are on the road again this morning dow futures up by 62 points, s&p futures up 3 1/2, the nasdaq up by 8 we were in negative territory when we started this morning, but since then, we've heard from four dow components, all beating expectations, coca-cola, proctor and gamble, verizon. the big gainer this morning helping the dow has to be utx. that stock up by 3.7%. utx alone adding about 38 points to the dow after it said earnings were $1.91, 20 cents better than the street expected. revenue beat expectations. they raised their full-year guidance and said they saw 8% organic growth currency was a headwind there, but only by about three points that stock again moving up sharply. $142 is the last tick. let's look at the treasury market and you'll see that treasury yields, at this point,

ten-year yielding 2.952%, so pushing up towards 2.6%. we've got like an earningspalooza going on this morning and we want to get over to dom chu, who is really at the center of earningspalooza. how are you doing? >> my morning has been so, i guess, filled with breathlessness because i've been trying to keep track of all these things, andrew but to becky's point, utx certainly one to much was, but big day for earnings dow components, becky mentioned a few. we start with gains around 3% to 4% for coca-cola, we'll call it up about 150,000 shares premarket at this point, maybe more the soda giant posting better than expected profits in sales thanks in part to better sales of water, sparkling beverages and a slate of new flavors for its flagship soda brands coca-cola's sales growth from existing business operations, organic sales growth, grew by about 6%, so shares up pretty big. shares of verizon catching a bit of a bid, up around 0.5%

roughly 70,000 shares premarket. the telecom and media conglomerate posting better-than-expected profits on sales that fell just shy of analyst estimates. it did report a bigger than expected loss of wireless phone subs but added 52,000 fios internet customers and it did boost its full-year forecast as well, so shares helping the dow. and then shares of proctor and gamble are lower by just around, call it a percent or so on roughly 50,000 shares premarket volume the maker of everything from pampers diapers to laundry detergent posting better-than-expected profits, sales and forecast in terms of organic sales that boosted that level. shares were up, remember, 16% year to date through yesterday's close, making it one of the bigger gainers in the dow. we'll end with a check on united technologies like becky pointed out, up around 3% to 4%, roughly 20,000 shares premarket profits, sales, full-year forecast all better than expected if the gains hold, like she said, two-thirds of the dow's

imemployed open just utx alone we'll keep an eye on that, guys. back to you. >> dom, thank you. we'll have a lot more from united technologies' analyst in a couple of minutes. wilf. another marltsie name reporting earnings this morning was twitter. the company posted adjusted earnings of 37 cents per share, more than double estimates on revenue growing faster than expected the stock's up 6%. julia boorstin joins us with more julia. >> good morning again to you, wilf with the big beat on the bottom line and that revenue that was stronger than expected, it really looks like twitter's efforts to reduce abuse on the platform and make it more conversational and user-friendly are working to help it grow its user base. twitter reporting 134 million monetizable daily active users that's the new metric that the company's used last quarter. that's about 8 million more than the prior quarter and more than analysts' expectations the monthly active users at 330

million also surpassing expectations that number actually growing from the prior quarter rather than shrinking for the first time in more than a year now, the company's second-quarter revenue guidance did come in at the lighter end of expectations, indicating that revenue growth is set to slow from this quarter's 18% growth, but we do see that the stock is up about 7% now, largely on those better-than-expected user numbers. the earnings call is just getting under way right now. jack dorsey talking about what's driving the company's growth, saying his number one priority is health, the health of the platform we'll be listening for news and then we'll be sitting down with cfo ned segal when we bring that interview to "squawk on the street." now we're joined by aaron gibbs, portfolio manager and alec canterwits, buzzfeed's senior technology reporter erin, what'd you think about the numbers in the report? >> so are, for twitter, look, very positive, obviously

but for me, i would have liked to see -- i want to see really how they're growing in the u.s. versus international we know that less than one-quarter of their users are u.s. so, even though we've seen an increase in their ad revenues, i want to make sure that we're seeing that higher growth, particularly as we head into the u.s. election. we want to make sure that platform is clean, that they've really got it organized. we saw them increase operating costs to make sure that it's secure i still see it as a turnaround story. i'm not getting in yet i think they have a lot of issues still hanging over. one quarter doesn't convince it for me just yet and i really want to see the makeup between the international and u.s. users in the call. >> so even in the call, if they were to tell you this was led by the u.s., you'd still be skeptical in terms of being ready to buy in just yet >> yeah, just because they're still struggling with organizing the video content, that was also another positive news, i think that's something that's really growing, but i'm not convinced just yet >> alex, what do you think your takeaway on this.

this was important and definitely a step along the way, but is it enough >> yeah, there's an old saying in silicon valley here that if you're going to move the goal post, you'd better kick it through, and i think that's what twitter did. it used to report monthly active users, now going to monetizable daily active users it needed to grow that number in order for us to have faith in it, and it did it went from 126 million daily active users to 134. that's pretty impressive, 11% growth so i think it's been a good quarter for twitter. >> alex, are they able to now finesse the numbers a little bit by stating this monetizable daily active user, rather than the outright daily active user number going forward, and also they'll retire the outright monthly active user number after this month >> yeah, i think it's definitely a finesse. i think what twitter's doing here is a subtweet of snapchat snapchat will come in and talk about its daily active user base, but they can't make money off of each one of them. a lot of people just jump in and

use the chat function. so this is twitter trying to tell the market, hey, we might have fewer daily active users, but at least we're making money off of them. >> erin, the one thing i'll point out is the stock's up 7.2% this morning, so there are certainly some believers -- >> no, no, no, look, it's a highly volatile stock. it's been relatively depressed for -- especially after a disappointing last quarter but for me, look, this is a growth stock this is somebody that needs to just blow it out we're talking -- it's trading at 40 times earnings. we're not talking about valuation. we're talking about momentum and growth and i think any time you're still talking about a potential turnaround, still working on the platform, for me and for my investors, it's too high of a risk because i don't want -- >> what's your value >> i mean, look, when you're talking -- there's no such thing as fair value with growth, right? like, i'm not even looking at valuations with this type of stock. i just want really significant growth and when you're still talking about growth in the teens and not until next year -- >> what would you say to

recommend this to investors, then if there is no valuation with which you think there is -- >> i want to see profit growth in the teens for next year and i want to see a real turnaround where they're not having to increase operating cost, where we're stabilizing operating cost so that the platform is actually stable and they've got a control on the user accounts. >> you like snap or facebook or anybody else >> facebook, yeah. and snap i'll take facebook. >> because there are real metrics? >> yeah, exactly. >> alex, what do you want from twitter? is valuation the key going forward or do metrics suggest they can leave things as they are? >> yeah, the stuff i'm looking for is not the stuff they're talking about. today in the shareholder letter, i read twitter talk about its project to make conversations better, to talk about how conversations are twitter's superpower guys, you've been around since 2006, and you're still trying to figure out conversations like, they are a news platform and how about a product strategy that centers around news so, there's so many different things twitter can do around news, whether it's to create a

stand-alone news app or to improve its explorer experience. but instead, they're focusing on conversations. that really doesn't make a lot of sense to me and i really think that if you're going to be bullish on twitter, you want to see product innovation in the news space, which we've seen a little bit of, but i don't think enough. >> julia >> i was going to say, is apple news a threat to them, alex? >> absolutely. any time you see a tech giant getting in the news space, that's a threat to twitter in fact, i would say a big part of its resurgence has come due to the fact that facebook has pulled back from news, giving twitter this wide-open swath of territory that it could jump in. it's done a great job exploiting that, but it really has to keep pushing in order to make sure that the big competitors that are coming in trying to push it out of that space don't have a chance. >> julia >> to go back to erin's concern about u.s. versus international, they actually disclose how many people are using their service on a daily basis in the u.s. versus the international there are 28 million daily active users, these mda use. that's up 8%, but they are

growing faster internationally with 12% international growth. but what i think is really interesting here is they made this big announcement last quarter that they would be shifting away from the monthly users because the monthly users were flat or down, and we've had over a year of declining monthly active users every quarter the numbers would decline. and now we're seeing by just focusing on daily users, they are able to grow engagement. that's really what the daily active users are about they're taking those monthly users and making, giving them reason to come back every day because the platform is not as polluted with either, you know, bots or these offensive news, which they've tried so hard to clean up and sort of trolling of people so it seems like dorsey is really focused on making this an easier-to-use platform and to me, whether they turn and create a separate news app as a separate thing is a separate question because twitter is really supposed to be about news and conversation about news, and if they can make it more

effective, they wouldn't need to create a whole separate thing. >> all right, guys thank you for joining us today we appreciate it. >> thank you. okay, coming up right here on "squawk box," in case you didn't notice, it's a major morning for earnings check out shares of united technologies, up after reporting top and bottom-line beats just a short time ago we're going to dig through those results when we come back and talk about what they mean for the broader u.s. economy that stock up. also moving the dow as wl.el you're watching "squawk" here on cnbc ow an index, but which ones target your goals? it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

welcome back to "squawk box. the futures right now -- take a look -- they turned positive we have the dow up about 80 points, nasdaq looking to open up about 13 points higher. s&p 500 looking to open about five points higher, all on the back of relatively positive earnings, virtually across the board this morning from a number of big dow components. one of them, united technology, shares rising after an earnings beat, adding about 35 points to the dow this morning joining us right now on the squawk news line is carter copeland, founding partner and defense analyst at milius research we wanted your perspective on this, and not just on technologies but what this means for the broader economy. we'll get honeywell, we'll hear from ge, the rest of them.

what does this portend >> yeah, look, i think, andrew, we're seeing numbers come in slightly better than expected across the industrial space, at least. and you're certainly seeing that in united technology's numbers we saw the same thing in honeywell last week, you know. so, i think we're at the front end of what could be a bit of a better-than-expected earnings trend. >> and when you think about this utx story, are you raising your forecast on the stock? >> yeah. look, it's a clean beat. it's a modest raise. it wasn't the sort of blow the doors off type of numbers that you have seen in the past. but look, the last couple years, sales growth at utx hasn't really been dropping to the bottom line because the company's bin vesting in so many numerous franchises. so this quarter you'll get 8% organic growth on the top line, 8% in adjusted eps growth. there's no leverage in that, but it's a step in the right direction. and furthermore, i mean, the strongest areas of the portfolio were in aerospace. and so, with the company breaking itself up next year,

it's in a spot where your strongest business is the one that's going to be the remain post split so that's nice for the overall narrative. and when your core businesses are performing the best, that certainly helps. >> carter, that's my one question when you look at guidance, they beat by 20 cents for this quarter. they raised their guidance to $7.80 to $8. the street was already at $7.91. are they being conservative with that guidance? >> i think you have to conclude that in a company this large, in this many markets, there's certainly a lot of moving parts they want to protect for for the beginning of the year -- or for the remainder of the year. but you know, you've got some areas of outsized strength, namely in the commercial aerospace aftermarket in first half of the year, this first quarter of the year. but you know, we've obviously got the situation with the 737 max and what does that mean for global airplane fleets you know, that could introduce some volatility later in the year, so they may want to protect for that. >> you know, we had a general market analyst yesterday -- i think it was savita, who pointed

out she would be telling people to look at late cycle, industrials and financials would you agree with that assessment, given how industrials were pretty much better across the board? >> look, i think that's right. i think in aerospace, which is notoriously late cycle and long cycle, numbers have been fantastic. you know, we're seeing that in the numbers that have been reported so far, and i think we'll continue to see that trend not only for the rest of the quarter, but for the remainder of this year. >> what do you think ge's going to look like that's a different story, but in the same space >> yeah, look, i mean, you've got -- again, there's a lot of moving parts, right? you'll have a lot of focus on power, but i will fully expect that the aerospace portion of that portfolio, which is the crown jewel in many respects, is going to continue to be strong as it has been for the last several quarters. >> what are you expecting from boeing as well what did you make of "the new york times" article over the weekend? >> you know, when i think about what that article addresses in terms of boeing's south carolina

facility, you know, this is a greenfield facility that like any aerospace facility is going to learn over time, you know so, i think there's some context missing from that analysis i mean, we could say similar things about all sorts of early aerospace and defense kind of factories. think spacex in their early rocket manufacturing, right? now we celebrate what they've been able to accomplish. so i think it's a bit more nuanced than that analysis, but nonetheless, look, i think tomorrow for boeing, partly you're going to get some numbers, and i don't think they're going to matter that much we know the numbers are going to be skewed by the 737 max challenges i think it's more about how they say the things they say and trying to help give people some clarity and transparency around the situation because we haven't had a ton of communication while the investigation's ongoing. and so, it will be a heavily listened to conference call and i think one where the bar is pretty high from a qualitative

standpoint as much as a quantitative standpoint. >> okay. carter copeland, we appreciate your time this morning and perspective. thank you. >> thanks, all. >> talk to you soon. motorcycle maker harley-davidson reporting quarterly numbers just a short time ago, beating on the top and bottom lines, even though profit was down about 20% from a year ago. joining us now is the managing director of equity research at wedbush securities thanks for joining us, james first take on the numbers? >> thanks for having me. yeah, for a company with expectations as low as they've been for so long, you'll take the beat, but i think you put it the right way. most of the major metrics are down, whether it's earnings, sales, retail sales. they're just down a little bit less than the street was looking for. >> does it count as turning the corner or not quite? >> i think it's way too early to make that assessment i think the general rule for me, having followed harley for a

long time and names like this for a long time that are pretty seasonal, until we get into the selling season, until we get into april/may time frame, i don't want to draw too many major conclusions. and you know, keep in mind, again, although they beat, domestic retail sales were still down 4% for the first quarter, and that was actually a little bit worse than what i was assuming it was the best quarter, or at least the smallest decline that we've seen in over two years, but nonetheless, it was still a decline. >> that came alongside some pretty big incentives they rolled out as well, did it not i mean, how big are those incentives compared to what they usually are for that time of year >> pretty significant. so, i've been following this company for about 15 years they offered between $750 and $2,000 in terms of rebates on certain of their models.

historically -- and this goes back to prior to the great recession -- the vast majority of promotions that they do are typically finance-oriented so, it's low aprs, that sort of thing. this is pretty aggressive. this is one of the bigger promos that we've seen in that time and yet, again, they were only able to get retail to down 4%. my guess -- and they didn't talk about this in the release -- hopefully, they'll touch on it on the call. i do think march was a better month. i think march was the best month of the quarter, which is typically good news and lends well to -- >> wouldn't that be typical just with the weather improving more people buy bikes? >> well, sure. but i guess the point i'm making is on a year-over-year basis, i do think march was the best month of the quarter but again, i do think that benefited from some pretty meaningful promotional activity. >> james, your price target i think is $35, a little below

where we're triding at the moment what are you looking for on the call that could lead you to upgrade that >> sure. some evidence that, a, things got better as we worked our way through the quarter, and ideally, that april is off to a strong start but then i think more importantly, that that improvement, for lack of a better term, is not only sustainable, but that, you know, we'll actually turn the corner and get back into positive growth territory from what we saw in the numbers, that's a little bit difficult to discern, but we're waiting to hear what management has to say on the subject. >> okay, james thanks very much for joining us. >> thank you when we return, is elon musk blowing smoke or is he right on target the tesla chief hailing his autonomous car technology and

saying hailing autonomous taxis is closer than we think. we'll talk about how much of this is real and how much is maybe a slight eggatn.xaerio stay tuned you're watching "squawk box" right here on cnbc erse. as investment management professionals, let's measure up. cfa institute. [kno♪king] ♪ memories. what we deliver by delivering.

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insure prosperity. as investment management professionals, let's measure up. cfa institute. welcome back to "squawk box" this morning take a quick look at futures we are in the green after a number of big earnings reports, all in the positive territory. dow up about 75, 76 points

nasdaq up about 13 points. s&p 500 up a little over five points. still to come, when could self-driving taxis hit u.s. roads? tesla's ceo elon musk says very soon ahead of that company's earnings report tomorrow, musk making the case for the future of autonomous cars, a sector tesla wants to own we'll break down musk's marathon presentation, coming up when "squawbo rur k x"etns

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welcome back to "squawk box," everybody. this is cnbc, and we are liv from the nasdaq market site in times square earnings a key driver on our stocks to watch this morning hasbro shares surging after reporting a surprise profit for the first quarter. the toy-maker earning 21 cents a share. analysts were actually expecting a loss of 11 cents and check that out, the stock is up by about 15% this morning cost-cutting helped and so did growth in digital platform revenue, also a strong performance from longtime brands like monopoly, play-doh and transformers also, take a look at whirlpool

shares, also moving higher this morning. the appliance-maker earned $3.11 a share for the latest quarter, beating consensus estimates of $2.86. it also said it expected lower costs from both raw materials and from tariffs this year similar story to what you're seeing with harley-davidson, except this is up by about 6% this morning, a gain of $8.46. and then homebuilder pulte group earning $2 a share and they say they were helped by a drop in mortgage rates the stock is up 3.5%. tesla's ceo elon musk placing a very public bet on futuristic car technology, but will it pay off for investors? phil lebeau joins us with more. >> good morning, wilf. after the presentation by elon musk, the reaction is, eh, luke-warm, at best yesterday, tesla announced advancements it's made when it comes to self-driving car

technology and the claim from elon musk that's getting the most attention is that he expects to have 1 million self-driving teslas capable of being robotaxis -- doesn't mean they're all going to be robotaxis, but that capability will be in effect by next year, according to musk. and by the way, if you are a tesla owner and you want to use it for autonomous rideshare, it has to be done through the tesla network. here is musk talking about his timeline for seeing self-driving teslas out on the road >> we expect to be future complete and self-driving this year, and we expect to be confident enough from our standpoint to say that we think people do not need to touch the wheel, look out of the window, sometime probably around, i don't know, second quarter of next year. and then we start to expect to get regulatory approval, at least in some jurisdictions for that towards the end of next year >> just a few of the bold predictions from elon musk yesterday. what's the reaction from analysts there in the room

citi says our sense is that tesla is making significant progress in highway domains and measurable progress in suburban domains, but that dense urban environments where gm-cruise competes will likely require more time due to greater complexity meanwhile, canaccord has a note out saying "if anything remotely close to the timeline for level 5 capabilities that the company has laid out occurs, the formidable lead that the company -- meaning tesla -- has in autonomy will result in meaningful market share gains. these are the questions that will be front and center, in addition to the first-quarter numbers when the company reports earnings after the bell tomorrow guys, i think you're going it see questions not only about the earnings for the first quarter and broader question about demand, but also about the timeline that elon musk laid out yesterday when it comes to robotaxis and self-driving technology for teslas. >> you know, i want to play a game we asked earlier, what happens

first, these million auto taxis hit the street, the broad distribution of 5g in the united states, but let's add another one to that, bitcoin goes back to 20,000. which one happens first? >> well, the robotaxis -- i have to be clear here -- what he said is he said, oh, a million robotaxis are going to be out there, and that got a lot of attention. and everyone says, wait a second, a million robotaxis? he tried to clarify and did not do a very good job at doing this, in saying the technology to allow them to be robotaxis will be in all of these tesla vehicles -- >> but i guess regulatory's going to be a big issue. >> oh, absolutely. >> even if you -- >> absolutely! >> if you rinse it and put it out there, are we talking about it being in three retirement communities in arizona and florida? >> correct i think you're going to see it in very restricted areas look, in phoenix where waymo is approved, they're in a geo-fenced area and plan to gradually expand over time that will likely happen in california as well i think you're going to see regulators very hesitant to

allow cars with nobody behind the wheel to go tododling aroun neighborhoods. that's going to be a big hurdle. >> phil, stick around and be part of this conversation with "wall street journal" reporter tim higgins. you watched all of this yesterday. i watched all of this yesterday. there seems to be very mixed impressions about whether this was impressive or whether this was something else >> well, phil hits on an interesting point. most of the companies that are doing this technology are focused on confined areas. when asked about that yesterday, he was talking about this could go anywhere and everywhere -- >> worldwide, yeah. >> and that level of autonomy, no company in the world has demonstrated that ability. and the idea that he's going to roll this out next year is for some hard to believe. >> the question, though, is you looked at the technology, you looked at what he talked about they got into the weeds, right they talked about the chips. they talked about how the cameras work they talked about the reason and rationale for not using lidar.

did you listen to that and say he's on to something, or did you say this is smoke and mirrors? >> i heard similar presentations from other companies for years, and it's interesting to hear their thought process and some of the details that they're doing, but that said, the idea of a level five, the ability of autonomy to go anywhere and everywhere is among some experts something that they don't see for a generation rolling out, let alone in the next 12 months. >> so, what do you think gives him the confidence to say that >> it's unclear. some of it is his hope and his ambition if you look past in tesla, it's always what could potentially roll out. >> did you look at that, though, and say he does have an advantage? i mean, this was a full-day demonstration to try to persuade the public, and i imagine investors, more importantly, especially ahead of what some people think are going to be troublesome earnings, to say don't even think about us as a car company anymore. actually think about us as something else, and it might be a couple years from now, but as

a company that competes almost with an uber. >> right you know, here's one of the things you take a step back it's almost like a classic, old detroit technique here with a silicon twist, because when automakers are facing slowdown in demand, they often push the lever of fleet sales, pushing car sales out to rental car companies and taxi companies the change here is he wants to put that demand into a robot taxi fleet, so it would help sales in the immediate term. >> phil, what did we learn about profitability yesterday, if the aall is that an issue for wednesday or did we get some comments that make profitability now tied to the robotaxis as opposed to how he thought about it six months ago, just sort of regular model 3 sales? >> he threw out some numbers in terms of potential profitability per vehicle, if the robotaxi fleet were to take off but you can't -- there's nothing you can ascribe to that, wilf. there's nothing you can look at and say, yeah, they're definitely going to be making "x" dollars per share or per

vehicle by 2021-2022 all that is contingent upon how and where it is used, the number of people who will theoretically be using the autonomous network. and to tim's point about whether or not you buy into this, the key point is what happens in that last, i call it the last block, where you're pulling into your neighborhood, where you're turning into a driveway, where you're turning into a parking lot, let's say at a kwik mart, and somebody walks out or a kid's on the bike and walks out. those are so tricky. >> but here's the thing -- >> for autonomous technology. >> this is what i wanted to understand, both from you, phil, and from you, tim. were you persuaded that he has -- elon -- has somehow either cracked the code on hardware in terms of this chip that he argues is faster than anything else that's ever been made he says it's empirical, that that's the case. nvidia, on the other end, says this is fundamentally not true

and that you're comparing apples with oranges on one end -- that his camera system and the software behind it is more effective, effectively, than lidar. these are the things he's put out there and said, look, if he can get these things right, he thinks he is way ahead of everybody else and what i'm trying to understand is the market doesn't seem to be convinced you've talked to computer scientists and people who specialize in this area. do they look at this and go, wow, that's impressive, or something else >> i think you hit on it, the market is clearly yawning at it. what's interesting is the dive into the data they're pulling off of those vehicles. you can see the routes that people are taking -- >> yep. >> and they can learn from that. that is useful information the idea of avoiding lidar and developing your own chip i think gets to kind of this key thing that the industry hasn't quite come to a consensus on exactly how they're going to roll this technology out. >> hey, phil, do you believe -- one of the things that i actually saw a lot of commotion among the computer scientists out there, was this idea that

they were actually taking video from the cars but doing it selectively and looking only for specific actions, meaning using machine learning to say today we need to look for images of tires that are left on the road. don't send us everything because that takes up too much bandwidth. only send us stuff when you see that -- >> correct. >> and they are sending it do you believe that? because there's a lot of people i'm seeing online that are skeptical of that. >> whether or not they're doing that do i believe that or do i believe -- >> selectively do it that way. >> well, they say that they are. >> right. >> i mean, i've heard the people who have said, there's no way you can do that. their rationale for doing that, as you heard in the presentation yesterday, was look, if we were to take reams of data of any time a vehicle of ours is going down the street and it's feeding an image, it's just, it's overload, it's just pushing too much into the sewer pipe, if you will instead, they believe that by selectively choosing certain elements allows you to say, okay, this makes sense, this is

how a vehicle should react in this particular situation. >> right but i mean, this idea that he effectively thinks that every car can effectively become retrofitted, if you will, as a robotaxi, arguing that all of the hardware is already on the car itself, for the most part, those that have been sold on the "s" and some of the others is that realistic to you because the other thing -- nvidia -- by the way, some of the cars are using nvidia chips and nvidia says the chip isn't even supposed to be used that way. >> i thought, for me, the most interesting part were the claims that their technology and their chipset is way better than nvidia's nvidia wasted no time pushing back saying, no, no, no, no, that is not the case and we haven't heard from anybody -- any of the analysts or experts in the arena who have said, oh, yeah, they are light years ahead of nvidia. so far, what i've heard has been sort of a muted, hmm, let's look into this little bit more. i want to see how that plays out

over the next couple of days as people look at these claims relative to nvidia. >> tim, help us with this. the hardest part about tesla is that no matter what they say, it feels like on one side people say, oh, these numbers are real, and on the other side, they say, no, these numbers are fake, which is very different than usually -- you know, there's a market, if you will, for people being bullish and bearish. and usually, it's they look at the numbers and they say, i feel more comfortable about assigning a higher value or less comfortable about assigning a higher value it's not usually about adjudicating the numbers or what's actually happening itself and that's the hard part for investors today. >> absolutely. and the challenge here also is, in 2016, elon musk made similar comments about the technology in his cars he said the vehicles they were rolling out would be able to be fully self-driving, they had the hardware in place and it was just going to be a software update and regulators' approval, and it was going to be demonstrated by the end of 2017. it didn't happen. >> do you think that regulators

will ever take action on these type of prognostications there are ongoing investigations at tesla today, correct? >> there are. >> there are for? >> reporting there's been investigations into the comments about production. we've reported that. >> right. >> there's been comments -- we've got a fight with the s.e.c. right now over his comments about production on twitter. >> absolutely. >> those are ongoing. >> and what's your expectation just for tomorrow, not to make it a short-term conversation, but people are focused on tomorrow in a very big way >> i think the big question is going to be cash is he going to raise has he got enough to get through the year >> okay. we are going to leave the conversation there tim, thank you phil, thank you, as always >> you bet. when we come back, the market is sitting just below its all-time highs, but that doesn't necessarily mean investors shouldn't be worried or maybe take advantage of the worry that's still coming into the markets. our next guest is going to share his reasons why on all of those questions. right now, though, as we head to a break, check out shares of dow component united technologies,

up by about 2.8% it's a gain of $3.87 after utx beat expectations this morning and raised its guidance for 2019 four dow components out. proctor and gamble among them. coming up, we'll get to talk to jim cramer about why proctor and gamble shares weren't trading higher, even after those good reports. stay tuned to "squawk box. can i get some help. watch his head. ♪ i'm so happy. ♪ whatever they went through, they went through together. welcome guys. life well planned. see what a raymond james financial advisor can do for you. that's where i feel normal. having an annuity tells me my retirement is protected.

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throughout the morning dow's up 50 points now a number of dow components reporting, of course, including coke, which is up about 4% or 5% s&p's also just higher, as is the nasdaq yesterday we saw the dow decline by 0.2%. s&p and nasdaq just slightly higher energy the best performing sector as oil prices gain. they're up again today real estate was the most notably negative sector yesterday. and it's been a huge and very busy day for earnings want to go tlouvd some of the highlights for you right now, starting with the four dow components that have already reported this morning. united technologies, coca-cola, proctor and gamble and verizon all scored bottom-line beats verizon and united tech also raised full-year forecasts, although we should say verizon saw a bigger than expected drop in wireless subscribers. and look at coca-cola, because their quarter was highlighted by a better-than-expected 6% jump in organic sales proctor and gamble raising its full-year organic sales growth outlook as well, but stuck with its prior full-year earnings forecast. >> you know, i've been waiting all morning for jim cramer

because i really want to talk to him about proctor and gamble they came out with strong organic growth, better than expected and better than reported a year ago, but the stock's still down about 2%, so i want his take on that in a couple minutes. >> and quickly, twitter reported better-than-expected earnings and revenue as well and also reported upbeat metrics, such as monetizable daily users and monthly average users. then we have lockheed martin to tell you about, reported a blowout quarter, earning $5.99 per share. that compared to a consensus estimate of only about $4.44 and lockheed also raised its full-year outlook. so lots going on in the green, in a positive way this morning. let's talk more about this morning's earnings and whether there is room in the market for a melt-up. joining us is jim paulsen, chief investment strategist with leuthold group why do you think the wall of strategy out there is a good thing and what do you think is most likely to happen here >> i do see the continuing wall of worry

this whole bull market, becky, started with a wall of worry and has never really totally gone away i mean, i think what we have now still, by and large. we just got an illustration right in your face of risk in the december swoon, up close and personal how quick and how ferocious a bear market can be that doesn't quickly leave the imagination of investors and then we had a technical inverted yield curve we're coming up here just in another month or two, we're going to be in the longest recovery ever in u.s. history, which makes you feel like how much longer can this go on we're worried that policy officials are out of bullets to do anything. we've got a slowdown here and globally i think we're still climbing that wall of worry, and it tells me we've got a lot of portfolios that are underinvested, waiting for this to end, if you will, and don't want to be caught overinvested if it is going to end. and if it continues to go on, i think they're going to have to reduce their underweights, even if they don't go full bullish.

and that's a pretty good driving force. but i also think, you know, we've revalued the stock market. it's now at 19 times trail it was 20 right before the collapse and 23 early in 2018. we've reduced the reduced the is down from 3 and a quarter percent. we brought the full policy cavalry of monetary and fiscal both here and globally we are still climbing that wall of worries we are going to set new highs but i am starting to wonder if the real surprise would be we don't go up to 3,000 s&p but go quite a bit higher, at least for a period of time if you go to 20 times earnings on street estimates about 165 to 170. that would be around 3400 s&p

and certainly is possible before the year is out. >> jim, people wondering why we see rate peaked for this cycle you disagree, you think it is going to rise again? >> i do, i do. the rise that we had in the stock market primarily is due to the fact that we pause over heated we took the fed from a foe to a friend that's created the rise. the next level of this market rally could be when people come to appreciate, not only we are going to recess but recovery for some degree. they'll start rising again and if that happens and the growth continues then at 4% unemployment rate, we'll bring back over heat pressures i don't know how soon, may not be until next year they'll come back before we grow

the sub percent of unemployment rate eventually we'll see pushing bond yields back above 4%. >> you like the cyclical ex exposure then rather than defensive? >> i do. i like the international markets better than the united states markets. both developed and emerging. here i would own some defensive sector, no doubt i would tilt away and look at a couple of things and look at weak dollar play, that could be another big thing happening as the dollar breaks south. if it does, it is going to boost commodity prices in general. i would look at the beat up financials here if the recovery continues, the yield curve resteepens, that value play can be attractive. i would still tilt your

portfolio a little bit more since they pull back here this year and away. >> i thought you thought those are risky and the fed have to come to play, that does not look likely for most other developed markets central banks. >> the weak dollar will if it occurs, will add over heat pressure weak dollar will bring more demand to the united states and put more pressure into our resource market and be inflation. as dollar bill goes down, commodity prices going up. right now given the attitudes of where investors are, a weak dollar reduce recession fears and causing more and more people think this recovery is going to continue for a period. >> bullish for earnings and ultimately for over heat >> jim, great to see you

>> i want to get down to the new york stock exchange, so much to go over with jim cramer this morning. which do you look at as the go weather, jim >> well, i kind of tell you, this is the odd one but i look at twitter what it says is social media is alive and well and gives you some room to buy snap, i think facebook is under value especially no one seems to be going away from the advertisers, that's my favorite united technology, the stock is doing extraordinary well >> what's your take on verizon >> look, verizon, they need to put up more numbers. when i look at it, it is continuing to say it is good, not great. tomorrow at&t is not that good so i think you will come back to buy verizon. people are more excited about qualcomm than thinking of 5-g.

verizon's 5-g does not look like a way to play it yet good advertisements but not ready to play yet. >> tesla tomorrow, there was this presentation yesterday and a lot about some people thought it was impressive and other people said it was smoking mirrors, what do you think >> i think phil has some great point. i am close to nvidia, the idea of what he said about nvidia, he's using an old chip it questions credibility i keep finding that it is a free range circus with the guy. it is kind of annoying but he's exciting i don't know, he always introduces something >> he's pt musk. >> what about procter & gamble >> oh, no, david taylor, is on a

great job. look, i think you should buy colgate, i think proctor is terrific i think you have to buy. i want to say one other thing. i think this is a quarter we have to stop focusing on the fed. >> why >> everybody asked about the fed, that's the thing that's keeping individuals out. the fed used to be for great kind not something we talk about unless we are bond traders we have to stop talking and endlessly javersing about the feds, we should focus on the ceo and the numbers they put out every time we focus on the fed, i got to tell you, i got to take a little nap, man, i am getting old. nap time >> you never sleep don't lie. >> jim, i guess the guidance to some of these names look really attractive >> proctor is such a buy, it is

scary, it is a frightening situation how good it is >> jim, thank you sir, great to see you, we'll see you in a few minutes. don't miss interviews tonight on "mad money," you can join jim at 6:00 p.m. eastern time, stay tuned, you are watching "squawk. ooo! ♪ ♪ and protect it all. customer records, our financials, they better be secured. but i also need easy access, to manage data across my clouds - no matter where it lives. ♪ ♪ so if an auditor shows up, i can be a step ahead. that's the cloud i want. is that to much to ask? expect more from your cloud. ibm cloud.

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let's get a final check on the markets. we were in the negative territory. a couple of them traded higher i want to thank will for being here we'll see you later tomorrow, folks, right now it is "squawk on the street. ♪ good tuesday morning, welcome to "squawk on the street," i am carl quintanilla with jim cramer and david faber. futures are green. as you heard four dow component, utx and verizon,all beat with at least two raising their guidance europe is getting back to work today. oil hits 66.19 iran will continue to export our road map begins wi