wall street and "squawk alley" is live. ♪ ♪ good wednesday morning i'm carl quintanilla, with morgan brennan and jon fortt busy morning, obviously. we're getting a pop here in the market dow up 75 points as reuters is running a headline that white house spokeswoman sarah sanders says the u.s. has received an indication china wants to make a trade deal that's all we have at this point. joining us jonathan, chief u.s. equity strategist at credit

suisse could to see you both. this what is we have been reduced to the tidbits on the wire services. how are we supposed to trade in this environment. >> first of all it's impossible for any of us us here to figure out whether we will get this i think the important thing is, you know, first of all we're going to get a deal eventually we want to get the best -- >> how do you know >> listen, there's no way that -- that we're going to break down trade between us and china. what we want to get is a deal that's going to be most useful to the united states we want to see things on intellectual property, not to simply get something like soybean orders which makes it look like window dressing to this if that means a president needs to stomp his feet if ek get more, the market may not like it but doesn't mean we're not better off for it. >> how much pain do you think the president is ready to withstand? >> ask me what equity investors are willing to withstand, almost nothing. as far as the president is concerned, i think that we got a

bit of a shot in the stomach in december when the market fell apart. if the market is down a few percent as he negotiates a better deal, i can't -- i would be very disappointed if that's enough to derail trying to get the best deal. >> i think it begs the question, i spoke with the ceo of polaris yesterday about this yesterday and he was talking about the fact if you see tariffs go up to 25% longer term it could be downright catastrophic you could see net income cut by a third. i wonder, it's one example and certainly he's still hopeful and they get an exemption from the tariffs at that company, but i just wonder if the risk is fully priced in to the market. >> first of all, it's not -- it's not catastrophic. you have to look at what percentage of the u.s. exports is exports of the economy, what percentage of that is to china if you look at the importance of canada and mexico, much more important to us than china would

be you're not talking about cutting all trade with china you're putting a tariff on something and as consumers you have the ability to switch if a chinese good becomes more expensive then you find it somewhere else what china knows really well is that u.s. companies are moving their production elsewhere as this goes on to, you know, immunize themselves from this as a problem. china has a really big reason to want to get this done. it's easier for us to switch suppliers than it is for china to find another consumer as strong as the american consumer. >> what is an accepted positive outcome here i've been hearing for days, weeks, not to expect anything significant on ip out of this. more or less, maybe there's some kind of a framework but lately we've heard senators from both sides of the aisle saying stick it out, president trump, get something concrete here, get something serious. i didn't think the market was expecting that. >> so look, we focus largely on consumer internet advertising content. the reality is most of the internet stocks we focus on

won't see a benefit. maybe amazon on the aws side google doesn't have a meaningful ad business in china facebook, not in china netflix, you know, has no business in china. again, if anything, we think the way to play this is through alibaba. if you get a resolution those stocks have suffered for a year on trade war concerns and the actual macro conditions within china. >> if we get a resolution, is there reason to believe that some of these u.s. internet names could actually expand in china? is there upside to be had? >> again, i think it would be more on kind of the data center, aws, microsoft, amazon, but again, you know, what's -- i don't think kind of content and kind of free speech is up for negotiation here >> yeah. >> and again, i think most of kind of fang gets left out again, it's more of maybe that particularly around alibaba and

ten which would benefit. >> i want to jump in with one thing. the asia conference is the credit suisse asia conference which happened a month ago and i met with a large group of asian investors, not only from across asia, but particularly from hong kong and mainland china and they highlighted the same point i was making before, that china, they believe, and these are investors there, that china needs this deal more than we do that they realize that the american consumer is ultimately the holy grail for chinese exporters. i was really surprised to see that tone out of people from china itself. >> overall, in terms of more pedestrian things like earnings, you were resolute we were not going to have negative earnings quarter and looks like you're probably going to be right does that mean that expectations for the back half have to be tempered a little bit? >> i mean here's the reality what we have is a few things we have an economy where the economic data is decelerating, expectations for gdp are below 2.5 and expectations for next

year is below 2 and i have no reason to believe that's not reasonable, that we're moving back towards a weaker trend. earnings this year probably come in, you know, eps, 3 to 4% and when you consider the buybacks are 2% of that, that's a pittances. it's not that i've been bullish that the earnings were going to be brilliant but this belief we're going to have a calamitas contraction was way off base what i think we're moving back to is a more stable, uninspiring trend, and what i think the investors miss is that stocks can do perfectly fine in that backdrop, especially if, you know, putting aside the china stuff this week, risk are down, the fed is supportive and the like i think stocks can do well anyway that's the backdrop. >> there's been a lot of sound and fury about regulation when it comes to alphabet, when it comes to facebook. we saw facebook earnings really strong we saw google and then some of their plans for android.

looking pretty interesting does it all signify nothing? should investors look past those regulatory dangers at the numbers these companies are turning in. >> we think so look at the valuation of facebook and amazon, basically facebook and google are trading, you know, 11, 10.5% cash flow. you know, google's multiple has not expanded in five years, right. to the extent they just got hit further. when we think about it, they actually sit on way more data than facebook does they've done a much better job of protecting the data whereas facebook has made their mistakes, owning up to it and what's the settlement. whether it's $3 billion, $4 billion, $5 billion, it really doesn't matter the question is, will the settlement require them to change the business practices. they've already i would say kind of two years ago acknowledged the business practices had to change the next thing to focus on and we're focusing on is this law of california, the ccpa,

california, consumer protection act, which looks to be the most onerous privacy law. that being said, will the federal government come up with its own law that supersedes california but congress is distracted with other things right now so hard to predict that that will happen. if that's the case facebook and others are working toward being compliant with this california law by january of 2020. >> jason, carl was asking about earnings and the one thing that jumped out when i looked at this, earnings season was the revenue lines on some of these companies, some of these big internet companies, are slowing a bit. how do you think about that and, you know, as compared to this discussion on margin hit, what drives the stocks on that? it's something that jumps out when you're looking at the data. >> sure. i think the one standout was like google where they had this revenue slow down, they didn't do a particularly good job of explaining why, and then when you really kind of take a step back, you know, amazon, by far and away has the best

disclosure, google has far and away the worst disclosure. >> i'm surprised to hear you say that about amazon. >> they give us revenue by segments a margin business for google as good as desktop search that was a 75%, 80% incremental margin business and everything from here is a lower margin business look, you know, google's revenue is slowing if you look at the rest of the companies, they all beat margins except for google, right how do you weigh that given the potential backdrop of when does the economy slow? >> yeah. jonathan and jason, thanks for joining us for a lively market discussion. over to the nasdaq and bertha coombs with an update on today's biggest tech movers. >> yeah. we're seeing a very nice turnaround this morning, the

nasdaq now moving positive now that stocks have moved off of the lows of this morning we weren't that low, nonetheless you might call it a bit of an oversold bounce. apple is one of the things that has been holding us up this morning. apple has been positive much of the morning, one of the fang names that is up for the month we're also seeing a bounce when it comes to some of the gaming stocks after electron flick arts results beat that, that is lifting, take two lifting, activision, some of the nontech names are moving higher today. chips turned around this morning. they were set for another day of losses after two big losses on monday and a big loss yesterday, down nearly 2.7% we're seeing those bounce this morning, as we're getting that news that perhaps we might make some kind of progress on those chinese talks. it's one of the things that folks are really focused on. if you have a slow down in the global economy in part because

of these new tariffs that will kick in, that will be bad for chips. chips in that sense are one of the most cyclical part of the tech sector because they are used in everything from cars to washing machines these days, everything needs some sort of technical memory also, today, coming off of the lows as well, we are seeing some stocks that are not participating, booking holders among the losers, but compared to the losses over the last few days we are seeing things come off of the lows. we'll see that momentum if it continues this morning. >> we certainly will thanks so much bertha coombs at the nasdaq. when we return we are all over this market volatility and it is volatile we got major averages taking a leg up just moments ago. the dow is up 101 points, the s&p is at 2894, closing back in on the 2900 mark can tech the main underperformer

yesterday, stage a turnaround. we have a lot more "squawk alley" after this break. -driverless cars... -all ground personnel... ...or trips to mars. $4.95. delivery drones or the latest phones. $4.95. no matter what you trade, at fidelity it's just $4.95 per online u.s. equity trade.

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analysts that 2019 would be its most money losing year and they would move steadily towards profitability. that resonated with public market investors who pushed lyft shares down 20% from its first day pop as they try to figure out what that path to profitability is shares moved up in the afterhours on the back of the comment but didn't last long take a look at where they're trading perhaps because the plan was light on details lyft is trading down nearly 7% getting close to its -- the valuation of its last private round. much of its plan to profitability depends on uber set to raise as much as $10 billion in its own ipo is that more fire power to battle for market share and keep both companies in the red for a very long time on the flip side, what does this mean for uber? lyft saying it will see peak losses this year could put pressure on uber to tell its investors when it will rein in spending now another key variable in both companies' paftsz to making, not losing money, are the drivers.

we've said this again and again what they make as freelance contractors is one of the biggest costs that uber and lyft can control but their ipos are making it clear that it's the employees and the investors getting rich not the drivers on whom they have built their platforms. a large number are striking across the country and want livable incomes and regulated fares and they are taking place in four of uber's five most important markets that make up nearly a quarter of all gross bookings around the world. that's new york, london, san francisco, and los angeles you can see the full list here of all the cities that these strikes are taking place some debate over how many people are showing up and how many are turning off their apps but the message is to send to investors ideally that they are not getting rich on the back of this ipo. >> yeah. we've got reporters in bureaus in san francisco and l.a of course we are here in new york just a four-minute wait in san francisco right now, five minutes in l.a i'm looking on lyft, two minutes

in new york there, four minutes on uber here doesn't seem to be a huge impact no surge pricing. >> i think you have to keep in mind there's a lot of drivers unhappy but there are also a lot of drivers, perhaps, the majority is what the companies would tell you, that are happy being freemans contractors and don't want to be xwees because they use uber and lyft as a supplemental income, a second job for them it is interesting to see i think what they want are, you know, they're asking for reasonable things like a livable wage, but there's divergence and it plays into the whole argument over the gig economy how do you classify these drivers. gig economy workers. it does have major ramifications for the ride sharing companies and already you have actually seen regulators take an eye to it and if this group of lyft and uber drivers get what they want, that would be a big problem for uber and lyft's business models. >> deirdre, to go back to the metrics for a minute because i feel like such a big part of

these companies going public has been this education of investors, of wall street, in terms of the metrics they're using and they want to be valued based on that. maybe they are different from what we've seen from other companies in the past. lyft didn't disclose gross bookings and moving away from total rides. it didn't disclose those numbers why? >> that's a very good question and an important part of this narrative. you make a good point, investors are learning about not just these two companies but the whole industry before lyft we never had a ride sharing company, the public market investors could trade the fact that they take out gross bookings is a point that a lot of analysts have picked up on and this is really important metric to talk about their total addressable market, which john and logan, the two co-founders, spent a lot of time talking about last night on the call why they took it out still uncertain. what they told investors as they move into scooters and e-bikes and other mobility options, it could be a little confusing.

you could argue that investors need that information and they can make up their own minds. it's a good point. >> yeah. deirdre, thanks. we're all looking forward to seeing what uber does. the dow coming off its worst day in five months, but rebounding sharply at least this hour take look the at names having the biggest impact on the dow's gains today. united tech, nike, walgreens, a lot more "squawk alley" still ahead.

market got a pop here as the white house spokeswoman sarah sanders told reporters the u.s. has received an indication from china they want to make a trade deal eamon javers in washington watching that. >> here's how this happened this morning. sarah sanders came over to talk to some reporters this morning i asked about the president's tweet this morning which he suggested that chinese side is coming to washington to make a deal i asked sarah sanders how the president knows that

was there any communication with the chinese side here's what she said >> look, we've got an indication that they want to make a deal. our teams are in continued negotiations they're going to sit down tomorrow and we'll see what happens from there. >> so sanders there saying they've gotten indications they would like to make a deal. that remark apparently hit the wires and that caused this market reaction that we're seeing, that you guys are seeing on the stock market floor. importantly s contextually, sanders is not saying what indications the white house has gotten and also not saying where this is going to land. she's sort of caveating this saying the two sides are going to negotiate what she's doing there is backing up the president's tweet, but not really going any further than that in terms of saying exactly where this is going to land or exactly what the communication was between the chinese side and the u.s. side, if any here, just saying indications broadly that they do want to cut a deal we'll have to see where all this plays out and that's what sarah sanders is saying as well.

carl >> i'll take it. thank you. the president tweeting about gm's ceo mary barra moments ago. phil lebeau joins us from chicago with more. >> morgan, the lordstown ohio plant with general motors basically idled, starting in march, and said look we're not going to be building any more small cars, that's where the chevy cruz was built, donald trump has been hammering general motors for weeks that something needs to change, they need to bring that plant back. he has just sent out a tweet and in that tweet, two tweets, we should point out great news for ohio just spoke to mary barra, ceo of general motors who informed me subject to a uaw agreement, et cetera, gm will be selling their beautiful lordstown plant to workhorse where they plan to build electric trucks. gm will also be spending $700 million in ohio and then he goes on to tweet again, in three separate locations creating 450 jobs i have been working nicely with gm to get this done.

thank you to mary b. your great governor and senator rob portman. with all the car companies coming back and much more the u.s. is booming. general motors is getting a little bounce off of this news the share is moving higher clearly this is one of those issues where general motors really wanted to get this off the front page as much as possible they have been working to figure out some type of a solution and according to the president, they now have one selling this plant in lordstown ohio to work hoarse. one thing we should point out the part about the uaw agreements that's crucial here because the question is whether or not workhorse, as part of buying this plant, said, yeah, we'll take those contracts from the uaw. the current agreement, that current uaw contract expires later this year. guys, back to you. >> phil, couple observations one is that we're no longer in a period where companies announce this through a press release we now get it through a presidential tweet. >> yeah. >> the other is that we don't

know how much of this $700 million is new money, do we? >> no, we don't. we don't and general motors, when they announced the closure of the lordstown plant, they were very active in telling me and other reporters look, we're still spending money on our suppliers and on some of our other facilities in ohio, so it's not like we're abandoning the state. what's unclear here is how much of that $700 million is a fresh investment, a new investment, or how much has already been earmarked. >> yeah. thank you, phil. given the way the president attacked mary barra kind of personally initially, it's interesting to see him say he's been working nicely. lots happening over the president's twitter account lately phil lebeau. >> you're right. >> thank you european markets set to close shortly. seema moody joins us with a breakdown of today's action. >> and jon, a nice intraday reversal for european equities on those latest trade headlines. the stock still headed for the

worst week of the year some pockets of strength, british oil majors rebounding after suffering their worst days since december strong chinese crude imports offsetting demand concerns news out of germany, weaker than expected factory orders yesterday. industrial output rose in march for the second month in a row. consumer goods and construction led the gains. and strong earnings from seemans helped alleviate investor concerns the conglomerate beat forecast on profits and sales and that stock on pace for its best day in more than two years, up nearly 5%. it comes on a day after the company said it would spin off its gas and power divisions. also in now cuss the geopoliticals, iran's president rouhani putting europe in the hot seat, germany, france and the uk, will these countries find way to continue buying iranian oil despite pressure from washington to pull away and will they succeed in using a special purpose vehicle in

conducting smaller transactions through it that is going to be a big story and you have to wonder how this complicates the relationship between the united states and europe as well back to you. >> absolutely. the other big geopolitical story right now to focus in on seema moody, thank you. let's get over to sue herera for a news update. >> good morning, morgan, everyone here's what's happening at this hour president trump asserting executive privilege over special counsel robert mueller's report escalating a battle with the democrats on the house jur hushry committee the move announced in a letter to gerald nadler minutes before they were poised to hold attorney general barr in contempt for defying a subpoena. secretary of state mike pompeo meeting with theresa may to discuss ties amid tensions with iran and he arrived in london after abruptly canceling a trip to germany to make an unannounced visit to baghdad. the taliban attacked the

offices of an international aid group in kabul setting off a huge explosion battling afghan security forces. at least nine afghans were wounded in those attacks and severe storms whipped through texas, leaving behind major flooding in the houston region some areas reported up to ten inches of rain and other regions received 76 inches in a 12-hour period a disaster declaration was issued in fort bend county they are getting more rain today. that is the news update at this hour i'll send it back downtown to you. carl >> thank you very much. we got a pop on that comment from sarah sanders that the white house has an indication that the chinese want a deal about 100 points we'll see it if holds. s&p 2892 back in a minute global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that,

you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

bob is with us at post nine to talk about the pop we got from sarah sanders. >> art cashin has been hitting it out of the ballpark all week. yesterday we moved 180 points in ten minutes. everybody said what's going on art says, beware overnight tweets because you can move the market up just like down i want to show the s&p futures overnight. around 4:30 in the morning, we had that big reuters story that said that china was backtracking on nearly all aspects of the trade deal forget about it. we lost 15 points on the s&p really quickly on that then just 45 minutes before the open, the president tweeted china's informed us the vice

premier is coming to the u.s. to make a deal. everybody latched on that "to make a deal. we moved up 10 points. sarah sanders you just saw with eamon javers standing in the driveway at the white house saying oh, we have indications that chinese delegate is coming to make a deal maybe she's echoing the president's comments, but we move up another 10 or 15 points. if this is not confusing to the markets i don't know what is hopefully we'll get some resolution in the next couple days you see the usual trade and tari stocks and your my krons and qualcomms and best buy and others have moved out. everybody trying to gain this. three outcomes, the trade deal gets done, everyone is happy no trade deal and no tariff increase but continue with negotiations or number three, no trade deal, the tariffs increase and they go home angry and we go home angry the market would be okay with the first two probably, including the second one, and not okay at all with the third one. that's why nobody is trading they're standing around to

figure out when will get we a resolution. >> i get the implications an the gravity of the situation where the u.s. and china are concerned, but we have this other major geopolitical situation bubbling up that's iran we had pompeo the secretary of state go and visit the region yesterday, navy ships in the region, starting to pull back on some of the nuclear agreement or at least talking about it. is this something the market is paying enough attention to. >> i think it should be a factor and i have been calling around saying where is iran figure in here we had the weak china export data everybody said absolutely, this should be an issue, is it 20% of the problem for the markets right now? it doesn't seem to be. it seems to be very difficult to factory factor how much should matter i think it does matter i think the situation is precarious over there. something could happen easily and everybody needs to be careful about that you can see how confused the markets are if you look at the vix futures. the front month, cash contracts very high, nearly 20, and the front month contract is like 18.

look at these numbers. very unusual where you see the first futures contract, that's the second one, may is higher than the ones that are further out. usually the further out you go we don't know what's going to happen, so it's -- the krostz higher farther out you go. this is called backwardation traders have no idea what's going to happen in the next couple weeks and saying i'm going to buy that up. >> you made that up, backwardation. you made. >> i'm going to use that phrase from now on. >> light volume suggesting people are sitting on their hands? >> yeah. yesterday the volume was hersav for the first time in a while in the big etfs like the spdr etfs. people were moving money around. remember we had arguably a distribution day, what's called a distribution day, where institutional funds were selling because we had some very, very unusual seven to one, ten to one declining to advance stock for a good part of the morning that suggests some distribution here when the volume goes up

like that and you get that kind of levels of declining to advancing stocks. >> the spoke did a chart this morning on intraday action suggesting that weakest part of the day has been in the morning and into the european close. >> yeah. >> and their thesis was that overseas investors are sellings u.s. >> yeah. this has been going on for a while now. everyone has noticed that we tend to generally higher than we open and the low print is either at the open or within the first hour or so i think there might be something to that. we don't know what europeans are particularly doing, but that pattern has been going on for more than a month now. >> the ipo train chugs along parsons that went public earlier today up 10% as well. >> that is a wonderful company i'm glad you had the ceo on. they do amazing things for the u.s. government. they're like booz allen. they are involved in virtually all aspects of helping out the government, infrastructure, cyber security this is a big deal it kind of gets lost in the

uber/lyft thing but there's very important companies going public now and this was one of them. >> the other tech companies. >> yeah. >> all right bob, thank you uber drivers nationwide staging protests this morning over low wages ahead of the company's ipo on friday. aditi roy is live on-site at uber hq with the latest. hey. >> hi there, morgan. we are just a few hours away from uber drivers beginning their protests here at the company's headquarters in san francisco. across the country and even the globe, we are expecting drivers to demonstrate in cities like los angeles, chicago, new york, and even overseas in london. in fact, in london this morning we've already seen protesters, though, about a third as many as we were expecting. another -- one sign says "uber driving us into poverty. closer to home a caravan of uber drivers moving slowly across the brooklyn bridge as cars in the next lane go by. the drivers have four demands --

higher wages, transparency in decision making, employee benefits and a voice in company decisions. lyft and uber drivers say they will shut down the apps but we're not hearing reports of that happening in a statement an uber spokesperson says drivers are at the heart of our service we can't succeed without them adding we'll continue working to improve the experience for and with drivers now as part of the company's ipo about a quarter or 1.1 million uber drivers globally will be eligible for a one-time driver appreciation reward. that's that ranges from $100 to $40,000 depending on the number of trips that the drivers finish u.s. based riders will have the option to buy up to $10,000 worth of stock with that money and the ride sharing company has set aside 5.4 million shares or 3% of its common stock for drivers according to an sec filing we're just about three hours away from the protests beginning here in san francisco. back to you guys >> aditi, what if the protests there in san francisco and

headquarters isn't as big as at least the drivers have hoped does that send a message to management are they saying anything about what they expect does that send a message to investors? >> yeah. i mean it's basically a message to the company, they want to get paid more and want benefits. that's the core of their demands. but as far as the numbers -- >> what if they don't show up. >> for instance, in london -- >> yeah. that's the big question. it really depends on having, you know, that critical mass of people showing up and trying to shut down the app. we're not seeing any indication of that happening. we still have a few hours to go. we'll have to see. >> indeed. aditi roy in san francisco, thank you. when we return, the ceo of service w'nos take on today's market volatility. stay with us you're right sir.... no not everything, i mean you're still blatantly sucking up to me gary. brilliantly observed, sir. always three steps ahead. six steps ahead. sixteen.

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your daily dashboard from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity. deal, the real story on the trade talks and what happens to stocks if new tariffs go into effect on trifriday. we'll debate with our investment committee which includes today kevin o'leary. the street slash to wall street. our call of the day. really time to sell that stock now? we'll debate pete najarian's buy and the name and the trade he must made. >> thank you earlier today i caught up with service now ceo john donahue who joined me from the

knowledge conference in las vegas and i asked him if he was worried about the volatility in the market and its impact on customer demand. >> we continue to see strong growth we had 40% growth in q1. we had close to 40% growth for all of 2018. so we're not seeing any indications of slow down and the reason for that is, companies must spend on technology to drive their digital troo transformation the fact of the matter technologies like service now help companies be more productive, help they drive or give them the capacity to reinvest in innovation we are very much part of the productivity enabler and that's part of why you're seeing very strong continued growth. >> speaking of continued growth, out with a new note after service now's analyst day

calling service now the next enterprise software firm to reach $100 billion market cap that would mean the stock about doubling from here i asked him if he thinks that's reasonable >> absolutely. and john, our focus is not on our market cap our focus is on how do we ensure our platform transforms our customers' experiences at work this is a very customer focused organization i had dinner last night with the folks from the usaa, linda jojo of united talking about how service now is enabling them to enable their employees to completely transform the experience of their passengers and so if we stay focused on that and we stay focused on continuing to innovate and built our platform, then we're going to grow and if we grow, i think our market cap will grow over time >> all right no backwardation for service now. i don't know if that even makes sense, but i love that word,

backwardation. he's expected continued strength, despite what -- from the markets looks like uncertainty, he said customer demand for that kind of cloud to digital transformation continues. >> it speaks to, you know, one of these conversations we've been having repeatedly on our air that it's a secular shift and secular growth for some of the technology software, the process of digitalation. look at a company like seamens, industrial conglomerate said it will spin off power and gas but essentially part of the reason is so it can focus on the digital assets and software it's looking to roll out and offer its customers as well. >> i'm skeptical of the recession proof, everybody has a plan until they get punched in the face. >> mike tyson said, one of the best five year charts you can look at. >> a lot of great five-year charts these days. indeed. >> all right great stuff, jon shares of match are surging off of the back of strong

earnings results you can see the shares up nearly 12%p the ceo will sit down with us exclusively next. meantime we continue to monitor today's market action. the dow is now up 20 points. it's back below 26k. wee ckn mont'rba ia me what do you look for when you trade? i want free access to research. yep, td ameritrade's got that. free access to every platform. yeah, that too. i don't want any trade minimums. yeah, i totally agree, they don't have any of those. i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale.

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boost the age to buy tobacco products from 18 to 21 years old. a movement called t 21 or tobacco 21 walmart will boost that age and said it will also is in the process of discontinuing sales of fruit and dessert flavored e-cigarette products as well outlined those steps to prevent minors from buying tobacco products in a letter it made to the food and drug administration t-21, walmart the latest company, more as we know more, back over to you guys. >> yeah. the latest being the keyword there, dominic chu, thank you. meantime increases in tinder and higher revenue to a beat on earnings those shares are trading up more than 12% joining us now from dallas in a cnbc exclusive is match group ceo mandy ginsberg great to have you on today thanks for joining us. >> thanks. good morning thanks for having me on again. >> so the fact that it fueled so much of the growth for the quarter what is it about this app and offering specifically

that is fueling so much growth >> yes tinder did drive a ton of growth this quarter and we hit a milestone, 5 million subscribers. i think at the end of the day, tinder is a fun, gaming experience people want to find love and connections and what we're seeing is that when people unlock these features it gives them much better success rates on the app so more and more people take us up on the added features it's good for them and clearly good for us. >> i'm going to put my anthropology hat on here for a minute because i saw this line in the results that you expect 25% of revenue to come from asia pacific in 2023. when you look across the world, i mean, there certainly has been a taboo or even a stigma attached to online dating in places like india, for example, you've historically had arranged marriages have continued to be a societal norm for some communities. how have you been able to, i guess, break down those social barriers and be able to access

more potential users in those markets? >> so, i think two things are happening. one is that there's big young populations in these parts of the world and also there's higher internet penetration and more smartphone use and then on the backdrop of things are changing pretty significantly from a societal perspective. i actually -- my nephew was married in india last year and none of his friends had arranged marriage so what's happening is we're providing these great apps and great experiences so as social change is happening, we're right there and we just see nice momentum because of both social change and also just real growth and people trying new things >> mandy, what's the role online in digital form of real identity in the dating process? because i know facebook is trying to get in here with features and ideas around people who have friends in common, connecting with each other i imagine there could be pluses but certainly minuses with mixing real life with digital

life too soon and in the wrong ways how do you think about that? >> yeah, well, i mean, so, we've been around for a couple of decades now, that's sort of remarkable, and our job has always been and is today connecting people to people you don't know, so it's expanding your dating pool, per se and i think expanding your dating pool and meeting in real life, i mean, the biggest advice i give people is be your true authentic self because the whole idea around these apps is meeting face-to-face and you have to make sure that you represent yourself in the right way. >> hey, mandy, you got pete buttigieg on the cover of "time" with his partner i wonder, same-sex, what percentage of the business is it now? >> it depends on each platform we've got some platforms like okcupid that tend to be a little bit left and more coastal that's above the sort of the u.s. national average i think above 10% and there's apps that are a little bit lower but on all of our platforms we

provide lots of options for people looking for same-sex relationships, et cetera >> let's talk a little bit about hinge because at least among quite a number of the single ladies in my life, that seems to be the hot app that everybody is plugging into. what is your strategy for that longer term and are you making money off of it? >> yeah, so, hinge is a really exciting product we actually just acquired it, finalized the acquisition in december, and we've seen tremendous traction with hinge and the real reason we're seeing traction is because people love it, to your point about your friend, and they're talking about it and telling their friends about it so it's getting real word of mouth marketing so the whole strategy around hinge is really simple it's all around intent and relationships so unlike tinder that's a little bit younger, like 18 to 25, hinge definitely skews a little bit older we haven't really focused so much on monetization it's really all about user growth we're seeing nice momentum in big cities especially on the east coast and now london is our second biggest market and we're seeing traction there and we'll

turn our focus a little bit later on in the year to focusing on monetization for the platform but we like what we see so far >> is there cross pollination between the different platforms in terms of users using more than one >> yeah, i mean, this is a category where when you have high intent and you're ready to find someone, people are using multiple products and so on average, people under 30 are using 3 to 4 products and we see that they're on multiple of our products and i think that will continue and that's why we see even in asia right now, we see multiple product usage and we think there's real opportunity not just for one product in these markets but for multiple >> mandy, thanks for breaking down all of these numbers and trends within the company for us we appreciate it >> thank you >> match group ceo with the stock up 12% we've lost about half of that pop that we got out of that comment from sarah sanders about the chinese indicating to the white house that they want a

deal but we're completely on headne wchliat today "squawk alley" is back in less than three minutes

welcome back to "squawk alley," google's ceo taking a

shot at apple, saying, quote, privacy cannot be a luxury good only available to people who can afford to buy premium products and services apple has been trying to differentiate itself from its silicon valley peers on privacy issues i know this is something you've been talking about quite a bit as well. >> my problem with sundar's statement here is it's a luxury good available to people who are smart and informed enough to be able to tweak their settings in exactly the right way. google, facebook, amazon, all of them offer these options for how to limit the data that you're sharing with them, but you have to know how to turn it on and by default, too often, they'll log you into chrome, even if you really don't want to, they'll track you in maps, they'll look at all this information. you have to keep checking to make sure. if you log into email, you logged into everything on chrome and suddenly they're tracking everything that you're doing so everybody's got an agenda, apple included, no saints out there making money but i don't know.

this statement from him, i'm not quite buying it. >> i know they've had their event going on all week so maybe that's way the op-ed today but i am surprised it took this long for him to come out and make his case for privacy and how the company's thinking about it. >> yeah, i mean, issues fraught, as we well know. we talk about it almost every day. it's an overt knock at apple, right, doesn't name them by name in the piece as far as i know. >> no. not overt. i think what we're lacking in the digital realm, at home, we know what privacy is if you want to get in, you got to ring the doorbell and i look and decide if i want to let you inside in the digital realm, it's all fuzzy. like, sundar, bezos, they're kind of in your living room hanging out and you don't know but they're like, oh, but you trust us i guess i do i thought i did for one thing but maybe not for that it's something hopefully we'll get figured out. >> yeah. >> we're working on it, that's for sure meantime, trade deal remains in flux, obviously, dow's up 54 we got the comments from sarah sanders a few moments ago that

the white house believes there's an indication the chinese are interested in putting a deal together although reuters with a headline that china's commerce ministry says we'll have to take necessary retaliatory measures if the u.s. decides to raise tariffs on may 10th. >> yeah, also in focus, a future mobility, we get the uber ipo on friday and then those tweets about workhorse and gm also putting that in focus too. >> let's get to the judge. carl, thanks, i'm scott wapner the trade tensions driving stocks lower just noise? or is it really nervous time for investors with a rally that has come too far too fast? it's 12:00 noon, this is "the halftime report. >> announcer: trade battle, the next step. we expect to hear from president trump this hour as the stock market hangs on every word >> you've got an irresistible force meeting an immovable object where both the premier of china and the president of the united states want to come across that they prevailed and