ten-year note, where it's been for -- since it came down from about 1.6, 1.7 to a new range to maybe 1.2 and 1.4. andrew, plans for the weekend? stay safe. >> resting, sleeping. >> we'll do it again next week. >> yes, we will. make sure you join us. "squawk on the street" is next >> good friday morning, welcome to "squawk on the street." i'm carl quintanilla with morgan brennan at the new york stock exchange david faber is with us remotely and cramer has the day off futures a little weak here not just on amazon's revenue, but warnings about higher costs. inflation data was cooler than expected road map begins with amazon's pandemic effect.

shares are down sharply ahead of the open >> plus, more companies are delaying return to work plans amid renewed fears of the covid virus. we're going to break down the implications of the future of the office with the ceo of one of the largest commercial real estate firms. and scarlett johansson versus disney. suing over potentially lost earnings because of its streaming release strategy disney saying it has no merit. we'll start with amazon, going to be a huge story not just for the company and the price action but the overall indices. we've been talking about some of the stellar revenue prints from the mega cap tech companies. and 27 still gets your attention, $100 billion quarter for the third time in a row, but these warnings about slow downs is definitely going to be seen at the open. >> yeah, and listen, not the first time that we've seen amazon sort of give us a warning only to ultimately exceed it you're right, carl it's been an interesting earnings season for the biggest of the big, you know, and we

pointed out many times the incredible top-line growth for all of these companies off of what are already enormous bases, growing -- as opposed to the largest companies on the planet. nonetheless, most of them, carl and morgan, the stocks went down given that there is a thought amongst investors that these kinds of growth rates are not simply repeatable. again, alphabet obviously was up on that 57% constant currency revenue growth, but we've seen what happened with some of the other names including apple and facebook, even microsoft, and now amazon taking it harder than any of the others have so far this morning after reporting numbers. >> it's interesting, coming into the second quarter a lot of the talk was around this reversion to the mean, right and what were these big tech names and all of these other types of stock and industries

that had essentially benefitted from the pandemic and stay-at-home trade, what that was going to look like as people started to come out of their houses and what that was going to mean for some of the numbers. you see it obviously in these results. you can say the same thing about pinterest and some of the other results we've gotten this week, the fact that the nasdaq is poised to end the week lower and the pressure there that being said, there are some areas of strength and advertising certainly is one of that we've seen that in amazon. we saw that in google, alphabet as you just mentioned as well. for so long, carl, i feel like for years we talked about about how it was al phabet and facebook now amazon really is truly becoming this formidable third player in this market. but again, speaking to how the big are getting bigger. >> no doubt about it the other category, which is what amazon calls it that includes advertising, up 83 year on year, prior quarter up 73 you actually saw acceleration on that front, but obviously that's

not what investors are keyed into this morning. sticking with amazon, let's check in with john black ledge, cowen senior internet analyst, and get a sense of what the street missed. they talked about rising mobility as morgan said, pinterest today talking about engagement headwinds should this be an obvious story or was there a surprise built in there? >> yeah, the near-term view with the results and the guide. i mean, you have a slight 2q revenue versus consensus as you mentioned, carl, with the e-commerce slowing with the rising consumer mobility that did overshadow, i think the biggest surprise was revenue outlookmissed consensus by 8% at the midpoint. it's expected to decline sequentially, and for context, over the last ten years, 3 q revenue has averaged 9% sequential growth, and then you had the op income guide was like

2 billion lower, than consensus at the high end. it was particularly disappointing given how great the high margin, aws and ad businesses are doing we modestly lowered our long-term margin outlook and raised our capex forecast on am amazon's historic fulfillment investments from 4,600 and stay staying at outperform. >> yeah, i'm just curious about the guidance i realize this wasn't the first full quarter with andrew jassy at the helm as ceo based on what we know about him and his leadership at aws is there a chance that we could be seeing a conservative guide? because you have a new ceo who is in place now? >> i don't think so. you know, i the top line guide was, you know, lighter as i mentioned than we thought. i think they're just bumping into tougher e-commerce comps and i didn't think either the top line guide or the op income guide were conservative, but the op income guide was surprising

to me just given -- i'll give you an example, in the second quarter, you know, depending on what you assume for the margin for the advertising business, advertising plus aws were over 90% of the op income for the company. so -- and those two businesses are accelerating, so b-- but i don't think it was conservative. i do think we need to look at the longer term here, the intermediate, and the longer term in this historic fulfillment investment the plan going into 2020 was to ramp fulfillment network for one day and ultimately same day delivery then covid hits and with the incredible demand surge, they ramped the expansion efforts even further so for context, we now are looking for amazon to spend 85 billion in capex if you combine 2020 capex spend versus spending 60 billion in capex spend ten years prior to 2020. the cfo said the fulfillment network nearly doubled in size

18 months ending at about 500 mill the network will expand further in the back half of the year as they prepare for the holidays. that will lead to elevated investment spend through year end and dampen margins >> yeah, those numbers are just staggering and they're almost hard to contemplate in terms of that kind of spending. speaking of some other numbers,you know, what about the the multiple here? what is appropriate given this quarter and given the outlook that you're sort of sharing with us at least from your perspective. >> i think it's trading at about 16 times next year's ebitda. the average is 13 to 25 times forward ebitda so it's kind of -- you know, it's not expensive. it hasn't been expensive for some time, so i just think investors are digesting the top line guide and the notion of, you know, kind of the next

couple of quarters are going to be tough comes i wouldn't look for, you know, kind of multiple expansion in the back half of the year. >> finally, john, you know, as we head into back to school, actually really we're already there in some parts of the country. >> oh, my gosh, yes. >> and then holiday, would you expect those to face sort of rising mobility type of problems like we saw in this quarter? >> i think back to school will be a challenge, you know, just given theoretically if children kindergarten through young adults in college, if everyone's kind of back and on a global basis, you're going to have a tailwind with the apparel and accessories vertical you're going to have some headwind probably at home and kind of at, you know, the electronics as well. i think back to school is a tailwind for the company, although you didn't really see it in the guide, and then, you know, the holidays, they're

preparing for a big holiday season so seasonally it should be good. back to school i'd say a tailwind. >> not often we see some trimming of price targets on this name. we got a couple today, and interesting to get your new metrics, too, john have a great weekend thanks very much >> okay, thank you >> david let's stick with earnings as well, procter & gamble posted better than expected quarterly results. the company also announcing chief operating officer ron muller will succeed david taylor as ceo in november taylor will take on the role of executive chairman here's what he had to say about the changes earlier on "squawk box." >> at the time i hand it over to john, it will be six years as the ceo. this is actually a very good time the company's delivering strong results. the strategy is working and john along with the very strong leadership team and organization are ready to take this company forward. >> yeah, taylor of course has

been through what was a difficult proxy fight and then a lot of smooth sailing to a certain extent, morgan, as well for the company as you can see there during his tenure. of course up 84 plus % want to see sort of them versus some of their peers to really put that in perspective in terms of his period of time as ceo. >> yeah, it's also interesting we got a number of manufacturers, perhaps some that are not so consumer facing but more on the industrial side that reported earnings today and this week as well that are in focus, so caterpillar this morning, for example, and you've seen beats on the top and bottom lines for some of those companies, too, but it's cost, right it's cost pressures. the ability or inability to push those costs out in terms of higher prices to end markets as well that seems to be a much bigger theme. even if it's not necessarily playing out with procter & gamble, it is playing out in some of those other packaged food names that have reported

results. i think about nestle yesterday, which was under pressure too, and so i think that's going to be something that really kind of guides the market, carl, as we do go into the second half of this year and especially as we do see earnings catch up to price or perhaps in this case some back and forth among investors about just how much that's actually happening. >> that was really -- i mean, the line from p&g that freight and commodity costs had, quote, escalated significantly is what got a lot of attention caterpillar did say full year price increases would offset some of those rising costs and that is turning out to be the magic line for a lot of these conference calls. >> yeah, we've talked to so many ceos about inflation in the core commodity they need to make their product, not to mention of course wage inflation. but to your point, many are at least trying to take price, whether it be permanent or not

guys, worth mentioning of course the big oils reported, chevron and exxon. again, to this sort of broader point, carl, you know, exxon chemicals were very strong that's an interesting reflection of the industrial economy. again sorkt of an indicator of industrial and consumer demand, obviously oil as well did fairly well we'll keep an eye on shares of exxon this morning they have a bit more to share as well in terms of some of their capital allocation they only spent 7 billion on capex in the first half of the year not unexpected that will bring them to the low end of what had been their guidance on had that front as well as we see exxon mobil shares, we'll see how they open roughly 18 minutes or so from now. >> yeah, and of course we did see those chemical shortages earlier in the year, which again speaks to all the pressures we've been seeing on supply

chains in general. coming up, what's next for robinhood after its rough public debut yesterday. we've got more "squawk on the street" from the floor of the new york stock exchange straight ahead. you can see those shares are town right now ow right now. down right now go aflac!!! what the heck, troy - that's not your kid! the aflac duck is just covering for sophie. same way he got me money to help cover her hospital bill when my health insurance didn't pay for all of it. but this isn't fair! that's exactly what i said! but then i learned health insurance isn't even supposed to cover everything. wait...for real? for real real. luckily i had aflac. aflac!!! get help with expenses health insurance doesn't cover. go aflac! !mm-hm! get to know us at aflac.com.

robinhood entering its second day as a public company after the stock tumbled in its debut.

vlad tenev the ceo shared his reaction to that climb. >> we're building a long-term business so you have to ignore these short-term fluctuations. some days markets are up some days the market is down look back on what the company has been able to do over the past six years we've delivered a lot of great products, a lot of value to customers and a lot of value to shareholders i'm used to being doubted personally i think from the very beginning we felt like underdogs here at robinhood, and you know, we'll see underdogs hopefully evolving into comeback kids >> we had paid attention to leslie picker's great metric about companies that came to market raising 2 billion and being in the red six straight, now seven obviously, but this one is the worst performing day one ipo of its size. >> it is it was a rough day for the stock and i think for the investors particularly some of the retail folks that maybe got in on the

ground floor for this. it's one to keep an eye on it's certainly interesting and if cnbc were able to bookend these interviews with tenev before the stock started trading and after. of course, david, it's really payment for order flow it's regulatory risks. i mean, this is what's very much in focus, if not in the long-term then certainly in the near-term. >> yeah, and those kind of risks, of course 80% as we know of the revenues coming from payment for order flow, questions about the long-term nature of the business at the same time those who were believers and listened to mr. tenev yesterday in both interviews and his discussion of it becoming a money app within five years broadly speaking. >> yeah. >> they are the ones perhaps who are going to be the longer term investors here carl, listen, you never want to see -- you never want to see an ipo break syndicate bid, and certainly not in this way. we've seen it before uber comes to mind as having a very poor debut and over time

you do develop a shareholder base at a certain level. but it's not good, and we're going to follow it closely today and see where it may settle. >> right also watching ark's strategy on all of this, cathie wood did buy about 1.3 million shares even as she has sold some roku quite a bit over the past month. we'll see how many defenders it has over the medium term as we get into another week of trading next week. >> what that vision with that strategy looks like i think is going to be key for this whole order flow, that is such a large percentage of revenue to diversify away from that, beyond that, and what all of that data could mean from a monetizable standpoint beyond that type of revenue stream is going to be key for robinhood and i'm sure something cathie wood is keeping in mind. >> i'm thinking of what jim said yesterday, david, and that is in some way retail investing

sentiment was riding on the performance of this. that will be a longer term story to see whether it took a bit of a ding as the ipo didn't go the way it hoped we'll see. there's a lot more to be determined take a look at the futures as we wrap up the month of july, some of the s&p gainers, moderna's going to be number one. also on the list chipotle, yum brands, domino's, oracle and hilton are tdown there as well "squawk on the street" is back in a minute. at the lexus golden opportunity sales event. get 0.9% apr financing on the all 2021 lexus hybrid models. experience amazing. all the things, all around you... where you learn, work, and fly... we help make them healthier. we are the people of abm. for more than 100 years, we've been a leader in making spaces cleaner, from the things you touch to the air you breathe.

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bitcoin is an idea that's worked it might have been risky ten years ago, but how long do you have to watch something spread like an idea virus before you

decide that maybe it's going to be around for a while? >> that was what microstrategies ceo michael sailor said about bitcoin on this program last month. stay tuned to hear what he's saying now about his crypto strategy on the next hour on squawk you "squawk on the street. reported earnings after the bell last night, you're actually seeing growth in that core company, but of course crypto, specifically bitcoin, the fact that the company owns more than 105,000 bitcoin now, has turned to the debt market to finance some of those purchases. such a key focus and key reason for the volatile movements we see in the stock in general. >> speaking of volatility in bitcoin, up 11% for the month is going to be the best first positive month in about four months and the best week since february, right? remember when we were in the high 28s and people wondered about whether or not some of these chart patterns could last,

some of the bulls definitely proved some of the skeptics wrong, at least on that. >> certainly what we've heard from a number of guests this week, is you are starting to see more institutional flows back into bitcoin and some of these other cryptocurrencies like ethereum this week as well there's also a big development you'll want to know about, and that is our own david faber will be the guest host of the iconic game show "jeopardy!" that's all next week. david, i can't wait to see this, and i'm dying to know what your preparation was like and if there were certain questions that even stumped you? >> there absolutely were and it was a great deal of preparation. we did tape the episodes some time back as they continue to have guest hosts on the program, lavar burton finishing up this week, and i'm very much looking forward to watching my five episodes, and hope everybody else will as well. it really was a fascinating,

exciting and difficult undertaking, morgan and carl you know, it's a very specific show and obviously i did try to do as best i could, in particular to sort of move it along and make it as easy as possible for the contestants because that's the key they're the star along with "jeopardy!" itself >> you're looking very spiffy in these photos that we're showing on air, david. i'm curious as somebody who's been a contestant and now a host, which was harder >> oh, i think hosting, yeah i think hosting is harder. i mean, yeah, yeah it just -- it was a new thing, you know as much time as we've all spent on television and as comfortable as we are, when you're put in new environment, it can tend to be a little more difficult perhaps than you even anticipate it will be. >> yeah, i mean, you taped it a while ago as we know, david, and it will be -- i wonder what kinds of things, can they fix it

and post as they say in holl hollywood? >> they didn't need to fix anything with me, carl, come on, man. >> great to watch. >> they try to make us all look good. >> that is definitely the point. i wish we had some of that on live tv. the opening bell is a few moments away, don't go anywhere.

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welcome back to "squawk on the street." did want to share a statement that we've gotten that's been put out by s.e.c. chair gensler on what they're calling recent developments in china. there are some specifics here that certainly are of interest to u.s.-based investors. it does involve the variable interest entities that are created by many chinese companies that go public here in the united states. and that arrangement -- and i'll read here because it may be clearer here than i can explain it a chinese based operating company typically establishes an offshore company to issue stock

to public shareholders, then the shell enters into service and other contracts, the chinese operating company issues shares on a foreign exchange such as the new york stock exchange. here's the important part for investors as well. gensler says in light of the recent developments in china -- and we all are well aware of course and have seen the fall in the stocks as a result of that new guidance and restrictions that they're doing -- in light of those recent developments and the overall risks with the china based vie structure, he has asked the staff to seek certain disclosures from offshore issuers associated with chinese operating companies before the registration statements will be declared effective he goes on from there to talk about specifics. i would direct people, carl, to read the actual release if they're interested we all know about the s shellacking. alibaba is one of them that does have that vie structure in order

to list here in the united states >> huge news out of the s.e.c. this morning, and we're going to keep our eye on all the china shares i did notice didi premarket is down about 4%, has recovered a little bit as we get closer to the opening bell here, and the cnbc realtime exchange at the big board. it is produce company dole celebrating its ipo at the nasdaq -- specializing in blood purification not sure what that means, but very nice. busy week for new issues of all sources. we're back to 43.90 here, s&p is going to up down 28 points or so media's going to be a big story for us today the scarlett johansson lawsuit of disney made huge news yesterday followed by the remarkable response from disney calling her lawsuit callous and showing disregard for the pandemic, but you and i have

talked about back end compensation in hollywood for a long time, and it does look like the industry's going to have to evolve one way or another. >> without a doubt and carl, one of the keys, and i know you spoke to brian roberts about that there's the disney respondent saying no merit about the filing and is especially sad and distressing in its callous disregard for the horrific and prolonged global effects of the covid-19 pandemic. they said they fully complied with the contract and in fact, they say that she's actually in a position to earn a lot more than the 20 million that she was paid carl, you've talked to -- i've talked to ari emmanuel about it who runs endeavor, we talked to mark wahlberg about it as well on one of the questions i have and i haven't fully answered at this point, this was a contract that was perhaps put together previously and had not been renegotiated many of the new deals are already taking account of the new reality in terms of how

movies actually are now distributed, so to speak and the fact that there is not going to be nearly as much of a so-called big back end given box office at least at this point doesn't appear to play as important of a role overall in the revenues that are accrued by a film as much as it is important to sort of keep people subscribing to the direct to consumer business and bring in new subscribers to those same businesses that proved so vitally important for the likes of disney. >> we talked so much about the impact streaming is having on movie theaters, on the business models there, but obviously a huge impact as well on actors and producers and the business models are changing. to your point, i mean, the comments from mark wahlberg last week i think are worth revisiting i believe we have that soundbite where he does talk about netflix and working with that company, which has really spearheaded some of the new ways that actors are now potentially starting to make money with some of these deals.

>> people decide when and where they want to view their content, right? so we want to make -- we want to make stuff that's entertaining that people want to watch, how they decide to do that i've always been a big supporter of the theater system, but i also love what netflix is doing as well. it's just changing, and constantly evolving, and we want to continue to make great content. >> carl, i think it sort of speaks to the fact there's probably always a place for movie theaters but how large is that place what tuz that mean for those stocks and on the flip side, what does that mean for those actual creators of that content >> we talked about to our boss, our boss's boss brian roberts a the comcast yesterday about how this window is going to evolve he actually had i thought an interesting interesting response there's so many more layers to distribution of content. here's what he said. >>. >> do you think some of your

competitors are doing it right by two tracking? >> well, first of all, i'm a -- my whole life love movies. my wife and i love to go to the movies and i fully hope and believe that that will be a big part of our society for generations to come and we're certainly kexcited to do that ad work in that way at the same time, technology has allowed us to build and comcast did this for years we built 35 million home theaters potentially with consumers and you want to sometimes stay home. >> 35 million home theaters. david, if you're an exhibitor in the classic theatrical chain, you have to think hard about that. >> you do. you do, and listen, we talk so often about the importance of these platforms, peacock obviously for comcast, disney plus, and we go on and on from there. paramount plus, discovery plus soon to be obviously merged with the warner properties as well. this is the key for many of

these companies and they have changed, as you know, better than many, carl, the way that they go about distributing movies at this point universal for its part, right, sort of still doing box office and then also getting some of the streaming money from outside vendors so to speak, the netflixs of the world and hbos and then bringing them back to the peacock platform and perhaps making more money overall, although given what you got to pay and what you're giving up on the back end, this is an expensive proposition. i want to continue to remind people, had ithis is costing a deal of money for the warners and the disneys and the universals out there in the world. >> we'll watch it, guys. huge story obviously in media. david, you mentioned energy earlier, both exxon and chevron did meet chevron free cash flow at a two-year high. they're going to resume the buyback in q3.

exxon, david you've been paying close attention to their cost reduction. they did say they're on pace for reductions of about 6 billion in 2023 versus 2019 as they have -- as they're being forced to implement more cost discipline >> yeah, and you know, as i pointed out earlier in the first half of the year, they spent less on capex and perhaps have been -- things may have come back more quickly than they anticipated at exxon as well in terms of the overall rebound let's not forget we are still in what many would say is sort of a tight supply environment, despite the recent moves even from opec and a lag of investment in the permian that will keep it tight for some period of time the shares have had a great run during the course of this year as you know. one of the biggest corporate stories of the year was the success of that very small activist firm engineer one and three directors on exxon's board, and we certainly expect to hear and get more

transparency and more communication from exxon mobil as i pointed out many times in the days following that heated proxy fight and that loss, that one of the problems that exxon's current management faced was simply a long history of frustration. when it comes to that, morgan, a lot of it is going to be on carbon capture technology, on the progress that they are making towards more efficiency overall in terms of, you know, the so-called gaps and the solution set and carbon capture being a key one in getting be better acceptance hof that. >> it's fascinating to see what has been a paradigm shift for these energy companies both in terms of big oil names like exxon, for example, here in the u.s. i saw quite a number of the european companies that are focusing on new clean energy,

alternative energy carbon capture technologies, which by the way is a key part of that infrastructure bill that is making its way through the senate right now while also just those permian producers, u.s. shale producers in general have really shifted from focusing on output and production numbers and basically drill, baby drill to maintaining and improving their financial results and those cash flow numbers as well. and you got to think that while that might be good for investors and certainly energy continues to be the top performing sector in the s&p this year, not necessarily, at least in the near-term so good for consumers given the fact that we have these high energy prices and also for businesses where crude and these hydrocarbons continue to be sort of the main crux of our energy infrastructure goes right back, carl i bring it up all the time it goes right back to this whole inflation debate. >> that's exactly right. bullard's on the tape today saying that he thinks criteria and jobs might be met sooner

than people think, thinks that the delta narrative is going to be temporary and that the pandemic is coming under better control. dow opened down about 100 points and has recovered quite a bit. we're down about 19. who knows if that had something to do with it. amazon, six-week low pins two-month low, and a little pit of a negative halo on etsy and ebay this morning. >> yeah, worth watching all of these, of course amazon being the main one as you see down almost 8%. you know, potentially going to earn less and spend more i guess that's the simplest way to put it. and carl, it's been just an extraordinary week of earnings from these enormous companies. i know i've come back to it many times, apple had 36%, i think it was top-line growth. facebook was 56%, alphabet 57% constant currency. amazon still, what, 27%, and microsoft 21%. those numbers are just almost

inconceivable for companies of this size. the five companies i just mentioned, what do they add up to in market value, i can't even doe do 2, $8 trillion. almost all of them except alphabet have lost market cap this week because of the overall belief that, well, can you right lane replicate those kinds of numbers? it does speak and reflect what, morgan has been the increased -- the acceleration of digitization i guess is the best way to put it that we've seen over the last year, and the beneficiaries of it being those largest platforms, those largest companies that we have in the world. >> absolutely. the cloud wars, enterprise technology, enterprise cloud, the things that we're going to continue to talk about increasingly over the years might not be as flashy as consumer facing technology, but this is where so many billions and billions of dollars are going from companies right now

because it kind of doesn't matter what sector, what industry you're in, your company needs to essentially be a tech company and everything is kind of shifting to the cloud it's microsoft it's amazon, it's increase ingl google, perhaps maybe a distant third and then everyone else what does it hathis look like, t does it mean for investors when it comes to some of these soft ware and cloud names. >> best performing dow stock, it's p&g this morning even with their comments about rising cost pressure getting a little bit of a lift, s&p's back to 4400 when we return, microstrategiesings michael saylor love to talk about business coin and his strategy. in the meanwhile, take a look at the month to date chart of the ten-year note yield. bond markets definitely sniffed out many things including that

gdp miss from yesterday. we'll be right back. ♪ ♪ ♪ ♪ with a bit more thought we can all do our part to keep plastic out of the ocea.

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rick santelli here live at the cme hq having a bit of computer problems, but things seem to be working again of course we are awaiting the release of the chicago purchasing manager, the pmi, it's expected to be somewhere less than the 75.2, which was out a couple of months ago that was a 48-year high. now, we are awaiting this data to come out momentarily. you know what? my systems are down here, i'm going to have to kick it back to the show my apologies >> i'm not sure it's your system actually -- you know, rick, i'm just looking at a water flash head i think we're seeing 73.4, which

i think would be above expectations. >> yeah, 73.4 and i thank you, carl my systems went down 73.4 as i was saying, 75.2 is a 48-year high we are backing back away from that a bit, and right now as we sit at 124 on a ten-year note, it's down several basis points on the day, several basis points on the week, and of course we'll continue to monitor how all of this in this morning's hotter than expected year-over-year pricing will continue to affect yields quk t see wl return after these messages. te. - ten-x it? ten-x is the world's largest online commercial real estate exchange. you see it. you want it. you ten-x it. it's that fast. if i could, i'd ten-x everything. like... uh... these salads. or these sandwiches... ten-x does the same thing, but with buildings. sweet. oh no, he wasn't... oh, actually... that looks pretty good. see it. want it. ten-x it.

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companies are pushing back their return to office plans this of course as the delta variant continues to surge in many parts of the country. we're joined by the ceo of one of the largest commercial real estate firms always good to have you. i want to get to what has been a very strong quarter for you, not to mention a stock price that has surged over the last 12 months, but we do come to you often to give us realtime updates on where things stand in the corporate office marketplace. are you seeing things get pushed back the way at least we're hearing anecdotally? >> david, we are seeing things get pushed back a little

the phrase i would use to best describe what's going on with office space and covid is uncer uncertainty. people are uncertain about what the future of the office is going to look like, how many people are going to be back in the office and what the timing's going to be. decisions don't get made about the use of office space. what we've seen with most of we're starting to see around the world we're in a much better place than we were a year ago without vaccines >> what are you seeing in terms

of occupancy right now in buildings that you manage? >> it's different mark tet to market, and around the world if you look in the city, i'm in dallas, you hear varying reports we're close to 50% back in the office if you go to new york city, where they have mass transportation they have to rely on and so on, you hear stories and reports that it's closer to 10 to 15%, maybe edging up from there. but so much uncertainty going on we think what we really believe is you'll start to see things crystallize in a more definitive way after labor day. >> the strength we're seeing in industrial, how sustaining is that since you have supply chains playing catch up from covid. >> you said industrial and supply chains. industrial real estate is doing extraordinarily well

it's full. there's more good product being built. that's being very quickly taken up values are good. this is in the united states, europe, asia and it's a prototype that we're very involved in by the way, things will be more over loaded on the industrial space side if it wasn't for the clogged up situation we have with supply chains around the world. i would imagine there would be more industrial space being used than today so, i think the demand for industrial space w the economy on a good trajectory, with e commerce on a good trajectory is going to be strong for years to come >> i know u.s. real estate development saw record operating profits, bob can that continue at the same pace >> well, we have a very large development business

it's branded largest commercial developer in the united states we generated our best quarter ever in the second quarter of 2021 and the reason for that was, as you said, there are aspects of what's going on out there that are doing exceptionally well industrials are doing exceptionally well multifamily, institutional quality multifamily is doing exceptionally well but some of our best projects were when we had really high quality office tenants, fully o occupiability. there's a lot of demand for those buildings. office clients that still are committed to having significant portions of their population back in the office >> you just mentioned multifamily. the fact the federal eviction moratorium is set to expire this weekend.

expectations that could be extended and if not, what are the ripple effects >> we think long-term multifamily product is going to do extraordinarily well there's big demand from tenants and of course from capital sources to own that product for companies like ours that develop it, finance, sell it, there's a big opportunity for us with the record results we had in the second quarter. by the way, double digit growth from peek year 2019. a lot of that was driven by the work we do in the multifamily space. >> you joined us only a few weeks ago. we talked about your spak deal you said you expect things will settle in at 80 to 85% in terms of overall occupancy when we're finally, as we like to say, on the other side any change, given the delta

variant? is it perhaps a less willingness to go back at all? >> it continues the uncertainty. i don't think it changes things in the long run. in the long run, we're going to figure out what technology needs to support occupancy from home we're going to figure out how much people need to be together for collaboration for culture, problem solving, for bringing young people on board. and we'll settle in somewhere independent of the delta variant. that is what it would have been otherwise in my view >> should point out your stock is 124% up bob from cre >> thank you very much >> as you've been chatting, dow's gone green five points or so as we're going to wrap up the month of july today. inter

interestingly, august is seasonal week. s&p's been up 12, down eight average return of just 2%. last august was crazy because of the covid rally. thanks for the great historicals on august. >> in terms of what is lower for the month of august, russell down 3% and dow transports, which speaks to -- and maybe that's in jeopardy but that rotation we did see out of the so-called reinflation trades and tech so, i can't believe we're talking about the month of august >> and talking about some of the pauses in the recovery efforts, at least as pertains to commercial real estate we have gdp yesterday. so far the lingering discussion appears to be inventory may have dinged us but it does set us up for a stronger than expected q

3. maybe we can start talking about duration of recovery, rather than strength. and michael sailer talking about bit coin a endverything else as the s&p's down about 12 points rush hour will never feel the same. experience, thrilling performance from our entire line of vehicles at the lexus golden opportunity sales event. lease the 2021 is 300 for $379 a month for 36 months. experience amazing. jerry is here! j! mate, how are ya!? it's so good to see you. good to see all of you, yeah! why is jerry so... popular? it's been like this ever since we started using workday. what do you mean? it makes it easier to develop great relationships with our suppliers. now everyone, everywhere loves jerry.

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good friday morning. welcome to another "squawk on the street." futures were bleak on the warnings last night. now, let's get back to rick santeli. >> yes, we take our midmonth read and it was 80.8 there's improvement here 81.2 is what we move up to and that basically is pretty much about what we're expecting if we look at current conditions, 84.5 remains and 79

is now expectations. and improvement of six 10ths of the read now, let's get to the money ball numbers. one-year inflation moderated from the initial read of 4.8, now 4.7. and 4.8 on the final read of 2.9. so too, see them moderate, but at high levels, shows the stickiness of price and inflation outlooks we know, at least in part, there's moderation coming. it's a question of how much and how long it takes to get back to precovid levels on pricing morgan, back to you. >> thank you we are 30 minutes into the trading session. here are the movers we're watching today robin hood falling 10% in the debut. down another 2.5%. 3395 is the level there.

pinterest. down more than 17% finally, microstrategy, struggling to buy more bitcoin, despite a loss in q 2. for the way bitcoin is classified for accounting purposes, tricky accounting there. michael sailer is going to join us in just a few moments meantime, perhaps the biggest name everybody is watching right now, amazon. after earnings last night, those shares are shrinking after revenue disappointed and bosa, who covered the company so closely is here, specifically, with more on the key metrics to watch on what is a mega tech name >> what's really catching the attention of wall street is that guidance midpoint, excuse me, represents

growth of year over year and that would be the slowest growth rate in 20 years it is seeing lasting effects of some of the big tech names they saw downturn in the pandemic so, analysts are focussed on that online growth, which the cfo told us is expected to slow for the next few quarters. keep in mind, andy now officially takes over. and amazon has traditionally been quite conservative in terms of guidance. this could be setting them up to surprise another area they're interested in is advertising to take on what is facebook and googling. such strong growth more than 80%. but keep in mind that this still represents about 7% of amazon's total revenue. >> you know, it's getting over

shadowed as the stock's having its worst day in a year. and a prior 32 i mean, what does it say about acceleration in such a competitive and large business for them >> it is lower than the growth rates. it is, by far, the leader in cloud infrastructure that 37% tells us it is managing to hold on to the lead andiand its market position. and of course, moving into the next level of that, which is layering on different services like artificial intelligence and big data for the next phase of the cloud work >> the level of spend or increase level of spend on fulfillment and what it takes to get all of the packages to people's stores is pretty

significant and probably not unnoticed by the folks that focus on freight and transportation on a week where u.p.s. missed in terms of expectations and one of the worse on the s&p does it say something that they continue to build out their own transportation network or despite the myth, they need to do whatever they can to keep pace with capacity >> amazon has, as you know, turned into a logistic juggernaut they said there would be no difference this year j remember, they're working on one-day and two-day shipping and getting it all online. that was pushed back because of demand during the pandemic one-day shipping interesting the cfo mentioned labor.

we know amazon's been on an insane hiring spree, especially during the pandemic. they haven't had trouble hiring and finding workers but they're offering higher wages and benefits said that's the source of inflation for the company. >> something you follow so closely are the chinese tech companies as well. and stopping processing registrations of u.s. ipos by chinese companies and what's been a rough and rocky and uncertain path for these companies. from, i guess, both countries right now. how does it speak to what we're seeing and what it means to investors and the ipo pipeline overall? >> i know the paper just read what the sec chair had to say on this you're right, now they're

getting it from both sides and china, by the way. it's also under scrutiny what it tells us is we've already seen listings drop off and that's expected to continue. i think this crackdown we've seen from beijing has unintended consequences and it may come down to this idea of soft check in china, which is platforms like alibaba, verses robotics and chip makers. if you look at a stock like this, a state-backed chinese chip maker a lot of folks are starting to see that beijing is starting to push certain sectors but really it's a potentially dangerous because it's unclear what the intended consequences are going to be. how much more disclosure

dede had 15 pages on the risks of doing business in china >> the vie structure getting a lot of attention this week i'm sure a lot of people getting beefed up on what that means we're going to turn now to cryptocurrencies the sauf wair company revealing it acquired more than 15,000 bitcoins for 529 million in the second quarter, adding to quite a number on the balance sheet. joining me is michael sailer chairman and ceo let's talk about the earnings and then we'll dive deeper into bitcoin specifically the fact you did report an increase in overall revenue. we talked about the core business intelligence piece of the company, coupled with the

balance sheet. how is that helping to fuel this recovery that's emerging within the core business? >> q 2 is awesome. the best second quarter in six years. we beat on the top line, the bottom line, we generated $1.72 in nongap ets and we did that without any acquisition gimmicks it was all organic growth. and i think you can attribute that to the laser-like focus of the business and they're doing their best to compete with aws and azure i think they're getting distracted by the need to build big multicloud platforms we do one thing and that's what benefits us in the second quarter. >> and certainly the transition

is what's been in focus. hoy does bitcoin factor in to that >> it's done wonders for our brand. obviously, it's made our shareholders billions over the last 12 months look, bitcoin is digital real estate people are starting to realize it's better than real real estate it's not taxed the same. you can take to any state or country and they used to say you can't take it with you you literally can if you want. and it's enormously appealing to people looking for economic security right now the company's benefitting from the ground swell of support for bitcoin. >> i want to get into that a bit more but first the fact that the company racked up $2.2 billion

in debt. you will continue to buy more bitcoin. how much and how will you fund that >> we're buying bitcoin with our cash flows as we generate more cash, we buy bitcoin, we've also bought bitcoin through issuance as they generate stock option revenues and bought bitcoin with senior secured debt and we have a billion dollar shelf registration to the extent we see those ek equated to our shareholders, we'll -- >> so many say you're a bitcoin whale. i'm curious how much is enough

you don't realize those gains unless you sell bitcoin. >> i think gap accounting doesn't always keep pace with the capitol markets. they know they can multiply 105,000 by the price of the bitcoin. they know we have $4 million worth of bitcoin right now the current treatment is a definite intangible. that used to be odd but irrelevant a year ago they didn't have any publicly traded bitcoins you have dozens of companies in this economy billions of dollars in assets. it's become ill suited and a bit opaque you can't tell the difference between a company with a billion dollars in bitcoin by glancing at the gap statement i do think an update the gap

accounting treatment would be a benefit to big tech. a benefit to investors, institutional investors in the u.s. market. so, i'm optimistic that people will look at that. >> i asked you a version of this question last time we spoke. i can understand, given your belief in bitcoin, taking cash flows and buying it. but why put debt on the balance sheet to do it as well why lever up the company and take the corresponding risk, at least, to buy this asset as well, michael? >> we've got $2.2 billion of debt and we pay 1.5% interest on that debt. we have a very long time horizon. our view is being a leveraged bitcoin long company is a good

thing for our shareholders if you could invest it in the next big tech digital network you thought was going to be the dominant amazon or google or facebook of money, why wouldn't you? if i could borrow a billion dollars and buy facebook a year ago at 1% interest, i think i would have done quite well >> you see as bitcoin as facebook 10 years ago? >> bitcoin is an open monetary network and everybody's looking for this open way to move and store value at the speed of light using computer chip and a mobile phone you had facebook that traded digital communications, apple gave us digital music, and amazon gave us digital retail. bitcoin's digital property on a big tech open monetary network the big news this week is 114

million people own bitcoin that makes the most broadly held asset in the history of the world and they're adding 2 million people a week. that's the fastest growing financial asset and open 24/7, 365 in any country on earth. so, it's our view that it's only a matter of time before mobile phones are plugged into bitcoin and we want to be the first. >> i thought it was interesting you said your involvement with bitcoin has elevated your brand. when you have your sales people out there, they go to a client and they know them as the bitcoins people and that leads them to conversation that might not have been there previously >> it's a very exciting thing.

it's an economic imperative for anyone who wants to escape inflation. it's goating built into square so, yeah, every ceo, and cfo wants to talk about it, the cios, anybody in the software industry it's a door opener and very important people know who you are. that starts the conversation it's great for employee morale as well. >> michael, the skeptics, critics in recent weeks have been pointing to bitcoin and the fact we saw such a dramatic drop in price from the highs earlier this year. to say it's not like digital gold, and i know the metaphor that it's not a hedge against inflation.

senator elizabeth warren had this to say and joined the chorus of critics earlier on cnbc >> people can make their own investment decisions but to do that somehow is two things one is what's happening with bitcoin or any other crypto currency is somehow going to be divorced from what's happening elsewhere in the economy they may come from a different source than what happens with dollars. but look what's happened in the high volatility, in the price of these things the idea that somehow they're protection or hedge, i don't think that's going to be born out over time.

>> your reaction to that >> i think bitcoin is like electricity or steel or fire it's a very big deal it would take a thousand hours to understand it well. i think right now every politician in the world is being asked to have an opinion on it i doubt every politician has a thousand hours to think or study. we look out a decade if you'd asked elizabeth warren her opinion of google, facebook, amazon in 2010, i wonder what she would have said. i think this is literally crypto steel for the 21st century and it takes time to fully grasp the implications of something so profound >> does crypto steel need more regulation >> i think that there's going to

be property tax and property regulation on digital property people expect you to pay your taxes on your property i think that the digital currencies like tether will be regulated as currencies. i think these derivative exchanges will be regulated as derivatives exchanges. i think, in general, as crypto community moves in into the regulatory environment, it's going to give investors comfort this is going to be around and say the will understand how, with clarity, they can invest in it 100 x is much money is outside the bitcoin world as inside. and as the regulatory clarity comes, i think more people are going to move into the bit coin ecosystem with comfort >> i always appreciate your insights thank you for joining us

michael sailer >> thank you for having me as we head to a quick break, disappointing debut for robin hood what's next for the stock after a worst ever performance for an epo this size. and the cdc warns they may need to change their strategy to combat the covid delta variant and as billionaires have their fun in space, we sit down with bill nelson on the future p space commercialization s&on facebook sixth straight month of gains as we're hanging on

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low end of the range marketed to investors. and it's even more of a rarity for larger deals this debut was the worst of any deal robin hood size or larger, according to bloomberg so, what happened here investment has been soured by concerned about regulation, litigation, investigations, concerns surrounding the business as well as what some perceive to be a lofty valuation. they priced at the low end of the range. that was supposed to coax more investors to bid but signalled they were balking at the deal. and that caught fire among the chat rooms then the complexity. among the highest ever in an ipo. well, that certainly fits in with the motto to democratize finance that left less fire power and momentum for day one,

as usually bankers count on retail, especially with halt, fuzzy deals, after it begins trading. and now, robin hood users are sitting on a little over 10% in paper losses not the best mark for the poster child of the retail trading movement >> we'll keep our eye on the price action today thanks, lessly when we come back, virgin voyager heads to sea ♪♪ it was my dream to be an entrepreneur based upon the examples that i had growing up. and that was important for me because you can't be what you can't see. the ey entrepreneurs access network has a tremendous impact on my business

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welcome back to "squawk on the street "it will only embark on six stayications before heading back to port. ceo joins us from the company's first ship, called the scarlet lady thanks for being with us this morning. >> good morning, morgan. great to be here >> the company was due to really

officially launch in a meaningful way last year what is the plan now and expectation that people will book and do this >> yeah, thanks, morgan. we've taken a hard look at how can we create a safe environment to build back the trust of the consumer we think that's very important obviously, the safety and security of our crew and sailers. so, we developed protocols we've developed the safest, possible way to travel and because of the controlled environment that we operate in, we create this safe way to travel we're going to be requiring all of our sailers and crews to be fully vaccinated and on top of that, we're testing all of our sailers, as they come on board, as an added

measure. we've invested in technologies like an air filtration system. it kills 99.9% of all bacteria in the air it's similar to what hospitals are using today. the combination of things is we've created a safe way to travel safer than a restaurant, a theater or night club or to a theme park, if you will. combination gives us the confidence that we can sail in a comfortable and safe way >> just this week alone, a steady march of companies saying they're going to require vaccines it's been a little more controversial, in part, because companies such as yours, that are calling florida home base, florida does have that ban on vaccine passports. so, how are you navigating that? >> so, we're working closely,

trying to find a solution. if not, we'll be able to talk to our sail everers and have them volunteer information that they're vaccinated we believe vaccinations are the way to go. we believe it creates a safe environment for our sailers. so, we're continuing to push on that issue >> talk boabout the trigger poi. if you wound up with a number of symptomatic cases on the vessel. has it changed since precovid when, obviously, the industry dealt with other infectious diseases as well >> the possibility is quite limed since we're requiring everybody to be vaccinated we don't think it will happen. but we have protocols and safety

measures where we can isolate folks in the unlikely vent we have a case on board >> what are you seeing in terms of consumer interest and booking? >> well, a huge pent-up demand the number one thing people are listening is getting out and traveling. we believe there's a lot of demand people love to cruise. so, we're launching a new brand and it's coming at a good time as we see a boom in travel again. >> thank you for joining us as you get ready to set sail. we'll be keeping an eye out. >> we're excited to cruise on a delta-only vacation and see what it's like. it's like. thank you.

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under pressures this morning. they raised their four-year fiscal they noted that surges have resulted in certain supply chain constraints. joining us this morning is chairman and ceo it's good to have you. >> thank you it's good to be here >> a lot of good metrics in the quarter. but obviously the market is so highly tuned to any announcement in supply chain disruption obviously you guys are planning for holiday, things that are months and months in advance is there any indication those are even directionally going to

get better soon? >> as we head back to school, our inventory positions here in our distribution schedules and we're carrying momentum in the important back to school season with great inventory and strong self we did talk about covid and the surge that continues to move through. our factory partners are open and operating. and we have line of sight to move those materials in a difficult marketplace or environment, we certainly have the production constraints that our teams are closely working on in the factory partners.

and looking at securing equipment and logistics to move to distribution centers. we did say we will see quarter-to-quarter movements here in the important september to october timeframe but we see no risk in our ability to serve the fall holiday demand that we have. but we also see coming in our own direct channels. >> i want to talk about demand for a long time in retail, we've been talking about whether supply chains need to be adjusted, moved, repateriated. it used to be about tariffs, obviously now it's about costs and covid. are we still in that discussion or do you think we can keep the change we have and surges with clarity? >> it's our ability to really flex with current market conditions

and we have a very diversified model today. with the ability to continue to diversify in seasons we talk a lot about bringing production closer to demand as a way to deliver more quickly against consumer demand and trends we see. we see ability to continue to evolve our supply chain we don't think we're in a negative position anymore. we're in a particular situation with the covid surge the productions of the marketplaces is allowing them to continue to produce, not at optimal levels, but certainly to meet demands we have and we'll work closely with them to keep those goods moving towards our point of sale.

>> i'm trying to understand everything you've told us. you say you're able to meet the demand that is out there i guess help me understand then. what are the produkds constraints? and if they're constraints, why are you able to meet the demand? >> meeting demand is over the course of the season and as we look at our current order books and the merchandising plans we have for our own retail stores, we are set up to service back to school it's now being able to fill back into those inventory needs to meet the demand. we're looking at delays in the two, three, four-week level. but we're also using a tremendous amount of air freight. we talked about returning to prepandemic levels in this last quarter.

this spike, a 30-basis point head wind tied to air freight. we'll continue to spend against moving our goods we see this as a unique opportunity to seize market share. we do believe our supply chain -- based on ability to keep goods moving and meet the expectations of the full fall holiday season, which takes us through that december, january time frame >> steve, it's morgan. it feels like what's old is new again when it comes to consumer brands that are popular. whether it's package foods or toys or in fashion we're showing a graphic earlier in the interview with all the different brands what are you seeing in terms of renewed consumer surge for some of your brands

>> i wouldn't think of them as old and surge noing into consum demand today we have a powerful portfolio of brands to really focus our portfolio on 13 core brands with our strongest being vans, the north-based timberland two of our latest acquisitions at dickey's and supreme seeing really strong sales today. there's trends in the marketplace. there's certainly a return to outdoor. there's the focus on health and wellness, a commitment to sustainability and they're looking to connect with brands that speak with those trends and most importantly the experiences to build the long-term loyal relationship that we work so hard on. >> steve, you're right in the

middle of so many important dynamics that the market is facing we appreciate your guidance. thank you. >> thank you >> david let's get an olympic update. frank. >> good morning, david megan rapinoe, the clinch of victory against the netherlands. it was decided by penalty kicks. broken by a tie, goalie made two saves in a shootout. this means the u.s. will be able to lay play for a medal as they advance at the next round. conor fields is awake and facing further medical evaluation after a bmx crash he won gold at the rio games and no grand slam for djokovic he lost to germany in the semifinal pmz he'd been hoping to be the first man to win all four grand slam tournaments and olympic gold in the same year.

after losing in the 200-meter back stroke, american swimmer, ryan murphy spoke out. >> i don't know if it was 100% clean. and that's because of things that have happened over the past >> and on the medal scoreboard, the u.s. has 41, china is right behind with 40 and the russian athletes with 34 back to you. >> frank collins, thank you. still ahead we talk about the fuch rpt at the lexus golden opportunity sales event. get 1.9% apr financing on the 2021 rx 350. experience amazing. on the 2021 rx 350. experience amazing. (sound of people returning to the workplace) (sound of a busy office) (phones ringing, people talking, meeting) the company we've trusted to keep us working remotely,

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the street." the starliner space capsule was set to take off later this afternoon. the russian spacecraft fired thrusters, causing a problem with the space station, briefly putting it out of position that was the reason for the postponement after december 2019 attempt that failed to reach correct orbit thanks to a software error and it comes as the space tourism race is heating up as blue origin last week after richard bransen. he spoke of the importance of infrastructure, a road to space, if you will. >> when amazon started, we didn't have to build a package delivery system, it already existed. that's infrastructure. there's no real infrafructure

that's an affordable cost and. we need build a infrastructure and future generations can build on that. >> joining us is nasa administrator, bill nelson in terms of the boeing test flight that's been pushed to next week now, part of the commercial crew, that spacex is a part of as well, how important is it to see this test flight go off without a hitch and for astronauts to eventually be able to climb on board? >> it's very important it's very important that we have another spacecraft to have access to space with our astronaut crews. spacex has been supplying that ever since we shut down the space shuttle 11 years ago waevl been using the russians

until spacex was able to get the aircraft certified they delivered through crews already to the international space station. and boeing has had delays but this spacecraft, starliner, is ready to go. the count is going smooth as glass. and then, would you know it, something completely related to boeing and starliner the [ inaudible ] of the russian started firing to stabilize the entire space station >> and i'm assuming that issue we saw play out yesterday in real time, is it safe to say it's been resolved everybody is safe on board

experiments are safe and you can say we're poised to see the test flight happen nex tuesday? >> the only thing standing in the way for tuesday is weather around 2:53 p.m., every day we have had major thunderstorms in florida. so, are you going to take him up on that offer >> well you can ask me that question next week because i'm in a legal blackout right now

under law and policy and procedure of the general accounting they are going to make the decision next week whether blue origins bid protest is successful or if it goes back to the original bid of spacex when we do talk about building the infrastructure with boeing or spacex or so many others are playing, how is nasa approaching that under this administration how much can you help propel that build out and the new era of spaceflight they are going

to contribute very much as we build out the infrastructure in space, they are going to mine as roads and habitats on the moon other commercial ventures are going to do landers on the moon that will do experimentation and procedures all the way to mars. >> nasa administrator, thank you for joining us today we'll be focusing in on that

space flight without people that will attempt to go to the space station next week. we appreciate your time ahead of it >> thanks, a lot we are watching some notable moves in the chip makers kla is up over almost 8.5% ahead of estimates the other side of the group, let's take a look at skyworks. that stock is down it did beat analyst earnings on revenue bunoenght t ou ♪ ♪ ♪ ♪

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welcome back time now for the etf spotlight k web ticker this morning after the registration of chinese ipos while they create new disclosures. take a look at the top five holdings tencent and alibaba on the news. they've been under pressure for weeks now. continuing to see the tensions

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welcome back david, exciting news you are guest hosting jepardy next week. can't wait to watch. >> looking forward to everybody watching it. have a great weekend it is now time for tech check. good friday morning, welcome to tech check.