speaking, not just in the gaming sector not today, though. not today. at least thus far. >> not today, although it is a merger -- i was going to say merger monday, it's tuesday. that will do it for us on "squawk on the street. "techcheck" starts now ♪ ♪ good tuesday morning welcome to "techcheck. i'm carl quintanilla with deirdre bosa and jon fortt massive m & a news this morning. microsoft buys blizzard for $68.7 billion and all cash deal expected to close in 2023. activision a company mired in sexual harassment allegations just this morning terminated 37 more employees as part of an internal probe they'll stay on as ceo for the time being

the head of microsoft gaming phil spencer joined "squawk on the street" earlier this morning on what led to the deal. >> microsoft has this great, long history, like we do, that goes back to the 1980s in video gaming they have the incredible resources and incredible pipeline of talent, culture that is aligned like ours for focus on creating a really great work experience, and so while there are a lot of other companies that would be interested in a company like ours, microsoft was clearly the company that made the most sense >> that $95 a share price, 45% premium to friday's close. deal comes just a week, of course, as you know, after take twos $11 billion zynga acquisition. jon, lots of implications for the metaverse, for gaming and for the overall environment of m & a in '22. >> yes but let's not get too far ahead of ourselves this has to get all kinds of approval we talked about big tech m & a

and kind of the scrutiny of that, especially with the biden administration and lena khan and whatnot. there is no bigger big tech that actually does big m & a than microsoft. right? market cap wise, yes, apple is bigger the biggest thing apple bought was beats. $3 billion, some small number by today's standards. so will this fly through i don't know but in gaming, this is a huge name with a lot of intellectual property, time when people are talking about not only the metaverse but cloud gaming and all these possibilities for the future microsoft will be in a very strong position both platform wise and content wise if this flies. so clear to see why microsoft wants it also interesting, dee, i think that microsoft is in a cultural position to be seen as competent to take over the mess that bobby kotick made over there at blizzard that's quite a transformation that satya nadella has been

bringing microsoft through. >> you see activision employees tweeting this gives them hope the culture can be cleaned up. m & a, yes, microsoft has been active 7.5 billion was only a year ago and minecraft what a brilliant move that was in retrospect and that was only $2.5 billion of course, carl, this is a much bigger purchase. i thought something that phil spencer said in the interview earlier on "squawk on the street" was really interesting he said that it's going to offset distribution capabilities that microsoft doesn't have on mobile devices he said the largest gaming platforms are the mobile devices owned by and controlled he said, he used the word controlled by two companies. i feel like we're getting a bit of what's going to be that anti-trust argument. we're going to be talking about this later with julia, i know, as well. there's so many implications and seemed like they were trying to get ahead talking about the

mobile platforms and ten cent, a huge player in this space we probably don't talk enough about. >> indeed, guys. today it's activision. last week it was take two and zynga. let's bring in wells fargo chairman global investment banking bob peck great to have you with us today. good morning. >> thanks for having me. >> i guess are you surprised at either the price or the aggressiveness of microsoft in the face of what we think is a tougher regulatory environment >> yeah. so first of all, as you know, carl, we're coming off a record m & a year almost 6 trillion in global deals that was done last year. all-time record. really beating the previous record in 2015 of about 4.5 trillion right? the u.s. also set a record doing 2.5 trillion in m & a deals as well d spacs helped a little bit being 600 billion of that as well but just record amounts of m & a being done last year and continuing going into 2022

this deal a big one already that we're seeing there's a couple different things that are driving this one is clearly still very affordable interest rates. when you look historically, great environment for that two, piles of cash on the sponsor's balance sheets in private equity as well as the corporates as well a lot of dry powder there today's deal being all cash. number three, just as technology is changing around us, companies in tech as well as outside of tech are looking for new ways to engage their customers new ways to reach the younger demographics as jon hit on, new ways to reach them mobile. web 3 and the metaverse mean going forward? we think you'll see a really strong 2022 as far as when it comes to more m & a. >> yeah. some take a note of this line from nadella, bob, saying he wants to reduce the friction between content, consumption and commerce with fewer constraints on distribution, some argue that's an implied dig at apple and google and app store fees.

do you see it going that way >> yeah. i think regulation for big tech is going to be a big part of the story going forward. lena khan is leading over there with a mandate to really scrutinize a lot of the big tech players. i also think it's why you haven't seen some of big tech deals the last year or so because that increased scrutiny. any deal that is announced and gets -- moves towards getting done is going to have some pretty sound footing there to be able to get these deals done and have sizable breakup fees just in case the deals can't get done but regulatory will be a big part of the story going forward, for sure, for big tech. >> yeah, bob, as an investor, though, how should you handicap this on the one side, the argument that microsoft seems to be making is you fight giants with giants yeah, you got some strong gaming platforms out there. the way to fix that situation is for us to get bigger and open up distribution but there is an argument to be made and, you know, regulators here in the u.s. might make it, that you just keep everybody from getting bigger, right

either break them up or you cap their ability to do m & a. so as an investor, how should you kind of hedge your bets on which argument ends up winning out? >> well, what i think is interesting is you're seeing a lot of the large tech players really diversify their portfolio. right? from being involved with os systems, cloud, enterprise, gaming, et cetera. really playing across the spectrum and not necessarily creating a monopoly or concentration in one certain area and i think you're going to continue to see that happen as well also outside of tech, look for other verticals to expand more and more into tech and jon, as you and i have talked about before, i think there comes a point in the future where tech is a vertical sort of becomes archaic. every single company will need to have certain tech strengths to compete you'll see more and more continue to happen obviously with the stocks reaction today, investors are putting little uncertainty on the deal completion. we'll probably see that as we get more information on the

regulatory side. >> i'm looking at electronic art almost up 6.5% take two up a little better than 4% but who is left out there tech wise that could afford to buy companies of that size and that would likely get the sort of regulatory nod that at least some are hoping microsoft gets i can't imagine that a facebook or amazon tried to buy one of those companies it would get a shrug. >> yeah. you know, look, outside just internet as well, right? when you think about the salesforce of the world, shopify of the world, snowflakes of the world, microsoft as you probably well recall, jon, there was a time a year ago microsoft was rumored to be looking very close at tiktok. i think you're seeing tech more broadly, not just consumer tech or internet tech you'll see these players play to create that portfolio that we talked about. >> bob, it's not just megatech talking about this and plans to go into the universe disney and walmart are two other

recent names have been talking in this space. could we see them do deals and with sort of a better hand in terms of the regulatory front and as jon said, who is there left to acquire in terms of gaming but perhaps gaming or metaverse adjacent, some of these software companies or developers. >> yeah, i think that's astute and you have seen some moves walmart has made, for example, investing in car getting closer to ecommerce take two rumored around tiktok i think you're right to my comment earlier, i don't think just a tech vertical consolidation quote unquote but more of these other large companies and other verticals thinking about what is crypto mean to us going forward what does block chain, what does meta, web 3? how do we think about all these thing and how do they impact our core businesses going forward and what moves can we make maybe on a smallish side to learn more about those areas or maybe on a very big scale side once you realize what you want to do to

be able to make sure you are best positioned as those technologies develop. >> and bob, as we're speaking, we're seeing the nasdaq continue to lose steam, now down 2% a lot of these growth names seeing this multiple revaluation. do you think that we will see more deals as they come down this was the story certainly with zynga last week coming down from the apple ios names growth names being acquisition targets as macro economic backdrop takes place >> yeah. no, it's a great point right? you had records -- very strong year last year with nasdaq and s&p up last year big megacap names are about 25% of the s&p since we had omicron come out, basically the end of november or so, you have seen those names pull back. weighing down about 6% or so but what's interesting there is the names outside those big megacap names in the s&p are actually flattish.

in fact, there's more names in the s&p that are up than down. but those big names have such a big impact on. i think you raise a really good point here as companies sit there and look what's -- i think someone said earlier, what's on sale or what's come down or what's become more affordable now is that now more attractive for what you can do and by the way, can you use your cash which you have a lot on your balance sheet probably but also can you use equity,too if your equity has also been strong. >> finally, bob, the knee jerk to the news this morning was trying to place microsoft in some kind of spectrum of regulatory risk, as if different players have different risk and from regulators in d.c. and we'll find out more from lena khan today, i would imagine. do you see it that way or is everybody sort of equally at risk to having a deal looked at >> yeah. our view is that they're going to take a hard, honest look at all these big deals and everyone is relatively on equal footing there are someconcentrations that the ftc will have to look at pretty closely, especially if

you're already in tech and therefore what are the opportunities and risks in front of you, but we think you'll see very fair, stern looks across any of these major deals. >> right that's certainly what we expect in the months ahead on this one, bob. appreciate you giving some guidance on it great to see you bob peck. >> thanks for having me. appreciate it. speaking of regulation, the ftc and doj are holding news conference -- a news conference in less than an hour, laying out a muscular anti-trust agenda that could put even greater scrutiny on deals just like microsoft. let's bring in our julia boorstin good morning, julia. >> well, jon, this nearly $70 billion acquisition of activision blizzard is by far micro soft's biggest followed by link e

linkedin now here is how activision bobby kotick explained why the combined company does not create monopoly power >> one of the motivations that we had for a partnership with microsoft is the recognition of it's a big market but enormous amounts of competition whether it's ten cent who has resources that are extraordinary and global footprint or sony or facebook or amazon or apple or google or netflix or disney. when you think about the race for the metaverse and for the more influence in gaming in the gaming ecosystem, we have now seen more competition than ever before >> we should get a lot more insight into the regulatory chances of this deal at the top houfrt when the department of justice and federal trade commission are holding a joint press conference they are expected to share their updated merger guidelines. then we'll hear from lena khan

directly tomorrow on cnbc's capital exchanges at 10:00 a.m. eastern live on your second screen at cnbc.com/capitalexchange of course we'll bring you all the headlines here and the timing of this deal, i have to say, it's pretty remarkable how it coincides with something else, also today, backed tech oversight project, launched today and it's all about lobbying for anti-trust legislation, part of this really pretty broad anti-trust push, jon. i'm curious if you think that after microsoft went through its own anti-trust regulatory issues so many decades ago, if they're better prepared for this they have avoided a lot of the scrutiny the likes of facebook and amazon have drawn. >> this is a great question, right? we talk often about this, julia, that anti-trust regulation sometimes feels like it's very back ward looking. we talk about regulating facebook for its social networks while its changed its name to

metta. and changes its name to the metaverse. i wonder the if the regulators will talk about the metaverse to get ahead of some of these issues and whether the big tech giants like facebook, metta, microsoft, apple can do these kinds of deals i know we talked about microsoft being in a unique position, but will that change the calculus somehow for them >> yeah. i think the real question here is microsoft is a giant. will it have too much power in the gaming space in particular it was really interesting listening to satya nadella who did a call earlier this morning talking about how they want to use the strength in mobile games that activision blizzard has with king and bring some of the other titles into the mobile space and this idea that many more people should be able to play games all of the time this should be something that should really be far more accessible and especially inging in some of the big titles off of the console or even off of the desktop. so i think one thing i'm wondering act here is whether

microsoft's power broadly and whether the fact that they do have teams, which is something that seemed so appealing in terms of bringing the voice and the audio and that whole component to games, whether that could be an advantage or a disadvantage here and jon, i'm particularly curious because i know you were aware of everything that microsoft has gone through, if you think that they're better positioned to deal with any of this anti-trust scrutiny because seems like we could hear about a big push coming up just in less than an hour. >> yeah. they're the grizzled sort of veteran soldier in the anti-trust wars that you always get in the movie got all the scars. i wouldn't do that if i were you, youngster that's who they are now. i don't see a lot of likelihood that this sort of flies through without scrutiny, particularly because there's this history in the video game space of platforms using titles that they have control over to launch their latest consoles or, you know, latest i guess cloud efforts, for example

i can't imagine that a sony, for example, is going to sit by and sort of let that happen without some amount of complaint, dee. it's in a way reminiscent of in nvidia arm and the scrutiny that's getting here is a chance for a strong competitor n sony for example, that's doing pretty darn well with the ps5 and ps4 to say, hey wait a minute, if this is going to go through, there's a few things that microsoft has to promise not to do. >> right on the flip side of that, though, you have got ten cent a chinese competitor that could, you know, give more reason for regulators to let this go through because it could make microsoft more of a competitor on that global scale. we've got a lot more on this block buster deal for activision this hour. plus the nasdaq is down nearly 2%. "techcheck" is just getting started. don't go away.

♪ i see trees of green ♪ ♪ red roses too ♪ ♪ i see them bloom ♪ ♪ for me and you ♪ ♪ and i think to myself ♪ ♪ what a wonderful world ♪ a rich life is about more than just money. that's why at vanguard, you're more than just an investor, you're an owner so you can build a future for those you love.

vanguard. become an owner.

we got check on z scaler morgan stanley upgrading from equal weight to overweight but lowering its price target from 330 to 325 dollars bullish on the cyber security firm's cloud security platform, given the broader transition to hybrid working and also says they see the potential for accelerating revenue growth.

the upgrade comes as morgan stanley releases top cyber security picks for 2022. this morning's zscaler joining names like palo alto and octa on that list. shares getting a boost on calls today. a lot of folks still love this cyber security space despite the selloff in software. >> indeed, dee. 2022 has kicked off with some big stock swings in today's no exception got significant selloff here nasdaq as you can see down almost 2%. our senior markets commentator mike santoli with a closer look at some of the moves and some of the damage that has been done late last year. >> absolutely starting back in the fall really. there's been some complication in this rotation that people have been expecting, predicting, applauding, positioning for back into the value and cyclical sectors. you see that today if you look at the financial etf against software now, software was kind of first to roll over, led to the downside within technology, within the growth area and as you see, they sort of completely decouple back in november or so

software trying to get its footing today. not underperforming at this point. stocks like service now getting a little bit of relief we'll see if that matters, but the financials, you know, rolling. they just got a little overaggressive on the upside it would seem relative to even pretty decent earnings goldman's missed today there's a valuation ceiling on the traditional cyclical sectors that maybe didn't apply to growth so if you look at the overall nasdaq 100, it's gone from, you know, 22 times forward earnings before the pandemic up to 30ish, 31 now it's down maybe 27 and the big question is how much more has to be drained away because in the most aggressive sectors of tech, the profitless companies, that has been deflated to a fair degree. never know if it's all done, but it's definitely had its reckoning before most of the big caps have as they are today. >> mike, i was struck just how much we're flailing on where inflation is headed. you got goldman talking about wage inflation hopping on to what jp morgan said on friday. yet a downgrade gap on the

prospect of deflation in apparel in the coming quarters. >> right and so that's the fix that the market feels itself in i'm not sure it's a genuine pinch, but it's one that's perceived right now, which is economic deceleration into people in advance of a fed meeting really starting to try and get in front of what they believe to be a pretty aggressive fed move. i think it's really important to remind everybody, the market has done its tightening. it's rashing capital on its own while the fed has done literally nothing but talk at this point. >> all right, mike thank you. mike santoli meantime, we have been talking m & a all morning. here is another name on the move citrix reports its in advanced talks to bay quired by elliott investment management. stock first popped a month ago on headlines saying that elliott and vista were in the early stages on putting together a 'lst wel ay with that more "techcheck" still ahead stay with us

♪♪ care. it has the power to change the way we see things. ♪♪ it inspires us to go further. ♪♪ it has our back. and goes out of its way to help. ♪♪ when you start with care, you get a different kind of bank. truist. born to care.

♪ welcome back to "techcheck." i'm carl quintawith carl quintah deirdre bosa and jon fortt the nasdaq is close to three month low, peloton, are leading to the backside. microsoft buying activision blizzard. good morning and here is what's happening at this hour. treasury yields surging as investors expect more rate hikes on the federal reserve the two-year note is above 1% for the first time since february 2020. stocks as carl just mentioned down across the board except for the energy sector and the rally in those stocks getting fuelled by rising energy prices. u.s. crude briefly broke above $85 a barrel and set a 7-year high so far this month the s&p energy sector is up 18% goldman sachs meantime

leading the dow and s&p lower. strong investment banking was unable to make up for shrinking stock trading revenue. charles schwab is down 5%. that stock, however, still up 7% this year. and home builder sentiment is down for the first time in four months. material and labor shortages significantly lengthening construction times for new homes. however, sentiment is still at high levels. the new york state manufacturing activity decreased for the first time in a year and a half with new orders posting a sharp decline. you're now up to date. jon, back to you. >> rahel, thank you. now back to the deal of the day, microsoft wants to buy activision blizzard for almost $70 billion. here to discuss serial gaming entrepreneur ceo raul sudd good to see you. can you imagine a world call of duty is an xbox exclusive. is sony going to allow that to

happen what do you think are the chances this deal gets done with no conditions? >> i think the chances the deal getting done are quite high actually >> but with no conditions. >> well, i mean, there's a number of reasons why. they have -- there's first of all in terms of microsoft's technology, i mean, they have a massive metaverse play here with their hololens and way less isolating than typical vr. they have a ton of subscribers on their game pass and they want to grow their game pass with more content and you know, to be honest when you think about the assets, dee yab bow, call of duty and starcraft, using those assets across all types of entertainment and using the characters within the metaverse, there's just a massive opportunity here for microsoft and activision i think they'll get it put through. they obviously have very talented people working on this. ithink it will do very well fo them. >> you sound excited about this,

which i find interesting on multiple levels. one, some people might know you co-founded a pc gaming company way back in the day that hp bought two, you are a microsoft executive and sort of the founding leader of the venture arm there. and now you've got this a.i. on block chain company startup that you've just launched what would be a threat to your efforts to innovate in this space because it doesn't sound like you think a big gaming company that also has a platform is a threat at all >> no. look, on the contrary. i think microsoft getting big into this metaverse space is important. and the reason i say that is facebook is, you know, taking a big sort of developer approach on the metaverse with their oculus and invitinge ing develos

to create content. creators aren't getting paid what they should get paid. microsoft has the ability to take investments and invest in the cloud, invest in azure a lot of the future games are going to be doing rendering on the cloud and there's really no better company positioned to build that than microsoft. by the way, you know, phil spencer was -- he was actually one of the people that hired me into microsoft he has really grown into this incredible leader. i really think that, you know, under phil's leadership they can clean up the culture and they can really make activision in a much better position than they are today. he leads with empathy. he's just very good at what he does and i believe they have a strong vision, a strong financial vision for where this is going to go. but beyond that, just the combination of this with hololens is no joke. >> you're alluding to a cultural vision as well, rahul. you talk about the scrutiny that megacap tech is under. we spoke to bob peck about this earlier on in the show

who else could do a deal of this size outside of what we typically think of as megatech, a disney or a walmart and how come we're not talking about netflix doing deals like this with their stated push into gaming >> everybody is copying the netflix model. the idea that they want more subscribers. game pass is a big deal for microsoft. i think a lot of these companies want that returning revenue going forward. in terms of who else could play in something like this, i would have no doubt that perhaps facebook was even bidding on activision as well maybe other companies pushing the price up the way it is at the moment i can't imagine it was just microsoft looking at this. so, i think there's a number of other companies looking for these types of deals, looking forcontent deals you know, and having the ownership of these assets is very important in the future of the metaverse. >> rahul, within microsoft, obviously gaming is going to be

a favorite child here for the foreseeable future what does it do to other business units and the optionalty that you might have been betting on at in cloud or hardware or something else >> well, i think -- look, this is pretty incredible at microsoft has created few divisions now in the last year like i think they created a security division recently and now they're creating this xbox gaming division. this is kind of like a departure from where satya nadella started. he changed the culture entirely within the company and now setting up these divisions really tells you where they're investing. and investing in the cloud is such a big deal for them and microsoft xbox pushes their cloud investments to another level. you know, it's going to push companies like nvidia and ati to create more gpus gpu rendering on the cloud is going to be absolutely massive and the future of gaming where it's going with a.i. and, you know, and having these artificially intelligent

characters within the game, i think -- and even rendering on the cloud, i think this is kind of like microsoft is enabling the future for developers like us to build on we're actually building on azure. and you know, perhaps these investments are helping to push the technology so that companies like us can exist. >> yeah. well, from the beginning, satya carved out gaming as an exception. focus on enterprise with the consumer downstream except for gaming and people are like, what are you doing buying minecraft now we know. rahul, thanks. >> they paid $2 billion for it and looking back it was a steal. everyone was asking phil the same thing and, you know, it was a steal. they've really thought ahead and they know exactly where they're going. so i'm excited about the deal. >> rahul sood, thanks. >> thank you. as we mentioned, don't miss lina chan since taking the helm. she'll sit down live tomorrow 10:00 a.m. eastern with our andrew ross sorkin and kara

swisher of the new york times. find out a lot more at cnbc.com/capitalexchange and we'll be playing and debating a lot of that tomorrow right here on "techcheck." we're back after this. this is the new world of work. each day looks different than the last. but whatever work becomes, the servicenow platform will make it just, flow. whether it's finding new ways to help you serve your customers, orchestrating a safe return to the office... wait. an office? what's an office? ...or solving a workplace challenge that's yet to come. wherever the new world of work takes your business, the world works with servicenow. don't like surprises? [ watch vibrates ] proactive notifications from fidelity keep you tuned in all day long. so when something happens that could affect your portfolio, you can act quickly. that's decision tech, only from fidelity. age before beauty?

why not both? visibly diminish wrinkled skin in... crepe corrector lotion... only from gold bond. new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today. - [announcer] at southern new hampshire university, we're committed to making college more affordable. that's why we're keeping our tuition the same through the year 2022. - [narrator] i knew snhu was the place for me when i saw how affordable it was. - [narrator] find your degree at snhu.edu.

♪ welcome back ibm ceo giving insight into how global customers are adjusting their logistic strategy in 2022.

i spoke with him sunday. he said customers are asking how to build more flexibility into their approaches >> how do i begin to look at not just how do i order, but how do i hook that up to my supply chain so i can begin to get the supply in according to my demand signal how do i begin to be predictive when i look at where it's coming from not in each channel by itself but by combining all of the channels we have a few clients beginning to look at can i begin to use my entire physical footprint as a delivery mechanism and as you look at that, is that about time or is it about optimizings inventry or is it about getting rid of what is the number that's often talked about 20% actually i think probably underestimated, maybe 25% of all inventry often gets massively moged down or is not sold or undersold or go some place else. how do you begin to optimize all of that when you do have these supply shortages is something

that's going to become critical. >> i also asked him about nfts and whether he sees value in the underlining technology he does because of basic economics. >> i wouldn't say it's impossible to copy physical goods because now all the techniques we have around 3d printing and scanning and reproduction, you actually can including reproduce layers of paint on things, right i think there is a value in nfts because people like originality and people like when there is a scarcity economics 101. if you can reduce the supply, then there's value in those. now you have to get deeper getting away from the fad, how do you assure it's rare and is a market for it? i think it's way too early to tell whether all this will be true but if i go based on other markets like that, there is a market and that market is measured in the tens, maybe hundreds of billions >> hundreds of billions. dee, that's a lot.

>> i like how he said getting away from the fad as well, jon >> yes. meanwhile, apple another bullish call this morning. deutsche forecasting more than 15% upside for the tech giant. catch the full call at cnbc.com/pro we're back in just a moment. stay with us when you're looking for answers, it's good to have help. because the right information, at the right time, may make all the difference. at humana, we know that's especially true when you're looking for a medicare supplement insurance plan. that's why we're offering "seven things every medicare supplement should have". it's yours free, just for calling the number on your screen. and when you call,

a knowledgeable licensed agent-producer can answer any questions you have, and help you choose the plan that's right for you. the call is free, and there's no obligation. you see, medicare covers only about 80% of your part b medical expenses. the rest is up to you! that's why so many people purchase medicare supplement insurance plans like those offered by humana. they're designed to help you save money and pay some of the costs medicare doesn't. depending on the medicare supplement plan you select, you could have no deductibles or copayments for doctor visits, hospital stays, emergency care and more! you can keep the doctors you have now, ones you know and trust, with no referrals needed. plus you can get medical care anywhere in the country, even when you're traveling. with humana, you get a competitive monthly premium and personalized service from a healthcare partner working to make healthcare simpler and easier for you. you can choose from a wide range of standardized plans. each one is designed to work seamlessly with

medicare, and help save you money. so how do you find the plan that's right for you? one that fits your needs and your budget? call humana now at the number on your screen for this free guide! it's just one of the ways that humana is making healthcare simpler. and when you call, a knowledgeable licensed agent-producer can answer any questions you have, and help you choose the plan that's right for you. the call is free and there's no obligation. you know medicare won't cover all your medical costs. so call now, and see why a medicare supplement plan from a company like humana just might be the answer.

♪ billionaire investor no stranger to controversy. now he's in hot water over comments on china. the discussion took place on his own all in podcast after the co-host brought up president biden's foreign policy approach to china and their treatment of uighurs. take a listen. >> i am curious about -- nobody cares about what's happening to the uighurs. you bring it up because you really care. >> what do you mean nobody cares. >> the rest of us don't care i'm just telling you a very -- >> you don't care? >> i'm telling you a very hard, ugly truth all the things i care about, yes, it d below my line. yes. all the things i care about it, it is below my line. >> tweet last night he tried to walk things back a bit, saying in relistening to this week's podcast i recognize i come across as lacking empathy. i acknowledge that entirely. to be clear, my belief is that h human rights matter in china,

the united states or elsewhere, full stop. he talked about his past, jon, his family history as a refugee. obviously a lot of discussion about his ties to the warriors and the myriad of relationships that the nba has with chinese interests and how difficult that is to separate >> it's a tough honest moment, i think. chamath speaks in provocative sound bites. he can't help it that's part of what makes him popular. the underlying question for investors is can you be heavily invested in china in company's economically dependent on china and honestly say you care about these other things to what degree is this esg stuff marketing and to what degree is it really going to impact where people put their money so statements get walked back, et cetera, et cetera but where are these companies actually putting their money and do they believe that they're having an actual impact on policy in china? do they care >> yeah.

it's one of just one of the things that investors and ceos, business leaders have to look at when doing business in china when i lived there we called the three ts, taiwan, tibet, tee tee enmen. provocative indeed and we're seeing the repercussions play out on twitter from the warriors and certainly it will continue despite his tweeting about the latest spac. meantime, guys, can't get enough "techcheck" content our audience should tune in on our live stream after the show we'll be talking all things gaming and metaverse with second life founder phillip rosedale as he returns to the company as strategic adviser. that's at 12:30 p.m./9:30 a.m. pacific live from our twitter page cnb echeck don't go away. ♪

we are now in the fourth quarter of today's "techcheck," continuing to track the selloff. the nasdaq lower by more than 2% dom chu, what's going on >> that pullback now, jon, brought us to a level where we are entering that so-called correction phase again where the markets pullback by about 10%. specifically with regard to the nasdaq composite overall from the record highs, that pullback is now down roughly 10% from the record levels we saw over the past few months. now compare that with the s&p

and dow down by more than 4 to 5% than the record highs they've seen very much more about the nasdaq composite, a big focus these days as for what's driving things lower, look at some of the worst performers within that composite trade in the nasdaq, it very much is the semiconductors specifically applied materials, micro chip technologies and nvidia and micro devices, some of the worst out there, nvidia down 2% is outperformer. keep an eye on the chips if you are looking for some place that's actually working right now, there's not a lot of green in the s&p 500 however, if you want to check out some of the overall moves, check out what's happening with some of the so-called value cyclical trades. we want to look at some of the stocks like deere that's outperforming today and also some of the other names with regard to the industrial complex, free port, exxonmobil keep an eye on those back over to you. >> dom, thanks very much we'll continue to track the selloff.

news on a company in the quick commerce space, space that attracted a ton of capital in recent years go puff is one of the recent players here last valued at $15 billion in the last fundraising round. it is expanding into private label products starting with bottled water private label products starting with bottled water and other household essentials gopuff co-founder rafael ilashaev it's great to have you i wonder, is this a move to differentiate you guys from uber, doordash and delivery. this is an industry, quick commerce that is known to burn through cash and what does it do with regard to profitability >> deirdre, thank you so much for having me. we are excited into ourent tree into private level ask we're going into essentials, and customers have been requesting as we look at internal data, 80%

of gopuff customers are looking for a high quality private label assortment and the flavor profile with the customers are different than the national average. so we're launching things like habanero barbecue almonds and everything seasoned cashews. we've been launching new categories and new geographies for a long time. we created this instant needs category and we, you know, in the very beginning, we didn't really raise any money for the first two years we had the model and building the best in class tech and the operational fire power to extend our lead in the category >> rafael, certainly, you guys captured marketshare in the space. as you look to an eventual ipo, you say you're different than the other delivery company, how should investors value gopuff. i remember when uber went public and they tried to tell investors

they were the amazon of transportation and the market didn't buy that. more than two years later they're trading below the inprice. why should gopuff be treated differently? >> we have a lot of respect for amazon, right? i think amazon has shown that the vertically integrated model is the model that wins long term for consumer demand and the overall customer satisfaction and profitability and while we share that same kind of tenet with amazon with vertical integration, we are very different and we created this instant needs category as you mentioned from a market share perspective and we have a 73% share in the instant needs category in the u.s. as you guys may know, we opened up in the uk in the last couple of months and we had a soft launch in france and we are prepared to be the number one globally, want just here in the u.s. >> i know you can't give us specific figure, and i wonder what the profitability picture

looks like for you guys and if if that is more like an amazon versus an uber >> yeah. you know, as i mentioned before, right? the last eight years we spent a lot of time nailing the business model before scaling before we started opening up a whole host of buildings we really focused on the economics and delivering positive contribution margin. we have really, really strong economics and positive contribution markets and it kind of gives us all of the confidence in the world to continue to reinvest in the consumer experience to continue to reinvest in technology and open up infrastructure in the global scale. >> rafael, thank you for being with us. we hope to talk to you soon, gopuff co-founder rafael ilishayev. gopuff say cnbc disrupter 50 company and cnbc is accepting nominations for the disruptor list scan the qr code on the screen

or go to cnbc.com/disruptors for more information. snowflake shares are almost 30% off their highs. william blair says now is the time to buy citing the company's better than expected growth. "tech check" is back in a moment

one more thing before we go. 2022 expected to be a busy year when it comes to big tech regulation just moment away from a press conference with antitrust head jonathan kanter and alina khan ylan mui join us with more. >> this is the first time we have these new regulators together how their agencies will approach mergers going forward. just after khan took the top job at the ftc it revoked what was developed during the trump administration the white house is encouraging both the ftc and the doj to enforce antitrust laws vigorously including looking back at prior mergers and that means the agencies have their work cut out in them

the boom is straining the ftc's resources. there is a proposal floating around on capitol hill that could increase the company's merger fees and boost funding for the ftc and doj, but that bill is currently in limbo meanwhile, you know who does have big money big tech they are flooding d.c. with cash right now. facebook was the biggest spender over the first three quarters last year dropping $13 million for misinformation, censorship and the whistle-blower hearings and second was amazon at 14.4 million google and microsoft deployed $7 million and apple $5 million we are expecting fourth quarter lobbying soon so, john, big tech is taking these threats seriously. >> back over to you. >> it's such an interesting backdrop, activision, blizzard deal for $7 million in the deal. in the past lina khan has

referred to merger reviews that didn't, perhaps, result in changes or stipulations as missed opportunities how do you think that might affect what we're going hear today? >> i don't expect that they would address the activision merger in particular certainly, they're going to stay away from naming specific companies, but we all know what their long academic history has pointed to, and as i said, the white house itself has called specifically on the aegencies to look backward and forward and we'll muddle through it. >> as we wrap up the show, guy, the nasdaq is up 1 2/3%. carl, you see the ark etf down 3% adding to the losses and the nasdaq an underperformer as we watch rates. >> yep zscaler is managing to get

mileage out of this upgrade out of morgan stanley up 4% and think, we'll hear a lot more about the banks in the morning with b of a and morgan stanley, but for the time being the top five s&p gainers right now are pretty much all gaming related let's get to the judge and the half. >> carl, thanks so much. welcome to "the halftime report." i'm scott wapner, front and center stocks falling, rates rising and earnings so far, mostly disappointing. what does all of that mean to your money we'll discuss and debate with the investment committee joining me for the hour today, stephanie link, jim lebenthal, joe terranova, josh brown. down 243 the dow down about 500, bit 1/ 1/3%, and rates are on the rise jim lebenthal, i'll turn to you first, you told our producers you think this could be the