weeks. >> and there is a soothing start to this wednesday. jim, thank you always great to see you. >> thank you for having me >> dynamite! >> dynamite! >> he's back back on all the commercials. the dow up by 227. that does it for us today. it's time for "squawk on the street." good morning wednesday morning. welcome to "squawk on the street." i'm sara eisen with jim cramer carl has the morning off david is on assignment we have an exclusive interview with the ceo of boeing, dave calhoun, on the heels of that company's results. looking at futures, looks like we'll rebound from an ugly session all around everything sold off yesterday, we're up 240 or so on the dow. s&p 500 up 16 points and the nasdaq up 34 the nasdaq got slammed

yesterday. big sell-off into the close. it was broad it was bad breath. this was the third negative session in a row for the dow the dow is below its 200-day moving average the nasdaq suffering its worst day since september 2020, trading in bear market territory. we have two big names out in the indexes with results, alphabet reporting weaker earnings, that was perception on a revenue -- >> perception. thank you for that >> because i know you'll push back >> you bet i am. >> i read that conference call and same with microsoft, which we'll talk about, which is helping futures, up 4% on alphabet, there's stale lot of growth. the youtube numbers were a big miss compared to a year ago. >> one thing he does as an excellent ceo is not hand hold she could have called everybody around and said ukraine, there's

a war, that could reverberate to western europe they built this incredible business in europe what bothered me is do you really just view it statically and accept the fact that you know what, what a miss or do you say of course, and you asterisk it. i know you're going through a million different things, but microsoft makes everybody look bad. a very big miss on russia. it was like, hey, who cares, take out $110 million. i feel like alphabet is a buy. i think it's buy because you have to be kidding do you really think they're not doing well >> they had tough comps. this quarter last year for youtube, the business was growing 49%. now only up 14%. the market was looking for 24% growth on youtube. >> let's look at the way we'll

get people to go somewhere traditional advertising tv, not so great, obviously not paper, poor trees you can reach people by amazon, and you can reach people by alphabet the r yeshoi for alphabet is amg we'll have to see that for facebook >> today after the bell. >> what was it, 30%? it will get worse. and mark zuckerberg is working on the metaverse i think it's fantastic with 23, 24, 25 we're in '22 we have to worry about instagram. i like that wing and i don't think that he's focused on instagram enough. >> are you negative on meta going -- >> we sold a lot of meta we had this basis from the days they were trying to figure out cell phones. he kept a little because capital gain, capital gain but mark has to focus on the

bell weather and that is instagram, okay? >> they have shown they can pivot pretty well. they pivoted to mobile quickly >> absolutely. but i'm just saying, look, maybe people say that's why the stock has been -- >> been slammed. >> not too granular, but instagram is the money, not meta talk to jensen on meta he's like this omni. that's right now but it's industrial omni and that's terrific chipotle is industrialized >> i increasingly am on instagram and doing things like shopping and following the links for the ads and buying stuff >> shopping? doing things that's what i like >> instagram >> my daughter went over my twitter feed to analyze it she's real smart if you ever read the messages, you'll commit suicide so just stop >> it is hard to read comments and free speech, i don't know if

that makes it worse or better, a la elon musk >> people have built their careers on twitter i think that he eel end up paying i'm getting all these articles about how the left is leaving twitter. they'll come back. you know why because it's free. >> for now >> right that's what he has to do he has to charge >> youtube and alphabet executives talked about tiktok competitor shorts. surprising numbers 30 billion daily views there, double the prior quart erp they're growing this business to compete with tiktok as well. >> they have to and that's what zuckerberg has to do i don't know if you've done tiktok video i did that versus reelz. tiktok is seamless when someone like me can do a tiktok video, therefore it's easy, i mean, i don't know how to fix a vcr >> camera, good lighting >> you need a pro.

this company is going to report. who cares? faang. we're in that moment where faang -- it's root canal >> it's problem. nobody's had a quarter like netflix. spotify. >> spotify thought it was a good quarter. >> they grew subscribers 19%. we have the cfo on >> a little less stream of consciousness because you're looking at what my brain does, and there's not where you want to go. >> back to the market. >> vegas nerve let them sell it if they actually bothered and understood ruth at morgan stanley, they'd realize it was an amazing quarter but they don't understand the mind of ruth porat, the ceo. she is brilliant they are lilliputians versus her. >> there's also microsoft, revenue growth of 18%, better guidance on all three business

segments and dealsworth $100 million in the quarter, more than doubled >> i was looking for 47. they came in at 49 azure fantastic. >> matched the quarter before. >> there were no flies on microsoft, no hair, whatever i say no flies because of the personal nature of no hair but it was amazing xbox is now available. gaming, down >> they are going to buy activist and blizzard. is that really going to happen >> they have to hope now that the antitrust blocks them. i will tell you with the xbox available, we have to find out what that means for best buy i thought the game cycle would have one more year it was going nowhere we really have to watch gaming because it's obvious that gaming is in the docusign world of hell right? >> right >> you have seven circles of hell

they're like circle five dante. >> are you a gamer >> no. i'm a dante guy. >> i thought the first question from keith white of morgan stanley on microsoft, what gives you the confidence you can see this durability in a slowdown and the confident answer we have better pricing and product. >> you want a company with worse pricing and worse business, the ceo. >> boeing is moving lower. they missed the street expectations on a number of metrics. phil lebeau with david calhoun phil >> thank you, sara dave, they set it up perfectly you missed on the top and bottom line, had a number of charges in there. it was not a good-look quarter >> what do you say to boeing investors looking at shares moving lower and tell them that you believe you have a game plan for not only second quarter but the rest of this year? >> yeah, first, great to have

you in south carolina and great to see some tails behind us on the production line. messier quarter than any of us would have liked familiar themes, supply chain constraints, covid, inflation have such an impact on our company in our fixed price development contracts we do with our defense business and they took a hit without a doubt. we had air force one, which was a program most people know a lot about. it took a hit. our trainer took a hit our mq-25. we love those development programs and we love the work we're doing and the performance of the airplanes, but the accounting proved to be difficult. >> inflation how worried are you act what we were seeing? we were talking before you went on the air you wanted to see these numbers in the middle of the year because you think that will be the telltale sign in terms of pricing and companies that have to bake this in permanently

because of higher costs? >> our contracts protect us to some extent, not completely. that first lap, the second year of the inflation for us is very meaningful because our airline customers are as short cycle as you can get and they have to go out with their prices as fast as they can there's pent-up demand it's strong demand and they can pass those prices through. that second year when inflation begins to take a toll on the consumer's pocket, that's when those numbers begin to matter to us we'll find out whether they have an effect or slowdown of any sort before we start thinking about longer term, medium term pricing stages >> the 777-x, you're pushing that off to 2025, pausing 777 passenger airplane manufacturing. you're still going to be manufacturing the freighter. people are looking at the 777 and saying it feels like they continue to push this out and

push it out. >> the pushout is simply a lessons learned on the new certification process. and it is rigorous high level of scrutinization this process, we take every lesson we have and we've tried to apply it to our future certs. the 777 has strength in lots of ways, and our decision to do this reflects those strengths. so we're delaying it long enough to believe that we can get to the finish line in accordance with the dates that we've set. 2025 is, in fact, the year importantly for us, it allows us to open up some capacity in a metal-winged 777 freighter so we'll plug that in there and it will prevent us from developing airplanes and producing airplanes which we then may have to rebuild and rework so there are a lot of reasons why i view this as the strength of the 777, our ability to make

this decision and do it early in its certification life >> jim's got a question for you. jim? >> yeah. always good to see you thanks for coming on >> hi, jim >> china i was getting very excited because i thought, well, obviously the plane is ready the china certification seems to be held up, orders not going anywhere could that be political? because the planes run well. >> yeah, jim again, good yes, a familiar theme. first, i want to at least pass on our thoughts and prayers to the families of the passenger and crew on flight 5735, which as you know over a couple months ago we experienced a horrible loss anyway, with respect to china broadly, right now all of the slowdowns relate to the covid management process and decisions that they've made as country so as you know, domestic passenger traffic is down

considerably and it will stay down i don't attribute anything to where we stand in china to politics i attribute it to that slowdown. every signal before that with respect to the recert of the airplane and the introduction of that, reintroduction of the airplane into service, has been going according to schedule, and we're comfortable it will continue to do so. we're there for our customers. we'll continue to support them i'm still confident that china, when it gets covid under control again, will come out and be an active buyer of boeing airplanes. >> so there are obviously just two large companies in this business we heard an unbelievable interview by phil about the demand we have some people that get that, greatest point ever. just positive for me had you had the best execution that we're used to from boeing, how great a quarter would this have been instead of a horrendous quarter it is >> well, the underlying trends

on both our max, both in terms of demand and honestly in delivery are pretty good we are constantly moving up our rate of production we are moving the inventory of airplanes, which is still consi considerable, out into the marketplace. true in the 787. i'm very proud that the 87 cert plan has been submitted, it's thorough, and this factory is humming and airplanes are ready to be flown. i feel very good about the progress we've made on that front. as you said, without a doubt, the demand for those two products is significant and i would say the demand for the 777 is significant so i'm not worried about demand issues and, yes, if i could make all the airplanes in the world i could make, things would be very rebust but the facts are we are in a supply constrained world and all of us have to keep our eye on that and deliver predictably to our customers. i will say in that environment, i hate how i got here, but we

have 400 airplanes in inventory that are essentially finished goods. that gives us an advantage in the next couple years while we're all battling supply chain constraints around the world >> let's talk about those 100 planes in inventory, the 787 dreamliner you have a cup bell hinld you here, one for american, one for united those ceos are wondering when they'll get them you've submitted the plans likely the third quarter what's your sense on delivering dreamliners again? >> everyone would love a date. i can't do that because the faa controls that product. we are confident and comfortable we've submitted the best boeing can submit it's thorough. it's been investigated in every way. you'll see first hand after we do this interview the precision and the scrutiny that each plane has gotten they're ready. they want to get flown i am confident that the faa, alongside our engineering team, will work their way through this cert and will be back in the air sooner than later. >> with that inventory of 400

planes including the 100 dreamliners, how quickly can you bring it down? once everything is in place, let's turn on the spi got and start delivering these >> the airlines have to get pilots and crewingss ready, thoe things we've got to get there as fast as we can, but we only do it in accordance with their ability to accept but as jim said, demand, the question of whether they want them and want them sooner rather than later, that is not an issue for us >> like other industrials, you guys worry about inflation, rising interest rates, and a global economy how worried are you about that >> i'm worried like everybody about the long-term effects of inflation. one, i don't want them to be long term. but we have some things that are beginning to bake themselves into the process we know labor contracts are

beginning to extend. we know they're getting richer we know those in the short circumstance cycle world with pricing power are exercising it. pricing power is inflation so all of that does ultimately take a toll on the consumer. i think if we tamp down or get anywhere near recession, i believe it's short lived because i think the underlying covid supply chain constraints will get resolved you know, we're all guessing a little about that. i have a little bit of time to get that right but it does worry me >> dave calhoun, ceo of boeing joining us today from charleston, dreamliner behind us here we'll look at some of the rework and changes that are part of their application for certification that they have submitted to the faa we'll have more on that throughout the day back to you. >> great, phil thanks you. making your way around the country talking to ceos this week phil lebeau and our thanks to the boeing ceo this will bring it down to 20%

>> unfortunate boeing sold a lot of travel trust. boeing is at a critical moment i don't think it says -- it's more existential than i think it is just execution. i think that the real issues here, they have got to fix these planes. >> trust. >> yes credibility factor is on the line, not just for the stock but for the company itself if you're any of the ceos of the major auirlines you're saying we're in bed with boeing, southwest in bed with boeing, but you heard what he said, this team has little bit of time. you can say dave just got in we know if you don't execute in this world someone else is going to execute dooichs got to get this together he needs what i call a "w. he's not had a win since he's come in. and i am very disappointed that even just with the presidential

plane, with defense, i'm looking for something that is heartening dennis, his unfortunate predecessor, and greg smith was in there for about a month, told you a story that i feel was false narrative. i don't like what's happening there at all you know, this is not anything that you can say is a proud american company anymore i remember when my father would tell me that -- i said this to jim mcnerney -- my father was getting shot at every single time he landed, nine times he saw silver planes, and he recognized that boeing was the great american company that could win the war or help against the soviets. this does not feel like boeing versus phil lebeau's interview

with mary, being sold short. >> on boeing, it does feel like the trends should be in their favor. not the strongest airline business and travel outlook we have seen maybe ever, and on defense, $2 trillion, defense spending we hit that for the first time last year. that's ramping that business is declining double digits. >> it's upsetting. it's an iconic company we haven't afford to have boeing in this nation, boeing become a third-rate pitiful, helpless giant. and that's what i feel that boeing is on the verge of doing. calhoun came on, okay, very good, but he came on to tell us nothing. by the he cash flow was awful. it wasn't fine come away from the interview saying what the heck was i thinking holding on to any of

this >> wow, that's pretty brutal >> hey, you know what, self-administration is the key to success >> it's not helping the dow today, although it looks like we are going to get a bit of a rebound. >> microsoft >> the dollar is making new highs. >> as we go into this. can we go into this? >> wurpgs. >> it's not helping our stock market >> or our earnings we'll talk about all of it we've also got another big interview this hour. t-mobile's mike sievert will join us. taking a look at futures higher. remember, we're rebounding from the worst day from the nasdaq since september 2020 dow futures up

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i have to hand it to our supply chain team and our partners that supply us. fortunately, we don't buy a lot of conventional items because a different feed ethos and food principles so that helps us in some of the inflationary environment, but we're doing everything we can to avoid having to pass on pricing. it's getting harder and harder >> the ceo occf chipotle

>> the reason i wanted to focus on them for a moment is they're not worried about unions why? because they own the store, first of all starbucks has a lot of stores that are unionized they're franchise. but they are in control of their own destiny and like to promote from within. if you work there in a couple years you can make $100,000 being a manager. they're trying to automate the parts of the job that are boring and horrible this company is a company that you and i would work for if you come out of school and started over again >> you dent think they're threatened by the robots they're increasingly using >> as someone who has watched a terrific guy have to make chips from 3:00 to 5:00 every day and is an artist and a great cook, no let's take that job out of the hands of people because it's just too dumb. >> i like how he told you they like making guacamole. >> we had the chicken dish

mixed reviews. >> i think i'm the only one that gets tofu at -- the tofu burrito. >> chipotle is doing well, in store, and digital it's a three-headed monster against everybody else don't get in their way i love those guys. >> i'm looking at the futures, jim. they've already lost some steam. it feels tentative, doesn't it >> people don't want to hear anything other than get out now. i'm not going to give them that. can we talk about something that is a comparative advantage that we would have learned that is not working? if china is indeed maximum lockdown mode, if europe is paralyzed by ukraine/russia, why doesn't more money come here buying our bonds and stocks from overseas >> that is the case from the u.s. that we look the best and not just against the rest of the world but u.s. stocks versus u.s. bonds with inflation rising and the fed hiking rates

no alternative right? >> but, i mean, if you look at what we're doing, if you're watching our stocks, i think you would say that everyone's running to cds and i don't think they're the place to be right now. [ bell ] >> there goes the bell the cnbc realtime exchange at the big board. ziff davis looks like we're up ten points one level to watch on the s&p is 4,170. that was the closing low in march. >> you could take that out i don't know by the way, ziff davis i like that stock very much. let the people who want to get out of this market right now do

it talk about the idea of you said safety might be too expensive. mondelies. safety never takes a vacation. >> they're winning on pricing and volumes. what's not helping them is the rest of the world. this is a company with 80% of their business outside of the u.s. they take a big hit from the strong dollar, 17 cents on earnings, but they were the first big food company to take down guidance or at least bring it to a lower range. that was a little bit of a warning sign because, look, they've got a bigger business than russia and ukraine. >> as between mondelies versus boeing >> it's all pricing. kraft. the volumes were down on craft >> i was upset because jonathan oliver saying my wife likes the

bake-inator. she likes the toblerones personalization with james quincy at coca-cola, another person who delivered a great quarter and you think it's too ebs pensive. >> i don't know if it's too expensive but those stocks have worked well and the earnings are showing why. even craft times had a really good quarter and are able to show 9% pricing gains, which in this kind of environment people pay it up for heinz and velveeta and mac and cheese >> we go back to the concept there has been no tradedown. if that stock is down, vie san jose sharks we should go home. >> they projected slowdowns. >> so visa is up 15. that shows you that if you do a

good quarter the world is not ending did you see that >> travel is helping, right? >> travel is very good cross border you know what we ought to do, a sound bite >> we have him it's a preview let's listen >> even with the invasion of ukraine and lingering impacts of omicron, volumes, transactions and credentials drove strong second quarter performance in terms of the big picture after the short four to five-week impact of omicron in december and january in the united states and many other parts of the world, the recovery continues to be robust at this stage in terms of volumes, we have seen no noticeable impact due to inflation, supply chain issues, or the war in ukraine. >> no noticeable impact at this point. >> what's the second biggest country for credit cards in the world? >> second biggest? >> it's a quiz

>> outside of the u.s. >> yeah. >> i don't know. russia germany? >> russia. multiple credit cards. their wallets are incredibly thick. whey like about this quarter more than anything else is everything is versus three years. payment up 135%. this is what's going on. charlie sharp, listen up from wells fargo, who's from this company, debit and credit are both up but what's incredible is in 2019 the world used 59% was cash, there is a year was 50%, now it's 46% i go to stores these days and say do you take cash >> i haven't cash in, like, five years. i haven't had cash i don't carry cash >> a really nice house jefferson. >> jefferson what does it mean for paypal after the bell that hasn't been as strong >> t-mobile is pretty good here.

>> are you punting that? >> completely. >> paypal reports after the bell i think there are some serious questions about that >> came on the show, dan shulman, when the stock was 185, drew a line in the sand, said there wouldn't be problems, really good, better than expected if you notice, there's a "1" missing in front of the "8." >> it's been slammed activist target? >> it's too big. slammed. you used the word slammed. do you think it's body slammed or -- >> crushed >> -- they're giving them the business give me something good tell me something good >> let's have gm because you like the execution here. >> mary barra i think is giving you this lineup of really terrific evs and she's got her battery system worked out, talking about a million evs and all people want to hear about is

the raw costs and how she's handling them. do we have demand destruction. the gulf between what she talked about on the call and what they talked about, we need respect. she deserves it. she is turning this company around by the way, cruise, huge numbers, great video, the cruise got pulled over and ran away >> no. >> it's a great video. >> let's listen to barra, who was on "squawk box" earlier this morning. >> demand for our products and that pricing, which we've already seen, is allowing us to really tackle some of the issues around inflation and some of the higher er commodity costs that gave us the confidence we can reaffirm our guidance. we have levers we can pull because of the strong products we have that we'll keep moving forward and executing not only the ice portfolio we have but

really focused on accelerating the evs we're putting into market and the progress we see at cruise from an autonomous perspective. >> there's the cruise mention. when does the valuation reflect that again it was doing that and we got the cyclical worries about a slowdown it's an awkward time >> i didn't mean to interrupt. >> no. >> even though when i speak i -- >> you want it >> not me. i see growth i like cruise. kyle came up with the twitch he's really smart. he's running it. a very non-gm guy. i think when i go out there in june i can't wait to ride in one that's truly autonomous. the hum ceradyne mite. the cadillac we have to see. we won't have those numbers till mid-may. their lineup is good i can tell you their lineup may have too many because you have silverado, a lot of different

things going jim will talk about that tonight with ford. i don't think this stock is worth what it's selling for but many stocks are quizzical in their valuation. >> the market a is lot more worried about this slowdown than what we're hearing from companies across the board >> basically said, shut up, give me a number. it's all china china shut down. >> but do you know how many cases are in beijing today do you know what they're reporting? 34 >> they have a draconian -- china -- look, putin, he ain't going to change because he's a crazy man. i always thought she was a rational, logical person they have a second-rate vaccine that's no better than our flu vaccine. and the biontech, the same as

pfizer and they're not using it. arrogance. hubris >> kind of test and squash the shanghai numbers fell for the fourth day in a row in terms of covid and there's discussion at a local level they might start to reopen. mary barr told squawk they consider auto an essential business and they'll start to open the factories again >> she's a great partner there they like gm we haven't mentioned elon musk >> tesla yesterday -- >> people forget how big it is china's self-inflicted it comes up on all the conference calls except of course for alphabet. facebook everything else will be a problem. >> you mentioned russia. there's been an escalation cutting off the gas to poland? >> yeah. a lot of people feel that the u.s. can supply poland with its

natural gas. on a month-to-month basis, we went between 1% and 2% not much >> no. biden has to do national defense act and say, listen, all that natural gas, we're going to break your contracts and we're going to send everything to europe that has to happen that's not happened. i don't know why it hasn't happened >> that's a good point also bulgaria, 75% of its gas from russia. they've been shut off, too, as putin is making them pay for gas in rubles and they cannot do that because of sanctions and that's boosting the rubles >> nobody in the u.s. cares about it >> what happens with germany is that a possibility? what would germany do? gas prices jumping another 10% or so. >> they talk about recommissioning coal, very hard to recommission nuke there was a person who ran germany who was revered. where is merkel?

>> merkel. >> why doesn't she own up? look, i just think that -- >> not a good look for her >> when people talk about this market, they're fixated on the fact that the nasdaq is falling apart. we did some work yesterday with carly garner talking about -- a terrific technician -- talking about we're still, if you use the trend line from the bottom l in 2009 to the top right before the pandemic, it took a long time to get up it was a long time to get there. and we did 7,000 points. we went 10,000 points in less than two years since the bottom of the pandemic. you know we'll have to -- >> i guess the question is has the underperformance been so huge at this point -- >> we're oversold. am alphabet was good. i think the big issue will be mondelez versus boeing

i want economy opening and, you know, give me milk and other owes please. >> nabisco snacks. it's been a good category. >> a good aisle. >> we can agree on that. as a reminder, get in on the investing club with jim. this is a good time in earnings season sign up, find out more or point your phone at the qr code it is time for "the bond report." treasuries, third day in a row we're seeing buying of treasuries >> we were selling in panic mode, but when they're buying -- >> because we're worried about growth they were selling because we were worried about inflation >> a great value >> dollar continues to go up we're at the highest level since 2017 we had a huge trade deficit. did you see that >> taking 2% >> we'll be right back here.

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after the break, our interview with mike sievert here at post 9 of the new york stock exchange first the biggest laggards on the nasdaq 100 for month of april. we're in the final three trading days of the month. nasdaq 100 down 11% for month. we'll be right back. it's an entire trading experience. with innovation that lets you customize interfaces, charts and orders to your style of trading. personalized education to expand your perspective. and a dedicated trade desk of expert-level support. that will push you to be even better. and just might change how you trade—forever. because once you experience thinkorswim® by td ameritrade ♪♪♪ there's no going back. to adapt in the changing world, you could hire a professor of theoretical mathematics. we all know this equation, right? he'd crunched numbers day and night.

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once again, shares of t-mobile higher this morning, raising guidance for the rest of the year joining us now in an exclusive is mike sievert, t-mobile's ceo. >> i brought him that mug. >> mike's kind enough to bring my coffee. let's go right into this so at&t 965,000, kind of impressive verizon, not as impressive you guys, 1.3 million. how is it possible don't you have everybody already? >> investors keep asking, you know, how long can this go on. i don't know i can tell you that for t-mobile it doesn't matter. we delivered in the very quarter people are asking, you know, will we be able to sustain this

growth we delivered more postpaid net ads in q1 than at&t and verizon combined 1.3 million, the best performance for a q1 in eight years just this quarter.you, bus remarkably low do they like the carrier that much >>. >> the magenta brand, we think it had the lowest churn. in this quarter the best sequential performance in seven years, best year-over-year performance in the industry, all ball this integration is coming through. we've been telling people for years, we will get this done ahead of schedule. we just celebrated two years we'll have every sprint customer offsh and we'll shut that network down this year what's happening the sprint customers come across, they like what they're finding, and the

churn is rapidly falling as a result. >> i watch a lot of sports what's incredible is at&t says they are the best 5g, verizon says they're the best, can i please get some clarity? those ads are very compelling. the woman in the store thinking i should switch. >> you'll never get clarity from the commercials we covered 1.8 million square miles with 5g that's more than at&t and verizon combined, more conveyor smiles than the two of them combined in population we're reaching 95% of the population, but the real game in 5g is what's call the ultra-capacity this is the midband 5g, where it's like 8, 10 times faster than lte

we'll be at 260 million by the end of this year, and 300 next year >> but does the customer care? where are we in the customer adoption of 5g there's been so much hype and investment from you guys in the cycle -- >> it shows that our customers are jumping in with both feet. we have 45% with 5g devices, more than half our traffic now is with 5g devices what's interesting is it's enabling new applications, like 5g home broadband. i mean, t-mobile -- not comcast, charter -- t-mobile is the fastest-growing home broadband provider that's happening because of the massive capacity of our leading 5g network >> so, the question i guess for the industry, is there going to be a slowing the numbers were so strong last

year, people working from home, they had to have their fast speeds, but as inflation starts to bite, with the consumer, and as we get into more normalized trends, what happens to overall subscriber growth? >> i think it may go the other way. there's been a long-term trend of all content, communications of all kinds, leaving the linear prior forms, and going to the internet there's been much more interest in home connections, but mobile is the trend that's where the eyeballs are. the growth has been remarkable in this sector >> the death of broadband, are you saying >> it doesn't matter whether the growth is there for the industry, it will be there for t-mobile we're the only ones with underpenetrated segments >> let ate just not write off broadband. >> we're the leading broadband growth company now. >> i found this site, saying i can get a free smartphone for

new lines. i paid a huge amount of money for shall matterphone. how great is apple to get customers? >> both apple and samsung are great partners of ours all the providers off great deals. we enjoy a great partnership, because we're able to bring their technology to so many millions, and we subsidize it. if you trade in a recent device, you get a completely free 13 pro. after you sign up and get that device, which all the providers will get for you, but at t-mobile we can save you $900 every year on the service. the service is part of the equation that matters more to people than -- inflation is on everybody's minds. every other category is getting more expensive while we're delivering the best values we've ever delivered. >> i'm going to give you a question i never thought i would

ask. 1.6 billion in free cash flow. what are you going to do with it >> grow it we increased our guidance again, it will be up 30% next year, and this year from last year, and so it's -- we have a massive unlock happening. the synergies are coming in. when i just said we're shutting down the spring network this year, that allows us to increase -- and allows us to reinforce we'll have 7.5 billion run rates by 2024. we think there's a chance for up to $60 billion in share buybacks >> that's what i was hoping you would say. >> we still see that >> you know, i'm trying to communication right now, of course, with your predecessor, i have some very good questions to ask, but -- he must be asleep, but he used to tell me, listen,

jim, you don't understand, this time at&t is dumb and verizon is dumber which one -- in your eyes, these one of your theeisms, which is dumb and which is number >> i'll tell you this -- >> give me an answer. >> this quarter our outperformance from verizon on net adds was the highest ever. >> at least at&t grew, right, jim? >> in terms of new accounts, was the widest margin of growth versus verizon >> are you really a germ ophobe? >> no. >> that's just something he sent to me. he's got some great stuff. he does seem to think that verizon may be dumber. mike, great to see you thank you for the mug. and yes, you did have the best good to see you. >> good to see you.

what's quickly on mad tonight? >> bestin show for the show. mattel, you know, if that's the case, why is he coming on? ceo of a company called ford the maverick is dynamite i have it in area 51 color >> you can ask him about it. anything to say, mike? >> no. >> fair enough. after the break, alphabet and microsoft, which are moving in opposite directions right now. microsoft continues to build on its gains of 5%..7 we'll be right back on "squawk on the street. policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. if you have $100,000 or more of life insurance, you may qualify to sell your policy. don't cancel

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good wednesday morning welcome to at hour of "squawk on the street." i'm morgan brennan with mike santoli. carl has the morning off david is on assignment a quick check on the markets a lot of green with all the major averages trying to bounce back after a rough day yesterday, with the dow up 286

points, s&p up 1.1%, 4222 is the left there the nasdaq up, as we await a slew of more megacap names in the meantime were gepgt pending home sales for that. hi, diana. >> reporter: hi, morgan. it felt right along expectations, but sales down 8.2% year over year. when you look regionally they were down everywhere except in the northeast month to month, but annually down across the nation they pending home sales are based on signed contracts in march, so people out shopping when mortgage rates really started to head higher rates started at 3.9% on the 30-years fixed, ended at 4.8%. that's a huge jump for one month. because of that jump, the chief economist from the national association of realtors said the sudden large gains have reduced

the pool of eligible home buyers that has consequently lowered buying activity. we are expecting to see a washout spring in this market because of those much higher interest rates morgan >> yeah, the move has been absolutely incredible. you think at least the prices may start to soften. diana olick, thank you. here are three big movers we're watching we're going to start with visa, reflecting growth in payments, volumes and transactions, the return of international travel boosting the top line. you can see the shares of 8.5% as well. operating margins shrank as -- menu price hikes helped to offset the higher costs, forecasting better than expected sales in the current quarter if trends persist as well finally twitter not the only company with plans to go private, potentially, mattel is

seek its stock rise as reports rise that they've been in discussions with private equity buyers, the company currently valued at more than $8 billion their shares are up about 12%. we're going to start with the broader markets. nasdaq off its worst day since september of 2020. mike, i've got to get your thoughts on this it certainly seems like the word of the day is, quote, capitulation >> three out of the last four days, actually have had near washout-type numbers, very broad based and fairly urgent selling. i wouldn't say you saw the telltale signs, but it was people with low conviction, very nervous about getting in the way of a earnings blowup i think that explains some relief today just in general, in terms of these levels, it's the fourth time the s&p 500 in the last three months has been right

around here and has more or less gathered itself and put in a bit of a forward to this trading range. it's enough for tale to wonder if they've seen enough selling earnings, while spotty, are not given you too much reason for immediate concern. >> the earnings piece of the puzzle, it seems like the last key leg here, where this market was concerned. the s&p 500, it was able to hold very, very slightly above its own 2022 lows at the close yesterday. obviously we're bouncing again today. that ample as well how key are these technical levels going to be, despite what we see companies posting in terms of results. >> yeah, they matter a lot in the short term the tactical story has been pretty much front and center it happens a lot, people have low conviction in the fundamentals, so the price has to move a lot to find people

with buying and selling interest that's why you get jumpy at this point. i don't know that we have any critical make-or-break levels, but the more times you test a down side, what seems like a floor to the market, there's more opportunities for it to break. i know that's not terribly helpful, but that's pretty much the way you have to deal with it bob pit pisani has more. the important thing is you can largely thank microsoft for this turnaround, a bit of visa. technology getting a big boost from microsoft's positive numbers. consumer discretionary getting a bounce energy is flattish, oil is holding in there around $100 communications services, that's alphabet that sector has been performing very poorly. morgan mentioned, i'm giving most of the credit to microsoft. we got very good numbers revenue beat guide wants was okay for them.

cloud was strong visa, you just heard there, the consumer spend sergeant terrific you add these two together, they're almost 200 points on the dow jones industrial average alphabet not on the dow, but weighs on the market overall, google advertising below expectations, youtube ads below, though the cloud was really good a lot of dow names frankly are right at 52-week lows. boeing disappointed today. verizon is at a new low, that's down 10% the last five days. jpmorgan is down, i don't know, 22% year to date that's one of the worst performers another worst performer is disney facebook is not in the dow, but that one is also down dramatically a lot of new big names at 52-week lows in terms of earnings, here's the

one thing that stands out. revenues, that's pricing power these corporations have the ability to raise prices. earnings are around 6.7% estimates. that's been steady for a while, but the traders don't really believe those numbers. the question is, what are the trends here's what's going on in general estimates are rising. for energy stock exchange here going up and up and up, folks. oceans of money being generated. airlines are getting big estimate to the up side. even some of regional banks are doing better, another not the money center banks estimates are tend to go go down for consumer discretionary, communication stocks, even some technology by and large, earnings have been fairly steady, but they're starting to crack a bit now. the reason is we're facing

multiple threats this is why you get the head spinning moves in the major averages every day, because the three threats -- fed and inflation. the ukraine crisis is threatening. upyap economy, and the china lockdown is impacting the chinese economy, and also impacting oil and commodities. these are three separate threats to three main geographic areas this is an awful lot for the market to deal with, and why you're getting these moves a look at s&p 500. morgan was mentioning this earlier. that's the on the low that we hit on may 8th morgan and mike, if we drop be low that, a lot of people mental will be in a bear market when you're in that bear market, you can't go hiding places

>> that is the closing low, short, fleeting sharp rallies is a hallmark, too of downward trends thank you, bob turning now to the. yesterday they reiterated their 2022 guidance, why because they have pricing power. here's mary barra talking to us on "squawk box" about that pricing power. it's something we're watching very, very closely, but right now we're seeing a pricing

environment stronger than we thought at the beginning of the year >> meanwhile, we have ford number three things to look at. one, rising costs chip supply constraints. they have been hit with this they think they get past it, then they have constraints, and that's what people will be focused on as you look at shares of ford moving in a little higher in sympathy with gm today appeared the prospects of perhaps better than expected numbers. the street is expecting 37 cents a share. we'll get those numbers after the bell that's what people will be focused on, guys what are they going to say about the outlooks particularly when they have to do with chips and cost mike, back to you. >> phil lebeau, thank you. >> you bet we also want a check on biotech and pharma, names in the sectors diverging. meg tirrell is looking at those

moves. hi, meg. >> hey, morgan it's quite a difference when you look at the larger cap, sort of safer names. you can see that when you look at the split with the xlv versus the xpi, down 45%, healthcare names, that index has a lot of big pharma in, but also big farma names year to date have also been a safe space for investors, outperformance you're sigh super people like bristol-myers, abbvie and merck. if you look at the xbi, it's a completely different story the xbi trying to rally over the last couple days in the white there, it did have some outperformance. but that's not able to keep up

with biotech, really losing steam yet again. the things that analysts say would pick things up would be m&a, and there are a lot of companies out there at they depressed valuations, and also positive clinical trial data we need to see more oppenheimer pointing out one-year catalyst is -- we're expecting data from them, and this is a huge catalyst i saw one analyst suggesting it could move up 40% or down 50% on the outcome of this trial we're waiting for. mike >> absolutely, meg that really does capture what's going on boring is beating exciting within pharma and biotech. as we head to a quick break, here's a look at our road map, including exclusive sown from dave calhoun. >> plus tech slammed much more on the selling and the

nasdaq and what we learned from alba bet and microsoft's results. are financials the place to be "squawk on the street" is just getting started. stay with us

welcome back now time for an etf spotlight. we're liking at ticker ita, down about 1%, hanging on to gains

for the year blue chip holding boeing sliding, posted another quarter of negative cash flow. stock is down 10%. dave calhoun joined "squawk on the street" to discuss. >> messier quarter than any of us would have liked. it's family themes -- supply chain constraints, covid, inflation have a disproportionate impact on fixed-price contracts. they took a hit, without a doubt. we had air force one, a program most people know a lot about it took a hit. our trainer took a hit our mq-25. we love those development programs and the work we're doing and the performance, but the accounting proved to be difficult. >> just to reiteration, on top

of regulatory and supply chain challenges, as calhoun mentioned there, the defense and space unit, long charges for both the presidential program and the new air force trainer jets when you talked about fixed-price contracts, that costs will fall on the company, which is what boeing is referring to there speaking of defense, another prime creditor, general dynamics, also on the move today, actually topping estimates, as business jet strength, which is gulfstream. those shares are up 2.5%, mike it does speak to the fact that even as we're seeing the return of more passengers traffic, more airline travel in general, and more business travel, more corporate travel, that private business jet section of the market, which saw a big bump

from the pandemic continues to hang in there. >> yeah, for sure. you know, when it comes to boeing, morgan, some people have been trying to make the case, as you look at the market cap slip below $90 billion, that maybe boeing's defense business is basically accounts for most of the public market cap. i guess it's tougher to make that call if, in fact, you see the stumbles at this point >> that's right. the diversification of the boeing portfolio, that defense business was sort of seen as the slow-and-steady stalwart that would help buoy boeing through its commercial issues, but we've seen hiccups through the years, and those seems to be growing to fruition here. it will be interesting to see what northrop grimened

>> it's the seventh time that elon musk's company has flown mission. second mission just this month after the all-private space flight the mission is part of the commercial program this is a public/private partnership which spacex, and eventually once starliner is going -- i spoke with former nasa deputy administrator lori gavinen. >> i really truly thought the time had come for the launching and transportation of astronauts to be done by the private sector we tried to do this transition decades earlier in the 1990s, but until elon, no one really

could get the cost through, at least initially now, or usability to be within a range where it's happening regularly >> yeah, something for investors to keep in mind where musk is concerned, as we have all this talk and debate about the future of, say, twitter and also tesla. hear more of my conversation with garver, on the latest episode of my podcast "manifest space. we are back in a moment. ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi.

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just under an hour into the trading session, we are giving up the gains the dow is basically hovering above the flight line, even traded negative a few moments ago. led lower by boeing.

mike bitcoin and other crypto closely tracking the moves of the stock market as of late, despite many saying it's a safe haven from inflation dom chu has more on that trend hey,dom. >> to your point, what's interesting about this, at one point, crypto prices and bit counsel in particular were actually inverseinseriously, org in the opposite direction. this is the white line here is bitcoin. the orange line is the invesco qqq trust, which tracks the nasdaq is 00 you can see at some point, they actually moved in opposite directions on or about the summer they started to converge, almost lock step together, so they're fairly tightly correlated it brings into question some of those crypto prices, especially

bitcoin, are some of the uncorrelated assets that move independently of the market. as for the prices of these bitcoin-related stocks out there, there's a huge focus right now on what's happening with regard to coinbase global, which is the biggest -- robinhood markets, which on its platform has crypto trading as well, and microstrategy, so it tends to trade more with the price action there coinbase and robinhood are some of the first derivative plays that a lot of stock investors are using to take a view on the crypto prices, and robinhood will be one to watch it will report results on thursday if you look at the ways the stocks have traded so far this year, remember, for robinhood, it hasn't been alive that long, only three quarterly reports but on a year to date basis, coinbase has lost hoof of its market value, robinhood nearly half of its value, and

microstrategy holding up relatively well. for the rob inhood side, when it reports results after thursday's closing bell, it's had three earnings report and three price actions. it's averagele about 10% moves in that. the options market is pricing in lacked -- what could be a 14% move back over to you. >> thank you,dom a new ftx is taking place amid all this price action pascal gaultier, thank you for being on the show. we had icrostrategy on yesterday. you could argue that it's a

similar dynamic across the cryptocurrency asset space. >> sure. i always give you the same disappointing answer, which is the ledger, we don't really care about the price on the market. we focus on bringing in security what we see from our side is the trend is still up. there are more and more users coming in every day. also for nfts, and we see big -- >> i think we're having some technical difficulties, so we're going to work on getting pascal back in the meantime, mike, just getting another check on the markets here while we do that. it's a mixed picture with the nasdaq, going back to the flat line as well, turning slightly negative, too. >> yes every move is untrust worthy

so that's the kind of action we have seen as we talked about before we're at some sensitive levels not too pricing to see these fades and air pockets, but that's where we are right now. we're going to take a quick break. sc'll be back with further diussion about the big tech moves. new projects means new project managers.

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here's your cnbc news update at this hours. russia has halted natural gas t poland because they refuse to pay in russian rubles.

russia has released marine trevor reed in exchange for a russian pilot convicted of drug trafficking. the trade of prisoners would be remarkable even without heightened tensions over russia's war in ukraine. u.s. diplomats meantime are working on reopening the u.s. embassy in kyiv. officials say they want to restart operations as soon as possible. and the owner of archegos has been charged with racketeers and fraud. a lawyer for hwang says he'sened of any wrongdoing. tech earnings expected to weigh on markets today they are in pockets today,

alphabet missed expectations, while movie beat the street. facebook on deck into, qualcomm and paypal as the broader market joining us to discuss, jeffries senior analyst brent thihh good to have you here. let's start with alphabet. it's interesting, the setup i think was skewed toward fear or skepticism also, people also pointing out stock is relatively cheap relative to its history coming into it. what do the results tell you in terms of the outlook and whether or not in fact the valuation is starting to make sense. >> good morning, mike. i think many of our clients were actually positioned long in google it was the biggest overweight for many internet investors given facebook's issues and

amazon's supply chain issues i think it was definitely more crowded. certainly the weakness was not expected, the magnitude. we think going into q2, one of the biggest comping, so in the short term there's more headwinds for google we're seeing a general ad slowdown across the industry snap talked about moderating a growth in their advertising business, so ultimately i think it's cheap they have executed well. ruth has done a phenomenal job of the buyback, using the majority of her free cash flow to buy the stock back, so refers have comfort they have a plan after buying considerable amount of stocks. it's good to see them aggressive on the buyback, but i think right now we're just facing a slow decel with the youtube number below, and i think internet money is moving into

software, so i think ear seeing a share shift from dollars over to software given what you saw with microsoft's positive numbers. >> right just when it comes to google cloud, obviously still good top-line growth, but how does that model out from here is that going to kind of flip into being a bigger net contributor? >> remember the scoreboard says amazon's 60%, amazon 30, and google ten, when you compare the top three clouds amazon is crushing it. they're so far ahead even microsoft with what ear seeing in their business google was late, no doubt we're turning into a multiclub world and google with their analytics and big query solution have done very well among other solutions

in the family, but we think, again, this is a rounding error to their business. it's search in advertising, and ultimately, again, they're coming from a position that they're so far behind that i think it's going to be a tough to catch amazon in the number one spot. >> so, brent, break it down for me if you could choose one stock on a day like today, after the earnings, which would it be? >> we still like microsoft the cfo was unwavering everyone was concerns with pcs weak, and concern she was going to unveil a slightly conservative outlook, and she did the opposite everyone who's been following the -- it could be 20 below zero, and they're like, it's hot, we're running remember, in many of these contracts are long term,

multiyear, in some cases decades long if you're moving to azure if you're a big corporation. next quarter, you don't know if we go into a hard landing, advertising dollars get shot up instantly. microsoft's dollars are easier because of that recurring base so we like microsoft, between the two, and continue to believe the fear factor was pretty large going in they're continues to say they -- as the economy starts to soften, but as they say, it doesn't matter what the climate is, our job is to outperform from whatever, and they've been doing that consistently. >> another name you have a buy rating on. meta platforms, company formerly known as facebook. the stock is down 47% year to

date it is an ugly chart. what gives you confidence this name will come through in this earnings, giving what we saw last quarter, and what we saw coming into the spring >> i think no one expected the quickness and magnitude of the slowdown i think they're going to guide really conservative. you've got to get through this quarter again with the q2 coming up, with a 50% comp. we expect them to effectively guide pretty low like google, they had a tough set upin q2, so you have to get to the other side of the second half of the year what gives us conviction is the stock is 13 times earnings we have seen other great companies going into pitstops and fix one of the wobbling wheels and get back on the road. we believe that facebook can do that over time so, short term, the answer is, you know, there's way better opportunities until we get the deck cleared, and we actually

know what the other side looks like, but from a valuation perspective, you know, this stop trades at a material discount to many of its peers, many other media companies. the sentiment is the absolute worst of our large cap so, again, i think it's more of a long-term view, short term tactically they're not out of the woods. they have to clear through and cud the guise potentially for the second quarter on, you know on prem. >> i think it will be a pretty doing tell whether things are washed out or getting there. thank you, brent, for your time today. >> thank you. we've got a huge show coming up on "techcheck" next hour, with the nasdaq getting fresh lows no the year they'll be all over the sell-off, and microsoft, they had a look at the tech earnings on deck. "squawk on the street" will be right back as we go to a break, we're

celebrating financial literacy month, featuring some of our contributors how bob's paper route talk him about money. >> as a young child i learned about money by having a paper route. it is certainly in many ways a microcosm of all the business lessons i had throughout my life to be involved with money, to have a profit from your hard work is a fundamental life lessons. i'm so glad i had it

welcome back,stifel shares surging 4% after reporting second best first quarter in the firm's history joining us is stifel financial

chairman ron, it's been an interesting time in terms of volatility. financial conditions are tightening and the ipo pipeline has dried up since the start of the year, so walk me through the quarter and the puts and takes of it. >> i think you just said it. on the one hand our global wealth business, which includes net interest income and asset management, had record quarters. it's a business that we've been growing for the years, and it was a great quarter. on the other hand, you know, our institutional business was on the one hand strong, our advisory business was very strong, but equity issuance across the street was down 80% we were not immune from that that was certainly a headwind, but overall a great quarter, considering that the equity markets were really, really weak in the first quarter >> as we just mentioned, a record net interest income up 38% year on year, and stifel is

a more interest rate sensitive firm, or at least seen that way by analysts. how does it speak to the incredible moves we've been seeing in the bond market, and where do you think that goes through the year >> well, there's the question not only for stifel, but for the market in general, you know, the market's fracturing that the fed will get to 2.5% you know, taken in isolation, that would be very good for stifel, but also good for banks, yet bank stocks are selling off. i think that is because the markets are also wondering if the fed will go too fast, meaning raising rates, and induce a recession my view is, look, there's no question that monetary policy was too easy last year, but we've got to be careful we don't

swerve in the road and suddenly try to get too tight, because that will have a pretty negative impact not only on the markets, but on the economy >> ron, what's your read on retail investors of all stripes. we obviously went through 2020, and 2021 with a lot of new people entering the market, a lot of do-it-yourselfers, and zero cost commissions seem to become the game. that seems to have ebbed a bit how does that bump up against the client activity you're seeing right now >> well, our client activity, our clients are very engaged we do not participate in the zero commission, and what was really going on, the meme stocks and all of that frenzy a lot of that was, again, a lot of stimulus checks got deposited

in trading accounts and people were sitting at home because they couldn't do anything else i know that seems like a long time ago, but it was just a year ago. so those volumes,in terms of that segment of the market are down significantly >> in terms of, you know, if you look across the industry landscape at this point, you've been an acquirer of sort of midsized firms out there any dislocations or you feel like you have the opportunity to maybe add? >> well, we're always looking, and we always want to be in a position, you know, take advantage of opportunities this market, i think it would be a little bit more pain in the market before you see some real opportunities in terms of just equity valuations investors need

to be cautious here, because the fed is very hawkish. it's hard to see with a $50 trillion valuation, on this economy, kind of hard to see how values go up significantly, but there's some downside risk under the fed settles on where them to go. >> investment banking pipeline at record levels where are you seeing the strength in the ib advisory? >> we're seeing it across the board. we have big backlogs in financials a lot of that is still from announced but not closed deals industrials, consumers, technology, you know, what causes that market to be active, those building blocks are still in play. the pe firms have a lot of money and there is a lot of strategic positioning going n.

so while we'll watch the market, i'm optimistic about the advisory market. the question for us and for the industry, the investment banks will be what happens in the capital raising, the ipo, so to speak. >> something i think everyone is watching ron, thank you for joining us today, ceo and chairman of stifel financial >> thank you. turning to that massive tech sell-off that we have seen in recent days, nasdaq suffering its biggest drop since 2020 yesterday. it's still trading in bear market territory, as it's hanging on to gains. it's down more than 20% from the 52-week high, though with us now, "techcheck" anchors jon fortt and deirdre bosa good morning to you both jon, i'll kick it off with you, in terms of the massive moves we have seen, it's almost like the faang names have been de-fanged,

i should say, even though we have more earnings to go >> we do, but it's rough we were talking about the impact of the fed's move, and how that's getting people to think about where they want to put their money, right more options, perhaps coming down the pike. we'll talk about the earnings, microsoft in particular. i think the important thing is not just what microsoft reported, but what's the read-through for the rest of tech great news for microsoft, yes, sir that stock is up 5% so far this morning, but there are some issues if there for the other names. >> deirdre, i realize we're seeing this across other industries as well, not just the impact of rates on something like the tech sector, but also the drag from a strong dollar, too, because we've got to remember some of these big megacap tech names are still multinational corporations in their own right. >> absolutely. everyone is sort of looking at

the europe impact, there is the impact of the strong dollar, which you are hearing being brought up so much is still riding on this week of big tech earnings. last quarter there was so much volatility i think netflix spooked a lot of folks. the passive 35% drop we're seeing microsoft up nearly 6% maybe that's a good thing. in this market those are not huge outside moves down 2.5% is not too bad what jon said about read-through, very true for alphabet certainly as we get meta tonight. there's this belief that alphabet is the best positioned from some of these macro factors that you point to. >> jon, on that point, it is interesting, as these companies have become huge and have been riding these multi-decade trends of digital transformation and all the rest of it, it all of a sudden becomes more macro

sensitive arguably a bigger percentage of gdp was there something in microsoft's results that said, okay, now you have to be a little bit on alert for slowdowns in certain parts of the market even outside of microsoft? >> yeah, i think there were some of those things, mike. microsoft results overall, i think a triumph of having a portfolio of businesses. they did exceedingly well overall because they had businesses in software that did really well. marketing and consumer i think is a canary in the coal mine when you have economic difficulty, perhaps a downturn we saw difficulties in marketing, as google saw in youtube which i know dee is going to talk about. it was really talent solutions that did particularly well and they calledout the overall growth, i think it was 35% roughly year over year they called out talent solutions and gave details there but didn't talk about the marketing

solutions number they just said continued strength that said something. also, surface revenue was fine, lower than expected, and xbox content and services up 4%, 6% also below expectation there you have that sort of consumer and marketing not holding up as well we'll see what the read-through is to meta the thing is, meta has already been beaten down the question is might they already outperform already lowered expectations that could be. >> we'll have to see it's almost a repeat playbook the way we saw with netflix. micr nadella discussed it yesterday. >> if you have more value for less price means you win in our case when it comes to commercial cloud offerings, we have significant advantages on that across the stack. the second thing is in the

conversations we're having with our customers, the interesting thing i find from perhaps even past challenges, whether macro or micro, i don't see businesses looking to their i.t. budgets or digital transformation projects as the place for cuts. i'm not seeing this level of demand for automation technology to improve productivity because in an inflationary environment, the only deflakes nair force is software. >> jon, it kind of speebs to w speaks to the digitize asian of everything, and what it meant in terms of the bigger longer-term executive shift in adoption to new types of technologies and new types of software among corporate america and really the business community even if you start to get tougher comps, this is a trend that's not going away, is certainly what it sounds like nadella is arguing >> that's right. but keep in mind he's talking

about businesses and largely talking about larger businesses, not really talking about consumers there or the marketing spend piece that does matter he's also saying they're not looking to cut i.t. budgets, not primarily looking there. that's right now, right? maybe they'll save that for last how aggressive are they going to be pushing into that if you're not as much of a must-have as so many of microsoft's titles are we will see. i think great news for microsoft, iffy news for tech overall because not everybody is as essential and not everybody is focused in enterprise software specifically. >> that is for sure. let's get to alphabet in more detail reporting weaker than expected earnings in revenue on that big youtube miss most of whatinvestors want to see usually with google is that nothing has really changed the long-term trends are still in place, this is still an enormous company growing was there anything in this

report that gave anybody a reason to think that maybe the story is a bit different now >> honestly, not really. the focus has been on youtube because it's been growing at such a quick clip. jon, i love what you said, triumph of having a portfolio of businesses that was the case for microsoft. certainly the case for affidavit. youtube, you think about it, is it nice to have or need to have. netflix, streaming is the entire business youtube is still an $8 billion revenue a quarter piece of the business where a search is still $40 billion. that, mike, to your question i think is still intact at google's core. remember search is a higher margin, it has benefited from the apple ios changes whereas youtube is more hurt by what's going on in ukraine and these macro factors. also, at the end of the day, mike, when you talk about these fundamentals, alphabet is sitting on a gigantic pile of cash, still. we can't forget that $70 billion

buyback, on top of the 50 they just completed the question here is not has anything fundamentally changed that could be the case but as of right now, not really. this is still a company doing very well. i should also on that note mention other bets -- those are its moon shots, still a very small piece of the alphabet pie. but revenue there doubled. we have waymo cars on the streets of san francisco with no driver this is something google, microsoft, the big tech guys are good at doing, seeing way off into the future. >> there's no doubt that investors tend to love the capital allocation strategy using the free cash flow for buying back shares and soaking up some of the demand -- some of the shares out there i would wonder about youtube, if there's anything structural. tiktok is moving out there, market san josewise.

>> well, the ceo said there's now 30 billion daily views this is their tiktok competitor. they're still at the early stages of monetizing this. tiktok is really the elephant in the room for all streaming services it's the elephant for meta, for netflix, for youtube it is this really strong competitor, especially in the ad market this is where the eyeballs are going. it sounded on the call last night like they're focused on it, but they're still figuring out how to monetize it something else that was interesting that ruth said yesterday is right now youtube is an ad-based business model. increasingly they're getting more subscription revenue. kind of interesting in that elon musk twitter conversation as well, but you can see that business model shift overtime.

>> d dom chew has a bit on what to expect. >> when it comes to some of the social media -- apple and amazon you can argue probably the most important ones out there along with microsoft and alphabet parent company google. after the closing bell today down about 2% when we're trying to find some stability after yesterday's selloff. amazon, apple, twitter, moving some things around if we go to the mega cap trade twitter, i'm not sure what to read into it trading at $48.11 going into earnings after a bid to acquire it has already been accepted to 54.20. with regard to how it's reverberating across other markets, these particular names are having an influence on some of the big views people take in the market with etf, certainly when it comes to industry groups the interneted related, fin tech

related etfs, all caught in the downdraft. with meta platforms in particular would be the volatility we could see in trading for meta because of the downdraft we've seen it's already one of the stocks in the s&p 500 that has fallen the most from its 200 average price. meta down 41% on a one-year basis. by the way, options prices right now, mike, morgan, are pricing in what could be an absolute move up or down around 14% that's a big move for a stock that's worth as much as meta is. certainly something to watch. >> we'll be watching it as the day unfolds. taking a look at the major averages, we're hanging off gains. that's going to do it for us here on "squawk on the street.

"tech check" starts now. good wednesday morning, welcome to "tech check," i'm deirdre bosa along with jon fortt. cloud revenue a huge driver behind the surge this morning, microsoft up more than 5% right now. alphabet is weaker by nearly 4%. all these numbers ahead of more results for names like meta, qualcomm, many more, jon a busy week. >> i guess the question is which one do you pay more attention to as an investor looking to survive and thrive north of this earnings week, the alphabet results or the microsoft results, dee i've got concerns. i think for the market overall, alphabet's results probably mean more -- here is my thinking. in a way part of mine is traumatize friday the dotcom bust marketing spend was