elon musk. and boston beer said it continued to overestimate demand for its truly brand after seltzer sales fell flat. seltzer sales. stock is getting punished on friday, july 22nd, 2022. "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen and andrew ross sorkin. we have been watching u.s. equities at this hour. it is friday easing our way into the week or slamming into it there are red arrows this morning. slight for the dow off 25 points. s&p futures off 13

nasdaq is off by 76. additional weakness in technology we'll tell you why in a moment stocks yesterday rose for the third straight session dow up .50%. the s&p up by 1% nasdaq gained 1.3% if you are keeping track for the week, that means the nasdaq is the big winner up by 5.3% so far with the s&p up 3.5%. the dow up by 2.4% all right. friday, we will see what happens. treasuries under pressure. the 10-year treasury is now below 2.9% 2-year treasury at 3%. 3.041% this is interesting action to watch. >> july is pretty good one of the best months >> lousy months. >> what was the weird thing when the market was down 35% or 30% it comes back. it gets nowhere near where it was. 20% gain if you bought at that

point. >> june? >> the dow yesterday again started sharply lower. whoa >> whoa! >> that looked like you are on a bike >> i leaned back and joe saw me almost full-on >> that would have set a new height if we had that. that would have been impressive. you are 40 years old >> dick van dyke move. >> dow opened down 300 points. i couldn't figure it out the dollar weakness? it closed up 160 s&p at 3998. it is not 3600 that was the low june 16th that's the open. we don't know. it is not at 3600. for everyone who says it is there. not at 3200. not at 3000. more and more -- don't you feel

it is cast in stone it will go down there don't you feel people -- it makes me think that it always tries to do -- >> dom had someone on this morning about the vix. vix at 23. that is a calm indicator this guy said if you look back at what is happening on the tape, every time the vix gets down to 23 or 22, that's when the market drops again it is a counter kindicator. we'll see. >> it has been at 35 at times. could they all be wrong this time could we have made a low the train which we were waiting to come back hasn't. it tried to yesterday. it has not come back to let anyone on. it's july. not all of the players are around if you are so sure -- these people short it. you can be so rich >> look at you being positive. everything that is happening

under the biden administration this is astonishing. >> it has nothing to do. joe manchin, luckily there is nothing bad that can happen. >> talk about something bad that has happened president biden tested positive for covid in a statement yesterday, his press secretary said the president quote is fully vaccinated and twice boosted and is experiencing mild symptoms. he is taking paxlovid. the 79-year-old president w will isolate in the white house. he will remain in isolation until he tests negative. in a video posted to twitter, the president thanked people for their concern and said he is doing well and getting a lot of work done. we talked about the diagnosis with dr. scott gottlieb in the 8:00 hour. >> he looked good. standing on the balcony with the

lawn behind him and a great look the blue blazer and open shirt i think he looked like -- >> when i had covid, the video would be me lying in bed >> yeah. he looked amazing. two boosters and two vaccines and paxlovid weaker strain. i expect him to do great hope for that. stocks to watch. mattel says sales took a hit from currency headwinds as the dollar was surging during the quarter. the company reiterating the quarter forecast here is the ceo last night on "mad money." >> continued growth in the second half and planning for increase in consumer demand in the holiday season all in all, very happy with our position and expect to win market share going forward

gamestop split goes into effect today anyone a shareholder of record of the stock at close of business on monday getting three additional shares. stock will begin trading on the split adjusted at the open you see that right now up 3%. also, a big pre-market drop for shares of seagate. a weak demanded story similar to micron last month. seagate wrapping up the fiscal year with the earnings miss. they came in with $1.59 on adjusted street looking for $1.90. seagate says consumer demand fell by more than it anticipated. it plans to reduce production plants to maintain supply levels that stock down by almost 12%. shares of capital one lower this morning net income of $2.03 billion beat expectations, but that was down from $3.54 billion a year ago.

non interest income fell short that stock off 3.5%. stock booze news boston beer shares falling this morning. maker of sam adams fell short of estimates and slashed the forecast revenue which was above expectations the demand for the truly hard seltzer continues to fall after it admitted the bet on the category was optimistic. boston beer increased prices over the past year and they expect to hike prices by additional 3% to 5% for rest of the year i have not tried truly have you >> a hard seltzer. i'm beyond those i liked those. >> you were into those for a wh while. >> that may be what a lot of people are saying. >> white claw was the hot one what about zima? >> that's what this is

>> i'm back -- i have beer that tastes like water now. i'm viewing it as hydration because it has so few carbs and 2.6 carbs. >> michelob ultralight >> i'm back to corona. corona premium in the bottles. it is hydrating. that's my story. i'm sticking to it it is healthy. >> joe's gatorade >> you drink water >> like i said many times, the first six go down smooth coming up, we'll talk about social media and online ad stocks dropping after snap posted disappointing quarter results. we will dig into the sector next. and the big money behind the new schism in golf

how much the pga spent on lobbying on the back of e thrise of liv golf. >> charles barkley >> you are watching "squawk box" on cnbc. >> announcer: this cnbc program is sponsored by truist wealth. where meaningful relationships matter most. medium latte, half-caff, no foam. quite the personalized order. i know what i like. i've been meaning to ask you, carl. does your firm offer personalized index investing? hmm? so i can remove a stock that doesn't align with my goals. i'm a broker, not a barista. what about managing gains and losses to be more tax efficient?

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snap reported the weakest sales growth since going public. other stocks are reacting falling on the news. joining us to discuss what it means for the social media market is the cleo is that her title? i don't know capital managing partner and director with us as well good morning to both of you. sarah, i'll start with you how much is this snap specific and issues they are clearly having with what apple has done with privacy and whatnot and how much is this across the board? >> i think we're about to find that out, right? is snap a canary in the coal mine for ad dollars or problems with snapchat specific they have been trying everything they are launching desktop and founders are not taking salary

they still can't get the price to go anywhere but down. there is a question if snap is still relevant is it losing out to peers like instagram on a bigger platform like meta or tiktok which is more day-to-day relevant for the younger con er generation now? you have twitter taking up so much oxygen on shows like this, but i don't know if snapchat's problems are ad dollar problem or lack of relevancy >> gunjan? this is a stock after the ipo and it swooned in a big way and had the remarkable return or comeback on expectations it was not just sticking around, but excel. now the shift back again >> people, especially institutional investors have

been pessimistic i think the snap result shows you why. these types of moves down 30% pre-market have been a feature of the year. not just a one-time thing. think facebook, amazon huge one-day moves they were locking. snap is striking how quickly things deteriorated for the company. a few months ago, it issued a profit warning and shares fell 40% in one day here we are in july and they are down another 30% this shows you it might be time to buckle up for investors and what we are seeing is investors are bracing for an incredibly rocky earnings season. we are seeing that in the options market where people are betting on the biggest moves around earns sings since the thd quarter of 2020. >> gunjan, what is the indication of a takeover target? >> i'm sure this will trigger

chatter. it seems ithe executives are hanging on for now >> sarah, what do you think given twitter -- we will see. >> they are about to make up with twitter no, no you can't not look at the market cap at snap and at least think somebody might consider it the big players like meta are probably off the table for anti-trust reasons there are questions of how much the s.e.c. and lena khan will keep silicon valley in the crosshairs and preventing a big tieup. certainly, you know, if you think there is value there, the price looks pretty good to consider a take private under $30 billion. >> i'm not thinking of a big tech company i'm thinking more of walmart or somebody like that who expressed interest, if you remember, in companies like tiktok and if you

think somebody like that would step up given the price tag we have >> snap has never driven consumer spend or online ad dollars like tiktok. it is normal for tiktok to make skews sell out because a product will go viral or a hack as they say will go viral. s snapchat doesn't have that if you are walmart buy everything you can era, i don't know if you really think snap is going to drive the shopping revenue or consumer revenue or ad dollars that makes you as excited as you used to you see media players see it as an opportunity a lot of them don't have much money either >> we'll leave the conversation there. maybe elon can put it with

twitter. both 2 for 1. sarah and gunjan, i appreciate it. when we come back, news from fedex. cutting sunday delivery in some areas. we have details after this break. a programming note tonight at 6:00 p.m., cnbc special. politics and profit. we'll explore the issues at the intersection of money and government from inflation to the f fed and the debate of chips and climate change and how the midterms could impact your portfolio. that is tonight at 6:00 p.m. eastern. i love it when work actually works! i just booked this parking spot... this desk... and this conference room! i am filing status reports on an app that i made! i'm not even a coder! and it works!... i like your bag! when your digital solutions work, the world works. that's why the world works with servicenow.

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fedex suspending sunday

residential delivery in u.s. markets starting august 15th the cut back for fedex ground is targeted for smaller populations. packages will be reallocated to saturday and monday deliveries in those markets the decision comes as the independent contractors asked for more compensation and reduction in package volume. 80% of the u.s. population will continue to receive sunday deliveries i'm surprised when you see the post office or fedex delivering the neighbor's packages on a sunday to our home. >> me, too it's not you >> no, sometimes it is they deliver plenty of neighbor's packages to us. >> you are a distribution center >> yeah. it's like a half mile. >> i'm sure. i'm sure. >> humble brag

convenience store chain 7/eleven has been under pressure to consider alternatives the job cuts come a year after the $21 billion acquisition of speedway the company said as with any merger, integration approach is combined structure there you have it. 880 jobs at corporate. >> do they use the service driveway or regular? >> the service driveway they don't have the code. >> i thought that was the security gate. >> they know the cameras are there. and the dogs none of this is true >> talk about the dogs we had a viral moment as you might know here on "squawk box"

this week. when cnbc contributor kari firestone's dogs not so politely interrupted our discussion we does not make a mention of it, but kari's husband made a brief appearance trying to quiet things down. that work from home moment got a lot of attention across the internet and twitter-sphere. you can check out the full story behind the knenow infamous boxer story. kari is speaking out it is fascinating to hear what she has to say about all of this >> i can't wait to listen to it. i feel for both. >> it's like seeing a guy on the beach. >> true. same thing. >> with the dad bod. nothing going on i didn't understand the comments on twitter

why did people say it was cnn? >> i don't know. >> i don't know what they he meant. >> i missed that >> i did, too. i think they were confused >> check it out on the favorite podcast app. this story will be in your feed if you follow or subscribe who let the dogs out >> it is a podcast they have to describe it >> right. >> if it is a visual medium -- to see that. >> this is the story that let's you create your own picture in your head which is worse than the actual picture >> news reports made it out to be a random streaker going through her house. >> streakers don't wear underwear. >> whatever. a random person. a lot of the reports did not explain what really happened >> people said that shower cap it was gray hair whitehair.

>> bed head. >> okay. >> in case you were wondering. >> stop. take it down >> check out the podcast you can learn more about it. >> maybe she should have said no so we don't revisit. coming up, ecb surprised markets yesterday with the half point rate hike. we get reaction from mohamed el-erian as we head to break, here say look at the s&p 500 winners and losers >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure a reliab ay to help keep everyone connected from wherever we go. well at at&t we'll help you find the right wireless plan for you.

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good morning welcome back to "squawk box. let me know when that happens. we don't need to go into it. katie couric live from the nasdaq market site

in times square. we'll do it. checking the futures >> just stick with the markets, my friend. >> ten seconds to come back from break. i had three of them. i like them. >> let's ask mohamed el-erian. >> s&p futures down 11.5 joining us now to weigh in on the markets is mohamed el-erian. queens college cambridge president. >> you will blow a kidney out. let it out. >> it is friday and we are all goofy at this point. although there are bad news headlines, the markets are doing well nasdaq up by 5%. is this a turning point? is it a head fake or people out on vacation? >> first, thank you for making

us laugh it is good on a friday morning to laugh like this look, i think it is a combination of relief rally and lower yields that's what driving it the next few days for the nasdaq and on the back of the snap results will would be critical the next few days will be very important determining what happens next. >> what do you think of the snap news is that indicative of more issues at snap >> yeah. the user basin ce increased significantly and revenue was flat there is something going on in the business i think what you were about to say is the question we all have is are we seeing a significant softening in envnterprise advertising? if we are, that will impact others in the space sdplflt who

is the increased competition how much of this is self i inflicted? >> we have the pmi data that came out this morning in europe and it was awful there are signs that the global economy is slowing in a rapid fashion and central banks are hiking and doing qt into the slowing economy. that just heightens the policy mistake with central banks. >> is it effective in terms of intended goals for the rate hikes? you think it will slowdown >> yeah. i think inflation has peaked in the u.s. at least for the next three or four months we have to see how sticky elements are the problem is inflation is not going to come down, but it will

come down with growth going into recession. that's not good news >> mohamed, the next 10% in the s&p and no one should ever answer a question like this, but the probability the next 10% takes us up to 3998. takes us over 4300 or 4400 on the s&p. that possibility from here going back to the june 16th low of 3639 what is more likely in your view as far as 10%? i can tell you the consensus, i would say 90% of people we talked to, say the move is down to the 3500 or 3600 range. i get uncomfortable. vix hasn't hit those levels, but all of the experts say we need to go back down and make new

lows >> so, joe, you have to define the time period here the next couple months or are we talking by the end of the year >> infinity. what do we hit first 4400 or 3600 you don't need a time on that. i don't care when it is. what's next? >> i agree with the 90% you cited. we played out interest rate risk we haven't played out recession or credit risk that will impact equities. >> do you get bullish during the pandemic you never did get bullish. we stayed too long on the bearish camp >> go back to cnbc in april and that statement was incorrect, joe. >> i was there i got so much twitter hate mail challenging you on on those this i'll go back and find it

you are in the 90% that says we go back to 3600 first. >> i am because i'm seeing the economy slow and i think the fed has no choice but to hit the brakes because it is so late the consequences of that is going to be pressure on earnings >> mohamed, we always have the crypto conversations we see crypto move higher recently i don't know if you think that is a reflection of the market moving we are now up 2300 what do you think that says if it says anything >> it says two things. one, it is moving with what has been a relaxation in financial conditions over the last two weeks. that helped crypto it is saying something else. a lot of people saying the second or third crypto winter is not behind us. that the damage has been absorbed and there's been a

flushing out, if you like, of excesses, and now we have a better base to go forward. >> so, mohamed, in terms of the earnings with earnings coming down i assume you also think earnings estimates need to come down significantly? so we are not trading 23 times forward earnings it is a higher number because the e part of the pe has to come down >> the thing i'm scared of over the last year and that's why i'm so hard on central banks that they should get out of the transitory mind set and start moving last year the thing that scared me the most is they would start hiking aggressively into a slowing economy. that is what has happened. over the last few days, we started to see signs the labor market may not be as strong as we hoped it would be >> right.

>> when you put the macro together, it suggests that this pressure is going to extend from the general economy to corporates at the same time, we are going to see a lot of pressure for wages to go up people don't like erosion in the purchasing power 90% inflation hurts and wage earners react. you see the wage cost side go against earnings that's what i'm worried about. >> i saw a stat yesterday that 35% of households are now having trouble paying bills finding ways to shift things around because of inflation. is this going to be a divided economy where the differences between the haves and have-nots will come into sharp focus again? >> absolutely. the at&t numbers the statement telling you people are falling behind on phone bills.

yes, the inflation shock and economic insecurity shock. income shock is not great equalizer. that is a massive distribution some people will not feel anything at all. others will feel the twin shock of first inflation eating away at purchasing power and then being worried about whether they will be able to sustain incomes. >> will all of this make the fed slow its role a little bit if you think inflation is already peaked and if it looks like people are really starting to get pinched, will that make them hold off and make them do big moves now and then watching and waiting to see what happens next >> that's what the market is pricing. the market is pricing the fed will go hard and then it will have to stop because the economy has gone into recession. just look at it of the it is incredible to see what happens to yields in 24 hours.

21-basis point range for years that is what the market is pricing in the worry about the fed is that they don't know how sticky inflation is they don't know how much the anchored expectations by being so late. they will not start immediately, but likely to stop when the economy is going into recession. >> mohamed, thank you. always great to see you. even with bad p news have a good weekend. >> thank you. coming up on the other side of the break sector nomics. plays in the material sector that could make sense in the portfolio. later, dr. scott gottlieb will join us to talk about president biden's covid diagnosis and reappearn appearao polio in the united states you can watch us anytime on the

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welcome back u.s. equities have turned positive on the dow. nasdaq is snappy with an influence. we will see if it is cast

app appalled what was it? up 5% for the week nasdaq has been the average that has been relative basis the strongest. what has been a good month if you had known july 1st what would happen, nice to put some money back in, maybe june 16th was the best deferred comp. took all the cash. >> good for you. >> lucky on the agenda, quarterly results from verizon and american express and twitter all due in the next 90 minutes people know we can do mutual fu funds. can pretend to be involv. i think over 30 years, cnbc

saved me a lot of money. overall. by not allowing us to do that. shares surged over robotic systems missing estimates of $1.19. revenue fell short the company placed 279of the duvinci systems down covid resurgence continued to impact the procedures conducted with devices. look at this sector nomics open >> so far this year, there is plenty of action under the hood. let's get to dominic chu with the sector nomics. >> roll the b footage.

this month's secretor nomics in the s&p materials. the smallest sector in the s&p it has been focus of the market action over 2022 because of the way things shaped an up in the market with ukraine and global inflation story and supply chain issues materials have been a market performer over the last year you see it tracks closely for a while and diffiverged in springd summer and back where the s&p is right now. you see those stocks tied to fertilizer makers and copper and gold mining companies. all of those that played into the inflation story and moving higher and one part of the market and moving down side in the most current few weeks here. that brings in the conversation which are some of the highest volatility and lowest volatility

stocks in the sector folks at market analytics and y charts looked at the market beta as for which stocks are most volatile compared to the broader market overall, lithium companies and albemarle and freeport and beta is twice the market volatility. martin marietta. mosaic and nucor higher volatility names in materials. on the flip side of the coin, which have come in lower volatility moves in the marketplace? you look at fmc and lyondell and corteva and dow and cf

industries as we watch for material sectors, watch the names because the story has been volatility. i'll accepsend it back to you. >> dom chu, thank you. one month down coming up, schism in the golf world dom. you were there we hhave data on how much money the pga spent on lobbying as it it tries to halt the affections of liv golf. as we head to break, check out the big winners after the 11% jump in gas prices this week eqt and antero resources up double digits. "squawk box" will be right back.

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. new insight into the golf world's tense battle pitting the pga tour against the saudi-backed liv golf. brian schwartz, his latest reveals the lobby efforts. the pga tour has paid $363,000 to the firm dla piper. lawmakers on their behalf for multiple topics, including saudi golf league proposals. thank force joining us, pga tour spending 360,000, and liv is

spending $200 million on one guy. i don't know that's like a drop in the bucket >> thanks for having me, vjoe. you compare those numbers, it is a drop in the bucket but really what's going on behind the scenes, between the pga tour and liv golf, the pga tour from our reporting has really since last year been engaging directly with lawmakers on capitol hill and biden white house officials about the issues they take with liv golf. and really, among the things that stood out to me was in fact this outreach to biden white house leaders about these concerns that pga, the pga tour has with liv, the message that's been delivered, from what i'm told to these leaders in washington is basically that the pga tour believes that this liv golf league is basically just

another effort by crown prince mbs to wield some sort of influence in the united states and around the world and of course this comes as we're really preparing here in the united states for liv matches and events at trump bedminster in new jersey very interesting what we're seeing >> 42 minutes ago, charles barkley expected to potentially join as a golf analyst at bedminster, where you said, and some of his comments about how, he said the world had been sports washed or something i guess he means brainwashed and he calls out the selective outrage. it sounds like this is or preemptive to him actually joining liv. is he a golf analyst i mean, you've seen his swing. do what i say, not what i do

>> analyst, he definitely plays golf and him coming forward with those comments is pretty interesting. and, again, it seems to me that that's, you know, another chance for liv to pull in a big name athlete in that case, to come in and be on their side here. look what they did with phil mickelson, look what they did with the american golf stars they basically have started picking off these people left, right and smercenter with massi contracts. i imagine the same thing happened with charles barkley. >> what do you think charles barkley would be worth >> man, i wonder he does like basketball stuff all the time >> yeah, i see him all the time doing basketball he's hilarious he's outspoken you know, he's a great player and everything else. does a lot of commercials, funny commercials >> yeah, i would expect him to cost a lot to go from what he's

doing now some comapacity to gog as a live analyst through them would be, i'm sure, a pretty penny. >> is it a huge threat or to the pga tour or is it a live and let live it's a big enough market for everyone do they eventually merge you heard former president trump say, i haven't seen any reason to think that there's anything to that, but how does that, how do you see it playing out? there are some big names, not the biggest, but some big names. >> yeah, no, i definitely think that liv golf is a clear competitor for the pga tour. there's no doubt about it. on the other hand, the pga tour moved ahead with these rules that if a golfer from the tour agrees to play with the saudi-backed liv golf league, they cannot play with the pga

tour so there is this back and forth between players, the pga tour and liv golf, and that of course also represents to me a competition side to this the pga tour is losing some of it because of their own doing, major players to liv golf, but i've read that also certain players are also losing sponsorship after deciding to go play with liv golf so there saul that at play here, and much of that comes down to something very simple, the scrutiny that many have on saudi arabia and crown prince mbs. that's where this issue comes down to in a holot of ways, because people are connecting the liv golf league, to him, the crown prince and an effort to sway sentiment around the world. >> interesting reporting i don't know is 300,000 a lot lobbying, it's expensive to lobby. k street, there are nice

buildings on k street. everybody does it, i think >> my question is, is there ever going to be a point at which saudi is considered acceptable or not, and i'm not suggesting they should be i just don't know how this all ma plays out over time >> anyway, we have earnings coming up. we are expecting earnings from verizon. and james comer will join us on the new investigation into tiktok , if you find a lower price, we'll match it. with value like that, it's never been easier to sport your style.

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good morning, everybody. futures are flat as investors get ready to wrap up the market's best week in a month. quarterly results from american express and verizon are on tap this hour. snap shares plunging we'll talk the advertising landscape. plus, prices at the pump easing. we'll get an outlook for the energy sector. the second hour of "squawk box" begins right now.

good morning, and welcome back to "squawk box" right here on cnbc. we are live from the nasdaq market site in times square. take a look at u.s. equity futures two and a half hours before the market's set to hour. we are set to open down about now. nasdaq down about 66 points. s&p 500 looking to open down a little over 11 points down let's show you treasury yields as well. you're looking right thousand at t now at th ten-year oil right now, wti crude, can you buy it by the barrel, $95.02 and finally, we've been talking about crypto all morning and you're looking at bitcoin at $23,500. it's moved up just a bit

american express just reporting its quarterly numbers, and they're strong numbers en earnings came in at $2.57 a share. the revenue topped forecasts and the results getting a big boost from record spending by card members has come in large part because of a rebound in travel and entertainment. they're raising their 2022 revenue growth sfrom 23% to 25%. member spending m in the second quarter was up 30% just a rebound in global travel. entertainment spending that's out there. delinquencies near historical lows that tells you maybe about the type of card member they have, probably a higher-end card member no delinquencies on these things

and really strong spending that stock right now up by about 2% >> let's get to dom chu. >> all kinds of things catalyst wise we'll have to start off with shares of snapchat even though they were part of yesterday's and last night's after-the-bell trades but the ripple effects are happening this morning they are about the session lows, down nearly 30%, $11.55. we already talked about it a lot this morning disappointing results on a quarterly basis. they have plans to slow down, reassess their workforce so online advertising spending, all of those issues coming to investors' minds in the forefront. as we move along from snap, i talked about the ripple effects. if you look at the mega cap names leveraged toward online advertising, they're down in sympathy with some of those

results. meta platforms, the parent company of facebook and instagram is down 5% in the premarket trade. alphabet's down nearly 3%. pinterest down 6.5%. and we're all anxiously awaiting the results from twitter and any commentary that may come about there. but for snap, lots of analyst down grades. the ripple effects there a couple earn beings reports to focus on we got schlumberger. remember, a lot of down-side volatility for oil and gas companies. we'll watch that as oil prices have slid. and then one more. hca health care, the big hospital operator, you can see

those shares down fractionally right now. they did see, though, labor costs start to increase and take a hit to their bottom line i'll send things back over to you. >> all right, dom, very good thanks, happy friday >> let's call up american express again. they strong numbers for the quarter, but they are also talking about $410 million in provisions for risk. they're seeing very little delinquencies, but they kind of see what's coming in the future. this is what we've heard from company after company, gearing up for what they anticipate is coming that stock is up by almost 4.2% right now. >> what does that say about the market though? so we have these two sort of interesting data points. >> really, really strong numbers right now. >> which is basically good for

am e amex but bad for the economy >> they are looking at the potential for losses coming down the road if people start getting delinquent >> but i would say their commentary is in line with sort of a jamie dimon and the conservative category, then vyo have the earnings report from at&t and i don't know if that was indicative of an at&t problem or larger a lot of people were taking away what was happening to at&t as a sign of what's going to happen this fall or not >> they are definitely seeing a couple days delay in terms of when they're collecting on things and john stankey said people will pay for their cell phone bills. it's more important than their car and everything else. but they're seeing it. all these add up to what we're

seeing you see the pmi numbers in europe we know there are rising risks of a recession the fed and other central banks continue to climb into this. market's pricing it in but it does add another piece to the puzzle when we come back. shares of snap are dragging down other names in the sector, too ad sales, really what's taking that stock down. that stock down about 29% right now. we'll talk about much more with tim armstrong. before the break, let's get a check on the markets right now, dow is positive again, american express is up by more than 4% it's a dow component dow's up by about 24 points. you still see weakness, thanks to snap and all the other cisoal media stocks "squawk box" had be right back but so is your sound engineer. you need to hire. i need indeed.

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quarter. wall street analysts look to be turning bearish. at least ten firms downgrading snap, including goldman sachs, deutsche bank, oppenheimer, keybanc. what do you think is happening here is this snap specific, tim or do you think there's a broader issue? >> well, andrew, thanks for having me on and great to see becky and just becky and joe. what's not getting talked about is amazon's projected to get 15% of the ad market tiktok's been on a tear. you have the netflix/microsoft deal i think in the larger looming picture in the next 12 months you're going to see a lot of ad dollars going to a lot of places

they haven't historically been i think when you zoom into snap, i think they've done a good job with the product one of the things that stood out in the release was their community growth they launched a mu subscription service. so i think snap is probably caught in some of those die th nam ickes, but it looks like it's doing pretty well. when you look at something like facebook or meta where they're announcing su announcing splitting up the news feed you're seeing companies of facebook's size start to change their strategy so i think macro picture, really big tectonic shifts changing where money's going in the ad business, and then micro picture on people's individual products. it's going to take a lot of product different sation to

capture ad dollars >> there's been long questions about whether these companies should be independent entities, given now we have elon musk trying to buy twitter which was also a perennial takeover target what do you think happens to snap long term >> we're in the post dotcom bubble type era. you know, i'd expect there to be a wave of consolidation in media. it's already been happening, but, you know, probably an accelerated one. and two, if you're a shopper if you have cash, i'll give you one stat which people are always surprised by when we left the 2009 financial crisis, the dotcom companies had about $50 billion in cash. they now have about $500 billion. and it's a tougher market for them with the government and

things like that but there's also a lot of big corporations with a lot of cash. a year ago, two years ago, if you wanted to go shopping for growth in companies in the new digital landscape or mobile landscape, very tough to do, today that's a different picture. i think you are going to see a fair amount of consolidation across these different sectors and media. and i say the other thing, andrew, just on what's happening in the bigger media landscape, tv youtube tv has done a pretty exceptional job of disrupting the tv market. so you're going to go through this re-bundling period and re-productizing, and i think it's going to take a little while, but there's probably a couple years in front of us of consolidation. >> hey, tim, you know this advertising market better than anybody. i think what i was hearing you say was this was not necessarily a huge drop in ad spending at this point, which is what is

freaking the market out at this point, but maybe just more competition, more places to choose from, snap getting caught up in all of that. is that what you're saying, the selloff of meta, is that too much if this is not a huge drop in ad sales ro sales or will all of them get caught >> i think ad sales will sbe down, but i think the thing that is not getting talked about is if you went back three, four, five year, the percentages of where dollars were going and to what players, that has dramatically shifted so if you're not one of the players where that migration has happened, it's going to put a lot of pressure on your product development to differentiate yourself enough to get into the categories of the, probably like the tiktoks and some of the other platforms that have seen growth and i would just say we're in an

election year, you know, right now. and you've got world cup coming up and things like that. so there is still pressure in the ad market. what you really want to look at is 2023 and 2024, is who's able to differentiate their products and communities and really, you know, product development into that cycle, and that's what i think probably investors don't know but i would say, if you look at where money has shifted to, there's been some pretty dramatic shifts just in terms of who's getting the money. >> you mentioned youtube tv, and i have to say that i've been blown away by that service and what that represents you're obviously, hulu live is another version of it. comcast has infinity flex how do you see that ecosystem working itself out in the next year or two? >> i feel like it's unsustainable. there's basically 300 ott services and the thought that consumers

are going to live in a world where they have to have 100 or 50 or 35 subscriptions to different platforms, i think that's not a tenable situation so i think we're kind of going through the natural phase of people re-bundling, and i think youtube and comcast and hulu have done a really nice job of pulling those assets together and apple tv has as well as a consumer, you're standing from the outside saying oh, great, i see all this incredible content, you're probably not saying i want to have 30, 40, 50 subscriptions to things. so i think the consolidation and re-platformizing of the ogt business is going to happen. and i think the other thing that will be interesting is watching microsoft and netflix. microsoft with x box netflix with 30%, 40% of the viewership on ott. you're going to have new types of bundles on new products and new hardware that will be really interesting.

i'm bullish on the space but also bullish on bundling >> and more broadly, let's go out 30,000 feet because you always seem to have a good sense of the demand by the advertising community, which i always think is the first to go if you actually think a recession is in the offing are you feeling any of that? are you see anything of that at all? >> one thing, there's been a consolidation at the top of the funnel where customers, especially in a recessionary period need to get more customers into their product if customers slow down interestt decision making, you need more customers. i would say at the same time, they're also managing their p&ls and budgets. i've been through two major of these cycles, one at google and one at aol i think it's totally natural for customers to slow down a little

bit. but really, what they do is get rid of things that don't work and spend more of their money and time on things that do work and are faster the people that are going to benefit from this are the googles of the world tiktok is performing and have become the bottom of the funnel. i think amazon's going to benefit in ads what you're going to see is the secondary players feeling more pain but advertisers need to keep spending it's really hard to turn demand back on once you shut it off that's a big lesson from the last couple big incidents like we've been in. >> tim armstrong, it's always good to see you. we appreciate your perspective >> andrew, hoidld on. you didn't give me a chance to talk about our launch. >> let's talk about it >> real quick. today we're announcing a new partnership with poap which allows you to make attendance the new membership for, if you're a big brand, and you have

customers in your offline channels, and you want to attach the blockchain to them and get first-party data and all the things that make having data around your customers really important, we are announcing today, a joint partnership with poap and that company, poap basically badges your fans as they interact about your brand, and can you access it directly through flow code, and we've been trying this out for the last six months. we just did a big program in france at the advertising festival and we've had an amazing set of interactions between fans and brands in the offline world that mimic what happens in the online world. >> in a very practical sense, just explain how it works. so if i have my phone, i'm at one of these event, and obviously, i'm going to point my phone at the code, but then what happens? >> if you're at the gary v. paris hilton event, a code would

come up in the audience or on a screen you would scan it and get a proof of attendance protocol on your phone that you were at that event, and then the brands can then take your proof of attendance and turn it into essentially an offline cookie that allows you as the user and gary v. at brand to know that you had a relationship and you physically got together. and then for future events or future interactions, gary v and the fan now know that they were connected in a very physical way in the offline world in an event, and it create as opportunity for royalty and benefits for users that have spent their time physically. >> does the company, though, have to provide royalty programs or some kind of incentives to put the phone up and create that connection in terms of why the customer's going to want to do that >> it works better if there's an

incentive, andrew. but i will tell you this people love being at events, their memories come from events. in many cases people want a memory taken directly off of one of our flow codes so they can keep it with them the rest of their lives. it's a good way for people to have big remembrances in their lives, and that's what poap does >> ga >> congratulations on that launch i'm sorry i didn't mention it earlier. we use flow code here. >> you do a great job. >> thanks. ♪ oh, oh, oh, ♪ when we come back, tiktok under investigation on the hill. we're going to speak oversight and reform we'll be speaking to the oversight and reform committee member james comer about the china-based company and the information they're collecting and why congress is so

concerned. around tnd then later, oil have been dropping we will talk energy with goldman's head of energy research "squawk box" will be right back. time now for today's aflac trivia question. along with his family, what actor opened a fast food restaurant chain in hingham, massachusetts in 2014? the answer when cnbc "squawk box" continues paul is about to suffer a shelf-inflicted injury. luckily, aflac will help cover his unexpected medical bills. aflac! maybe you could use the money to buy a step stool. i have a step stool. so why are you climbing a shelf? the stool's on top of the shelf, isn't it paul... (shelf crashing) yeah... ♪ ♪ aflac!

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mom: how was school? dad: wow! ♪ vo: music can help you express how you're feeling. when you can't find the language, find the lyrics. house oversight ranking member, james comer, has launch

a launched an investigation into tiktok in a letter to tiktok, the congressman wrote, we write to request documents and information regarding recent report has tiktok allows china-based employees to access non-public user data if true, not only did tiktok misrepresent or provide false information but has placed the safety and privacy of millions of u.s. citizens this jeopardy james comer is the lead republican on the committee for oversight and reform congressman, it's good to have you on this morning. i don't know why i think cynically about all of our public data. i don't think anything i have is private anymore. is it that bytedance is a

china-based company? and i'm just wondering, the information they do glean, it seems like it would be for commerce i'm not sure if there are any security issues that the people on tiktok, other than just confirming that western civilization is in decline, other than confirming that, what are you going to find out from user data on tiktok? >> well, first of all, we know bytedance is a chinese company text tok has previously testified to congress that all the user data from americans was stored in the united states. now what we've learned now from former employees is that's not true that china actually stores that data or at least has access to that data. so we're talking about not just browser data, joe, but also location when you're talking about china having access to your location, then we believe that's a national security risk, in addition to the fact that tiktok misrepresented congress when they had a previous testimony. so we've requested information

from both bytedance and the treasury department to see exactly what the federal government's role? this under the trump administration, he wanted to completely ban tiktok for national security kearn concerns, and of course the democrats laughed it off and now we realize that tiktok has the potential to be a national security concern. we're probing minto this to determine what exactly china has and what the biden administration is doing about it >> would you say a lot of companies domiciled here have access to the same info, congressman? is it that different >> american companies have access to that, too. and we know big tech's been sharing privacy, private data for a long time, and that's a concern. i think you're going to see in a republican majority that's going to be a major priority to try to wrap our hands around that, but

when we're talking about china, i mean china is a bad actor with respect to spying, with respect to stealing our intellectual property, our patents, and they're getting to be a national security concern more and more because they're beefing up their military behind the scenes we believe china's working closely with vladimir putin. we're concerned about what china's intentions are in taiwan so we need to take this very seriously that china has access to our location. that's the big concern, the location >> it's one of many, many, many things to focus on and i wouldn't want to discount the importance of it, but sounds like they misled us, too, is what you're saying a lot of times the coverup might be worse than the actual event itself they just deny it. >> that's true that's true. nothing irritates me more as the top republican on the oversight committee is when someone comes

before congress and doesn't tell the truth. it could be the fact that the tiktok employees actually believe believed that that data was stored in the u.s., somewhere in the seattle area but what we've learned from former employees is that china actually has access to that. china passed a law about five years ago that requires citizens and companies in china to work with the government in their intelligence operation so in other words, china passed a law that would require companies like bytedance to turn over that data if the chinese communist party requested it, and i'm pretty confident that's something the chinese communist party would do >> i shouldn't keep returning to what i think goes on, on tiktok. just trying to figure out what national security, even with location, i don't know, i haven't used it enough to know but there are, what about, a day

doesn't go by that we don't hear about a large plot of farmland that catches the eye of china, and it always seems to be located close to something that would actually, not withstanding tiktok users, but actual airspace or defense facilities in the united states and suddenly, it's like, wow, what a great place to grow some wheat. i don't know and taiwan is a real concern, considering our supply chain issues with the chips. and you put it all together, and it's troubling, and you wonder, putin versus xi. i don't know they're both scary >> congressman, my question to you, but my question to you, is there a solution that you believe that would allow tiktok to operate in a way that you would feel comfortable with? one of the things that's happen, and you're seeing this in what they're calling the splintering of the internet is effectively servers being maintained in

different countries and the like and then you get back to this issue that you're referring to which is do other countries have access to those servers depending on where they're based. is there something that tiktok could do to satisfy you? >> well, i think at the very least, they need to retain that data in the united states. and i think that needs to be regulated by the federal government i'm for less government, less regulations, but we have a problem here and when you look at cyber security, the united states is very dee -fishment that as compared to other countries around the world this is something president trump raised the alarm on but when biden came into office they reversed course. it seems like biden's always on the side of china in a lot of these issues, but with respect to the sloougs i think at the very least we need to know exactly what information that tiktok has shared with the

chinese chinese communest party, what the biden administration's doing about it, and to ensure that that data stays in the united states >> congressman comer, we appreciate it. come back and update us on what you find out and continuing, this years now we've been talking about bytedance and tiktok and everything else. it make please ls me laugh, moss stuff. have you been on liberals of tiktok are those people real? >> it is entertaining. >> are they real i don't believe it i think they're -- i don't know. all right, thank you see you later. all right, verizon just out with its earnings. we're talking about numbers a little weaker than expectations at least on the bottom line.

$1.31 a share. however the company has a lot of different things going on. first of all, it added fewer than expected monthly bill-paying phone subscribers, they added just 12,000 sub describers who pay a monthly bill despite estimate of 150,000. verizon is also lowering its full-year. they're now looking for adjusted earnings of share from $5.10 to $5.25. the earlier guidance had been $5.40 to $5.55 also lowering expectations of wireless growth, looking at 8.5% to 9%. they're looking for minus 1% versus flat.

so it does look like they are looking at tougher economic conditions the stock is down by about 4.5%. this is kind of in line with some of the things we heard from at&t yesterday what they're talking about in terms of expectations for growth certainly a weaker economy catching up with some of these names. verizon shares off still to come, results from twitter. we will see what they have to say after snap's disappointing quarter. down 30% right now stock is trading at $11.40 a decline of almost $5 and as we head to a break, take a hook look at some other winned losers on the nasdaq consellation is up, followed by tesla, up by .6 of a percent your why. what drives you?

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welcome back to "squawk box. take a look at futures on this friday morning right now we are on the green on the dow, up about 36 points, dow looking to open down about 51

points and the s&p looking to open down a little bit over 8 points >> a four-for-one stock split does go into effect for gamestop today. that stock will begin trading on a split-adjusted basis at the open the shares right now up by about a pthird of a percent >> seagate, a story similar to what we saw on micron last month. wrapping up the year with a big earnings miss. a solid revenue miss thanks to covid shutdown impacts in asia it plans reduced production to

reduce demand. tonight at 6:00 p.m., a specialing "politics and profit." all you twitter people, be forewarned, they may discuss politics with business news. i know a lot of people really don't like to see that, because they're really not related, are they from inflation and the fed to the debate over funding for chips and climate change to the way the midterms could impact your portfolio wow, that's a lot of stuff with a great lineup, including the counsel of economic adsovirs, and more

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get a great offer on internet and security, now with more speed and more bandwidth. plus find out how to get up to a $650 prepaid card with a qualifying bundle. new this morning, germany has agreed to bail out uniper. it will see the german st government take a 30% stake. as germany's biggest importer of gas, it's been hit hard by vastly-reduced flows from russia which in turn has sent prices soaring. what happens in a situation like this, not reading into it or knowing exactly what the details

are, gas prices soared, they probably were in a position where they couldn't raise their rates as quickly to customers, because regulators always say how much can you raise not surprising that the government would step in and say yes, we're going to make sure we continue to support you. you see that stock, though, down by more than 20% the government will take a 30% equity stake to get involved >> we probably, as an entire media machine. do we talk about ukraine anymore? days go by where we're not hearing anything and, you know, that's just a common carry on. i don't know attention span or something? >> i was going to say, and people getting more concerned with their own issues, even though their own issues pale in comparison >> but now we probably need to know what putin's planning, based on if he doesn't get his way or -- >> if we know what he's planning >> if he doesn't get his way, if

there's sanctions, anything that upset him, and he's going to take it out on -- sfw >> he's going to use this as a tool i think he's made that very clear. this week the nord streamline opened up at 40% he said already if they don't remove sanctions on some of the parts that they are requiring that he will drop it to 20% as he takes down one of those turbines >> and he's got plenty of money, because the oil is not, he's getting, he's not even discounting it at a lot of places that still buy it >> clerk ouheck out energy pric morning, they have come down over the last couple days. this morning, wti trading at $93.43 and this is happening as we are seeing demand destruction. joining us is goldman sachs'

head of research and the demand destruction we're talking about, people using less gas at this point. and we're talking about gas, the price that they're paying, what they're paying at the pump for these things u.s. usage down by about 8%. higher prices tend to cure high prices whether that be through the supply picture or demand and it looks like demand is being cut. how long do you anticipate that will last? >> as you point out we have seen a demand adjustment in the gasoline market especially in the u.s. keep in mind, that's a response to record-high prices that have since significantly come down. we think maybe the demand weakness is overstated in the data so current retail misses are currently still declining, we would find some demand the key question then is has the increase in prices been enough and our take when we look normally at the u.s. on a global scale s look, demand for oil is still about supply

we're still dough efeating recoo inventories. and in our view, it sets the stage for higher prices in coming weeks, unless the economy sb sb to abruptly slow, and we don't see that so far >> hearing from verizon today, even hearing from american express, 30% increases in consumer spending on their amex cards, but amex still setting aside card losses for $410 million for the slowdown that they're anticipating, too. things look great at the moment, but just about every company is worried about what's coming in the next three to six months why do you think that slowdown won't be as severe as some of these other companies are anticipating >> first of all, as you stated, in the moment, demand is still

good, and commodities are in the moment markets the issue we have is today, the very near term, supply and demand, especially as i said in a world where we don't have the norm i normal inventory buffer. that's today's challenge that's the case for a recession, right? think about 2008 we were beyond six months into the recession and oil prices were still rallying to record high, because the issue there is not about future growth rates, it's about today's imbalance now, eventually, of course, if we do have a sharp slowdown in economic activity, of course this will help for some time resolve the oil deficit. there are two challenges the first one is that's not guaranteed there is slowing growth, tightening financial conditions. in our view, the recessions are still below 50%.

second, even a recession, if it cu occurs, hasn't resolved the energy shortage. this is a decade of investment if you slow demand through tightening, as soon as you pull that restraint back it recovers and areyou are exactly at the s. the move to finally get the trillions of dollars of investment migrating in fact, compared to 2008, we had record high prices after ten years of investment in oil supply today we may end up with record high prices after ten years of underinvestment. the challenge is much greater from here. >> yeah, i would also say, what you talked about, just these commodity markets, living moment to moment and seeing these huge swings we are two years out from a time when we saw oil prices go negative we've watched them jump well

above a hundred dollars a barrel and that's a difficult environment to convince energy executives to start spending billions and billions of dollars for additional production. when you see these crazy fluctuations, bigger swings than we've ever seen. nobody had ever seen oil prices go negative before is that something that is going to make it even harder and take longer to get them to invest more money back in that and the esg backdrop that you have >> that's very important we tend to think of the world in investing under uncertainty. and that your huncertainty is rh chinese demand, russian supply, potential recession. then you look to your low, the pace of the energy transition. second, given all those concerns, plus record-low inventories, you have price

volatility, extreme price volatility then as you're trying to budget for billions of dollars of investment you have to naturally be cautious in the face of this uncertainty. the uncertainty and volatility it itself reduces your ability to hedge. were you talking uniper. you need to avoid what is roeall the worst possible outcome that would be the main risk here following this underinvestment crisis >> i mean, it goes along with global economic swings like we haven't seen before, too the covid shutdown those are the things that are so hard to plan around. are we convinced that this is going to be maybe a more normal recession that we see this time

around because that's what it would take to keep oil prices high >> what this recession looked like i think is a key challenge. on the one hant hand, if you compare to history what stands out, first of all we're heading into a potential recession but with tight commodity markets historically, such recession, if they occur tend to see high commodity prices second, maybe the systemic risks in the system are not as great in 2008, 2009. when you put those two elements together, a recession is not a plus for commodity prices. we won't go to $30, but that concern, though, as you mention, is reducing investment today, and i think that's really why, even if in the short run prices remain volatile, on average, they will have to remain high. the last point i would make to how we square all that, what's our guiding in the metric in the short run. it is one of record high physical prices, relative to the

brent you see on the screen. the physical premium is unprecedented. that's symptomatic of that tightness today, and why i'd argue the next move is higher from here. >> damian, thanks. coming up, dr. scott gottlieb on president biden's covid diagnosis, a reemergence of polio nasdaq down about 37 points, the s&p down about 5 points. "squawk box" back a big hour ahead on this friday morning

good morning earnings coming in fast. we have new numbers from verizon and american express plus we're expecting twitter results any second we'll bring you those numbers when they hit and the talk of the direction of the company with or without elon musk at the helm and president biden testing positive for covid polio, and monkeypox is spreading. we'll talk with dr. scott gottlieb he will join us live as the final hour of "squawk box" begins right now.

. good morning and welcome to "squawk box," live from the nasdaq market site in times square i'm joe kernen with becky quick and ann dr andrew ross sorkin. this week it seems like we start the mornings with some red and it i think the nasdaq's up 5%. we've seen at least some stabilization from the sharp selloff we've been dealing with m 2022 t in 2022. take a look at the treasury yields, down 2.8

that's giving some strength, probably, to just market sentiment, unless you think it's a slowdown oil 95 and crypto currencies holding up relatively well bitcoin was somewhere above 23,000, 23,6 dom chu is still with us as he agonizes over the decision of whether to join liv golf or not. >> i'm not going to quit my day job, joe i'm not nearly as good as you are on the golf course >> that's funny. when you lie straight face, it's not becoming >> while i kind of do my real job here, i'll contemplate my liv golf future. let's get to the earnings report joe mentioned some of the positivity in the dow drifting into the green side of things, a lot of that has to do with what's happening at american express. we'll start with amex good news first.

4.5%, roughly $6.50, $7, 40-some points added to the dow right now. trading about 60,000 share premarket. this is the payments company, credit card issuer, reports better than expected profits, also revenues, driven in large part by a big rebound in card member spending on travel and leisure activities, a big notable move there when it comes to spending in april because amex says that surpassed pre-pandemic levels for the first time so a big benchmark there amex did boost the amount of money it sets a side for possible credit-related losses but you're talking about a gain there. but then you have verizon, another dow component, the telecom giant slumping by roughly 5% right now, about $2.50 per share. 300,000 shares of volume a more mixed report tilted towards the negative

the revenues appear to have narrowly topped estimates or maybe in line depending on how you want to view things. and verizon cut its full-year forecast among other things seeing the impact of higher prices it's charging on phone subscriber growth down about 19% over the last 12 months and then we're going to check, gamestop, not earnings, but the owner of the meme stocks, right now down about 1%. $37.99 we do see some volume picking up here remember it closed at $153 and change yesterday and then today the four-for-one stock split goes into effect meaning shareholders get a three-share dividend making each share worth a quarter of what it was before the new split-adjusted price is about $37.99 in the premarket right now.

so on balance, gamestop, you might see funky quotes on whatever website you're looking at, or whatever news service you're getting, but rest assure, there's not a massive move in gamestop it's just the share split. >> i love the meme stock people. i would never say, wow, now that's a price gamestop actually looks reasonable, a little bit more reasonable. >> you could say that. here's the thing. >> based on fundamentals, that seem pretty accurate that's going to make people so mad, andrew. see what i'm saying? >> you mean folk whose don't understand math? sha w

is that what you sneen. mean? >> i want to say gamestop was like $120. >> there's where they were on the left hand side i love those people. >> do you remember, there was a story back in the day like over here on that left-hand side where people were using gamestop store credit s like a bank? people would go in and preorder games and pay the preorder and then have that as currency so that they could kind of use it back when people apparently didn't trust the banking system. they used gamestop. >> trust the bank? >> but they trust gamestop you could preorder games and use that as currency. >> that was when adam mirren was out what, a pan and some gold. >> in them thar hills

>> the company, twitter, post apostin an adjusted loss of 8 cents a share. 8-cent loss versus 14-cent profit expectation revenue coming in below expectation, $1.8 billion. the street had been looking for $1.315 billion and they're talking about the second quarter revenue coming down because of what they say were industry headwinds associated with the macro environment like we heard from snap, but they also say it's because of uncertainty related to the buyout of twitter by affiliate elon musk. stock's only off by 2.78% versus snap down 30%. they had weaker numbers because there's so much more riding on the stock. if you're looking at snap down

30%, twitter's only down 2.5%, because this is all riding on that bid from elon musk. >> i'm wondering what the whole 5420 >> impossible to say what they talk about their mdaus, 41.5 million for the second quarter, up from the second quarter of the prior year so snap had more years they were using, monetizable users, ad revenue didn't show up for some reason now they are not making any comment on what's going on with the elon musk. but they just reiterate their position as they announced, they entered that merger agreement for $54.20 in cash. they still think that stands

they talk about the litigation they're not going to say much more than this they just mention that the trial has been scheduled for october of 2022. but you're right, this is all riding not on the results. >> the results are insignificant at this point >> to twitter, but i wonder what this means to the other companies like pinterest, like meta meta's still at the same place 4.5% >> they're also blaming the transaction and the uncertainty. >> which is why they're trying to get a speedy trial. >> and the question s do you blame that, do you have to say that in the release so that when you -- >> because you say it in your lawsuit. >> exactly hard to know >> do we tweet out the result? >> they might have tweeted out the results. we're going to talk a lot more about elon musk and twitter later this hour. but as becky was just

mentioning, take a look at shares of snap, because they're missing, attributing the results to slower demand they said supply chain snags led to cutbacks in ad spending other social media stocks highly-dependent on ad dollars we showed you that list. losing a combined $80 million in market cap the investor snap said we are not satisfied with the results we are delivering. someone said the phrase "too little too late. a little too little to late to be downgrading them now. let's get you caught up on some of today's other business

stories. shares in mattel lower the ceo was on "mad money" last night. here's what he told jim cramer about the months ahead >> we expect continued growth in the second laugh and are planning for increase in consumer demand in the holiday season, so all in all, very happy with our position and expect to win market share going forward. >> gross billings for barbie were only up 3% in the quarter, but there is a live action barbie movie with margo robbie expected to premiere next year and could help spur demand for the dolls. production on the barbie movie wrapped up yesterday the stock off this morning by two and a third. boston beer posted lower hthan

expected the stock's off by almost 10%. and dow and travelers could be dropped from the dow jones industrial average they are one of the 30 stocks to face relegation. bringing their share praisices w to a little under $100 apiece. you've got to have price swing, a lower stock price. >> they should know, you know what the qingy dink is the market cap is the same 37 billion that's not a dow stock i'm sorry. i have to make that decision

sorry, andrew. >> you are now the -- >> no, i can certainly understand it if they decide it that you need to update things they do it constantly. they change those things like changing their underwear so there's going to be some new ones, and we will be like oh, a year ago >> i still am tempted to call old dow components dow components but they're not when we come back, dr. scott gottlieb will join us live to talk about president biden's covid diagnosis and what people should keep in md ouinabt the current wave of infection. you're watching "squawk box" and this is cnbc

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welcome back to "squawk box," everybody. let's take a look at the futures this morning the dow is the outperformer. that's in part because of what we've seen from american express. dow futures indicated up by about 72 point dow turned positive this morning after we heard from american express. nasdaq off by 37 the dow turned positive after we heard from american express this morning, just talking about how strong their quarter was up 30% and spending on the card for the second quarter

now the company did set aside $410 million for potential future losses if people don't start paying back their loans if things get worse in this economic outlook but very strong numbers due to an increase in travel spending and across the board very strong numbers at amex and that turns things around this morning for the dow. covid as variants drive summer cases the president is said to have very mild symptoms joining us for more on this and so many other topics dr. scott gottlieb he serves on the boards of pfizer doctor, let's talk about the prognosis for the president. he's he's paxlovid. >> his prognosis is very good.

he's been recently boosted he received his second shot on march 30th he's on pax lovid, which has substantially reduced his risk of a bad outcome i think the risk of him programming to more serious disease is single digit, 1% or%. or 2%. so he should be in good shape. i think from the white house standpoint we need to remember he was diagnosed very early in the course of his illness. this was a routine test that detected this,and once they found the positive antigen test they listed the symptoms and asked if he had any symptoms it's possible he's going to have more symptoms as the days go by. he may develop a fever i wouldn't be surprised by that.

from a white house standpoint they should be emphasizing that he has substantially lower risk given the therapeutics and vaccination, not the fact that he doesn't have symptoms yet he may in fact develop symptoms before he full y recovers >> pfizer question since you are on the board and there's anecdotal evidence of rebound case around the country. do you think paxlovid should be longer? there are doctors prescribing two courses of it. >> i'm going to leave it to the regulators they've looked at the question of rebound haven't really affirmed the anecdotal reporting that we're seeing on twitter and from physicians it does seem to be consistent with what was served in the clinical trials with a rate of rebound or people having

persisting symptoms after coming off the drug was quite low and consistent with placebo. but i'm going to leave it to the regulators on what the course should be. if you look at the phase two, phase three study, the risk reduction for someone 65 years or older was about 94% so, you know, and the hospitalization rate, the risk of hospitalization or death was around 1.1%. so this should have a treatment impact for the president >> you've talked about the potential for a surge this summer, and then of course this issue of when we're going to get new vaccines that are based off ba.4 and the race between those two things how do you think that race is going? do you think we're going to see those vaccines as early as september or october and will it be in time >> well, i think the ba.4 vaccine, which they seem to have pivoted to will be available at some point in september and

certainly by october you should have it available. if everything goes well, both companies, pfizer and moderna have said they would have supply by then and perhaps supply muff enough to meet demand. they manufactured that at-risk m advance. fda and cdc have made a decision not to deploy that the europeans and canadians may make a different decision and roll over into the b.4 vaccine when it comes available. i think the accruing evidence in recent days suggests that prior infection with ba.1 does confer not pretty robust protection against ba.4 and ba.5, not absolute for sure, but it doing suggest if you were vaccinated with the ba.1 vaccine, i think

we should consider where we make it available now to people who are at risk so they can get the better protection from that vaccine. and then when the ba.4 vaccine becomes available roll that out. there's enough of an integral of time that people could potentially get boosted with both >> it's a plamanic argument would you say at this point that this is characteristic today, is it more akin to a pandemic or is it now moved to where it's endemic? because every time you talk about, people you say people at risk can it be a pandemic if the vast majority of people are not at a high risk of an adverse event? or what does it have more characteristics of right now a pandemic or an endemic, which we've been wishing we'd get there for quite a while now?

>> well, look, this is an endemic virus, but an endemic virus can cause a pandemic we have a flu pandemic every year so it meets the definition of being a pandemic you have global spread of a pathogen but this, at this point, this is an endemic virus, we're not going to be able to distinguish it >> are we still in a pandemic? >> we're still in the pandemic with covid, yes. you're going to see, this is probably going to be a seasonal pandemic, even if this settles into a seasonal pattern, it's going to meet the definition of being a pandemic i think the reality is most people see the pandemic as a part of the fabric of modern life rather than some public health emergency and some of that is simply widespread recalibration of risk, but most people aren't im immunologically naïve >> we got to talk about polio. what do you make of this what do you make of this news report >> well, look, m thiin this cash

sequencing was confirmed by cdc and a type two virus this is a vaccine-induced infection from the oral polio vaccine which isn't used here in the u.s. what's unclear is whether or not this individual, the 20-year-old male, they haven't reported any more details, whether he contracted that here or overseas there was some report that he had recently traveled to hungary or poland. but cdc lhas to have the theory of the case, and they haven't put that out so it makes me a little suspicious about whether he got that here or overseas. one thing worth noting, the oral polio vaccine isn't used widely around the world the place where it's being used right now is in ukraine, because they are experiencing an outbreak of vaccine-derived polio virus. so they've been vaccinating children with oral polio virus

it's possible that people who migrated out of ukraine into poland and hungary brought some cases into those countries and perhaps this individual contracted it there, because you're just not seeing a lot of this around the world right now. it's unclear where he got it the risk of course is that he might have contracted it here in the u.s. from a child who maybe travelled from overseas, and there could be other cases that's why you're seeing an effort in rockland county to get more people vaccinated this particular count has had a low vaccination rate historically in recent years they had a very big outbreak, 312 kids were infected with measles between 2018 and 2019. there is risk in this particular region of the country. >> and how much should we worry more broadly, though >> i think what we should be worried about is declining polio vaccination in pockets of the country that could create the potential for clusters of illness. this is a highly-contagious

virus. i think from this single case, given the fact that it occurred in june, there haven't been any more cases discover. this probably isn't the leading edge of an outbreak, but it evidences the risk that we face as vaccination rates decline >> hey, scott, most people are vaccinated for this, right most kids are protected? it's part of the normal vaccination regime >> most kids in the united states received ipv, the injected polio vaccine post people are protected but the kids who tend not to be vaccinated tend to be clustered in certain communities, because you see community of people make decisions not to vaccinate their kids so it is in certain pockets of the country and this is one of those communities, and this's perhaps why you saw the case here >> okay, dr. scott cgottlieb, we appreciate it. have a great weekend >> thank you when we come back we'll go

inside second quarter results. we'll ask were there's anything in the numbers that is of particular interest to elon musk as we head to a break, a programming note, you don't want to miss a cnbc special at 6:00 p.m. eastern time, politics and profit from inflation and the fed to the debate over funding for clips and climate change to the ways the midterms could impact your portfolio we have a huge lineup, including business leaders as well, in solar, evs, semi-conductors and more you're watching squawk on cnbc

welcome back to "squawk box. the futures right now, we see mixed with the dow up about 55 points nasdaq still in the red, but it's improved slightly, and can you see the s&p down about six >> fedex is suspending sunday delivery in certain markets. targeted for areas with smaller populations. packages had be reallocated to saturday and monday delivery in those markets. the decision comes as its independent contractors have asked for more compensation. fedex said nearly 80% of the u.s. population will ten to receive sunday deliveries. we're going backwards. going backwards. >> you ramp up for these things

when everybody was ordering everything at home and you needed it there every single day. i can understand why they might pull back in some cases. >> i get the economic, but in a world that is constantly innovating where things are getting to people faster, making it more convenient >> it's the same thing of amazon building out their warehouses too much, and then oh, we did this too much. >> they've been doing this on sundays for over a decade. >> it's still 80% of the country will get it. >> when i say backwards, this is like going a decade backwards. there were a lot of parts of the country that wanted this, i don't know if they needed it we'll see. >> joe kernen. coming up, much more on second quarter twitter results and where the company goes from here as it prepares to battle elon mus e-elon musk in court

washington weighs bills in subsidies. maybe they'll hold off on that after looking at that chart. been a great week for the chips. up 8% since monday on pace for the best week since march. and its longest weekly winning streak and a hot oflot of people say w a chip turn around stay tuned you're watching "squawk box" on cnbc

welcome back to "squawk box. this is cnbc, and we're watching the futures this morning it's friday. it's been a really strong week for the markets. the nasdaq has been up more than 5% this week a hill little bit of a mixed pi. after the disappointing numbers from snap last night, twitter this morning, you see nasdaq sh sh shs shares indicated up. in the meantime, the nasdaq is

on pace to break a three-week winning streak no kidding that's what happens when the ecb raises by 50 points. and this morning's big earnings reports, let's talk about american express this is a big deal it's the reason probably that the dow is positive, up more than $5 this morning after that company came out with better than expected earnings check out american express, looks hik looks like they are going to be up about $5.50 american express talking about the incredible strength they've seen in card spending as people get back to traveling. it really gave them a solid boost, better than 30% increase in card spending over the second quarter. that stock on a tear verizon the opposite story after the company came in with weaker than expected earnings and they added far fewer monthly

paying subscribers for phone service than had been expected they only added about 12,000 subscribers versus the 150,000 or so. probably lost ground there so achlto at&t match a matching a little bit with the service numbers. weakness with the consumer, and again, that stock off by about 4.25%. twitter shares lower in the premarket right now. the company reporting an adjusted loss instead of an expected profit in revenues. below expectations questions whether any of this really matters in the larger scheme of things given the elon musk transaction that is now going to court julia boorstin joins us. >> andrew, twitter disappointed across the board, with ad and

yes, the pending acquisition by elon musk, also citing the musk acquisition as to why they aren't giving guidance or hosting a conference call. twitter reporting an 8 crent pe share loss instead of the gain while revenue fell majorly below expectations 11% below which makes it the biggest miss they have ever reported its cost increased 31% in the quarter. we also heard from snap and it painted a grim outlook in the ad market 13% revenue growth in the second quarter. so far in the third quarter, revenue growth is flat with a

year ago that's a massive dispoappointme. now the ceo evan speigel blaming that on platform policy changes. of course he's referring to apple. macro economic challenges and growing competition for a shrinking pool of ad dollars he warned that it will quote, likely take some time before we see significant improvements he also laid out how they're trying to drove productivity with reprioritization of goals and initiatives across country, so a retrenching there snap and twitter together do paint a very dark picture of what's going on in the digital ad market. we see meta, alphabet, pinterest all trading lower and off meaningfully on this news. one challenge that these digital ad platforms face is that they make it very quickly to turn on ads but also very easy for advertisers to pull the plug or

pull back when they're feeling economic pressure, which is different from some of the ad commitments that they make with television where ad dollars may be more locked in. >> would you look at these two earnings reports and say there's a trend? one thing that twitter has said, whether this is partially a function of this court case going to delaware now, where they're saying, look, this situation with elon musk i actually hurting our business. do you believe that's what's hurting their business or they have to say that because they're in the middle of this lawsuit? >> it's problemably an economy combination of both. snap grew its user base faster than expected. and it's projected pfor q3 that it would have a bigger usage the fact that it's gaining in

usage and underperforming in ad dollars indicates to me that what twitter is seeing a macro economic environment, and a lot of pressure i think particularly on these digital platforms so i don't think it's just the elon musk situation, although i'm sure that is not helping you can imagine in negotiations with advertisers they want to make sure that the platform is not distracted so i'm sure it's a combination of factors perhaps a perfect storm for twitter right now. >> appreciate it thank you. let's check more about twitter and specificallity fight with elon musk a five-day trial set to take place in october what do we know about the possible outcomes, and who likely has the better case here? joining us is executive director for the institute of law and economics at the university of pennsylvania's kerry law school. and carrie lombardo. what you saw coming out of this trial or the initial hearing on this, what your take away was.

>> yeah, i think what really struck people at the tuesday hearing was the moment when the judge made a comment about it not necessarily being apparent that monetary damages would be sufficient as a remedy for twitter m this case. that led people to believe that specific performance or forcing musk to follow through with the deal was actually a plausible outcome here another thing that stuck out to me that one person mentioned to me was just how nonchalance chancellor mccormick was a major line of thinking has been here's a case on such a massive scale with an unpredictable buyer and a company as visible as twitter. is the law going to play out as we've usually seen it play out and the way that the judge acted so far seems to suggest she's not phased by these factors and maybe that could bode well for twitter. >> the other thing i thought that was pretty significant was the idea that she went along with a time frame that was much closer to what twitter had been

asking for, in part because she doesn't think it's all that necessary to dig through all of the bots and or information, because she doesn't necessarily think it's all that relevant to the case that is elon musk's main reason for saying that's why he wants to terminate the agreement >> yeah, there's a limit to how much it's appropriate to get into the details of that look, if it's really so complicated as musk has suggested, then it gets harder for him to fault twitter's disclosures about that subject and if he can't fault those disclosures, i'm not sure he has much of a case left. >> where do you think, larry, the upper hand lies? i would think just about everybody we talk to thinks twitter has the upper hand, but what does that mean? what would the outcome look like if that's potentially the case >> i'm with the majority on this one. from what i've seen so far, twitter does have the upper hand

legally. it's a very seller strong agreement that musk signed one possible outcome is musk friendly, somehow he persuades the court that he had the right to terminate the deal. but in what i think is the more likely outcome, that he's guilty of a breach of the agreement, question is will he be forced to go forward with it, or will the court rely on some monetary remedy that, to me, is really the core issue. and on that one, cara's write. t right the chancellor's not phased. delaware's seen many big deals before >> here's the question, though in terms of, you talk about monetary damages there seems to be a binary choice, unless you think there's

s something in the middle here are you going to force elon musk to buy their cis company if you think he is in the wrong you would say congratulations, you own twitter now, or because the contract suggests pretty clearly that a billion dollars is the cap on liability, that would be, that would be the price. is there something in the middle where if you wanted to say we think you're wrong and you're going to have to pay monetary damages, but it looks, fort dam if the damages are canpped you would force him to bite cuy the compay >> there may be something in between. there is a provision in the cap as you point out, but there's a suggestion that it doesn't apply if the breach is knowing and

intentional. and, you know, that's certainly a possible finding >> kcara, just in terms of how people are kind of positioning themselves around this, what is the buzz that you're picking up? what are you hearing from people because if he was forced to go through with this as-is, there's a long gap between $38 with stock trades now and 54 where that deal went through >> yeah, i mean, as you know, becky, most of these broken deal cases tend to end in settlement. so is a settlement still possible yes. i think in the short term, one of the major questions that people are asking at least is about what will the discovery process look like? smufx is musk going to get access to all the bot data he'd like to see? and i think how the judge responds to some of those disagreements over what's

allowed in discovery could be telling in where this one lands in the end >> larry, is there a historical precedent that we could look back to and say, okay, here's a case where they actually made somebody pay and pay full price? >> well, yeah. there are actually two notable cases. the historically significant one goes back about 20 years when tyson foods was forced to go through with its agreement to buy ibp, iowa beef processors. and that's a case that was important in defining what a material adverse change is but more recently, the very judge who has the twitter/musk case herself required a buyer to go forward with a deal much smaller deal of course, but she's clearly not afraid to

require specific performance and po force a deal if she thinks that's what the facts in the law and the contract require >> here's the thing, and this goes back to the daylight issue. if she doesn't find that this was effectively a willful breach, but finds it to be anything else, and she also, i mean, there's this fascinating issue, which is here's a company that doesn't want to be owned by musk and mucsk doesn't want to own. and yet it seems like the answer contractually is to force the issue. >> well, when you say the company doesn't want to be owned by musk, i guess you have to talk about who the company is. at this point, once the company has agreed to sell to musk for cash >> i agree with you, but you though wh know what i mean >> yeah. >> philosophically from a social perspective, is it, it would be one thing if it were a large company buying another company

it's an individual it's a different kind of situation. >> yeah, i mine, ean, that's th issue that makes the case interesting to me, the remedial choice the judge has it would be pretty easy to write an opinion that says musk, you have to buy theis company, but judges are human being, and i'm sure when she decides to write the opinion and decide the case she has to have those in mind, do i really want to force a deal that makes so many people unhappy simply because it gives the stockholders the money >> it's not simply giving the stockholders money, it's setting legal precedent. that's the important thing how do you effectively, you know, maintain law and order around contracts i think that's the bigger question >> idon't think it's gone too far past the legal frontier for her to do that, though >> larry, cara, thank you both

coming up, much more on the markets as we prepare to wrap this week up on wall street and get ready for nextee wk's fed meeting. oh, another one? you're watching "squawk box" on cnbc

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we have s&p 500 rising. 4200, if it gets there, does it go back to the lows of 3630, or are we off to the races? is it immediate short-term call or as you say, a relief rally only to be resolved with further new lows, or are those in the past for us? >> the main call had two point. one was the low for thousands, 4200 or 4300 is a good number, and that is fine. it comes up on the screen. the other main point is what to own. that is sitting at growth, entertainment, tech hardware including apple, retail and of course amazon. those are the groups would like for the key expansion rally off the bottom.

as far as getting back to the lows is possible in a full fledged recession but i think this is just the mid to late cycle slowdown. we had several of those in the 2010s and the 2000's, and i have seen this show before. >> so here it is. we have not had a lot of people like you on. so what is the probability that we have below 3600 in the next year inking in your view at the snp? >> that's just it. when we look at the decline, you and i remember the inflation era. many people are thinking that you have to adjust everything for real now. the real economy, after inflation economy slow down for income, sales and so for. the nominal economy is exceptionally strong, the print headline growth of income or

sales looks great. so inflation is back in the short-term basis but back and affecting everything. we fail 26.9% from december high inflation adjusted to the juno. the average decline leaving into recession since world war ii in real terms for the s&p 500 is only 31.1% so we came close to that. the question is the recession. typically the market bottoms into a recession and of course then declared after-the-fact. but as i said i think it is a slowdown causing you to go to the low which is what 31.1% would be. that would be back to the low and nominal terms at 36.66, but that is not our view at this point. >> it sounds to me after all of that, and are you prohibiting people from saying there will not be new lows? after it is all said and done you don't

expect it and you expect a slowdown so therefore you don't expect us to revisit to have the new lows? not to put words in your mouth but is that what you're saying? >> no. deep in mind what you are saying is kind of what i am hearing a lot of saying we have very washed out investor sentiment surveys. only three lows with the american association of investors. only three lows in 40 years and we just have one of the other three. the other two were tremendous buying opportunities. the futures is positioning, incredibly bearish. everybody is on one side of the trade with rumors and the fact is we are on the other side of the trade. >> that is what i will take away from it. it sounds to me like you're not one of the people that think this is a snapback rally only to resolve itself with the 40

on or a washout ending in october that could be at 3200. that does not sound like your forecast. did i get that right but we have to go in five seconds. >> we are going to go 4200 and possibly 4300 led by growth. >> fantastic and thank you, berry bannon. it's also good to have you on, this morning steve. up 75 point and we will see where it stands at the open. that will do it for us today and this week. have a great weekend, everybody. right now it is time for squawk on discrete street. it is friday morning and welcome to squawk on the street. >> let's take a look at the futures this morning. we kind of see a mix bag but of course