sarah will certainly be talking about that we'll see how parks look, see how the current quarter is going. maybe we'll get updates there. direct to consumer is still a key, 230 million, 260 million subs is what they say they'll reach by the end of 2024 will they continue the pace needed for that is one key question that's going to do it for us on "squawk on the street. "techcheck" starts now >> good wednesday morning, welcome to "techcheck," i'm deirdre bosa in san francisco with jort. carl has the day off this hour plus more on this morning's big moves, roblox gets a reality check. coinbase disappoints even as shares are moving higher and finally getting more bullish on meta why one big name likes it over alphabet we've got a huge show ahead. >> we'll talk a lot of things

from the metaverse to crypto, this virtual stuff we'll get a reality check, first roblox seeing a slump this quarter as shares fall after results that disappointed, showed a decrease in daily active users unity, another metaverse name also missing estimates by a wide margin all these results suggest demand for virtual world and virtual currencies is falling. bitcoin is down more than 20% since april. coin base this morning reported a fall in active users similar to roblox along with more than a billion dollars in losses. dee, my question, and we'll get to rahul sut, roblox is trading i think between nine and ten times revenue. it's got this 26 billionish market cap which suggests it's a platform and not a game, right i'm not convinced yet that this

is a platform, that this is scaleable to the degree that tools are scaleable. >> john, i'm so glad you bring this up. i wanted to get your take on this, ever since i read this line in the earnings transcript. the ceo, and i quote him he said we're not even really a gaming platform, to your point he said we're a future human co-experience platform is that another way of saying metaverse? i need to know your thoughts on this >> well, if we're to take what he's saying at face value, it seems to me he's making an argument they're more like what xbox live is, right? that's a platform for playing all kinds of games it's an environment where people who enter it have different types of options their currencies that they can spend, potentially community and viral effects. right now this looks more like minecraft than it does like xbox live it's a game, a very popular game with an economy inside it.

and we can argue about the degrees to which that economy just within that game can scale. unless they can buy other things and expand that ecosystem into other games across our brands, not just inside roblox, i'm not sure how long this scales. >> you're not buying it. they have had concerts i thought one of the most interesting things is that the rule of luxury brands. we know that free to play is maybe less recession proof than some of the others, than an xbox live however gucci town, tommy hilfiger town, those are some of the games within the game that the ceo, that the company called out as being points of strength. so in that point, do you buy it could be a platform, there's a luxury side of it, a side that is more vulnerable, perhaps, to a slowdown >> no, i don't yet i don't yet. this is a lot about what zynga used to say, they have an infin nat gaming possibility because

they discovered mobil. it worked for a while until it didn't >> they're going for the older demographic. >> let's bring rahul into this conversation irreverent labs co-founder recentry raising a 40 million series a led by horowitz you've been in the gaming pc seat, you're at microsoft where they've got xbox which i was mentioning the question is whether roblox is a platform or just a really successful game with an economy inside it. >> i think your assessment is probably more correct, that it is more of a game that's trying to be a platform the thing about roblox is, it caters to a much younger demographic. unless -- if you think about the pandemic, kids weren't in

school they were able to sort of spend money on games that parents wanted kids out of their hair. they had a massive spike during the pandemic lots of little games were being played and built on roblox unless they completely expand their demographic somehow, i don't see 5, 6-year-olds, 10-year-olds buying gucci. it's cool as a story, but they have to expand their demographic or make new acquisitions in the space to really think about down the road how do they turn this into new mixed reality experiences. there is potentially a future will. >> there's some signs they could be doing that in the sense that -- forget whether it was median or average age of a use did move up above -- more users over 13 years old. their user base isn't growing that much. you don't know if that's younger people leaving or older people coming in more what's also interesting about this space to me is you take roblox's market cap. it's almost -- you put app lovin

and unit together, smaller than those two together they're doing tools. they are doing -- working on platforms that are seeking to sort of engage this whole ecosystem, potentially metaverse and mobil gamers should -- do you think unity should combine with app lovin or is iron source a better bet? >> personally i think iron source is a better bet i didn't realize app lovin had 17 billion to acquire unit i guess they don't because they want to do an all stock transaction. i think they should do a deal with iron source at the end of the day you're absolutely right, unit is building tools there's two choices in engines for game developers. it's unity or unreal unity has a great 3d engine. we're building on unit we think that they have -- they

are enabling sort of the future of this space in a way that other companies can't. so, yeah, i feel unity should finish the deal with ironsource and get it done. >> rahul, gaming is more recession proof or recession resistant, that's being turned on its head over the last few weeks. the result from chip makers to gaming consoles to video game publishers, what do you make of that has that argument changed because we see more mobil games in this ecosystem? >> i think it's just temporary everything is down basically the markets are generally down i think a lot of companies are kind of cutting costs ahead of the consumer because of this -- because of inflation and because of the way the markets are but to us the future of entertainment is these mixed reality gaming experiences i think gaming is going to be --

gaming and entertainment is the place where everything looks -- where players will have ownership in the game, players will have emotional connections to the characters that they own and play, artificial intelligence is going to play a huge role in the space, and i think the key to unlocking this metaverse -- i know metaverse is thrown out quite a bit we fundamentally agree to it the key to unlocking it is to make it an all-day effortless experience vr is cool, but it's very short term it's fun for like an hour at the most and then you get kind of a headache i think the mixed reality experiences with gloss is huge meta's vision for where it can go is great. it might be too far down the road, but this is exactly where things need to converge is in these mixed reality experiences. >> do youthink we're too early do you think that thesis is intact that gaming is recession proof? what are we seeing now what do you attribute it to?

>> gaming is absolutely recession proof. i'm been a gamer my entire careerment when the markets are down, people play games. when the markets are up, people play games gaming is definitely recession proof. you have to look at the infrastructure around gaming and the metaverse. if you ask about, are we too early, i think meta is probably -- probably came in a little early with their vision and now they have to convince investors that this is the right path for them. but i would look at things like amazon, unity, epic, microsoft, apple, alphabet, nvidia, amd, ibm, even c3ai, machine learning type of stuff. >> let's go back to unity/ironsource which is the combination you favor wii i view as an adobe-esque attempt to combine tools and data but for the next generation of this space. if that is the right idea, whose hand gets forced by that

combination and app lovin pution itself in play is it an adobe microsoft is busy, right, trying to do the activation/blizzard acquisition. what other players might get forced to get into the m&a game if that's the right move to make. >> microsoft might be busy, but they're huge microsoft can still do a deal in this space if they want to they're already building tools on cloud for companies like unity, like i think unity recently announced a deal with microsoft and azure. who do i think is going to force their hand if anything, i think what will happen next is unity will start looking at how do we take the data that we're building and gathering and applying machine learning to it and not even just the data, but being able to apply machine learning to automate the creation of these objects. so, for example, if you're an artist and creating characters, imagine being able to take the 3d art and putting it to a

pipeline and having it jump right from unity to blender using machine learning that's kind of the future where they kind of automate that work and make the job for the artist or the creator much easier. >> unless you ear an artist, you have a hard time imagining exactly what you just said, but we get the idea. rahul, thank you that sort of inside perspective on how it needs to work is so important. rahul sood. >> thank you meanwhile, session highs the dow is up about 570 points coinbase recovering all its premarket losses amid the broader rally this morning especially intact. the quarter was ugly, serkd one of consecutive losses. kate rooney with more on that. kate, i've been looking over the last month shares are up nearly 50% investors are really focused on what's ahead. >> absolutely. you kind of see that data in realtime it's easy to forecast the trading revenue that really was expected the billion dollar loss for

coinbase was bigger than investors anticipated. it was a profitable company just a year ago revenue still very much tied to crypto trading, down 64% in a year and also lowered guidance for users and warned of slower trading volume and revenue per user to come i sat down with cfo alicia haas. she said they're cutting operating experiences but still planned to spend for growth and potential m&a. >> we want to do crucial spend we want to be rational and a proper amount, vis-a-vis, the capital resources we have. >> investors have worried as well about pressure on coinbase's margins with more competition out there. she said growing revenue to things like staking and nfts should help, but no changes on fees yet. >> we have not seen the need to lower fees on the retail side over the last three-quarters we are constantly running pricing experiments and looking

at price elasticity. we don't see fee being the driving factor for retail products right now. >> regulation is also a big theme for coinbase and an overhang on the stock according to haas. she says uncertainty is keeping institutional money on the sidelines and casting a shadow on coinbase as well as the industry guys >> a couple interesting things she said, okay with burning money in the short term. no need to lower fees, that's interesting. why wouldn't someone switch to an ftx or binance that have eliminated fees or are going to? >> she says that's inevitable in the long term. there will be fee compression like we've seen play out in stocks she said in the near term they're not going to lower fees. long term they'll face the pressure she admitted we'll likely have to lower fees. it's just not there yet. with all the competition out there, the fees are lower on the institutional side for retail 2%, for institution, only a couple basis points they've already gotten on the

institutional side but the pressure and competition is picking up. >> kate, we'll talk about this more our next guest didn't expect the company to post favable second quarter results, he did open a catalyst watch on the results. joining us now, citi analyst pete christiansen. i don't want to get too technical or in the weeds, that focus on staking ahead of the ethereum merge, it would be very early here, versus being late to another businesslike nfts for example. how long would investors have to wait for that? what would it do to revenue and the bottom line? >> yeah, sure. thanks for having me great to be here first we need to find out exactly when the merger is going to happen. a lot of progress has gotten there recently in the next week or two we'll get news on when the actual merge date will occur. i think the soft date is set for september 19th

hopefully we'll hit around that area as for the revenue opportunity for coinbase, they certainly take a commission as a validating service in staking protocols. so that's clearly an upside opportunity there. currently they stake i think six or seven currencies. they launched core dana in march and recently solano. that's a big part of the reason why you're seeing growth in the subscription and services line eegt thunderstorm will be a much larger contributor in our view we'll have to wait to see what the initial yields are and how that attracts users. we do think it's a meaningful upside opportunity for them down the road >> maybe further down the road i wonder in the near term, when you take a look at wha they're doing, they're being very aggressive in terms of their investments and deal activity.

the cfo of coinbase told our kate rooney that they're okay with burning cash now, still in growth mode, investment mode should they be more aggressive do they stand to fall behind if they're making bigger moves, especially if everyone is trying to set up for the next crypto boom if there is one >> i think spending up to $4.2 billion in opex, scaling up the business head count is pretty aggr aggressive, but what coinbase i think played a fine line last night, being able to prudently manage the business in a rougher period, but at the same time scaling for their top five priorities some of those -- one of those priorities is being the number one staking service provider out there. we think they certainly have the capability to do so. >> pete, thanks so much for your insights we continue to watch coin which

is up 6% in today's session. talk to you soon pete christiansen. >> thank you. elon musk sending more tesla shares after he implied he wouldn't, but he kind of needed to what that means for twitter next plus, rare name in the red today. more on the quarter sending akamai shares lower with ceo tom layton "techcheck" is just getting started.

let's get a get chuck on tesla. the stock is on the rise this morning, up about 2% it's underperforming the broader markets, especially tech if you're trying to do the math, the move nets him nearly $7 billion, though musk did take to twitter to explain that he offloaded the shares in case twitter forces the deal to close or equity partners back out. some pointed to the news as a positive sign for twitter. web bush raising the price target saying there's even a higher chance the deal closes. could be a settlement as well. the big question, what happens to twitter after all this is done in either scenario?

>> either way he's acknowledging the possibility of defeat. he's got to hedge against that possibility. we'll see if they agree to that debate let's turn to cybersecurity and the data security, akamai posting a business on the q3 guide lowering the outlook for the rest of the year joining us co-founder and ceo dr. tom leighton welcome. it seems like part of the message here is that the inflation effect on your revenue and the headwinds there and just everything that's happening to slow the economy is perhaps also slowing some of the data flows that feed into your business >> that's right. foreign exchange isn't helping either about half our revenue is from overseas we're really seeing the impact in our media verticals, e gaming, less traffic there video, opt, even advertising

have been impacted traffic is up year over year, but not nearly as much as it normally would be. so that's got a near term dampening of our revenue growth. we were pleased with q2 results, grew revenue 9%. really excited about security and compute. that's now the majority of our business people think of us as the cdn company with traffic but the majority is security and compute. >> how is that affecting your approach to capx you talk in the call about really cost controls you're working on including spending less capx-wise what specifically are you spending less on, and how are you prioritizing things that are going to result in higher margins? >> we've been shifting focus on investment towards security, especially in zero trust where we have the market leading solution to stop ransomware and

towards compute. we're saving a lot on capx because we're deploying lesser veries for delivery, especially the peak events where you spend a lot to build out the capacity. the revenue is not that much there. you see that in our results, a little less revenue, but much -- very strong cash flows because of the savings on capx. >> what's that do for your relationship with data center providers? do you needless from them for the foreseeable future going forward? you talked about some of these economic impacts lasting several quarters >> yeah. we're still growing and still investing in the platform, of course, but not at the rate that we were before so the capx is much lower than we'd anticipated historically, capx would be 8%, 10% of revenue when we were 3% last quarter we think it will be low to mid-single digits for the foreseeable future so we're adapting to what's going on out there and really excited about the future and

security in compute where there's tremendous growth potential. >> jim chenos take note with his data center thesis i want to finally ask about the workforce. are you slowing hiring, freezing hiring are you cut? are you still hiring are you maybe hiring gangbusters in the security area that you're excited about? >> we are continuing to hire we're not freezing or doing a rif. we've been very disciplined in the hiring over the last couple years. some companies sort of went through a boom and now a bit of a bust there we've been steady, and obviously focused in security and in compute with the lenode acquisition, really puts us in a great position to tap into an enormous compute market. we were really excited to sign up our first major cust were with a critical app, the app worth millions of dollars a year

as it scales that's the type of the iceberg. >> tom leighton, ceo of akamai, thank you. zscaler at the top of the list with gains of 8%. docusign, data dog, crowd strike and meta which we'll talk about later. plus what this morning's inflation rate means for tech oc at bk in a moment. e in order to thrive in an ever-changing market. the right relationship with a bank who understands your industry, as well as the local markets where you do business, can help lay a solid foundation for the future. pnc provides the resources of one of the nation's largest banks and local leaders with a focus on customized insights to help your business achieve its goals. that's how we make a difference. ♪♪

tonight the latest on the fbi's search of former president trump's home plus, there aren't enough teachers some states are getting creative welcome back to "techcheck." i'm deirdre bosa with jon fortt and julia boorstin half past the hour, the dow is up nearly 5% nasdaq up 2.5% after the better-than-expected inflation numbers. the growth trade on fire this morning. more on the media outlook after a slew of bad reports. disney results tonight, chairman of sony pictures will join us to discuss it all in just a moment. first, a news update let's get to christina >> good morning.

here is what's happening at this hour prices that consumers pay for a variety of goods and services rose 8.5% in july from a year ago. that's less than expected and less than june's increase due to a drop in gas prices shelter costs make up about one-third of the cpi are up 5.7% over the last 12 months. nikola announcing mark russell will retired, replaced by michael lohscheller who joined back in february archer aviation incorporation announcing a $10 million predelivery payment from united for 100 electric vertical take off and landing aircraft this technology could help the carrier reach carbon neutral targets while also helping aid consumers with commutes across the globe. mike, jon, whoever is there.

>> i'm here. >> it sathe markets reacting, t nasdaq up more than 2% i mike santoli, what's going on? it looks like a lot of speculative names in tech, affirm, asana, bill.com, up double digits. >> pretty strong wave. those are the stocks that do get washed hirer if, in fact, what we're seeing is a little more evidence that it was peak inflation, perhaps peak bond yields, perhaps peak fed hawkishness. arguably it means there's now support for higher valuation

stocks interesting spot, it's taken the nasdaq 100 to right now. it's been making progress since mid june if you go from the january peak, it shows this is kind of making a bit to reverse this trend line that's been lower for a while. it takes some proving here that's where we've now gotten to it's been the outperformer take a look at the nasdaq 100. relative to the kinds of stocks that benefit from a high inflation environment. this is over the current quarter. so quarter to date, since june 30th, you see massive out performance by those disinflationary growth names that drive the nasdaq 100. that being said, our one-year base, year-to-date basis, these are almost about flat year-to-date which is massively out performing the broader market progress but maybe not final proof that we're where we want

to get to. >> big debate over whether we bottomed or not. the arc innovation etf up 5% today, 26% since the quarter began. what's that telling us about the trade. >> when you do have a little bit of a flush into riskier assets, the riskiest ones, the lowest financial quality or lowest earnings power, they're going to move the fastest it's just the way these dynamics work, one of these rallies will probably be the real one i wouldn't necessarily look to rewind the script and say we're going to have the kind of leadership from that category of stocks any time soon, but on a day like today when really what's going on is a massive tension release, those are the ones that are going to get the most benefit in the short term >> mike frrks what you can tell, the conversations you're having, what is priced in with the indices at these levels?

when we talk about soft landing, we mean slowing the economy without having a recession really when we talk about a mild recession, that's just one where i mean markets sometimes perform pretty well in mild recession. is this a mild recession being priced in here and not a serious one, or is it a soft landing >> i think it probably is more priced for some version of a soft landing now, we can talk about negative gdp. we got two quarters of them. if you want to call that a recession despite what the normal definition is, fine what i think the market is pricing in, corporate earnings that more or less hold at the currently projected levels in other words, that companies don't actually start to suffer, have top line growth go down across the board, have their margins compressed a lot that means 2023 earnings forecasts are way too high i think the market is now saying maybe they're not way too high maybe they're normally high the

way they always are in the typical start of a year and get whittled a little ower we're not really cheap based on the current outlook, but certainly at a reasonable value compared to where we were six months ago if the earnings hold together. >> mike, thank you speaking of earnings, for media names this season, it's been mixed we'll talk about what to expect from disney tonight after we sit down with chairman of sony pictures that's up next new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today. and it's easier than ever to get your projects done right. with angi, you can connect with and see ratings and reviews. and when you book and pay throug you're covered by our happiness check out angi.com today. angi... and done.

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welcome back will it be the happiest earnings on earth let's talk about disney. earnings are after the bell, the last of the media giants to report in q2 we'll be watching streaming subs, parks, potential new details on sports rights deals julia boorstin is here to help us break it down people are getting out again that's good for parks. streaming is taking a turn >> that's the real question here disney is expected to grow both revenue and earnings by over 20%. so showing meaningful growth over last year, and a lot of that growth is expected to come from the parks division. jon, we know this is a stock likely to move not just on streaming but also the outlook for streaming. the company is expected to add about 10 million subs for its disney plus streamingservice

deirdre, the question that i'm going to be most focused on perhaps is whether or not they reiterate their long-term guidance for their streaming goals because this is a company that has pivoted so much to focus on streaming what will they tell us about how they're bundling of hully plus, espn plus, disney plus is all working and what's their outlook? >> that target, 230, 260 million subscribers by 2024, time is sort of running on that clock. i was listening to jim cramer and david favor this morning talking about what they should be focused on. they said they shouldn't be talking about streaming at all and put the focus on parks to show they're not in that streaming category necessarily, or at least the focus, that they have this other hedge that a lot of other streamers don't have. what do you think they're going to do? >> look, i think this is really a very diversified business. the question, though, is whether each of the different pieces of the business are, in fact, going

to be impacted by all this economic uncertainty yes, i think you're right. i think the marks is a major growth driver. i suspect because of the focus of analysts and investors in this future of streaming, they will be talking a lot about streaming. of course, remember that they announced that they were going to be introducing an ad-supported service, something that netflix is also working on. we'll see how that fits into things and also their streaming bundle then, of course, there's also this advertising piece of the puzzle here. disney is exposed to advertising, not only because of their new disney plus streaming service in the works, but on their linear networks as well. that's going to be an interesting thing to watch so many of these other media companies have talked about an overall pullback in advertising that they're reckoning with. this gives us a great opportunity now to dive deeper into the media landscape with a perfect guest who has quite a perspective on it. sony pictures entertainment chairman and ceo

tony, thanks for talking with us today. >> hey, julia. great to be with you >> tony, last week sony reported better-than-expected results particularly in your division, in the entertainment division. talk to us about what's driving this upside? >> we restructured the company about five years ago and really focused it on responding to how our customers are looking to do business with us we didn't jump into the general entertainment subscription video business, and we became, for lack of a better term, the arms dealer for the industry. it's paid off really, really well last year, our fiscal year which ended in march, we were up 75% in operating profit. we started out this year, the first quarter up 70% it's a very, very broad-based business now we've added anime. we have a big india business which we're now waiting for

regulatory approval to make it even bigger -- have an even bigger presence in india we're firing on all cylinders. >> so, tony, i want to talk to you about this strategy of being the arms dealer. it's been very effective when all of the other media companies have been expanding and investing so much. but now you have netflix talking about being more conservative. you have warner brothers who would be buyer for their streaming services the fact that so many players are pulling back their spending. how problematic is that going to be for you >> i don't think at all. we've expanded over the past few years. while the streaming services have said -- still battle every

day trying to get subscribers for those services you mentioned what disney is looking the do, and the streaming business to expand netflix, while they had a rough time recently. now judged as a media company as opposed to a tech company. i think that's very good for the business they're now operating as a media. they said they're not going to cut expenditures on premium product. we are a premium provider for t them, hbo, i'm not sure where that's going to go we only have one show on hbo actually we had 100% rating for consumers and they just canceled it. we're not all that concerned about it those services are going to continue to compete. while this is all going on, we're expanding our base of business in a very, very

aggressive way. >> what do you make of netflix -- what is it going to do to the overall landscape and where consumers are spending their money and time. >> you may recall -- hulu, we launched as an ad-supported business and then went to subscription those businesses operate very, very well together, very complimentary fashion. i think both of them will do well they'll expand their base of subscribers. that will help us as our colloquial term of being an arms dealer it will help us in our development as well. i think it's great they will need to renegotiate some of the deals they have for programming, of course, in order to be able to put advertising into those programs. >> so that renegotiation, does that mean more revenue for you down the line? how would you say that's going to play out in terms of the potential -- >> in a single word, yes

there will be a positive for us. >> and then just a question about the theatrical movie business obviously the numbers are way up this summer from last summer as people get more out and about. long term there's still these questions about windowing, how long movies should be in theaters before they're available at home and also whether we're going to see fewer movies released because maybe audiences are expecting the bigger movies. if you were bigger-budget movies, what's your expectation based on what you've seen with films such as "bullet train. >> you and i have talked about it for the last four or five years, and we're very bullish on theatrical business. this summer has been a testing ground we released "where the craw dad sings" and "bullet train," both originals. both have been very successful for us

gotten us off to a great start in the second quarter. i have no doubts that the theatrical business will be just as it always was, a risky business, one we're very comfortable with, one we know very well and one that we'll be successful with, not a big concern on our part. >> well, we appreciate you joining us today to talk about your quarterly results and what's ahead for this very complex and fast-changing media industry tony, thank you. >> great to be with you. >> julia, thank you for bringing that to us i haven't seen either of those movies i did go to the theater for "top gun: maverick. more on why roblox shares are falling, plus a check on advertising. one name in the space shows no signs of a slowdown. bank of america picks meta over google don't go away. policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. we thought we had planned carefully for our retirement. but we quickly

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video game companies saw huge gains during the pandemic the growth is coming to a halt or slowing steve kovach joins us with more. we've heard from roblox. they say gaming is still recession proof despite some data points to the contrary. >> yeah, that's right, dee some of their peers are saying different things gaming companies are warning of tough time ahead after a dismal second quarter for the industry.

video game spending falling 13% in the second quarter. and that showed up in the results from companies like take two interactive and activation it could get worse gaming is not recession proof saying people will spend money on food and gas before video games. take two and others providing disappointing guidance for the rest of the year it's not just the drop in spending either. these companies do a lot of business in europe and asia where foreign exchange headwinds are the worst. roblox planning way to diversify revenue selling digital items to players. the ceo saying just this morning the company will launch a metaverse advertising platform this year. they'll also have to prove the tough comparisons from covid we heard from nvidia earlier this week and other hardware makers like nintendo reporting disappointing results, guys. >> steve, what does this mean

for christmas, particularly when it comes to consoles and the game sales that often come off of that. that's several months out but critical for this industry. >> yeah, john. they're going to bepushing their subscription services. this is the xbox game plas whict an internet connection sony has their own version, which basically these subscription services give you access to libraries of hundreds of dozens of games they'll push that and there are huge releases coming out this year, jon, that will drive people to spend more on games. >> all right thank you. moffett nathanson taking roku back down to underperform, and pointing to the same reasons they downgraded the name last november high competition, high costs and the stock's 20-plus percent rise off the close. more market action after the break.

let's get a gut check on a name doing well in digital advertising. julia boorstin has that for us. >> jon, check out this move for trade desk shares surging after better than expected results with guidance coming in above the consensus. that stock up 34%. the companies saying they're confident they can gave market share in any economic environment based on these

results. oppenheimer raising its price target to $78 a share, calling the name, quote, the clear softer leader in digital advertising. those shares are up nearly 35% >> let's take a look now at two mega cap names for our latest edition of overvalued/undervalued alphabet off ideas list and adding meta. facebook has lost roughly half its value year-to-date there's also this question of free cash flow this is a very important metric for value investors even after sinking billions into the metaverse. as of this past quarter, meta trades half cash-to-price ratio. jon, a lower ratio means that it is more undervalued. and it is kind of interesting because both of these companies are pouring a lot of money into future investments

we know that very well about meta, that it's pouring billions into the metaverse still, good free cash flow for a value investor. >> i'll continue to say it, a not convinced yet that meta's model is irrevocably users growing in some of the products in their portfolio and the massive data access. they have trouble with targeting, the trade desk is doing well despite that. you know, if you think that meta -- facebook, instagram, primarily, and then some other stuff, too, if you think that they have the capacity, that mark zuckerberg isn't giving up, they have the capacity to figure this out, yes, relative to some other things out there, this is cheaper. >> jon, is that optimism on the metaverse i'm hearing from you -- >> no. >> or are you just talking about the ad business? >> i'm talking about actual

business in the real world that makes money. >> i thought i saw a hint there. >> no. again, it's not that i don't believe any piece of this metaverse stuff. we've been talking about unity and iron source and app loving and the idea there's an economy, there's fintech around digital goods and ee merss ive environments sure this idea we'll all be spending time in "ready player one," i don't buy it >> scary thought. one rare name in the red today, online retailer, the realreal, a forecast cut hitting things there raising a real question for other beaten down competitors like stitchfix and poshmark.

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one more thing before we hand it off. a major change in the long-standing softbank partnership with alibaba they will no longer buy back shares and derivative deals. they allowed it to raise cash while having the option to buy back baba shares now softbank is giving up that

right. and they call it definitive step back from a 22-year-old bet on which masayoshi son built his name what is the next baba, that's the big question here? >> he can't stay away. with the nasdaq at session highs up 2.7%, s&p up 2% that will do it. "halftime" starts now. thanks, jon. welcome to the "halftime report," i'm frank holland in for scott wapner key inflation lighter than expected what does it mean for the fed's next rate hike we'll discuss that and much with karen fire stone, jason snipe and on set, jim leeben that will, joe terranova. first, let's begin with a check on the rally at this hour. stocpi