get bank earnings tomorrow morning. treasury yields came off pretty aggressively on the heels of that cpi report. something to keep an eye on, too. the ten-year back towards maybe a one-month low on the yield >> yeah, and we will be right here tomorrow with those bank earnings as morgan just said that going to do it for "squawk on the street. "tech check" starts now. >> good thursday morning welcome to "tech check." i'm carl quintanilla with deirdre bosa and jon fortt today, proxies, outperformance nelson peltz wants to restore the magic to disney. later, cpi prints in line with estimates, and growth stocks to consider this morning. we'll talk to the ceo of one of those names, box, the rare tech outperformer in 2020 with aaron levie joining us on set. >> let's get a quick check on markets, coming right in line with expectations, and we're off highs. the nasdaq is underperformer,

giving back some gains from the beginning of the year, down about .4%. the dow industrial up about 90 points energy and communication services are leading health care is your laggard. within communication services, guess who, disney taking the reign, seeing a 3% gain. what a good interview with nelson peltz >> disney having a good day. having a great start to the year as well. stock's having one of the second best performer stocks so far this year. the three-year down 50 pest from the all-time high in march of 2021 in fact, it's back below where it was pre-pandemic and a big part of that drop was due to the latest quarter, far from a fairy tale as streaming costs mounted. it led nelson peltz to try to launch a proxy fight with the company after disney opposed his attempt to try to join the board board yesterday. they build up a stake in early

november before iger took the reins as ceo pelts was on "squawk on the street" this morning talking about what his goal is for the company. >> my goal is to reduce corporate overhead to a point that the company gets better i would like to see this company stop running like a matrix and start running like the companies we have been involved in, where they have real ceos of businesses with real pnls, real cash flows, and real projections. i know it's hard in the movie business, but it's not that hard in the streaming business. okay and they have got to be able to do that. >> this is now the second battle with an activist investor that disney has faced in the last year the company engaged with dan lobe's third point in november disney eventually reached a deal with him no mention of espn in peltz's

presentation, although he does say you have to have hulu. overearning on parks, and that's been masking a lot of losses in dtc, and then he argues overpaying for fox assets. >> yeah, this is, i mean, first of all, i think nelson peltz makes a lot of great points here and the argument is that disney is sort of a version of the story in tech, there was too much growth at all cost. the growth top line was great. the cost discipline was not, and you have to look under the cover, and this comes down, i think, also to streaming if disney stops trying to outnetflix netflix, and peltz is arguing they weren't really doing that on the cost side, what is the strategy can they be disciplined enough on the cost side to get a benefit out of streaming, especially if they have to buy hulu from comcast? then they have to be extra tight on making sure they execute with cost discipline.

>> mr. peltz kept bringing it back to total shareholder return that's a simple chart, one we have been looking at for many months, many years he's not looking to replace bob iger but when david faber pointed out iger is seen on wall street as one of the great ceos, why wouldn't he have confidence in him, peltz pointed back to toter shareholder return, asking how can you be one of the great ceos of our generation and underperform in terms of this metric so badly? when you look at this chart, look at that middle bar, very important. that's the company's proxy peers. that is not selected by peltz, it is selected by disney itself. it includes comcast, at&t, alphabet, amazon so jon, in a way, this really kind of proves nelson peltz's point and maybe begs the question, which i know some don't even want to intertate, is bob iger one of the great ceos >> great at what i think is the question let's dive deeper into the proxy

battle and what might happen next bring in niems columnist jim stewart who wrote the book on disney jim, now that we have had a chance to see nelson peltz's at least initial argument, to me it seems like the biggest issue is rethinking the reason for streaming and the profitability of it, especially if disney buys hulu, and making the case that iger for all that he's been great at wasn't great at cost discipline, and even though he thought he wasn't paid enough, peltz arguing he was overpaid. >> well, a couple things here. i had to smile when i heard nelson peltz say i know the movie business is different, but streaming, we can really make that efficient and cut costs and increase profitability i'm thinking good luck with that so much money is being lost in streaming. if he can solve that problem, then he really is a genius and going to the iger question, that proxy statement he filed is

so interesting i call it in terms of iger, the iron fist inside the velvet glove. while he's sort of saying, oh, we support iger, we don't want to replace him, is filled with criticism of iger in there starting with the acquisition of fox. i mean, putting aside whether that was a good deal or not, i think peltz makes some good points about it, nevertheless, that's water under the bridge. that was iger's project, his deal when you attack the fox acquisition, you are attacking iger that is not a flattering proxy statement for iger and i can understand why iger would bristle at the idea of bringing peltz on the board given the criticism he was leveling at iger >> it sure seemed like disney's board in part brought iger back to avoid having to deal with activists, with the idea that iger has such credibility that this would calm everybody down that doesn't seem to be happening. so if peltz does get on disney's

board, does that support the idea that there might be pressure for iger to make this two-year tenure an actual two-year tenure and for this board to get some more discipline around ceo succession >> absolutely. i don't think there's any question that a glaring efficiency of the disney board has been succession planning going back to naming chapek, which i don't think has really been satisfactorily explained why they picked him and two years later they felt like they had to get rid of him. the sequence of events in the proxy suggest that peltz's conversations, first he's talking to chapek, and then chapek says you can't talk to me and then a few days later, chapek is out. what role diz the pressure from peltz have in that decision? putting that aside, which i think is a very important question for people getting ready to vote in this proxy fight, the issue is to me, is

he's cutting iger off. he's saying, this is it for iger he's going to get two years. two years is not that long in that business to turn around an aircraft carrier like disney, and he's saying no, we're going to get him out and somebody else in again, that is not very supportive of iger >> which is what iger said he wants as well, but there's all sorts of questions as to who picks up the baton after that. i looked at total shareholder return jon pointed out that's one metric you take net income, that's increased 400% over bob iger's reign when he departed and that is, you know, that's a good metric. a successful one, i think many shareholders would argue he's slammed for the fox deal, but there's also really good acquisitions along the way as well or successful, i suppose. p pixar, lucas films, marvel how do you put that into the judgment of what he's done or

hasn't done? >> iger does have a fuphenomenal track record looking over his tenure and successful acquisitions there were plenty people at the time who thought he was overpaying for pixar and marvel and those paid off well. i do think the jury is out on fox. those previous acquisitions were for intellectual property and they got tremendous assets there. in fox, what do they get avatar i mean, you know, if avatar clears $2 billion, it's kind of going to break even. i don't know the jury is still very much out on that. they didn't get that much intellectual property in the fox deal putting that aside, what peltz is going to have to deal with, which i don't think you can blame iger or anyone else for this, is this sort of secular issue facing the business. first of all, the transition to streaming, which by the way, you can't measure by the stock price because until investors suddenly change their minds this year, they were giving the benefit of the doubt to streamers

all they wanted was subscriber growth and that strategy needed investor acceptance for many years of losses until these streaming companies achieve some kind of stability and perhaps dominance. and that's not happening and you've got a slowdown in digital spending that's another big issue the espn problems. those are problems that go beyond any one individual. >> right and then he spoke about parks, though, saying that maybe they're overreaching there and there's a lot of profit coming out of that area that should maybe help pay for some of the others. what do you think index funds are going to do here criticism of fox is criticism of iger he says he doesn't want iger out, but do you think shareholers should believe that. i know he's throwing shade in other ways as well, the whole yacht comment. >>that was a completely gratuitous comment in there. you know, it showed iger floating around on his yacht when disney -- in new zealand of

all places, pelts did not need to put that in the proxy statement. i think it speaks volumes even though it's a small detail i think shareholders, i mean, the big shareholders, they like it i can understand why the stock is up. i mean, a healthy debate about what's going on at disney and pressure on that board, particularly over the succession issue, which they have flubbed recently, is very positive i don't see any downside for shareholders in that >> which makes me ask, jim, i'm glad we have you on disney, with or without the influence of peltz and trian now, what do you think will be iger's biggest strategic move in the coming, say, 12 months is it going to be about a reset on direct to consumer expectations or something regarding espn or hulu or some combination of all of those things? >> i think he needs to confront and then address a clear strategy for the whole streaming thing. that includes what is the future

in disney plus, where does it fit in to the streaming ecosystem and how is it going to coexist with hulu. i mean, the hulu question, you know, people say, well, should they sell hulu i don't think they can do that they own two-thirds of it and they don't want to krcreate a significant additional comp competitor, but they need to come up with a strategy and articulate it. the old strategy, which was we will spend whatever it takes, we will grow subscribers even if we're not getting much revenue from them and some day we'll dominate and raise prices. that's not working anymore investors are not accepting that and the timeframe there has shrunk considerably and iger has to confront that >> a remarkable turn, as you say, jim, from where we were say even six months ago. we'll see what happens continue to talk about it with you. good to see you, thanks. >> good to see you, too. >> and coming up on the show, what is happening with the mega

cap meltdown, what today's cpi numbers mean for tech's biggest players, plus the other cpi. we'll explain that "tech check" is back in a moment i count on personalized financial advice from my ameriprise advisor. she knows my goals and can help me reach them with confidence. the markets may fluctuate but you're still on track. more than 9 out of 10 clients are likely to recommend us. ameriprise financial.

let's dive into this morning's cpi number. a big test for mega cap, all those naks that took a hit last year prices in december falling in line with expectations what's the read through for some of the sector's biggest names? will this year's outperformance continue let's bring in cnbc contradibutr tony, good to see you. i wonder how much you think the market priced in the number today? >> big swings this morning the nasdaq 100 down over 1% right now, relatively flat here. i think there was a lot of optimism going into this number and which is why i think even though the number came out better than expected, we're still flat on the day. that speaks to the fact there's not too much upside in the mega cap names as far as tech goes. i think if you break down the mega cap names, there are a few

that seem a little more interesting, at least to me. i think both on the valuation side if you look at meta trading at about 15 times forward earnings you're starting to get to valuation numbers that look fairly attractive. most of the mega cap tech names are not near those types of valuations the other one that does look interesting to me right now here is really microsoft. microsoft and meta microsoft more so from the perspective of i think they have a solid business that's going to be able to ride through what could be a recessionary environment here in 2023 and meta more so from a valuation perspective. >> right on microsoft, you push back on the notion that if companies do embark in serious head count reduction that azure seat count does take a hit? >> certainly, absolutely, but i think you also have to think about the upside here, especially going into a recessionary environment a lot of companies trying to reduce head count. thinking about azure and automation, that's where microsoft plays in that particular space i think there's potential upside

as well in this type of environment as everyone is trying to protect margins, that microsoft could be a potential beneficiary as a result of that. alphabet falls in that category as well as we start to look at automation that's the side effect of cost cutting and laying off head count is the fact that you have to still be productive and some of these technology companies power that productivity and so from my perspective, i think they do kind of have a bit of a hedge against that as well >> as you watch alphabet and we sort of are in this moment of not knowing whether we're heading for a soft or a hard landing, is the market crying out for cost reduction or do they want to sort of hedge their bets and see how it plays out from a macro basis >> if you look at the reduction in head count from these major tech names over the past couple months, it speaks to the fact that investors are concerned about protecting margins and protecting costs pretty much that is what we're

hearing from analysts on the street, is taking a look at kind of which companies are looking at protecting margins and those are the companies investors are paying more attention to i think also on the alphabet side, i want to look at the upside here as well. especially if you look at youtube monetization and looking at where valuations right now for alphabet is. that's really the next area of growth here. i think that's an area of growth that some investors are not paying enough attention to in terms of huh much money can be extracted out of youtube if you think of the early stages of netflix, youtube is in the same phases, and i think potentially can add a lot of value, especially for long term investors in the next few years. >> speaking of netflix, it's had quite a run, getting some momentum the sell side is catching up jefferies goes to buy. they're at $385. why aren't you more enthusiastic >> this is a two-pronged approach right now we're back at a critical level, $330 that's the level the stock sold off from, from the q12020

disastrous report. we're back to a level where pretty much every investors from the beginning of the pandemic through q1 of last year pretty much is now underwater has nothe opportunity to potentially get out at break even. you have a lot of overhead supply that can potentially start selling the stock. one, we're at a key technical level. the second thing is on a valuation perspective. we're trading at 31 times forward earnings only expecting 1% eps growth next year. those seem a little decoupled from reality if you look at what they have on deck in terms of growth opportunities, you have one which is password sharing which from my perspective is not likely going to deliver any long term value and the other is the ad-supported model that is in theory a lot of value, but i think from netflix's perspective, this is a completely new business model. likely something that's going to have growing pains as they try to execute on that and that's where i see execution risk

the stock is priced to perfection from that perspective and there could be some stumbling in the next few quarters as they try to launch that new feature >> yeah, going to be interesting as we roll over into this new year tony, some good insight on big names. talk soon. >> thank you so much >> and up next, why walmart is building on its side hustle and delivery pack. going to break down a new partnership with salesforce and how it could impact the deliveries at your door. meanwhile, here's a look at your nasdaq 100 laggards. zscaler tesla, data dog. we're back in two.

walmart announcing a partnership with salesforce this morning. relatively new side hustle go local has been around for a year and a half as retailers struggle to keep margins going with a declining consumer and higher prices.

cnbc's melissa repko with me on set to break that down melissa, is this more competitive with what amazon is doing in third-party retailers or what doordash is doing working with existing brick and mortar merchants >> it's really riffing off amazon's playbook. walmart has seen how much money can be made when amazon is selling things like just walk out technology, that cashierless technology, but it's offering services it's selling local delivery and some of its clients are people like home depot, for example so it's dropping off packages at people's doorsteps and for walmart, it also has another benefit, which is that these routes become more cost efficient because every time they deliver a package for walmart, they can maybe deliver a few other packages for retailers as more retailers sign on >> is this a case through go local, walmart has this delivery workforce already, and now they're just trying to load up capacity to make it efficient by

getting other brick and mortar retailers in the neighborhood using it >> exactly, but the other thing they're doing is selling some inhouse technology one piece of that is they're selling technology that its employees use to pick and pack orders to have them ready for curbside pickup and delivery as well i spoke to walmart's cto about this and he said there are other added benefits here's what he said. >> by bringing in other retailers, we can understand what the customer needs are throughout the journey, and then be able to improve our products to be able to serve the customer no matter how, where, or when they shop. that ultimately is going to benefit us also because we will continue to keep improving our products >> is walmart through go local prepared to scale this though? are they just looking to make their existing capacity more efficient? >> no, they're scaling this

across the country this has become a big part of what they're doing this is why having their stores across the country is so valuable a lot of them are becoming like fulfillment centers. they're not just delivering packages from their stores they're delivering from other retailers and this is a higher profit business at a time where consumers are under pressure groceries are notoriously low margin and it's looking at these services and technologies as a way to make money with less overhead >> real pressure on instacart and doordash melissa, thank you still to come this morning, the other cpi. chips purchases, and ipos. the tech trade on today's cpi print is coming up next. stay with us for expedia members, travel doesn't end at booking. it's getting a discount on your trip, plus points for your future travels. so you can think about the next trip. and the next trip and the next next trip.

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duckduckgo helps keep companies from watching you as you brows. join tens of millions of people making the easy switch by downloading the app today. duckduckgo, privacy simplified. welcome back to "tech check. i'm bertha coombs and here is your news update at this hour. easing consumer inflation has helped push the dollar to a seven-month low. against the gryo, the greenback dropped to its lowest level in nearly nine months analysts say slowing price gains are easing pressure on the fed to raise rates american airlines giving a lift to all domestic carriers with its raised guidance. american's shares are up about 5% after the airline roughly doubled its eps guidance for the fourth quarter ceo robertizen told "squawk box," good planning helped drive the strong performance

>> from a profitability perspective, we have put the planes in the right places and in terms of demand, it's been strong throughout the year. accelerated in the fourth quarter, and really our beat is revenue related. >> and the subway restaurant chain may be going up for sale "wall street journal" reports the privately held business is seeking a price tag of more than $10 billion. subway is one of the largest quick serve restaurant chains in the world with over 37,000 locations and more than 100 countries. and a lot of big athletes in their advertisements >> they do bertha coombs, thanks very much. let's get a quick check on the markets. the nasdaq and s&p turning lower but they are off session lows, and the s&p 500 right around that flat line some of the movers at this hour, the short squeeze on bed, bath, & beyond continues today stock is up nearly 13% up 200% this week. remember, this is a $4 stock

hitting a four-month high after raising the fourth quarter revenue guidance and looking at warner brurts discovery, the company announcing its first price hike for its hbo max service, it goes from $14.99 to $15.99, the price is effective immediately. we did see a pop on that move. moderated a little bit since then, carl >> indeed. we told you about this morning's cpi number and the impact on mega capps and the rest of tech, but what about the other cpi we're looking at chips, purchases, and ipos. kristina partsinevelos dives deep on taiwan semi earnings frank holland has more on the inflation impact on econ, and robert frank tells us why the tech wreck is slamming taxes in california we'll begin with kristina and that read through on chips >> q4 earnings showed revenue growth of 43% year over year which is a far cry from the profit warnings and negative outlooks from chip peers from

intel, micron, and nvidia. the stock is reacting very positively, over 6% higher and hitting a five-day win streak, but tsmc warns there is more short term pain ahead. forecasting semi-conductor demand, and that's excluding memory chips, to fall 4% in 2023 with foundry demand expected to dip 3% after both were increasing in 2022 that's why tsmc's utilization rates came in lower for the quarter. it plans to spend less on capital expenditures and guided lower for this current quarter, but the numbers, not hitting equipment names today like asml or applied materials as stocks are still trending higher, and it's not necessarily all doom and gloom. tsmc is predicting a v-shaped recovery in the second half of this year, driven by its smaller ai chips used by customers from apple to broad com, and it's considering building a second factory in japan and an

automotive fab in europe big plans ahead. >> onethening we got notice today is these numbers on pc shipments in q4 down 28%, the biggest quarterly drop in the history of gartner's data set. >> which is why so many chip makers are pivoting to auto or high-hpc, higher end computers, advanced nodes right now for tsmc, roughly 54% of sales come from those advance nodes and auto is about 6% a lot of room to grow from there. you mentioned pcs, the cfo on the call pointed out the pc market is still expecting to drop in the first quarter. so you just mentioned some really bad numbers prediction is that those bad numbers are going to continue. >> all right thanks jon. >> let's shift now to e-commerce the sector surging to kick off the new year with e-commerce etfs up by double digits

frank holland with us on inflation's impact on purchases. >> it's talk one of the stocks, wayfair, one of the continued beneficiaries of consumer spending as cash spendings have dwindles, credit card balances increase. e-commerce darlings that got a big boost from tlend of spending and the thought we reached peak inflation and it could lead to a pause or pivot that would reduce their cost of capital. all four trading lower due to higher than expected cpi those stocks boosted by consumers that have really continued to spend as prices in many areas have dropped significantly. electronics, 9% less expensive than prepandemic other areas seeing only a single digit drop but making their cost well below what consumers were paying a year ago. those lower prices not good for e-tailors but have been offset by shipping costs also falling to near pre-pandemic levels. take a look, that orange line

represents rates for on demand trucking they have been buying back capacity and offering lower rates that are lower than the blue line which is contract rates. thas that's the kind of rates that etsy or amazon would buy. >> here's what i'm worried about when it comes to e-commerce. their margins this earnings season with all of the extreme holiday discounting that we saw and their labor costs still high, is that priced in? or are investors gauche to get surprised by that over the next two quarter snz. >> when it comes to labor costs when we're talking about e-commerce, those costs have come down significantly. they have their investor day, i spoke to their ceo last year, a year ago, they had to pay big premiums to get workers in their fulfillment centers. this year it's gone away and he believes the wages are not only going down, but they'll continue to go down >> not all worker salaries have gone down. >> certainly not >> they're still pretty high along with everything else, that's going to put some pressure on. >> directly for fulfillment and

warehousing, those prices have gone down, but things like website development, those have gone up. wicks upgraded on the thought we'll continue to see demand, also for websites for events and experiences. a lot of people selling classes online and other things online i agree with you, when it comes to the tech part of e-commerce, those cost for workers not going down, but when it comes to the physical fulfillment, those costs going down significantly when it comes to workers and for shipment >> let's turn to ipos. a dramatic drop in initial offerings. that's hitting california's state budget robert joins us to talk about the tack break for taxes >> last year, less than a dozen california companies went public, that's down from over 200 the year before. the ipo drop is a big reason california now looking at a $20 billion budget deficit but half of california's income

taxes are paid by the top 1%, and much of that comes from capital gains in text. ipos, stock sales, all of that wealth created and tax from tech california's revenue from capital gains now expected to fall from $31 billion last fiscal year to just $16 billion, so basically cut in half got layoffs at saleforce, meta, twitter, all the other big california tech companies also hitting the state's pay roll tax collections. add to that the end of federal aid from covid and all their higher spending on social programs and california's surplus last year, that was over $100 billion, is now projected to become a deficit of about $22 to $24 billion for the fiscal year that starts in july new york also looking at a deficit of about $3 billion this year that's tied to profits from wall street, which has fallen by half both of these states suffer from

overreliance on the most volatile piece of the income stream, which is those highest earners and the stock market >> and this is a big topic of discussion here, just anecdotally, but there's osthis ripple effect. private valuations usually follow or lag public valuations. you're seeing the valuations of private companies come down as w well, so this may only be the start, right as that deficit here in california expected to deepen? >> yeah, and part of it depends on what happens with the stock market the private companies, they're less liquid so you're not seeing as many people cash out with capital gains. but we're going to have to see what happens with the stock market we had $10 trillion in wealth loss last year that only now starting to ripple through the economy and state budgets. >> great to get your perspective, robert, thank you >> layoffs finally hit alphabet. google making some cuts in the health tech division

>> and we're watching cybersecurity stocks today morgan stanley downgrades zscaler saying comps and macro are going to be tough through the end of the year. top pick is palo alto and crowdstrike. still a lot more "tech check" ahead. [music - cover of blondie's “dreaming”] [music playing] ♪ imagine something of your very own. ♪ ♪ something you can have and hold. ♪ ♪ i'd build a road in gold just to have some dreaming, ♪ ♪ dreaming is free. ♪ accenture, let there be change.

welcome back to "tech check. google's parent company making its first wave of layoffs.

alphabet cutting 50% of its health sciences unit joining me is jennifer with the details. this is not the kind of cuts that some investors have been calling for, especially considering how many jobs alphabet added over the pandemic >> exactly, so verily is the health science unit in the company's other bets segment this is not core to the company's business this is more moonshots, experimental projects. >> loss leading. >> yes, lost so much money consistently each quarter and each year, so the context is needed that, you know, these are cuts that are happening. and it's multiple units in the other bets segment but also not very close to the core advertising or search business >> these bets known as alphabet's moonshots which includes other divisions like w waymo. this is something other activist investors have taken note of

do you think maybe this is the beginning of perhaps them getting serious about these job cuts, about that efficiency and bringing back up gross margins >> i think we are starting to see this is ruth starting to pull the purse strings more aggressively now it's starting here and i think employees think that, too. there's a little anxiety which we talked about last time. on one hand, this is somewhat inconsequential to google's core business, so that's a good sign, i think, for people who are in the core area. but on the other side, i think employees take this view of, well, if these are inconsequential areas getting cut, what does that mean for maybe more consequential areas but i do think that we could start to see more. we already saw two from two different units, the robotics unit as well, which we confirmed since we published that yesterday. i think that could continue to happen >> it's not like ruth isn't willing to make the cuts, but maybe not what the street is

looking for. the moonshots are in a unique position because they can raise outside money. right? >> 100%, exactly verily, for example, the health science unit that is having layoffs, they have raised over $2 billion in the last few years and waymo has raised a couple billion since -- over the last few years. that is an aim for them, is to eventually have them be financially independent. we got city the memo the verily ceo sent to employees. he said this is part of the restructuring. we're trying to aim for financial independence, and they have been trying for a few years. >> always raises a few questions about spin-offs which some investors have been questioning. thank you for being with us. carl >> cloud stocks were some of the market's worst names in 2022 a rare outlier was box, actually up 10% last year should investors stay bullish in '23?

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just look around. this digital age we're living in, it's pretty unbelievable. problem is, not everyone's fully living in it. nobody should have to take a class or fill out a medical form on public wifi with a screen the size of your hand. home internet shouldn't be a luxury. everyone should have it and now a lot more people can. so let's go.

the digital age is waiting. welcome back to "tech check. the proxy battle at disney leads the headlines today. our next guest has some experience in that area. box ceo aaron levie successfully fought off a challenge from starboard back in '21. shares of the company over 14% since that ended and despite the tech melt pm down last year, box was an outperformer, rallying 18%

what's coming up in store for '23, aaron levie joins us at the, nyse. how do you view the runway in '23 from a business standpoint >> there's definitely no question that there's macro economic headwinds that all businesses are facing right now. and it certainly behooves any technology company to be leaning into their customers, helping to support their customers with whatever transportation initiatives they have. i think there's three really big trends that every enterprise is focused on they want to drive up produ productivity, lower costs and stay secure. what we're focused on with our platform is helping enterprise, make sure they enable the greatest amount of productivity from their employees and we can stay secure with their most important data. those are the big trends we're looking at and all enterprise software companies will have to the same >> what about your own costs and how does that rank in terms of priorities >> it's high

we have been running the business for the past especially few years with a high degree of focus on operating margin. we put up record results on the operating margin front our guidance reflected a continued focus on the bottom line and this has been kind of instilled and deeply kind of been a instilled deeply, kind of focus of our company for the last number of years >> would you say you were earlier than some. >> we empirically were >> you feel good about that. >> we do we had had to double down and focus on key focus areas you get focused on efficiency. >> you've had such focus on cost, let me throw you a curve ball considering your stock currency held up so well in 2022 the stock nearly doubled off pre-pandemic highs, startup

value eggs coming down fast, and the ipo window is painted shut right now might be the time for you to drive some top line growth with mna. >> i think right now we have a very strong focus on our organic road map we're building out the leading content cloud to help enterprises manage all the most important data and that affords us the ability to go pretty deep around the future of claberation and ai there will be opportunities but i don't think it'll be the kind of mna that is significantly expensive or material from a financial standpoint >> i don't know if you heard about squawk on the street this morning but nelson said he's very popular with ceos

would you like to have on him on your board >> no comment on nelson. i think activists whether or not he calls himself that plays an important role in businesses i think it's helpful to have in terms of investors being able to price feedback and support i think that's a healthy exercise i frankly think bob iger a fantastic ceo and leader of disney i'm sure he's taken the wheel and definitely leading the charge on that front i have no idea what nelson his perspective is on that but certainly interesting to watch from afar. >> good morning. so you now maybe have some perspective. when starboard waged its own proxy battle in other words was the pressure good did it help you right size the ship or were you already on that

path was it distraction >> i would say it's proxy battles from activist investors and investors in general providing feedback and sort of collaborating with companies on how to continue to transform so in our case we were in parallel working on poperating margin we were working on stabilizing the growth rate when we had starboard get involved in the business we were able to cooperate with them pretty effectively in the later period some of that was less productive but ultimately i think investors are pushing back on companies and companies equally have to balance that out with their long-term view of what you need to be able to possess. and thank that counter tension and pressure can be healthy.

>> i had one more. >> you've been writing about chadgpt. you said it's been giving something to people something they didn't know they did it how should viewers be thinking about this >>thers been only actually a few major platform shifts in technology in the past few decades. the web was sort of the modern one we think of. the next was mobile and sort of corresponding with that was cloud computing. ai sort of represents, you know, the next major shift in that succession and chadgpt was a model that can predict text and be able to understand what text was coming in and what text is coming out it turns out most of the way we interact with computers is

through analogy and often texts. this is a transformational technology we have billions and billions of documents and the technologyical help you understand what is inside those documents and that data in an enterprise context you can begin to enrich the data you're working with you can search and query information in all new ways. this will be a major profitability boom for basically every worker on the planet >> we've got to have you back to talk about the economics about it, if it's going to get cheaper and who's going to leverage it the best, but it does feel we're at the beginning of something

amazing. aaron, thank you so much as always >> more on sam bankman-fried and strike's loan funding are next plus don't forget to follow on our podcast. listen anytime, anywhere more on tech check after the break. aren't we all just looking for the hottest stocks? (fisher investments) nope. we use diversified strategies to position our client's portfolios for their long-term goals. (other money manager) but you still sell investments that generate high commissions for you, right? (fisher investments) no, we don't sell commission products. we're a fiduciary, obligated to act in our client's best interest. (other money manager) so when do you make more money, only when your clients make more money? (fisher investments) yep. we do better when our clients do better. at fisher investments, we're clearly different.

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one more thing before we go. while fin tech has had a good year so far in the public market, can't say the same for one of private names this morning. sources telling the information that stripe, a payment startup has cut its internal valuation to $63 bill i know its second valuation cut in the last seven months. that's still a $60 plus billion valuation fee. >> i mean you could also say, though, stripe was late to cut this this is also, carl, how are they marking their portfolios at the end of the year there's a number of ways to do so. if there's going to be more funding, more up rounds, depends on what sector i suppose

>> as for today's session pretty tight range here as we absorb cpi this morning but of course the fireworks continue as we get into tomorrow earnings from b of a, black rock, citi, delta, unh just to get this q4 earnings season into motion let's get to the half. thanks very much and welcome to the half time report. the markets reactions of today's cpi report shows inflation continues to fall, so what does it mean for your money and the sfed we discuss and debate that with the investment committee everybody is at the table. let's check the markets. it's taken a bit of time to get things going today in the market because wasn't sure what it wanted to do after the cpi 174 on the