improvement and very defensive on a relative basis. his words? it is an easy bet. >> all right, contessa brewer, thank you. and i'll check on the broader markets. the dow has turned to negative, down about 63 points s&p down slightly as well. >> but up 2% for the week. >> and that will do it for us. tech check starts now. happy friday, i'm jon fortt. a dramatic tumble for intel, the stock getting pummeled in today's trade with some calling it the worst earnings in the company's history. pat gelsinger will be joining us in a moment with his outlook and plus why tesla's options are wall street's the whoest new trade, that stock up more than 20% just this week a big hour of tech check ahead

>> and we have to start with intel. take a look at the stock, you've been likely seeing it on the screens all morning. the top laggard, down as much about 10%, but now 7.5%. let's dig into the numbers it was the guidance that really hit the stock, weaker than expected across the board. very different story from what pat gelsinger told us innall >> we see ourselves as a share gainer even as we go through some turbulence in the marketplace. so overall, we're very confident and as we said on the call yesterday, this is the bottom, we're rebuilding from here >> clearly with the shares down as i said 7.5% today, not the bottom, but could it be finally? the street's reaction today has been brutal. bernstein calling the quaub intel's worst earnings in their time covering the company. and then rosenblat says no words can explain the historic collapse of intel.

guys, it goes from bad to worse. take a look at some of the other chip makers though, this is a very intel specific event, at least that is how the market is taking it. you have nvidia up a bit, amd wasn't down too much what has changed though from last time? that optimism, that is where we hear a lot of complaints, that he has just been too optimistic and you certainly didn't hear that last night. >> i tell what you has changed, demand demand has changed remember intel was among the first to say we have an inventory situation that needs to correct a lot of others have said that since then including amd but intel is in a situation where not only is it trying to execute on a turnaround and do that in a couple different ways including spending massively on capex, but now revenue is slowing down because of the combination of demand softness and customers chewing through inventory and therefore doing

even more preservation, not buying because they have already got stuff that they can afford to get out there and so that combination of the slowdown, the inventory which is driven by the macro and the turnaround spending is what explains a lot of what intel is dealing with >> along with the competition. others would throw them in there as well. and the moves they have made the gross margin guide of course is ten points below amd's for q1 b of a says intel has sort of the interesting combination of being both unprofitable tech and value. and they do believe the difference dent wildividend wile at risk. >> on let's talk about it with pat gel singelsinger. worst quarter out of intel possibly ever. revenue at the bottom end of guy answer, march quarter revenue projected down 37%, gross margin

projected at 39% no guide beyond q1 how much of this do you at tribute to the macro, how much of it is your own execution? >> thanks for having me on the so he. obviously appreciate the opportunity when the numbers are good, but we'll be herethe s he obviously appreciate the opportunity when the numbers are good, but we'll be here when the numbers aren't good as well. so thank you, jon, carl, deidre for having me. clearly the q4, we eked out at the low end of guide, but the q1 numbers were well below our expectations the big factor in q1 is the market shift what we've seen is customers carried a fair amount of inventory in q3 and q4 for the back to school and holiday refresh. obviously as they come into the new year and the macro situation for their business, major inventory adjustments. we're selling into our customers well below their sellout rates in their businesses. so it will be the biggest single

quarter of inventory correction that we see in the marketplace literally in our history that we can look back as we see records. so major inventory adjustments as they look into a much weaker market than was forecast and we see that globally, but also particularly with china and the issues that they have been working through with their market in covid. so overall, we've given a very transparent look and also working with our customers to bring their inventories down in the first quarter of the year. and with that, we do expect that there will be some strengthening as we go possibly into the second half of the year. but as we've said, we view the q1 guide being transparent and one that we're working with our customers. now, clearly we had good position for some of our new product, sapphire rapids obviously the client ramp of our products has been strong so we feel products are in a position and we did gain share in the pc marketplace last year. so good news inside of that, but

still a very tough outlook >> so you saw an inventory situation coming, but not the severity of this demand slowdown six months ago, i asked you about this q4 scenario of an extreme weakening in demand. so now are you prepared for demand not to rebound all year even weaken further even in pcs or data center because in data center, even with the hyper scaler, you are starting to see some weakening, right? >> yeah, generally we see that weakening through the first half of the year. we see some modest recovery in the second half of the year. you know, we've clearly adjusted our cost basis of making those adjustments. however, you know, we run factories and if the factory is full, it costs x if it is empty, it costs most of x. so fixed cost business that becomes acutely painful on the margins. but that said, we do have strengthening of the product

lines. we do can speexpect some improvn the market and as we ramp the new products, that will improve the situation second half of the year with more competitive products as well but overall, we still see the outlook of being pretty challenging in the first half of the year >> so that leads me to given that nobody knows what the second half will look like, what operational and financial levers are you prepared to pull seems that you can further delay capital projects perhaps, you can cut the dividend to preserve, i know you don't want to do that, and you can layoff workers but that doesn't save you much in the near term. are you prepare dodd to do any r all of those things? >> this is why we announced our cost and austerity programs in the last quarter earning we said 3 billion this year. me and my cfo are committed to meeting or exceeding that level as we go through cost programs

some of those are people, a lot of that is product cost steps that we're taking in our factories. at the same time, you know, we're fundamentally investing in the future of the company. and this is where we need to make those long term capital investments and as i like to say, three quarter economic cycles cannot tick at a time five year capital cycle investments for strategic leadership so we have to continue some level of those investments if we're going to get back to leadership and we're deeply committed to doing that so adjusting the near term costs, i call it capacity for capital as well as strategic capital, and keeping on path with the strategic capital even as we make adjustments in the near term. also our smart capital programs, you know, u.s. chips, eu can chips, our skip, semiconductor co-investment programs, itc, all of these give us leverage on our capital so that we can minimize the pressure on the balance the lot sheet in the near term so we

continue to navigate through being able to do near term adjustments, long term investments. >> so about those potential adjustments. i know your strategy is interlocking, you need the capital spending to regain manufacturing leadership you need manufacturing leadership to stand up the foundry business, you need the foundry business to have margin. but does this economic maelstrom that the pc business is going through mean that you can or should delay some of that capital outlay because your revenue is getting delayed >> well, we're looking at it very carefully and i say this is never an a, b. we're always looking can we delay the capital a little bit and still stay on track. you know, can we lower the requirements, can we get a little bit more efficient. and clearly if we laid out a capital intensity as a percentage of revenue last year, net capital, and we were able to stay inside of those guardrails, we expect that we'll be able to do that again this year as we work hard to get the capital

offsets in place that give us more room on the gross capital line even as we make net capital adjustments. so we believe that we'll be able to navigate through those. we're taking aggressive steps. and also finding other ways to present value to our shareholders things like the mobile ipo that we successfully did late last year other ways that we can improve the balance sheet and present value to our shareholders. >> this is deidre. appreciate you coming on you do sound more humble and realistic which i think some investors may see as a relief and maybe part of that bottoming process. i have to press out dividends. it looks like you did clear the deck in a way with your guidance last night why didn't you just say that you might need to cut the dividend instead of changing the language around it? >> we're always going to look at the capital allocation priorities of the company. we should be a dividends payor as dave said on the call last

night, we're committed to the dividend and to a very competitive dividend position. but amongst all the capital requirements, we look at that very carefully over time and per the last conversation strategic capital, kaptscapital offsets, term adjustments as well as the continuing healthy dividend that we present to the shareholders >> and i guess what does that mean you mentioned that you wanted to be transparent so are the folks that took that wording competitive dividend you just said it again, are they wrong to interpret that as a potential cut? >> well, we just reaffirmed our dividend payment for this last quarter. and we did that on the earnings call yesterday obviously important topic that we'll continue discussing in the leadership team and with the board of directors but we do believe this competitive healthy dividend, you know, something a company of our size and scale should be presenting to our shareholders

>> let's move on, some might argue thatyour tech transition plan is still too ambitious. they point to your plan to make five nodes in four years, twice as fast as anything done in history. given intel's history of mixed execution, what makes you confident that you can achieve that >> we're seeing the data every day and our customers are reaffirming. when i said five nodes in four year,intel 7 was the first one that is now fully ramped intel 4 will be ramped this year with our meteor light prod product. intel 3, the server products and that is looking very healthy for the 24 server products and then the process technology that gets us back to leadership, what we call intel 20-a and 18-a, we're hitting key milestones in this quarter, we presented the design guidelines to our foundry customers so we're measuring it all the time and presenting the data to our customers and product teams.

and i'll say we're on track for five nodes in four years yeah, it has never been done before, but we're exited to get back to leadership, we're making the investments to accomplish that and so i like to say let the silicon speak. and our test silicon is speaking clearly that we're on track to accomplish that very aggressive strategy that we've laid out >> pat, do government officials have a right to be critical in the wake of some of the subsidies the company received for some of the expansions and does it affect your ability to qualify for anything that might be in the pipeline down the road >> well, remember, we've laid out this path with the eu chips act and u.s. chips act and i'll just remind you that no government should be acting on three quarter economic cycles on decade-long investment strategies and that is the basis of the u.s. chips act also commerce has yet to do the

rule making. so we believe that is the right thing because, you know, today when we have surplus, it isn't that long ago where we were screaming for shortages as had so many industries that weren't able to get enough chips we have to build this critical technology for the foundation of every aspect of human existence. so we believe that is still a sound strategy and as commerce presents their rule making shortly we believe, we'll be applying for grants against that for the long term commitments that we are making, the long term factory and we're making good progress in arizona, ohio, as two big projects i regularly update photos to the white house and the administration of the progress that we're making to have that capacity in place. >> i want to get back to products emerald rapid should be coming end of year. should be a relatively easy transition from sapphire but at the same time, there is

this data center slowdown. so how much visibility do you have into the send cond half of hyper skarcaler and enterprise demand >> we definitely saw data center slowdown we do expect that there will be inventory burn in the data center portion of the business in the first half of the year. and that is reflective in our q1 guide. now, that slowdown was enterprise, china, but it also has now started to affect the cloud vendors. working closely with them, we do expect some level of recovery in the second half of the year, so we expect year on year growth in the data center business, but much more modest for what you described. one of the big factors there, we have larger exposure to the china market

we believe that they will come back in their words at the world economic forum and what they will do for economic stimulation, we're a bit optimistic there but our segments, the enterprise and china stronger for us. and we expect that they potentially will be recovering a little bit more quickly than the cloud vendors. obviously with sapphire rapids, the product line is strengthening and we're getting tremendously positive response from customers about key capabilities, you know, like ai performance, security capabilities, networking capabilities where we're not a little bit ahead, we're a lot ahead in the competition and we're clear with a leadership position now with sapphire and emerald coming out later this year. >> pat, finally, a different kind of macro question unlike a lot of other tech companies, certainly in software, when i think of the macro impact in the fed, i think of you guys because of some of

the capital projects that you are doing. not only the large amount of outlay that that involves, but the labor that that involves and as we're seeing perhaps some softening in the labor market, and some coming down in inflation, are you seeing any potential benefit on those capital projects that you are spending billions to get complete >> and general answer is not yet. we are expecting some of those things will start to affect energy prices coming down, labor shortages, potentially ben benefiting those project as bit. but generally we saw a huge increase in some of the cost gaps as we went into the second half of the year for exactly the reasons. so we're optimistic that those gaps will start to clapgs a bit, but at this point we're still expecting that some of those effects are in fact driving our cost comparisons and if you go back to the chips

abilit act, the key question is can we build the factories cost effectively in the u.s. compared to asia. and that is the basis of the chips abct and why commerce has been a great partner but as inflation has pushed up the costs, the gap has being in inned increased. so we need to see improvements in those areas to be sure that the factories are competitive.ss in those areas to be sure that the factories are competitive. >> any ceo can talk about a good quarter. we appreciate hearing from you today. let's get the street's reaction to that conversation. our next guest pulling no punches in a new note saying intel is punching itself in the face and calling those q4 earnings the worst he has seen from a company joining us now from bernstein, stacy razgun anything new you heard in that conversation that changes your opinion about intel either way

>> no, not really. i mean, the numbers kind of spoke for themselves last night. they screamed a pretty direct message. there wasn't anything new that i just heard >> huch risk is there for intel in the second half if conditions deteriorate and by deteriorate, i mean if the pc market doesn't get much worse but the data center market does >> so it is not implausible that the back half should be better it better be, but not implausible that it could be quite a bit better pcs are undergone massive inventory question they are undershipping by a really big -- by the way, they were overshipping by a massive amount too over the last four to six quarters so that is correcting now. at some point when that flush stops and you go from undershipping to just shipping to it, you can get -- usually

pcs are stronger in the back half versus the front half so the idea that that could be better is not crazy. it should. on the searcher side, same thing. we have some inventory correction going on, i don't think that it is nearly as bad, but we havesome of that now. so some of that correction i think what pat is hoping is that the enterprise headwinds in china start to ease. we'll have to see with cloud usually they last a few quarters and they do have a product cycle. sapphire is ramping now. you could have more sapphire as percentage of the mix in the back half than the front half. asps should be higher. but look, in my model, i've got data center up, i don't know, 35% half over half i have pcs doing about 54 build

or so billion or something like that it was a big revision. >> and you noted -- and tell me if this is an accounting change. of course that should help with the longer term targets. but what should investors know is there a risk here that the company is using this kind of accounting to get there to those longer term targets? >> so they are doing it because they are using the equipment longer let's be honest. his more particularly they were stuck on 14 annie meters or whatever it was. and they will be buildings foundry business that will be on nodes for longer and in 2016 they went from four years to five, this year from five years to eight. and for the listeners, the effect it has, it reduces the amount of costs on the same asset and makes the margins look better the q1 guide was minus 15 cents,

fl inflated by about nine cents margins were 39% was the guide and they were actually 36% and for the full year this this change inflates earnings by probably 60 krebtss. it does not change cash flow, so that is -- but it will inflate earnings and they have margin targets they want to get to 51 to 53, yeah, they will have a four point tail bwind >> and more broadly, you were on the call last night, i know you didn't get a question. you just heard our interview as i remarked very different tone from mr. gelsinger, he seems humbled. is that something that needed to happen, is that part of the bottoming process? >> i wish it happened when he started the job. it is sort of unusual for somebody to come into a company which is a clear turnaround and just sound that bullish right

out of the gate. in hindsight not a good thing do head count is up 20% since he took the job, so they were hiring and had him doing something like $120 billion in five years clearly hiring to that plan. certainly didn't get a whole lot out of sounding that bullish out of the gate. so i think that the tone change is warrantedand helpful. i would also say that you are right, this was the second quarter they didn't put me on the call people are noticing. it is into the good look >> i noticed >> a lot of our viewers probably remember a time where companies like amd existed at the pleasure of intel when you think back, was there is a moment that was consequential in that flip or has it been more of a frog in water kind of dynamic? >> no, you're right, amd at one

point existed at intel's pleasure amd at that point basically got whatever scraps that intel left on the ground. but it makes amd's turnaround pretty remarkable. the controversy was would they go bankrupt or not and it was a $2 stock and we can argue about it now, but clearly not a $2 stock, it is a real business with real products and they have leadership i think the real issue is the process technology delays. that was a biggie. i mean, that is what gave amd the push that they needed. maybe they got lucky but they aren't capitalize ordered on that roadmap. the consequences of those stronger term extra strategic issues and there have been execution issues so i think that is the current

management team. strategic issue and process issues, i mean that is what pat is trying to fix i guess that is what he was sort of brought in do if you take him at his word, they claim to have fixed the process stuff. we'll know if they can execute on that process roadmap or not even if they can't, they will never be back in the position that they were in. those days where gone. even if they can get that to parity, is parity enough like amd is a real company now and there are other competitors out there and a.r.m. architecture and a lot of other things that are coming it will never be the kind of market that it was five, six, seven years ago for intel. >> feel also used to say that about microsoft and windows. and while it is true they managed to build something else. you never know with these things in tech. stacy, always good to talk to you. >> you bet still to come, daily volume of options on tesla nearly doubled year on year

they now account for 7% of option activity. we'll take a look at what way those bets are leaning and a check on intra day action. huggingthe flat line after a pretty decent week s&p with almost 100 point gain on the week and of course compared to yesterday's nearly 11% gain technology lets you monitor your pet when you're not at home, but to monitor threats to your hybrid workforce wherever they are... you need more than technology. you need cdw, who gets to know your business and can design and deploy custom solutions, with pre-configured hp notebooks with hp wolf security. ai-enabled threat detection and remote management protect your endpoints 24/7, giving your defenses some real teeth. bummer. hp makes always-on remote security possible. cdw makes it powerful.

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welcome back here is your cnbc news update. the justice department says that it has broken off an iranian attempt to as satisfie attempt to as satisfassinate an american journalist. there are charges against members of a crime group allegedly hired to silence a critic of the iranian regime director wray says this is the latest in a string of attempted threats. and shares of goodyear down 6%, the company warning fourth quarter results will be shy of

estimates due to weak demand and they will layoff about 5% of its workforce as part of cost reduction efforts. and cvs and walmart are cutting pharmacy hours due to satisfying shortages starting in march, walmart says its pharmacies will close two hours earlier on weekdays and cvs says it will trim pharmacy opening times bat two-t at aboud of its stores. and let's watch tesla, shares are extending the rally from yesterday now up more than 20% from the week stock has seen a surge in options trading as well, roughly 3 million contracts traded each day on average compared to 1.5 million a year ago obviously more than any other stock. and here to discuss, kkm financial ceo is joining us. the "journal" sort of frame it as swinging for the fences in either direction but i don't know, others would argue given some of the street's

targets, maybe there is that much optionality in the name itself what do you think? >> i think that more and more investors have become more sophisticated in using options as an option in the tool box we've never seen emotion, politics and true technical breakdown in a stock and look at the way tesla came down over 80%. but january 6 was capitulation dade and all the index was oversold but i was selling puts at 1.40, 1.30, and it didn't feel good. but i was being paid handsomely. so i've been an owner of the stock roughly around 130 and i covered about half my position at 165. pigs get fat, hogs get slaughtered. but it seems like the political undercurrent, they got pushed in to tesla, in the wake of twitter, that oversold the stock and i think it has the ability to bounce back up to 220 kind of where it fell from last fall

>> for you you're getting to some of the base targets does the volume surprise you?oue of the base targets. does the volume surprise you?u of the base targets. does the volume surprise you? ye of the base targets. does the volume surprise you?yof the base targets does the volume surprise you or does it fit with the fact that he is the world's richest man and we talk about him every day? >> all the offices that i talk to, they get attracted to trades like this. so, yes, we've seen a dramatic spike in option. but look at the underlying shares typical average volume is about 131 million share as day, and that is nearly double right now. so i think people are trying to figure out where the market is going. but at the end of the day, volatility involved is sensational. you don't see a stock opportunity like this too often. you will continue to see volatility and that is just opportunity. >> and i know you are also bullish on emerging markets. want to pick your brain. eem moving higher to start the year after a challenging 2022.

near record inflows this week with more than a billion flowing into equity and debt markets each day so some night argue that this enormous rally means a lot of this is priced in and i wonder too about the longer term growth story. is that still intact you have rising levels of debt, higher interest rates. aging demographic. >> i think that you have to take a step back. we've seen emerging markets really be quite sanguine and sideways but here as you see the dollar index coming down, if we just rewind a little bit, if you remember the ten year note, i always go back to where i cut my teeth in chicago, butwhat we saw in chicago is that max move higher in ten year yields. we've done nothing but come straight down since then, and now tethered to 3.5%, and that is allowing emerging markets to heal and the fed looking to pause as we got a nice expected pce data today, i think that that puts this in a position to be poised to move hire but eem for that exposure,

nearly 20% is china exposure so as china is finally coming back online, that is where there is momentum and i'm also an owner of pgj, and that also gives you exposure to china. so i think that you have to have a one-two punch here >> and what about some of the other factors i mentioned that aren't really dependent on interest rates like aging demographics, rising levels of debt and fiscal strains that are emerging >> i like to look through the lens that it has been priced in. yes, we are obviously focused on all those factors, but i think if you look at the three year perspective, we've grappled, we've been on the mat with august those issues. so i think this puts wind in th sales. but you're right, it is a tough trend.

>> jeff, that care andcoming up, salesforce with three new directors to the board as they prepare for a possible proxy fight with activist elliott that story is next this tiny payment thing- is a giant pain! hi ladies! alex from u.s. bank! can she help? how about a comprehensive point of sale system... that can track inventory, manage schedules- and customize orders? that's what u.s. bank business essentials is for. (oven explosion) what about a new oven, can u.s. bank help us there? we can serve loans in as fast as 12 minutes. that would be a big help! huge! jumbo! ginormous! woo! -woo! finding ways to make your business boom. that's what u.s. bank is for. we'll get there together.

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might be time to cash in some of the coupons. bed bath & beyond disclosed that it can't settle its debts with

creditors including jpmorgan and sixth street and considering filing for chapter 11. they say they are trying it lower cap ex-close something stores, renegotiating some leases but the measures may not be successful certainly faces an uphill battle shares are trading down about 80% over 12 months and as cramer said this morning, share donation continues for firms like for example a target or a tjx >> and also a check on salesforce the stock is up by 0.6%. maybe flat we'll call it the company confirming plans to shake up its board of directors adding three new members as it gears up with a proxy fight with elliott management new members include arnold donald, sachin mehra and mason morfit and the company is being

targeted by a few activist investors. and marc benioff has reason to be optimistic perhaps. the stock has soared as a result of investor interest up 25%. rebounding from a rough 2022 when it fell more than 40% sure, maybe the market is optimistic that maybe it can change, but how much are they optimistic that it is elliott and the activist investors that will push of course the board members nominated are. >> yeah, what catches my eye is value act on the board they got into microsoft and adobe a little more than a decade ago kind of before their big cloud transitions. those two stocks have been doing well is this kind of like david fightinghe philly steens

>> certainly fits with what cramer said this morning and that is that the dialogue will be more constructive than other activist battles we see at other companies like disney. the others that if you are looking for -- ifs players are looking for technical expertise on the board, that certainly you could get that from someone who ran say william sonoma and added a lot of tech into the firm. >> so the question, is elliott going to accept that, are they okay that they went with the other activists. we'll see. >> no, come on, they want their own people on the board, right >> up next, we'll have results from meta, alphabet and amazon we'll have the trades.

story this week was microsoft and intel. next week we'll get earnings from other big names in the space including meta, alphabet, amazon, apple. it will be a busy one. so how do you position yourself ahead of the results our next guest had a top idea and the stock is up 25 percent and joining us with his expectations, brad erickson. good morning and happy friday. >> good morning. >> and this quarter was supposed to be a clearing out event

and microsoft wasn't all that good if you narrow in on the azure results, but market is taking it in stride. the nasdaq looks to have another winning week how do you take all this could markets be in for a surprise next week or do you think that they -- the expectations are actually in line >> yeah, so we actually just had a note out yesterday on this, we did our most recent checks with ad agencies that can be sort of instructive for that forward view and, yeah, i think that we came out with a view that q4 actually ended up okay, kind of maybe just a touch better than feared. and in january similar trends. i know that you are getting mixed data points. i think american express was out this morning maybe sounding a bit of the opposite. others have sounded okay we kind of think that january's tracking pretty in line, maybe even a little bit better for the advertising guys and so, yeah, i think that we're a bit more on the optimistic side here heading in to next week >> and brad, let's me float an idea to you. there is advertising which

everyone assumed would be falling off a cliff and maybe you're saying maybe that is not happening. and a tech ceo says that he is not cutting his advertising budget but what he is cutting is cloud spending, enterprise software spending do you think the market is looking at the wrong thing here and it could surprise on the down side like azure did, and could that be in the store for the likes of amazon and google >> yeah, i think that -- i do think that that is entirely possible you're right ad spend kind of got cut middle of last year people got really skittish on the macro kind of may, june, july so once you cut, and maybe that is why maybe we're seeing a little bit better than feared out of that part of it, but you're right, cloud has held up on the other hand quite strong through q3 amazon on their last call they use this word of optimization. they are being more proactive helping clients maybe not spend so much on things that they don't immediately need related to cloud services. and then microsoft had a

disappointing march quarter guide earlier this week. and so part of the reason, a big reason frankly we characterize google and amazon as maybe better second half ideas is because we need to right size. >> so i wonder if there is a chance the reaction might change based on that. >> sorry, i missed it, did you saw meta >> we have a fed meeting right smack dab in the middle of the week and does that infect investor sentiment and reaction to the same kind of earnings >> right, unfortunately from my seat and investors, yes. you know, i'm no expert on the fed. i have to follow the fundamentals of these companies. but, yes, at times that becomes a much greater force in the

market than the fundamental performance these companies tend to put up. >> i know that you probably don't cover d.c. as a policy expert, but this bubbling idea that tiktok could face much more than just guardrails has been used as a net bullish case for meta in the back half of the year let's say it looks like we might get some things on paper. are you taking that seriously? >> yeah, no, i mean there are clear indications that people are reserved certainly a lot of the public institutions, higher education, you know, municipal governments, state governments are banning these things from their networks and then obviously the policy initiatives you mentioned. what is interesting is that it really contrasts what we're hearing out of the advertising channel. people don't care. everyone still -- a lot of people are spending a lot of time on tiktok and companies, brands, products, they need to be in front of those companies -- sorry, they need to

be in front of that audience so they are continuing to spend we actually ask these folks on our channel checks like hey, are you concerned about this sure, they are, but at this point, we're not seeing a change from their customer base but could it affect that, obviously and be a huge benefit for meta or snap if it were to change absolutely that is not our base caves i wouldn't say at this point though >> so of course amazon was able to grow their ad business felt like overnight >> right, meta has been our call a little concern about maybe crowding going on there, but i think that there is actually really powerful conversion trends meaning facebook is in the process of dynamically restoring

that signal loss that we all talked about last year we continue to hear evidence in the channel that they are making improvements on that front to the degree that that is playing out, that would be the outperformance that is how we're positioned >> brad, great to get your insights have a good weekend. >> see ya. after the break, what results from american express and visa tell us about state of the consumer and a possible recession. don't go away. ♪♪ for skin as alive as you are... don't settle for silver. harness the power of 7 moisturizers & 3 vitamins to smooth, heal, and moisturize your dry skin. gold bond. champion your skin. now adt professionally installs google nest products... cool.

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earnings and some new economic data giving us insights into the consumer today let's talk about amex. shares are surging despite a miss on the top and bottom line. they raised dividend by 15%. management says we are not seeing recessionary signals. visa with a beat across the board. on the consumer front they report u.s. q1 payment volume up 9 year on year some data we got may be telling a slightly different story for the short term consumer spend for december did fall 0.2%, coupled with underlying inflation slowing to its lowest pace since october of '21. and that all comes as investors await the fed next week. the fed chair powell expected to hike by another 25 basis points on wednesday despite those worries, stocks continue to rally here into the new year the nasdaq is leading us, as you know, up bretter than 10%, on pace for the best month since july of '22.

that doesn't even account for one of the best months for european stocks in decades. >> we have to be careful, particularly about these companies' results and the read-through to the broader economy. a lot of these payment processors get a benefit from inflation because they get paid on the total dollar amount processed. even if people are wig the same, they are paying more for it, and they payment processors get paid and interest rates higher can be good for their business model. if we have inflation coming down and demand slowing down at the same time, that could slow down for some of these companies more rapidly than in the past. >> inflation is a tailwind for them, to an extent you have larger total absolutely transactions, but in the long run i think some of the ceos have identified this it's actually a headwind because it can lead to a pullback in spending i think that's what the market is nervous about going forward

as we've seen this huge boom in travel spending, cross-border transactions look good, carl, but if we head into a recessionary environment, inflation is no longer go to provide that bigger absolute number people may actually pull back. >> that's exactly the bear case at morgan stanley, for example, where sales declined faster than your costs can decline that mix is going to be dangerous. treacherous, they would argue, in the new term. still to come, the highlights from our conversation with intel ceo pat gelsinger the stock is down more than 50% since he took over in february of 2021. down another 7% today. off its lows, though eche" bk aomt."thcckisacin men

we're selling into our customers well below their sellout rates in their businesses, so it will be the biggest single quarter of inventory correction we see in the marketplace, literally, in our history that we can look back as we see records major inventory adjustments. as they look into a much weaker market than was forecast and we see that globally, particularly with china and the issues they've been working through with their market and covid there.

overall, we've given a very transparent look and also working with our customers to bring their inventories down in the first quarter of the year. >> that was intel ceo pat gelsinger on our air just a few minutes ago. coming on after a really bad earnings quarter for the company. talking through a tough macro environment. i heard him talking about the inventory correction they're going through, and the macro and the geopolitics all affecting this company as it's trying to spend on the future. >> yeah. i think key here, a few months ago he told us it was the bottom i don't believe anyone believed him. are they going to believe him this time? is this really the bottom? one fund manager called me and said, i've been short since pat took over. now i'm long the rest of the market, i mean, we've been cutting losses, carl. we're down 7%. now down more than 10% this will probably shake out over the weeks and months to come the new he cantechnology he's put in place, going to make that

ambitious plan more achievable of course, the billion dollar question >> i'm thinking, guys, jon, how the picture might feel differently if we hadn't gotten different types of guidance this week from tsm and asml and st micro. you could argue it really is very much limited to an intel story. >> we'll find out when we hear from the rest of the pc ecosystem. we certainly heard from microsoft and we saw the impact of pcs within that company and it was, frankly, just as bad. so, it's not just intel. it's just that intel is so much of pcs and intel is continuing to spend on trying to reachieve some dominance in the future if they had just said, we'll settle to mediocrity, they could be okay here maybe they could break into a bunch of pieces, do an hp. they're trying not to do that. carl >> really quick, guys. just take a peek at tesla.

i know the tape's moving a little bit overall, but 8% gain after yesterday's gain it's going to take you back to 174. what a week it's had 30% gain in five sessions. next week, adp jolts, and mega cap tech rest up. let's get to the judge >> carl, thank you very much welcome to "the halftime report." the state of the rally, the s&p moving closer to another key level. this is another critical week looms especially large we debate the road ahead with the investment committee joining me for the hour today, carrie fire stone brim and in front of me is jim we've been all over the place. 33994. dow is good for 94 s&p is 4070. that's one quarter of 1% nasdaq having a pretty decent day.