first quarter up beat guidance. and house passes debt limit bill democrats are looking to avoid default. speaker mccarthy joins uses live from washington. it is thursday, april 27th, 2023 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at equity futures this hour. there are green arrows right now, it looks like the dow indicated up80 points.

nasdaq up 104. this comes after a mixed day for the markets yesterday when the do you dow was down 230 points. s&p fell 10% treasury market this morning looks like we are sitting for the 10-year treasury at .464%. in the green this morning, but well below 3.5%. 2-year treasury is below 4% at 3.971% if you are looking at the squawk planner, there are notable economic data head we get weekly jobless claims and the first look at gdp in the first quarter. all at 8:30. then we hear from caterpillar and eli lilly and comcast. that is before the opening bell. this is the busiest day for the

quarter. after the closing bell, amazon, intel and snap. honeywell topped $1.93 street consensus that beat estimates. the company raising the midpoint of the fuel yll year guidance w the range of 9 to 9.25 honeywell backing the full-year cash flow guidance that stock down marginally on the back of the news. the house of representatives passing a republican bill to slash government funding the final vote tally 21217-215. the bill passed after last-minute revisions. rescued tax credits for ethanol

and block fuel winning over democrats from iowa. the bill is considered a dead on arrival bill to the democratic controlled senate. it is is seen as an opening bidf negotiations with speaker mccarthy and president biden with the dead limit. we will ask the speaker about that later this morning on "squawk box" live from washington that's at 8:15 >> you hold a vote and you win with exactly the number 217-215. for years, speaker pelosi was lauded for knowing what the outcome was going to be. very narrow wins we will see whether the same thing happens here here it is you barely did it there will be a different take on how it happened you recognize the name of the

four gaetz and andy biggs a thorn in the side of the 15 rounds maybe that was it for mccarthy once he got passt that i'm cynical about it as i was saying i'm hopeful. i don't think president biden has any reason to come to the table. even -- in 2022, i don't think democrats ran on a great record. why did they win on trump and abortion if they don't change that in the next one, he has a free reign to blow off the deal. senator holland said this bill is trying to defund law

enforcement. trying to cut border security. the democrats, the system thing they get criticized for, are in this bill. there are spending cuts in the bill he said there is no reason to do anything but a clean debt limit. it is ultra maga initiatives these aren't totally whacky initiatives. we will hear a lot of gas lighting. >> the question comes down to the debt ceiling trying to separate it from the debt ceiling each side has its take on when it needs to happen i realize parties hold this up because it is their only leverage. >> we found out speaker pelosi negotiated with the trump administration are these negotiations going on the entire time? the same leverage is exerted

people read no negotiations. they read it, but don't remember what do you think they would accept the right and left republicans in the house how can you get them to accept something? what can you take out or leave in that is enough for these guys to say yes >> part of what he said -- >> it is a wish list sdplchlt p -- >> part of what it was is will you ever be able to get a clean debt bill without having bipartisanship if he agrees to bipartisanship, what does it mean? >> what if president biden insists on no negotiations and clean bill and the republicans already said we will raise the debt limit if the worst were to happen and some people like j dudd gregg a

worried the worst could happen even with the abysmal numbers with not wanting joe biden to run again and he is under water with the numbers i don't think he cares if it is trump, people are voting against trump >> judd gregg's point is he likes leadership to step up. this is not something to happen. >> it is all political there should be leadership if you don't think republicans have any leverage whatsoever, you will stick to your guns. they don't he will stick to his guns. >> strong leadership tells elements each side they will not do it of >> i hope so shares of meta platform is sharply higher spending so much money on the crazy stuff. >> it is not working it is working. >> they are doing better

>> the stock is up 10% this morning. >> lost 2/3 of value last year >> life is relative. >> up 70% this year. >> correct. >> like a nasdaq daily active users beat estimates. average revenue per user jumped 9.62 anybody that tries to cover the stock has been whipsawed you don't sell at the top. don't buy at the bottom. >> many thought it was a disaster of a company. >> did you look at how much lower the results are from a year ago above expectations. >> on a relative basis. >> reality labs unit focusing on the metaverse. $4 billion operating loss. joining us is brad ericson.

brad, you picked up something in the last two weeks of march. did you think it would be a worse report than we saw it was better than what your metrics were indicating to you >> yeah. i think we saw some definitely back and forth data points we found three or four weeks ago for the digital response ad industry which is primarily google search and meta, we found results were in line to better april had started out more above expectations we felt google was doing better than meta. kind of splitting hairs. we picked up some things suggesting meta made changes and had messed with people's return on ad spend a little bit late in the quarter and didn't know what to make of that. we didn't find much behavior change the not many people were changing spending. it did not feel great to us. i think coming out of last

night's report and it's safe to say it didn't matter >> the stock started rebounding after mark zuckerberg, i guess, said this is a year of efficiency we have seen what's happened fairly significant layoffs and, i guess, trying to cut costs would you characterize the move into the metaverse still going almost 100% -- that's okay they cut costs other places and employees and still spend a lot of money on what may or may not payoff do you think it will payoff eventually are you a bull >> we're bullish on the core business meta was the top pick coming into the year. we are still in the camp >> is that the metaverse business or core business? >> that's the core business. >> bullish on the metaverse?

>> not to dodge the question when your core business is firing on all cylinders and they are showing that is happening, you can work on science projects that may take five or ten plus years to show a return on investment i don't think we have concrete enough evidence that there's the mass adoption to run the model close to what meta does on the core business at this point. we haven't touted the metaverse as part of the bull thesis that is a free call option in the stock at this point. >> it is not free, is it >> well, again, if you figure the core business is below market multiple, you can make the argument it's less than free >> we've had a lot of conversations and whenever we talk about tech, we get back to ad spending somehow. that gets some insight into the

not virtual world, but real world. how would you characterize the overall economy and ad spending for meta >> here's what i think is going on that's proving better than anticipated. google beat expectation on search revenue meta beat last night ahead of expectation. what happened last night which was missed was a lot of medium and small businesses, which are a majority of the companyies al changed spending mid last year the war started february 24th. inflation happened energy costs wage eneinflation. higher operating costs in may and june, they had to find revenue and they pulled ad

revenue. what we are finding is the consumer is more resilient than people would think month after month and yquarter after quarte, the ad revenue is trickling back we can debate what the future holds and will the consumer hold up it is at this point generally speaking. >> meta is almost like a blue chip tech stock. you look at the range which was $88, brad. did you pound the table at $88 >> we were fortunate we were fortunate to find the signal they lost from apple. we found the advantage plus they use to restore that back in october. that is when we made that call it has been consistent since

then. >> from 379 880. it is not a spac that you expect to see this is really the state of the nasdaq right now is that what you should expect if you decide to go into the big cap tech stocks? 80% loss and then a triple >> it is a real business, joe. that's what i can say. >> a real business the stock has nothing to do with the real business half the time. crazy. brad, thanks i don't envy what you have to do for a living you do it well thank you. >> thanks. coming up, we will talk about what is next for first republic bank. that stock down 60% this week. this week alone, folks that story is next we have a huge lineup still to come senator ted cruz and american

airlines ceo is with us. we have cfo of eli lilly and activision-blizzard ceo bobby kotick and what it means for the appeal and future of the company. and then house speaker kevin mccarthy in the debt ceiling debate and fight you are watching it all on "squawk box" on cnbc >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com.

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we are watching shares of first republic this morning. up 3.5% or 20 cents. the regional bank fell 30% in yesterday's session after falling 50% in the session the day before it was halted 16 times at the nyse yesterday because volatility thresholds were tryin triggered. the stock is down 60% for the week now market cap down $1 billion that is 1/20th before the banking turmoil began in march the u.s. bank regulators are considering a downgrade of the bank that could curb access to the

lending facilities that means they could not go up to the window or emergency facility launched last month a lot of questions around this guys, the precedent set with silicon valley bank and signature bank probably has the private money waiting around to see what happens they got better deals in that situation where things were carved off parts of the bank that people didn't want were carved off. losses of how there would be insurance against the losses made everybody now waiting because of the precedents set to see what happens. >> you said it all in the first sentence up 3.5%. 20 cents >> yup would you keep your money there right now? >> i think a lot of people deciding or saying no. i think first republic is what happened in the market dur durable goods. nothing happened to the 10-year.

>> anybody with $250,000 in insured deposdeposits what happened is monday is a bigger glimpse behind-the-scenes. the bank deposits dropped more than expected. as of march 31st, $103 billion in deposits. below what the street expected as of that date, $50 billion is above insured levels above the $250,000 limit. >> janet yellen said they are insured. >> she said both depending who she is speaking to >> the working assumption is it is insured. >> why are people running for the exits? >> it is not -- >> i don't know. if you had, you know, let's say 10 or 15 years from now over $250,000 saved up --

>> i'm not sure if that is where i keep the money there. >> exactly >> i wouldn't want to find out >> that's what happens when there are questions about this this comes despite the fact that 11 u.s. banks corralled together and put in another $30 billion in deposits a short time ago >> we were trying to understand if those were fully insured as well i'm under the impression they are. >> "the times" is saying it is part of the uninsured. i don't understand. coming up, ceo of bristol myers is coming and earnings from eli lilly and cater pill arc and me -- caterpillar and merck and the numbers on wall street impossible-to-change problems.

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time for executive edge. shares of pioneer resources are down 2.5% this morning the company's long time ceo scott sheffield is retiring after the end of the year. the current chief operating officer will be succeeding sheffield. that stock down 2.5%. we are watching bristol myers. ceo giovanni caforio announced plans to retire on november 1st. he will remain executive

chairman the industrial officer will take over as ceo. shares of deutsche bank are higher the company reported a profit of 1.2 t $1.28 billion. the 11th straight quarterly profit for the german lender we used to talk about the bank as a troubled bank which with started in 2019. deposits fell in the quarter from 621 billion euro to 592 billion euro. shares of barclays are rising in the pre-market net profit of $2.2 billion jumping 27 puer% year over year it makes up 1% growth in the corporate division and investment banking division. you see the different sides of the banks. coming up in the 8:00 hour, don't miss the interview with house speaker kevin mccarthy

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good morning welcome back to "squawk box" here on cnbc we are live at the nasdaq market site in times square we we have news hitting the tape. dow opening 27 points higher nasdaq up 103 points higher. s&p up 18 points joe. merck just reporting earnings at 1.40 better than 1.32 revenue was 14.49billion the estimate was $13.78 billion. the company is raising guidance for sales and earnings for the

full year. all that in mind, it is up 22 cents or .2%. caterpillar coming in better than expected. adjusted earnings per share 4.91 the street was looking at 3.78 revenue came in better in terms of the operating profit margin, that is something people are watching 17.72% the stock up .8% comments from the chairman and ceo saying they were serving healthy demand in the first quarter. looking for any comments about what they say for the future i don't see any yet. right now, the stock up .80% for more on the earnings movers, let's bring in kari firestone.

founder of asset management and cnbc contributor kari, the busiest day of earnings season. we have seen a lot of numbers to this point any recent ones jump out caterpillar? eli lilly? >> thanks for having me, guys. i think today is interesting because if you add up all of the earnings that will be reported and sales, they will be lower this year than last year particularly for the drug companies. merck had better than expected numbers. that is down 30% bristol and lilly will be down caterpillar with okay numbers. this is what we can look to the future for what they are seeing in bookings. same at honeywell and keytruda and merck and lilly. it is all about the diabetes drugs used for weight loss those numbers will be down, too. >> you are right if you are putting up strong

numbers like caterpillar, the question is what happens in the economy and what do we see concerns that commercial construction is seeing a downturn to 2024 you are facing an investor base hard to impress. everybody is looking to what is next. >> everybody is cynical in the case of caterpillar, china is coming back it hasn't been growing the last few years. the commercial construction is weak in a lot of places. people are skeptical with higher interest rates weighing on them. the airlines are reporting you are talking about companies that are marginal with profitability with lots of debt. that weighs on the systems and southwest and airlines >> any airline you like? >> i wouldn't buy an airline

right now. i know people are enthusiastic about them and a lot of travel and busy at airports it is such a tough business to be in. the profitability is minimal and costs of the airplanes you can't get many of the max jets now. >> is there a travel play you like >> booking. >> booking. >> we like booking that is a good stock the question is at what point is it less attractive people are traveling a lot they use systems that are easy for them to make the plans and it is a very easy product to use and the revenue generation is good without being capital intensive for the future they are reaping the benefit. >> what do you think of the tech earnings meta out last night and stock up 10%. >> we own meta we have been in meta this whole

time which is grit -- great. >> were you in it on the ride down >> we did buy more it was all about cost cutting. that is what people expected now you have revenue positive. 3% it is not up 15%, but in the right direction and daily average users is trending up for the last four quarters you had some better news on reels. he talked less about the metaverse. everybody talks about a.i. unclear what it means with profitability any time in the next five years. he is speaking a language that people like and has gotten religion of how to rationalize costs. >> if you look at the bright side, the first time, they have 3 billion people they count as users on average daily users on all of the platforms >> are there that many people? >> it is crazy how much of the world population they are

hitting. they were cheaper ads and profitability came down on that. >> that's something we are aware of dp google is another example where the advertising business was cyclical and the tv business where i covered media a long time ago. people forgot it was cyclical. we had a recession in advertising. including digital advertising. they are starting to come out of it the fourth quarter was the low point. we will hear more with comcast reporting today. >> the businesses matured to the point of cyclical just like advertising. >> exactly it is not just grow, grow, grow. you deal with an economy you are the economy. when you have companies -- google and microsoft is so big i look at microsoft sales numbers. they are bigger than the entire u.s. airline industry. you can put a lot of industries inside every one of the big companies. they are the economy to some

extent the idea they would not be cyclical is wishful thinking. >> what do you think of the banking sector given what we're talking about with first republic and last week >> is it a day of wrereckoning here it feels to me they don't want to touch it. they don't want to save it the government doesn't want that to let it go and say, you know, we wanted to put money in, but didn't want to lose a cent of it that seemed unrealistic at the time or in naive. try to divide it up among the banks that provided that capital. i would think that is a sad statement about the financial system and its ability to a absorb >> why would the banks do that if you look at silicon valley bank and signature bank, there

were better sweetheart deals if you waited until the government stepped in >> they can say no and wait. >> how concerned are you if first republic gets resolved -- resolved a euphamism for it fails and the government takes over. are we talking about the next come domino >> it is such a good question. last month, we spent a fair amount of time looking at the real estate market office tower and commercial real estate market and vulnerability and how much of the percentage of loans and any banks vulnerable to the default of real estate. it is not great for most banks there are a few banks in the country where the portfolio where commercial tower portfolio is 30% of their loans. those banks could potentially be in trouble

again, not very many of them, but that's a potential down side you know, that was always going to be true when you take a $1 billion loan it is questionable in an environment with interest rates going up and demand and covid hit and nobody in the tower. that is where the stress could be >> kari, i want to thank you great to see you in person today. thanks for coming in. >> thanks, a lot we have more coming up on the broadcast. we have bobby kotick and kevin mccarthy and comcast earnings. we have lilly. everything hoims elizabeth holmes was due to report to prison today that has been delayed. and we will speak with bobby kotick after the regulator

blocked the deal for activision-blizzard. what's next? we'll answer that at 8:00 a.m. don't go anywhere. "squawk box" is coming right back >> announcer: currency check is sponsored by interactive brokers. best informed brokers choose interactive brokers.

welcome back something good must have

happened since the beginning of the show up 190 points on the dow a lot of dow reporting that is being well received for some of these names. you have it. that is helping. caterpillar is helping more than any with the 7 point gain. caterpillar and honeywell and merck trading higher elizabeth holmes will not go to prison despite the order to serve the 11--year sentence today. on tuesday, elizabeth holmes' ton attorneys appealed to the t appeals court. holmes will remain free on bail for now. the government has ten days to respond. holmes was convicted last year on four counts of defrauding investors in the failed blood testing company. everything takes so long before you can -- you can't decide on the appeal for ten

days does she ever go >> i'm sure she goes the question is do you want to get it over with or would you want to extend it as long as humanly possible >> how long has she got? >> 11 years. >> i don't want to do either >> she has two small kids. >> 11 hours is a long time if you don't have your freedom. i've been told >> i've been told. >> i have friends. >> you have to tell us that story about your friend. shares of e-bay higher the company with earnings $1.11 per share. r revenue beat it wasn't as bad as the 12% decline in the prior quarter guidance coming in higher than analysts expected. that stock up 3% right now take a look at shares of tv streaming roku moving higher at 2%. the company reported a loss of

$1.38 a share. a penny worst than expected. $741 million that beat the estimate of 7$708 bil million. it raised the outlook given folks who have been dour with the advertising. when we come back, disney is suing florida governor ron desantis we will dig into the battle after that break. and reminder, you can watch or listen to us live any time. check out the cnbc app ugh covid-19? i'm not waiting. if it's covid, paxlovid. authorized for emergency use, paxlovid is an oral treatment for people 12 and up who have mild-to-moderate covid-19 and have a high-risk factor for it becoming severe. my symptoms are mild now, but i'm not risking it. if it's covid, paxlovid. if you have a risk factor, like being 50+, being overweight, asthma, or others, don't wait.

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eli lilly shares are up. not a lot.

it is interesting that the year guidance is being raised 8.65 to 8.815. the street is at 8.45. the adjusted share $1.62 though revenue was above expectations at $6.96 billion versus 6.859 either there may be something in there that brings it down, it should be adjusted or in the first quarter they're going to make up any -- what is that, nine cents or something below expectations -- 11 cents below expectations they're making it up in the remainder of the year, which allowed them as i say to actually raise guidance to quite a bit above where they were. this is your weight loss drug. >> my weight loss drug >> that's what i mean -- >> not my weight loss drug. >> you like the idea

you think it is an amazing thing, even though you're the last person that would need it you would need a weight gain drug >> i -- started talking about early on when i saw and knew people who had taken it with great success. >> who didn't have diabetes and who take it and get injections just to lose weight. >> i'm looking at the financial guidance, they're pdating certain elements of their 2023 financial guidance they say since announcing it, back in december, u.s. dollar has weaken ed against most majo currencies it may be the dollar, just the weakness in the u.s. dollar. >> but the stock is okay >> yeah. >> for -- if that adjusted number, like we always say is -- >> increased by 900 million, driven by about $650 million associated with updates to -- >> so it could -- we'll ask david. it could be below where wall street was, 11 cents but all the other stuff is doesn't have -- the stock is not

under pressure as you can see at this point and -- >> okay. disney suing florida governor ron desantis yesterday, alleging that he has waged a relentless campaign to weaponize government power against the company. federal lawsuit alleged desantis orchestrated a campaign to punish disney and threatens its business disney taking issue with the crackdown of the special development district that gives control over disney world and the surrounding land governor desantis communication director sending a statement to cnbc, this is what it says we are unasqkware of any legal right the company has to operate its own government or maintain special privileges not held by other businesses in the state. the next guest predicted this would happen next week in his newsletter citing a possible nightmare scenario where florida's government uses eminent domain law to acquire disney property. joining us now is matt bellamy you did predict this would happen it seems to me that you have a

situation now where bob iger is making a bet that given the love for the brand that is disney, that it is effectively going to overcome potentially the politics of this state >> well, he's also betting on the law. and it is pretty clear when you look at what is going on that this is retaliation. the legislature who introduced the law said, yeah, we're targeting one company here, the walt disney company. and iger has been using that word retaliation over and over again because that is his first amendment weapon card right there. you cannot punish a person or a company for the exercise of free speech and what disney is saying is that is exactly a textbook example of what happened the company expressed an opinion about a political issue, the

so-called don't say gay law in florida. and when the company did so, the governor and the legislature started lashing out and punishing the company specifically for the expression of that speech >> matt, i think you're 100% right and in this case i will take the side of bob iger and it is clear, by the way, i will say this, desantis said this was retribution. said it, out loud. videotape of him saying this so -- >> multiple times. >> we can stipulate that that is a fact the question that i'm trying to figure out legally and just from a political process perspective is who is the judge that is going to see this in court and have to rule on it, at least first time before it gets to an appeals court, what is this process look like and in the process, which is to say as this case moves forward, what can desantis do or not do, whether he's allowed to or otherwise, to try to muddle the waters for disney further >> right

well, the judge is a federal judge who has made some pro free speech rulings in the past so i think disney is liking the judge that it got in this situation. and ultimately this will be appealed, but if you appeal this all the way to the supreme court, it is going to be tough for the supreme court because, remember, we got citizens united here where the supreme court has specifically said that a corporation is a person for the purposes of giving money to a cause or a political candidate, and that's an expression of free speech so, that's an expression of free speech by a corporation, certainly commenting on a company's -- commenting on a political issue that is before the florida legislature would count as well. so it is going to be hard for the supreme court to distinguish this case. w >> what kind of risk do you think this case poses for disney

in terms of to the extent that desantis is prepared to pursue more acts of retribution and as i said, stipulate that they are acts of retribution, what kind of damage could take place in the meantime >> well, that is a political question and i think the risk there, it could poke the bear further and desantis could keep going and saying, listen, okay, this is war, we're going to go after you, and up until i am told i can no longer do this, we're going to void development agreements, we're going to enact taxes, we're going to do everything we can do they said they're going to start inspecting rides and doing things to just annoy disney. and they're going to keep doing that and then there is the court of public opinion disney had been riding a pretty nice wave here of public opinion, i think, because they have been perceived as being bullied by desantis. and now they're the aggressor

here they're the ones that sue. so, we'll see how the court of public opinion responds to this. >> matt bellamy, we're up against a hard break we appreciate you joining us good prediction, by the way, come true. and i'm sure we'll talk to you soon thanks coming up, earnings on deck from our parent company comcast as well as american airlines bringing you the numbers and the market reaction. plus, a big interview is ahead in the next hour senator ted cruz, american airlines ceo robert eisen, and eli lilly ceo david ricks. in the 8:00 hour, bobby kockti and house speaker kevin mccarthy amazing. we'll be right back. ♪ ♪

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good morning welcome to "squawk box" here on cnbc we're live at the nasdaq market site in times square i'm andrew ross sorkin we have a big show on hand u.s. equity futures at this hour, take a look, the dow up 175 points right about now nasdaq trending higher, 111 points higher. the s&p 500 up about 22 points

higher treasuries, looking at the ten-year, 3.462. two-year, under four at 3.965. and parent company out with earnings. >> comcast just reporting numbers. earnings coming in at an adjusted 92 cents a share. that's ten cents better than the street was expecting revenue coming in at $29.69 billion. that's also ahead of expectations there are some changes in the wacomy comcast is reporting thi time around. the new way they're breaking this out is connectivity and platforms, comcast cable and sky's connectivity products, and then the entertainment platforms of those like x1, sky now, some of those issues. content and experiences, everything at nbc universal including studios, peacock, the theme parks. and sky sports and sky studios, those are going to be the two reporting lines. if you break down what you're

seeing in some of those issues, you see that connectivity and platforms had adjusted ebitda that was up 3.9% when you exclude the impact of currency $8.1 billion adjusted ebitda margins up 160 basis points to 40.2 they look through some of the other things that are there, you got best first quarter domestic wireless line ads up 355,000 now 5.7 million wireless lines in the u.s. with only about 10% penetration of the broadband base they say that is still a lot of runway if you're looking at some of the things for the media, content and experiences revenue, that was actually down 9.5% that's because you didn't have the winter olympics, you didn't have the super bowl that you had the year earlier if you look at adjusted ebitda, down 1% to 1.6 billion media results, they break out some of the peacock numbers here it includes $685 million of revenue and adjusted ebitda loss

of $704 million related to peacock, compared to an ebitda loss of about $456 million. >> good gains, though, in the number of paid subscribers. >> yeah. >> for peacock. >> yeah. 22 million is the latest number. >> scale without anybody - >> this is the big question, which is what is the number you reach to have demonstrable scale? >> for a customer relationship to figure out, 5k, total domestic broadband and wireline -- wireless lines up 350,000. and then even though comcast is not chasing unprofitable subs, people still watch and it is a big number, 714,000, minus 614,000 domestic video customer losses and that's the cord cutting that we all know is occurring. but, you know, you have a -- let's say you've got x million of those, 614,000 a quarter,

there are people leaving cable >> yeah. >> doing other things. that's why luckily comcast is the first to make a lot of other things to make up for that. >> studio revenue up 1.7%. adjusted ebitda up 13.3% to 277 million. if you got the theme parks revenue, up almost 25% to 1.9 billion. adjusted ebitda there, 46%, 658 million. >> the engine that keeps on going and then you start thinking about what happens in asia when that opens up and the number should get higher. >> comcast shares up by 2% to 3 37.24. >> conference call is what everybody wants. >> what? >> conference call is what everybody wants. >> why >> i think a lot of people are looking forward to the conference call. they want to hear about the earnings and the future and the future of nbc universal post jeff shell. >> thank you, elephant in the room not really though. elephant -- i mean, you can

thank tucker and don lemon for that american airlines releasing first quarter results. let's get to phil lebeau with the numbers. hey, phil. >> joe, this is american airlines reporting, a profit of 5 cents a share, inline with expectations remember, just a couple of weeks ago, they gave new guidance, it was guidance in around 5 cents a share, that was below what the street was expecting, the stock came under pressure. the revenue side, a smidge underneath expectations, $12.19 billion. in line with expectations. operating margin 3.5%. revenue up 30.1% this speaks to the market we're seeing now and the demand that is out there, especially for people to pay up for premium when they're flying, in terms of its cost per seat mile, up compared to the first quarter of last year. now, what people are focused on, the guidance in the first quarter, in the second quarter, their guidance is above what the street is expecting. american expecting to earn

between 1.20 and 1.40. the street is at 1.4 that's why shares are moving higher premarket capacity up 3.5% to 5.5% in the second quarter and adjusted operating margin is expected to come in at 11 to 13% capacity for the full year up 5% to 8% and full year earning ings guidance, between 2.50 and 3.50 a share. lots to discuss with robert isom they're going to be talking about the strength of the market and strength of the demand, especially for people paying up to premium lots to discuss when we talk with him in about half an hour we'll send it back to you. >> all right, we will be waiting for that lots going on today. phil, thank you. other earnings >> let's get you through some of the other earn rgz ings reports are moving the markets honeywell up 2%, reporting earnings of $2.07 per share.

revenue of $8.9 billion, that beat estimates caterpillar, that beat street earnings of $2.07 per share, better than $1.93 a share that the street was looking for revenue better than expected at $8.86 billion. look now at eli lilly. this estimate, the drugmaker reported $1.62 per share, the street estimate had been $1.73 revenue beat estimates coming in at $6.96 billion the company raising guidance and that's why you're seeing that stock up close to 3% the ceo david ricks will join us later this hour. and then merck earnings at $1.40 a share, better than $1.32 the street was expecting, on revenue that had been estimated. >> huge keytruda number, 5

billion or so, that's for a quarter. that's a targeted cancer brand-new. no such thing how many years ago for merck. they had to, you know, replace all the other stuff they had but that run rate of 20 billion for a targeted cancer, ie, not chemo. anything that is not chemo is, you know, you're making strides. great britain's top competition regulator that blocked microsoft's proposed acquisition of video game publisher activision blizzard, the decision comes as the cma raised concern about the impact that the acquisition would have to the evolving cloud and gaming market joining us now is aaron glick good to see you, aaron the first question would be many times we point at either the uk or the eu and say, well, they operate by, you know, somewhat

different rules, maybe sometimes employees might be, you know, more important than customers for competition. in this case, it seems like the united states is more on the same page in the current administration with the eu and uk and it only takes the uk, it is not a huge market, the rest of the world could do it, but you can't without the uk i don't know if people realize that >> yeah, that's right. we're seeing generally a convergence on antitrust policy globally that's a trend happening for a number of years. and to your point, in the u.s., if there is a more aggressive antitrust approach, there are options to overcome an adverse decision by the ftc or the doj in court that's not really the case in the uk with the cma and we could get into those details it is a very difficult process to overcome. the companies are talking tough about appealing, and, again, that's something we could get into as well if you would like. >> let's get into that

also, are they right is the uk right? is competition going to be harmed or are we, you know, i was a little bit tongue in cheek yesterday, if maybe we'll reciprocate to the uk if they ever do have two new and innovative companies, if that ever happens in the uk, which it hasn't happened or the eu for that matter, but is it -- does it have merit, the entire argument in your view, aaron >> there is a lot of people i heard raising flags about the uk's closed for business this is going to be bad for m&a. i think those concerns are a bit exaggerated. there are plenty of people that i've spoken to that are experts on the video game industry that actually view this as a good outcome. and, you don't necessarily have to only take their word for it, you can see the stock price reaction of take two, for example. a competitor to activision that was -- that stock was down yesterday and conversations that i had with investors, the reason it was down was because there was some m&a premium built into

the stock and some investors i spoke to a handful yesterday who thought if this microsoft deal was completed, well, another tech giant would have to buy tech two to remain competitive with microsoft so that insinuates there was some competitive advantage to microsoft owning activision. there are split opinions on this we do think it is within the cma's jurisdiction to make this decision, though >> companies always decide to do things that benefit them in light of their competitors what about consumers and customers? that's the crux of it. would it have been -- would it have hurt competition and pricing for the customers. i feel bad for take two, that it was going to happen. that is not the paramount thing here it is supposed to be whether it hurts the pricing or competition and would impact customers or users >> yeah, again, a lot of different viewpoints here.

but one thing to highlight is what the cma said. so a lot of the customer benefits here and again this is the cma's view were short-term in nature, and likely to be achieved anyway absent the deal. that's something that all regulators are looking at. are the efficiencies from the deal, deal specific or would they happen or could they happen outside an actual merger transaction. the cma told us, other regulators like the ftc told us they thought those benefits were adding call of duty to game pass, for example, are things that could have happened and evolved naturally. >> you're suggesting the regulatory -- the global regulators, it is all converging i have a different view, which is that the u.s. has decided for reasons i find inexplicable and maybe they are understandable to effectively outsource their antitrust enforcement to europe. i don't understand it. it doesn't make sense to me. the media -- this media context, text context, even in the defense context, this is

becoming a meaningful issue. and i can't figure out why the u.s., which is -- which you think is as strong as it is and should care about its own companies to some degree allows this to happen >> it is an interesting evolution here the cma is a new regulatory body relatively new regulatory body, formed after brexit. still getting new data points. i think as we see more data points come out from the cma, i think people will be a little more relaxed about what their jurisdiction means for m&a going forward. >> more relaxed? if one agency that has no legitimate appeals process, since you're basically appealing to the same people who rejected you, you have to go hat and hand and say, excuse me, would you reconsider this? please help me how is this a process that the rest of the world should get behind >> don't get me wrong.

the process is problematic there is no doubt about that and actually we have seen the ftc has a similar process with their administrative law judge and the supreme court actually just ruled essentially that that was unconstitutional >> they're loving it our regulators are loving what's happening. >> that's what i said. they're outsourcing, so -- but having said that, i think we're putting ourselves in a real big bind. >> can regulators collude? >> they are colluding. but they have been colluding forever. >> is that a monopoly? >> they colluded for as long as i can remember. >> i know, but -- >> are they allowed to >> are they allowed to under what -- >> regulators can do whatever they want. >> who are you going to go to and say you can't talk to each other? of course they talk to each other constantly uk is talking to europe, talking to the u.s. >> it is wrong if the people regulating can do that. >> i think that's how it is working, right >> that's right.

>> that's unbelievable so, what's bobby kotick going to tell us today? >> that's a great question all ears on that that's at the top of the hour? i think investors are looking for one of two things. and conversations that i've had, they're actually split on what the preferred outcome is i think the key, neither outcome or the market perception is neither outcome is really bad, right? they're either going to at some point deal is going to terminate and they're going to announce plans for potentially distributing their significant cash balance to shareholders and going at it as a stand alone or on the other hand, if they are sincere about appealing this process, even if there is a low outcome of -- low probability of success, i think investors are of the view that there would have to be a significant improvement to the terms of the offer, maybe looking at the spirit jetblue deal as a model for how to do that in exchange for extending the termination date to give them enough time to go through the appeals process.

>> and the -- explain again what that structure was >> yeah, so for spirit and jetblue, jetblue is paying dividends to spirit shareholders as they wait for the regulatory outcome, and if the deal closes, those dividends are being reduced from consideration if the deal does not close, it is essentially a prepayment of the termination fee. >> okay. aaron glick, you like the glasses? go to warby. >> aaron, i have to get glasses. we have been having conversations during the commercial breaks about -- >> i like them. >> i need to find a pair i don't know if i go with the thin rims like he has or if i go with something more blocky we'll see. >> activision shares, you said this is good no matter what. activision shares were down yesterday because was that the arbs getting washed out? >> i think the market perception or for investors who are involved in activision and in their view there is really no

bad decision here for kotick yesterday there were some arbs that had to sell because there was a lower probability of success. back at the end of march, without getting into too much detail here, the cma made a decision, they were saying there was harm on the console market, cloud market, there is no longer harm in the console market and there was a chase by investors who thought, oh, that improves the likelihood of success. so that's what drove the stock higher and that needed to come out of the stock after the cma blocked the deal >> aaron, thanks appreciate it. >> thank you good luck on the glasses >> yeah, yeah. we got to decide we got to talk it over >> reading glasses so -- i don't wear those on tv that's more of a distance situation. >> won't help with the prompter anyway >> thanks. the next hour, first on cnbc

it interview with activision blizzard ceo bobby kotick. >> coming up in the meantime, senator ted cruz introducing a bill, the stock hitting fees and requiring ticket sellers to disclose the real price of tickets. he'll join us next

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coming in at $1.79 billion, versus the estimate of 1.35. the stock is up, reaffirming the full year outlook and quarterly shipments up to 62,000, versus 54,700 a year ago. when we come back, senator ted cruz on stopping hidden fees for concert and sporting event tickets. we're going to talk about that and much more as we head to a break right now. let's take a check on shares of meta the stock surging, earnings revenue and daily active users all beating the street's expectations the average revenue per user jumped to $9.62. that beat the estimates by 32 cents. stock up by 12.3%. "squawk box" will be right back. time now for today's aflac trivia question. name the five oldest colleges in america. the answer when cnbc "squawk box" continues nt thing.

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william & mary, st. john's college, annapolis, yale, and university of pennsylvania welcome back to "squawk box. our next guest introduced bipartisan legislation yesterday designed to protect consumers by pushing to require ticket sellers to disclose their fees up-front want to bring in senator ted cruz of texas. this is a bipartisan bill. is there anyone who disagrees with this? i would think the truth in showing the numbers up front makes a lot of sense >> yeah, no, i think that's right. i think there is bipartisan agreement. this is legislation, the ticket act that i introduced this week with maria cantwell, democrat from washington state. maria is the chairman of the senate commerce committee. i'm the ranking member of the senior republican on the senate commerce committee we have introduced this together and i'm confident we're going to get it passed. it addresses a problem that affects a lot of consumers, which is when you go to buy tickets, whether to a sporting event, going to see baseball or

football or basketball, or you're going to a concert, just recently my 12-year-old daughter catherine went to see taylor swift in concert and had an amazing time, she said, dad, it was the most incredible experience of my entire life that was awesome but when you go buy the tickets, at the back end you get a ton of fees added on. the data shows the average fees added on to a ticket range anywhere from 21% all the way up to 58% and so with the ticket act, it requires those fees to be disclosed up front right when you start, you know the total price of the ticket so you don't get surprised after you've gone through the whole process and get hit on the back end. what it also does is -- >> go ahead. >> yeah. >> what it also does is addresses a practice called speculative tickets. a number of sites will sell you a ticket you think you bought a ticket to go see the yankees it turns out you didn't. the person selling it doesn't

have a ticket to see the yankees, they're selling you an option and once you buy it, they go try to find a ticket for you, but it is not going to be the ticket they sold you so the ticket act requires if it is a speculative ticket, they disclose that up front too the consumer deserves to know. if you don't have the thing they say they're selling to you, then don't advertise and pretend you do >> so here's my -- the larger question, i think, is to the extent that you support this -- this move around ticketing, would you extend this out to all kinds of practices around advertising for any product at any price point? i say talk about a cell phone, for example, you'll see $99 a month or whatever it is. actually get the bill. it is like 140 or $150 a month you can do this for airline tickets. you can go -- you can go down the list of things that are misadvertised to the public, and they realize only at the last

second what the actual price is. >> look, i think there is potential value to that approach it needs to be at an industry where there has been a problem i spent a couple of years as the head of policy at the federal trade commission and the federal trade commission statutorily is foc focused on consumer protection one key aspect of consumer protection is disclosure, is not allowing advertisers, not allowing retailers to engage in fraud or deception and so i think it is a much better practice to advertise the price up front so the consumers know what they're getting and what consumers have information, they can exercise informed choice and get the products and goods and services they want >> senator, while we have you, another sort of business policy dispute, if you will, that is taking place on a very large stage, it is a state issue at this point, but it is going to federal court, which is disney now suing the governor and the

state of florida over his decisions around what they have described as retribution around tax policies and the like. what do you think of both first amendment, for corporations on one end, and the ability of political leaders, elected leaders on the other end, potentially to pursue that retribution which desantis said is why he's done this. >> so, look, i haven't examined the particulars of the lawsuit that disney filed. i'll tell you i think ron desantis has done a terrific job as governor of florida and in the dispute with disney, look, this started when disney behaved as a whole lot of corporations have by engaging in essentially woke politics, that their employees demanded that disney start attacking the legislature in florida for passing legislation that prohibited teachers that are teaching kindergarten through third grade from getting into

sexuality explicitly. >> the opposite could happen where they -- you could have a corporation that engages in some antiwoke stuff that you would love and if the democrats went after them and said we're going to have retribution for doing that, this isn't good for either side, is it? >> well, i will say this also, what florida did, if florida were going out of their way to be punitive and target a company, i might well agree with you. but disney had a very special carve out, a subsidy of a special tax district, no one else got, and when you got a practice of corporate welfare, it is perfectly fine to say, you know, to go after that anyway, but especially when a company is getting into politics. i think way too many companies are getting into politics and i would rather disney deal with mickey mouse and not be lobbying the legislature. i think a lot of consumers are tired of companyies that -- >> isn't the entire purpose of

citizens united the idea to give voice to corporations to actually be able to influence politics this is something, by the way, democrats never wanted actually. >> well, look, there is no doubt disney has a right to do this. but if they have a right to do this, they also face the consequences of their actions. and let's be clear, citizens united was primarily dealing with corporations like sierra club, like planned parenthood, like the nra with corporations, there are lots of nonprofit corporations that express views all the time and they exist to do that. if disney wants to be a lobbying company, fine. but there are a whole lot of customers that like taking their kids to disney movies that don't necessarily want to support their politics of their pressing florida to start teaching about sex to 5-year-olds i think 5-year-olds ought to be learning about reading and writing and arithmetic and not having a political or sexual agenda forced on them in the schools and that's what the

florida legislature thought as well >> on cnbc, let's get to the debt ceiling, because that's more of what we worry about here you can imagine what would happen, which is getting a little bit scary i want to -- speaker mccarthy had a big win yesterday, but the question of whether there really is any leverage over president biden, and i want you to see dan henninger piece today. i made mention of this to speaker mccarthy, just saying president biden won't negotiate, doesn't do press conferences, does only canned events, can't maintain focus, has minimal factual grasp and so naturally, with all that going for him, he's running for a second term with the total support of the democratic party mr. biden likely wouldn't be able to do this ifit was not - if it was anyone other than donald trump my point is, senator, very dangerous if we get to a point where the president feels like he can insist on this clean debt

ceiling and neither side comes to an agreement and we default, which people think is -- and it won't stick to joe biden because he is the perfect president for prodepgres progressives they can do whatever they want, and nothing tarnishes him as long as trump is the nominee do you agree with that >> so, joe, let me start by saying i agree with you the defaulting would be a terrible outcome. and i believe the united states should never default, but the interesting thing is, joe, there is one person on planet earth who can actually guarantee we not default. his name is joseph biden jr. he could say the united states will never, ever, ever default on our debt, we will pay our debts. if they did that, every month the federal government takes in more in tax revenue than interest on the debt so biden could do that tomorrow. the reason he doesn't want to do that is he wants to scare

monger, wants to threaten a default, he wants to freak out the equity markets, the bond markets, and this is deliberate scare mongering. what i will tell you, you know what's dangerous, $32 trillion in debt is dangerous what is dangerous is politicians that are bankrupting this country as interest rates are rising, the cost of serving the debt is going up and up and up and biden and the democrats don't want to change course at all. historically the debt ceiling has proven the most effective lever to force real and meaningful fiscal reforms and i'll point back to 2010, the budget control act, then republicans stood on the debt ceiling, said we'll use this leverage obama was president and he blinked and the person who negotiated the budget control act was joe biden who negotiated it with mitch mcconnell. what biden is saying now is wildly irresponsible i won't negotiate, i won't talk to anyone. to hell with you, default on the debt that is wrong.

and it is indefensible and i don't think he's going to be able to hold that line because kevin mccarthy and the house cannot give into him on a clean debt ceiling and so biden is going to blink or else deposie i he's going to drive this country off the cliff. >> you would think the 2022 election there would be a lot of retribution. look at the polls, everything else, it didn't happen it was a red whimper because of all these other -- and the same thing can happen now i don't think he's going to get blamed for this, so why should he do anything >> although i'll tell you, joe, i think one of the reasons -- i spent a lot of time out compaining in 2022 for house candidates, senate candidates, republicans did take the house that was very significant. we wouldn't be having this debate if we hadn't taken the house. i do think we would have seen -- i do think we would have seen a much bigger republican victory if we had seen republicans in congress actually standing and

fighting and i'll tell you, we had a leadership battle in the senate where i turned to our leadership and asked the question, on what are you willing to fight is there anything? because i can tell you, our voters are frustrated saying, you know, what difference does it make? i think it does make a difference, but i think it is incumbent on republicans to demonstrate that we're willing to stand and fight, not on everything, but on something and going from the national debt, just 22 years ago, the year 2000, the national debt was $5 trillion. now it is $32 trillion and what we're doing to the next generation is irresponsible. and i'm proud of house republicans for standing up and having the courage to deliver on what they promised to voters now joe biden needs to do his job and not threaten the american economy, which is what he's doing right now. >> i think we got a downgrade, we don't need any of this,

senator. and you guys, democrats and republicans, are in charge we're just sitting here held hostage by this crazy stuff and it is not good thanks we'll speak to speaker mccarthy and see if he has some answers thanks. when we come back, american airlines ceo robert isom joins us on american's latest results. stay tuned yoreatin"sawbou' wchg quk x. what do you see on the horizon? uncertainty? or opportunity. whatever you see, at pgim we can help you rise to the challenges of today,

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welcome back to "squawk box. i'm phil lebeau in fort worth, texas, with american airlines ceo scott isom revenue basically in line with expectations what are you seeing with the market now and the consumer and the demand that is out there >> straight down the middle on the results. look, a year ago we said we were going to be reliable and profitable i got to congratulate the team they have done both. in terms of profitability, that's four quarters in a row, record revenues, and it is $2 billion in pretax year over year as we look forward, i see continued strength in demand, record revenues projected in the second quarter, and that's all good for us. >> how much of that demand is

predicated upon people, not only wanting to fly, but when they're flying, saying, i want to pay up. >> yeah. well, i can tell you this, our premium cabin loads are as high as they have ever been and i'm really looking forward to what we see this summer people are book and paying more for it as well that's with a backdrop of corporate travel not being all the way back so this is a lot of leisure travelers from trips it is good >> new york city you guys, it is a hub for you. and you have the faa saying, hey, everybody is going to bring down their flights for you, that's ten flights, you know, roughly speaking a day that you have to adjust. are you confident that this will be a smooth summer >> i applaud the faa for making the move to relax the slot requirement this summer. and i think it will have an impact look, any moves at all are going to be good, but for us, we put larger planes on those flights, we'll carry the same number of passengers and we'll do everything in our power to be reliable. >> you're pretty confident,

though. >> i am. across the board too we take a look to the summer, it is about making sure you don't get over your skis and our planning the airline to the resources you have, we have done that i know the faa has done that as well i'm confident that the tsa and cvp, all of our partners want to make sure this summer goes smoothly. >> transatlantic, we know it will be a big summer there latin america, the caribbean, near latin america, has just been red hot and now you're starting to see that extend further south, right >> i think all international is seeing benefits of coming out of the pandemic fully this full first year going down south america for us, we have been really strong short haul, but now as we go longer haul, it is looking very positive so yields are much higher. we're not fully back restored. as i take a look, i see a positive summer and projections for the future as well. >> as china opens up, the issue of over flights to russia is going to come up

are you confident that can be worked out or do you look at this and say, that may be a bridge too far for -- given everything going on between us and russia >> let's face it, we're all flying a fraction of what we had formerly flown to china. china carriers and u.s. carriers there can't be an unlevel playing field. so we have to have the ability to fly the same lengths and not bring more fuel and add time on, so, until there really is a settlement to that, that's going to stand in the way. but i'm hopeful that the chinese government, the u.s. government, can get together, figure out a way, because i know one thing, there is a lot of demand >> real quick, on the aircraft, some deliveries are going to be delayed both in terms of the max and then the dreamliner as well. is that curtailing as much growth as you would like this year >> it sure is. we have constraints in a couple of areas american would be flying more. first off, the other manufacturers and supply chain hasn't kept up and we had to delay some aircraft.

we have to get that taken care of we're working real hard to make sure that we get our pilots all back in position america still has about 150 regional aircraft that aren't flying, to small cities that want service and i really look forward to getting that back. but, in terms of the aircraft manufacturers, both boeing and airbus, they have to do a better job. when we don't receive a delivery on time, we're going out and having to cancel flights, that impacts thousands of customers i know boeing and airbus know that we have to hold them accountable, they have to do a better job. >> robert isom, ceo of american airlines, busy day with earnings we'll send it back to you. >> thanks, phil. great interview. when we come back, eli lilly's ceo david ricks will discuss the company's quarter. and two big interviews in the next hour you cannot afford to miss at the top of the hour, activision blizzard ceo bobb by kotick will be here. and then house speaker kevin mccarthy on the passing of the

debt limit bill by the house "squawk box" coming back with all of it and more imagine my life without them. man: that coach changed our son. on the field and off. (cheering) (cheering) (cheering) ( ♪♪ )

all right, let's look at the futures this morning things had improved as we have gone through the early hours you see the dow futures indicated by up by 140 points.

s&p futures up by 21 nasdaq up by 123 look at what is leading the dow higher this morning. merck, honeywell, amgen, boeing, jpmorgan chase also the ceo of eli lilly will be joining us after the company reported results s that beat expectations that stock is up after the company reported lower earnings but talked about raising the guidance for the full year the stock is up by 3.3%. coming up, a first on cnbc interview with bobby kotick, his first commentary -- first interview since we heard about uk regulators throwing a wrench in the works for the deal between microsoft and activision we'll talk with that and much more with him when "squawk box" comes right back

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eli lilly missing estimates for the current quarter but revenue is above expectations coming in at 6.96 billion and the company raised guidance and put it all together and the stock is sharply hire. joining me to break down the number, david ricks, eli lilly ceo. a lot of companies would rather do yearly results. any quarter is liable to be a little bit lumpy in some cases it matters but why the slightly below analyst expectation? >> thanks, joe this quarter we had a very strong revenue picture, though last year's compare was tough. we had a bunch of covid revenue that's no longer there but our core products grew dramatically, up 19% in the u.s.

our newest blockbuster had a great quarter, well above what many expected but we also invested heavily in the business we told people when we set the guidance this would be a year of growth and investment. i think for us to set up a great decade ahead, we need to build plant and invest in new clinical trials that timing was a little bit different than what the street might have expected. you can see raising it by 30 cents on the year. >> that's what i figured so, yeah, when you're doing it every three months, the first week of the second quarter when something comes in and all of a sudden, that was amazing, though first quarter revenue, you actually back out covid related stuff. it was down about 11% but if you back out all the covid stuff, you were up 10% for everything else >> that's right. that 10% includes about three points of current sif headwind

and about five points of price head wind. so volume is up 18 we get to 10% with those challenges but still really strong underlying growth and that's what's different about lilly, we have a strong core business and we're announcing product and we announced obesity results today in people with diabetes, again, setting a new bar for weight loss in people with diabetes so more pipeline coming, more growth ahead for the company. >> so monjara, i've never been there. i heard it's beautiful >> finally a good name, joe. >> there are some horrible, horrible names out there but yours is pretty good it's going to approved eventually as a stand alone for obesity? right now it's off label >> right now we're proved and

only focused on patients with type two diabetes. that lunch by itself is setting records for a primary care-type drug but today's news also in people but with the goal of losing weight here coupled with last year's results, which showed a 22 1/2% body rate reduction. we'll wrap up that process this quarter and hopefully be approved before the end of the year for chronic weight management or obesity, which opens up the opportunity for many more people to benefit from it >> alzheimer's is tough to figure out in terms of a therapeutic but also tzipi livni and you can't really tell us anything they're very similar mechanisms. when will reknow whether it is

statistically significant in trying to help people that are this -- well, we all could look at the put and think that would be great >> we're really focused on that readout. hopefully i'll be back to talk about that soon. this is a replication studiy i can't imagine from one of our competitors was positive but pretty solid results for them. and we hope to demonstrate what we did and our face as well and finally we'll be able it talk about alzheimer's drugs that work it's a new era for treatment which is currently not reimbursing these drugs. only people with alzheimer's can't access a therapy when they reimburse everything else with a rubber stamp if it's fda

approved here they're saying we want more requirements people paid in all maybe they want to see our results first, that's fine we're pretty confident in that study but we'll need to see the data when it comes out >> you've done a pretty good job with this stock, david $365 billion today you're getting close to johnson & johnson, even though you don't have nearly the sales. how does that work >> it's really driven on forward expectations that we're going to keep innovating. in our business, they're going to make new weapons that are useful one of the first thing was we sparts o o there's a textbook

but it works and i think our team has innovated better than anyone in the industry not only do we have growth in our current business but a strong pipeline ahead. >> did you know the stock of going to do that were you worried about the light on the current quarter there >> we feel pretty confident in the long-term values of a business >>. coming up, a massive hour on "squawk box" still ahead we'll talk to act vision's ceo and the company's plans to and "squawk box" is coming right back do not, i swear to you -

good morning it is the busiest day of earnings season. new results from industrial giants, our parent company comcast and later we'll hear from amazon. and kevin mccarthy said "we did our job" after he muscled through a $1.5 million increase. we'll ask him if he thinks president biden is ready to negotiate. and the next steps for activism. after the u.k. rejected his

company after the tie-up with microsoft. all of that and more as the final hour of "squawk box" begins right now. good morning and welcome to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen along with becky quick and andrew ross sorkin u.s. equity futures not too shabby, up 145 points. some nice move in dow components including caterpillar. meta had a pretty surprising report last night and as a result, the nasdaq is up so that's like 3 for 3 this week for the big -- and amazon.

we had durable goods yesterday, which is so crazy because we're like oh no, it's such a good number, that's really bad but treasuries didn't really move on that that much we below 3 1/2 on the 10 year and below 4% even though the durable goods number is pretty solid. you would think that the fed would be emboldened to maybe go further or at least go this next time and maybe not pause >> we'll see a gdp number coming out in 28 minutes. in the meantime, microsoft and a activision blizzard releasing quarterly results right after this news came out yesterday, earlier than expected after that news the company beat the street's expectations both in terms of profit and in terms of revenue joining us first on "squawk box" to talk about all of this is

activision blizzard's ceo. welcome. >> thanks for having me. >> the big news yesterday is what happened with the u.k.c.m.a., the competition markets authority. that is what a lot of people assumed was an entity that could not be overruled or appealed to. you're appealing to the same people who just said no to the deal yesterday the ceo of illumina, he said he said he wouldn't take on the cma deal they saw because they didn't think it was beatable and that you could record it. >> first, thanks for having me and for the ben our gap earnings up 70% so we had a great quarter. business is great.

and, um, the ruling was disappointing. i think when you look at the facts and you look at what the opportunities are for the u.k., this was a transaction that was only going to enhance opportunities for kpe particular fof and it was just a flawed ruling in every respect. itdemonstrated to us is that these regulators, they don't really understand our business they're making that's what you have to focus on whether it havish rational or pact and it was such a -- >> i should say for him -- >> it's the only place to appeal realist country. >> it was so flawed every way that it actually is going to create a lessening of competition, which is the

opposite of what their mention is we think the appeals will see that and rule in our favor >> how does it work? have there been people who have been successful at this in the past >> layears there was a firm called g and fed, the cma had to go back and accept their remedies we didn't expect to have to use it but i think that we'll be successful in that result. >> microsoft has kind of alluded that we i think the cme had kind of hinted at the idea that maybe a call of duty was spun off. that might be something them feel about is that something they have the possibility for? >> i think what we found through this process is these regulators are now taking dogmatic positions that they don't serve

the interest in the, so you can't say we're only going to accept structural recommend dips but not behavioral remedies. that isn't actually consistent with their historic missions so in this case, divesting something like "call of duty", it's not practical and they actually didn't really suggest that m. >> can we talk about sort of the timing of this ubs in their report yesterday say how transactions that are under appeal work the an raj period of time -- they think the conclusion would not be a positive one in your case and looked at and i imagine there would have to be some kind of

tolling agreement or that you would have to agree with with microsoft. does microsoft pay for that privilege? what's going on hyped the scenes how this would happen. >> i can't speak to u and our bar rhys at that think there's a way. the conclusions with so flawed that we should be able to get an excel rated results. >> that would have to happen in the last two, three months, right? we'll get a lot more detail over the course of the next week and better understand what the timing will be >> we had someone on earlier this morning who was saying no

they said basically if the deal would have to be extended they would love to but that love to see something like that. is that something you all have discussed with microsoft at this point? >> we haven't discussed it we didn't get to pay the dividend this year but i think we're very ek that we have right process in place and we still have some work to do with the ftc. we expect the eu will come in before may 22nd. >> there are some people who believe ma have essentially

outsourced some of the work so pen. >> well, i was prooiz to learn that lena perng but i think that's what you're seeing now is the cma is being used as a tool by fdc to be able to create these kinds of -- this isn't the way that they're supposed to be operating. >> did this come as a huge shock to you the chf we found them thoughtful and reasonable, given they came to a conclusion -- they started out with a conclusion that would

have frok they seem like the cloud remedies that microsoft offered, which were very generous crowd limb opinions is, you go up to what do you do with that $3 billion? there have been instances, did, the back of at&t giving them a massive breaker fee actually led to the creation of this whole other giant. but took him ten years but a your. our first focus is trying to

get the deal done, which if it weren't to get done, by the end of the year wole be sitting on something like $18 billion of cash and i think if you look at our 30-year history, we have deployed capital for the benefit of our shareholders very well and we'll continue to do that. >> spread that around. >> but the other issue is different banks. >> in this regulatory environment, could you take any of that $18 billion in cash and make a big acquisition or do you think in the u.k. or it's the fdc or whomever that we're in an environment now where deal making is so challenged? >> i think at some point you're going to start to see the regulators realize that we're seeing enormous amounts of high-paying jobs getting lost from tech companies. you're starting to see the foreign competitors.

i look at alibaba's break up al alibaba has six severed companies. i like at bike dance, 10 cent. these are the best companies in their industries in the world. i think the estimates for bite dance profits this year are $30 billion. they have exceptional talent and technology for american technology to compete, we have to have consolidation and mergers. >> does that mean if the microsoft deal falls apart you can't do it alone? you would partner up to buy someone or what happens? >> look, we're a strong company. i think whether the deal goes through or not and we have every expectation of it going through, but if it does not, it just gets more challenging when you're

operating in a goebbels market where in japan you don't have free access to the consumers where in china you have to enter into a joint venture to be able to operate fair competition should start in the countries that we operate in like the u.k. and the u.s. i think that we should be more focused on a reciprocal trade framework that would allow us to compete in countries like china more effectively, not preventing competition. >> let's ask about some of those numbers. act vision segment alone, up 28%, blizzard up 62% what's going on? what's happening who are your strong players and there was expectation for a while that this was a covid surge and then people went back to work and stopped playing games. that doesn't look like it. >> no, the results were strong, our business is strong i think, you know, we remain focused on franchises that have the greatest opportunities

it's one things that we've done successfully for a long time so the business continues to be strong and i think you've had dynamic shifts in some parts of the marketplace but overall i think our business will continue to grow >> golf game is still bad. >> it's terrible >> it's a good sign. >> i have one sort of last regulatory question because i think it matters to the technology and all of business there's a view that this administration of the united states is very challenging against deal making and transactions and somehow there's a lot of folks you get to 2024, if that administration were to change that somehow the flood gates were open and the world would be a different place at the same time you start to look at some of the republicans, whether president trump against president again or desantis, or the populist sort of republicans were to become the president or take the administration, it's not clear that things would open

up -- >> disney's a one off. they'd be back >> the question is whether it would open up and be different >> it would be. >> what does bobby think about that well, you know, i think -- >> careful >> there are people in this administration like gina romando who are advancing the agenda of american business and doing it very, very effectively i would say she is the exception. and i think that we see these regulators like nina cannes who ideology shouldn't play a role in the functioning of the ftc. and we're missing the opportunities when we're protecting foreign companies who have free access and open akes, that isn't going to serve the interest of america. >> bobby, i want to thank you for being with us today. >> thanks for having me.

>> good to see you >> and republicans plan to raise the federal debt ceiling, the increase would come with federal spending cuts, clawing back unspent covid-19 funds, tougher work requirements for food stamp recipients but senate majority leader chuck schumer called the bill dead on arrival and president biden said he would veto it if it reached his desk joining us is senator mccarthy it's been all downhill for those 15 votes what doesn't kill you makes you stronger is that it, mr. speaker? >> i think grit and perseverance matters in life. every single week they underestimate what this new group of parents can do. we had a plan and lifted the debt ceiling but we made our economy strong eat the same time what have the senate done?

they congratulated uconn for winning basketball game. they're putting our economy in jeopardy the president not to negotiate is not what the american public wants, not how our government is designed, it's not what we've done before. we believe in a responsible, sensible plan that puts us on a pa m the criticism has been that you had no plan and we can see -- he can't give us a plan now that you've got a lan. representative jefferies says you're saying pass our extreme maga republican bill or else america is going to key fault i

know the white house press secretary said no way. we must immediately pass a clen bawl is there anything going on behind the scenes, speaker have you heard from anyone froms president or below that. >> i met with the president february 1st in the oval office. we sat down, talked about how we could move forward how we would not make the economy in any jeopardy. the president then said the next day at the prayer breakfast. 85 days since then, i've heard nothing from him if he wants to do nothing, we actually put out plan and passed it the white house said we would melt children's bones, we would

bring as at that time, at that spending level the president praz prt what we were able to do he signed a bill would you leave those billions sitting there and not save the taxpayer money. we reformed red tape, the per etting process so woo could build things again we capped future spending. that was manchin's idea so we can control the cost of where things were going. we put people back into the workforce. you know what that idea was? it's a plan that senator biden voted for when president clinton wasn't in office this is common sense, responsibility and we're the only body in washington that has lifted the debt limit. so if you come down to a challenge when this hits the

wall it only and then you go to conference and the president can decide wh he, putting our economy in jeopardy. i've come on your ho fwr we have just taken action and put a plan forward. >> we'llistically i'm wondering where it goes from here. we is -- it would take too long to go through the whole spiel again. basically the president is age to do just about anything he wants and i think he believes the next nominee for the president because if the brinkmanship on either side. this is emboldening you. he doesn't need to be emboldened bus he thinks he's not going to

be blamed for it we're getting closer to a default! >> i disagree. the american public overwhelmingly believes we have taken action so what's really going to happen here, the senate needs to pass a bill if chuck schumer blefs manchin says he won't vote for that either. so they've got to find something and they need to we moved something early, long before the debt ceiling came. i went to the president february 1st so we would never be in this jeopardy more importantly, he will harm this economy again if he pla rrk

i mean, actually tossage being made be fwrrk and criticizing the ethanol went back in but it does point out something, that a lot of your consistents have guy so you've got to wrangle your own cats at the time and on top of everything else, what is the president going to sign? what's going to be in the final bill in what would you settle for in what would police departmenten and that would where you could get enough votes in house again >> we showed the public what we

woulding even democrats today are reaching out and saying that the president is wrong you even had clooi burn the other day saying that the president should sit down and talk with me, myself, the speaker. he should negotiate just like he's done every timing before. remember when the former the only difference, the democrats always wanted to spend more. any time you want to suburb of the rrk. >> well, no, it's not. when shoom are snrm our debt was at 20 trillion today it's at 33 trillion. when are we going to pac and

borrow as much as we. >> we had in the there was and the u.k. regulators just last week what do you think about what's happening in the sort of global, regulatory world, and would you approve this deal? >> first of all, i've got a lot of respect for bobby i think he runs a tremendous company and he hat high one thing very concerning to me is it raises a ra parkand i think

what i'm finding a lot in washington itself now is the regulatory burden continuing to rise, which brings us greater inflation and harms us with our competition with china also you probably saw bob iger suing the state of florida and governor ron desantis as what they're describing as retribution. the governor has been explicit he's seeking retribution there's lots in your own party that are uncomfortable about what's happening here. what do you think? >> i'd give him the same advice

i gave president biden why wouldn't you sit down and negotiate and talk if there's differences you can always find ways to solve this problem. if you think the only action is to go to the court, i believe that's wrong instead of solving it this is a bigger employer inside florida. i don't think the idea of building a prison next to the place that you bring your family is the best idea i think it would be much better if you sat down and solved the problems at the same point if you're going to be a large buyer, you should run your business and don't get into politics. >> meaning you can't take ever a position on anything >> you can take whatever position you want but remember, if you're elected to run a business, that's what your shareholders want you to do. when i was young and i played a game frogger, since you had bobby on doing games the only time i got ran over when i got out of my lane. if you're elected, do your job and things will work out okay. >> but retribution, just that

aspect of it, i would think you wouldn't want democrats or republicans going after companies that are big businesses >> if you listened to my first answer to this question, that's exactly what i said, sit down and find your differences and sol solve them go to the president early, not requesting anything out of the ordinary we added $6 trillion, we can't continue that, you brought us inflation, you made us more dependent on china let's be responsible and reasonable and let's get this done he would ignore and not even talk sounds a little like the question you asked me before but we put a plan forward. that's what he requested we just didn't put a plan. we passed it, something how government works now let's see what they can do >> and the other question i would ask you is about the credibility of the supreme court and our legal system is under

some question, justice roberts saying he would not appear at a hearing. do you think he should, he shouldn't? are you concerned about some of the revelations around justice thomas and business transactions and the like and do you think they should answer for these things in a public manner? >> i think there's disclosure forms that are public and they can do that. he put the correction forward. if you're wondering about there's doubts out there, there's doubt in frobl everybody in our industry about whether people reported the truth or not. if you're going to be an officer in the supreme court, i think you have a higher standard i don't have any doubt about clarence thomas whatsoever >> get back to the debt ceiling, i don't know if it's gas lighting or what i call it but i'm hearing that you now in this bill say you're trying to cut

and defund lab every law enforcement our you're also cutting all of the border -- and pote and ultra maga. these are whacko ideas if someone has to actually try to get a job to receive some things at home. so i don't know how you ever come together, speaker and i don't know how -- >> wheit scares me at cnbc becae we're talking abouts full faith and credit of the government here >> ask one question, show me where it's written in the bill, show me where it says we cut anything we go back to the spending levels where we were back four months ago the only people who have

defunded the police have been the raps openly and willingly. if you watch and compare what has passed in the house and in the senate there's a big comparison there we are simply doing the work that we said to the american public we would do >> great to you have on. we got a gdp number coming up at the bottom of. hour thank you very much once again, mr. speaker. >> thank you very much, senator. let's get to chicago right now rick santelli is standing by at the cme. i just called him senator. he's a congressman nevertheless, he breaks the place. rick, the numbers. >> let's start out with initial jobless claims, 230,000. it's less than expected, less thanes 245,000 in the rear view mirror 230,000 is the lightist since the last week in march continuing claims, 1,858,000, a

smidge less than expected, a smidge less than the rear view mirror, which is $1,860,000. gtp, first look at first quarter. 1.1, a miss. we were expecting a number closer to 1 nt 1 and if you look at the consumption number 3 matter how i slice it. 3.7 is the best going back to the second quarter of 21 when it was 12.1 and if we look at the gdp price index, 4%, 4%. we are expecting we've been

expecting 3.7. in this series, it is bumpy because we're want to ten will the high water mark of the second quarter of '22, the highest since '81. when you look at 4% less than 9% but it breaks pattern of lower quarter over quarter, 4.9. simg lar 4.4 in the rear view mirror 4.9 is actually the highest going back to the high, which was 5.6 -- execution me, 5.6 was the first quarter of to to so we see that the pattern of inflation moving down everybody month was broken what has

interest rates con they've moved higher and to me, that is these last two numbers. bree poping but they're basically the sap all that measures these pricing issues because most believe the peek of inflations, how long does it take to float back town to a range that the central bank is comfortable. >> stay with us. i wangt to stay with steve from a nag m. he's now chief economist steve, i want to get your

reaction first to the data >> well, to take the most con temg pri data first, why is the job and we didn't, we're going down to 320. the tilling krams rick was right to put some pronunciation emphasis on that 3-7 that's your consumer now, the thinking is that that number was front load ed at the end of the quarter, which would be lift and tell us where we start the second quarter but right now the consumerssong positive numbers on intellectual property but the real thing i want to talk to you about, andrew, is lts sexiest part of economics, which is inventories

if we look on inventories, i don't know if i had that charts i think it inventories i think this is still an echo or a wave froms pandemic. it took away 2.3 percentage points there it is. if you look to the left of the chart there, inventories are pretty volatile until you get to the pandemic period. and inventories are creating massive swings we got and that's a big factor in what's going on right now i don't think this is a huge mist for i don't know if that was reflected in the consensus outlooks that are in there >> and the chief economist at the conference board is with us. i'll get to you, dana, in just a

moment >> what did you think? >> my guess is that has to to you a core cpi is slowing. headline is move doing we need to worry about growth and all of the leading indicators are growth tell us that the economy will weaken and recession is still ahead of us. elon musk saying the date on which the federal reserve is making dewhat do you think >> well, the problem is that with gdp, you need all the

components but when you look at the pieces we have been getting, yes, the economy has been slowing we did see a big surge in consumer spending in january, but that flagged in february and we're probably going to see that in march, just given what we saw in retail sales. i agree, yes, woo woor it's not going to be that long or that deep but recession nonetheless i'm still very concerned about inflation. core numbers are still veryle elevated and farp far from. >> well, i think of this as sky diving, right? sky diving is not a free fall. it's a cold the fed can't do

anything about the supply side drivers are ib flags but it been businessness investment is slipping we need to sue an ash as people see employment, theying if to. >> hey, jay -- >> andrew, i just -- i want to just go back to this issue of inventories. i want to pick up something that peter lynch of waying on i don't, but let me just throw this idea ou every knows or thinks it's coming and the idea is recessions tend to are i see businesses right

sizing their businesses and the amount of goods they have in the storeroom and their shelves for what they think is less actives i guess thats fed is tightening strongly, but i'm just wondering if businesses prepare for it appropriately. it's not a shock maybe we have less growth but that doesn't mean we have a recession. >> the problem i have with that, steve, that narrative rather if you've got mortgages rates ap personal loan rates that are at the highest readsing since '01 rates have risen massively we're getting a lot of con fix

recovering, that makes it a deep recession. my opinion is the fed is making a classic mistake of foam us being be, it's like your immune session has frozen >> do i get a final word >> we got to run, guys dana, joe, rick and steve. >> my question is even if you have. >> we'll give him a ride >> when we come back, some key metrics to watch when amazon reports first quarter results. a top alt anyswill join us stay tuned, you're watching "squawk box" and this is cnbc.

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both profit and revenue, a boost in infrastructure spending helped drive profit up 31% over the year that was up a lot more earlier than it is now, but the dow's maintained its gains honeywell topped earnings and ref now estimate and also raised its full-year sales. so that maybe took up the slack for caterpillar. american airlines matching expectations the revenue fell a bit short >> in terms of profitability, that's four quarters in a row. record revenues. it's $2 billion in a pretax better year over year. and that's all good for us >> in southwest sales fell just short of estimates and its adjusted loss was wider than

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and prevent breaches before they happen to keep your business from becoming history. we stop cyberattacks. we stop breaches. we stop a lot of bad things from happening. crowdstrike. protection that powers you. welcome back to "squawk box. amazon set to report after the bell giving investors a little more insight into the consumer

and corporate cloud spending world. we have with us the senior research analyst at cfra good morning to you. given what we saw to microsoft and google, what are you expecting toer that this afternoon? >> thanks for having me. i think the bar is set atwo, wet

shoulder once all the efficiency initiatives take hold. >> stock's trading at $108 a share basically. what do you think fair value is? >> our price target is 157 we have a buy rating on the stock. we think the stock is compelling, the valuation is compelling at current levels i think amazon is really embarking on this multi--year profit turn around story and has all these measures where they take fold. i think you'll see a turn around in profits and margins,

especially as amazon starts to pull back on the spending. this is the time for investors to be in the stock, not ou of the and it's pulling back on i.t. spending. even a lot of amazon's clients or customers are just not computing as much. think of some of the aws customers, mortgage refinancing companies or crypto companies. they're certainly not computing as much as they were back a few years ago, so that's going to be a headwind probably for the remainder of this year, but i think the positive is that amazon's not necessarily losing customers to other big providers. instead, what they're doing right now is really working with their existing customers to try to lower costs as their customers embrace and try to prepare for this weak macro environment. and you talked about a.i. and generative a.i., you know,

amazon really, really kind of entered this race just a few weeks ago when andy jassy released that shareholder letter i think that there could be a lot of talk on today's earnings call about a.i. and generative a.i. i think microsoft mentioned a.i. about 50 times, a little bit more than 50 times on their earnings call. amazon will probably do the same the good news for amazon is although these new technologies are relatively new, the company has been doing things like machine learning for over 20 years. i think that's a positive. they have been using machine learning in their front-end pools like search. i think going forward, what's going to happen, what amazon is going to be doing is they're really going to try to democratize these new technologies, like chatgpt, and really try to help companies of all sizes implement these technologies >> okay, thank you aaron, appreciate it very much talk to you soon >> thank you

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welcome back to "squawk box. this is a very special day here, probably a very special day at your workplace too this is take your child to workday, and we are celebrating right here at cnbc with some of the smallest moebz members of our team we've been adding more and more kids as they come in today i see ann, blake, ellie, kyle, those are some of our mini-squawkers i see dexter and lillian wagner, lilia, ben, olivia, chase and juliana, lots of kids piling in here today, and we're really excited about this, because we get a chance to show off to the kiddos what their parents do all day. they don't just disappear. they're not doing nothing. they're working hard, and the kids are going to get to see this today too and help us out along the way. thank you, everybody and thank you, everybody, out there. i hope you're having the same

fun at your workplace. today is also the businest day of earnings season we have a cnbc contributor, and we've talked a lot about the earnings, we'll get to that in a minute, but first of all, what did you think about the gdp number what do you think it means for the fed and stocks overall >> i think it's just confirming what we're seeing which is all the rate hikes are lagging, and gdp's going to come down slower, and the question is when does the fed say, hey, enough is enough we've got rates at a certain point that you are slowing down the economy. >> okay, and that means -- i mean, what we've seen some pretty strong earnings that have been coming in, but there have been some questions that have been asked, like, what does that mean for the future earnings to come caterpillar may be an example of that they had pretty good numbers today. the stock was up initially there's been a little lower since. there was a lot of questions about how quickly a downturn in the economy is going to end up impacting earnings and maybe

margins too. >> absolutely. and you saw that with google too. i think the question here, becky, is a lot of these earnings also have been, hey, we're cutting costs, we're trying to increase our margins by looking at expenses, and then what is that going to do for the next couple quarters if demand is slowing, the consumer will probably start pulling back we'll start looking at, hey, where do we want to spend our money? stocks will have to start reflecting those valuations, and a lot of the parts of the market are still pretty rich. we're just trading at multiples that are above 18, and i think that's where the market's now focused on, okay, we know where rates are probably going to be, but what will true valuations be in the last two years, with so much stimulus, not just with covid but fiscal, that clouded what true valuations are so, i think you're going to see true valuations coming out, cash flow's going to be a really important. balance sheets are going to be really important and those companies that can grow, they are going to be rewarded look at microsoft. you know, those are companies

that will get a premium valuation, but if you're not going to grow, and all you're doing is cutting costs, you're going to feel it in the market >> are there any places where you think stocks are undervalued at this point? any places where maybe the market hasn't rewarded them yet? >> so, the defensive sectors like health care you look at companies like cvs or bristol, even j&j, trading at below-market multiples, higher growth rates, those companies haven't really been rewarded as much as some of the others you know, sectors like staples are defensive, but they're trading at above-market multiples. i think you've got some utilities that are out there, like aes or edison, below-market multiple, so there are stocks out there within sectors, but you have to be very, very careful, because right now the way is market's so bifurcated that you're being really rewarded if you have good topline growth but if you don't, you're going to get hurt. >> we're not through issues in the banking sector yet you see that today with first republic and all the questions

surrounding that what does that mean, more broadly, maybe for the financial? >> so, i think what we saw with first republic and then you saw silicon valley valley signature is the big are going to get bigger, and that's where the capital's going to go. so, jpmorgan, morgan stanley are going to get rewarded. they have the balance sheets they have the diversification of earnings, and i think it's going to be a very tough side for community banks and small banks going forward just for regulation and also return of capital, because it's going to be more expensive to run these banks. the bigger banks have an advantage. more capital is flowing to them, we saw that, and if rates stabilize and m&a picks up, these companies are going to do well, and they're cheap. and now they're cheap because investors are saying, what's the next shoe? i would stick with the bigger banks. i think they're the ones you want to be in. >> just 20 seconds, but do you worry about the bigger banks getting stuck with the price tag for the fdic, for any of the clean-up for the smaller banks >> do,i do, and that's why theye

trading at 10, 12 times valuation, but i think the other range path, the other parts of their business they can pass on those costs and get a smaller return for the banks are going to have a much harder time doing it >> thank you great to see you today take a quick check on the markets before we hand things over the futures this morning have actually improved even throughout the entire course after the gdp numbers too. weaker than expected, but i guess that means the fed may not be as strong dow up by 167. that does it for us today. join us tomorrow right now, it's time for "squawk on the street. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange futures bouncing a bit, despite a weaker than expected q1 gdp number market seems more interested in the ongoing wave of companies raising guidance today, honeywell, american, mastercard, merck, and meta guiding above last night our road map begins with the economy, though, expanding