as for today, though, we are seeing some red, we have had it all morning long, even with a variety of things, results coming and then we had all those economic numbers at 8:30, but that's what you're looking at heading into this weekend. it's -- something's happening in washington too does c-span have that? >> the nerds >> the nerd prom, white house correspondents dinner. we're out of here. i'll see you monday. ♪ good friday 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, stocks giving back some of yesterday's rally, the second best day of the year amazon's cloud guidance not helping tech core pce was in line our road map is going to begin with big tech caution, though, amazon saying cloud growth is slowing. intel, also a cautious outlook for enterprise and cloud and snap saying sales are being

disrupted as it makes some adjustments to ads plus we'll keep energy in focus. chevron and exxon both out with quarterly results. they both beat, even as u.s. oil futures head for the longest run of monthly losses they have seen in more than eight years >> wow >> yeah. we'll talk first republic, of course. bit of a bounce, but we will bring you the latest on what most likely will be an important weekend for that bank. let's begin with big tech earnings, amazon with that quarterly beat shortly after yesterday's close, and that did spark an initial double-digit rally. those gains, though, were erased on the company's warning of a slowdown in cloud growth this is what the cfo had to say about aws on the call. >> given the ongoing economic uncertainty, customers of all sizes and all industries continue to look for cost savings across their businesses. similar to what you have seen us doing at amazon. as expected, customers continue

to evafluate ways to optimize, and we are seeing those optimizations continue into the second quarter with rates lower than what we saw in q1 >> that was the line, jim. that's what did it >> yeah, and we got to flesh it out here, because first of all, there's so many good things that happened this quarter. we're seeing the beginning of the workforce being ignored but for that one line, taking the growth from 16% down to 11%. it was as high as 32%, 18 months ago. they are trying to say, listen, it's bottoming, and it's bottoming in part because of all the exciting things that are going to happen with chatgpt, with generative a.i. i have to tell you, i'm with them i think there are a lot of people who say they lost a lot of share i'm not buying that. a lot of people say, this is the beginning of the end of the cloud. given the fact that 90% of companies are still on premises, i think there's a lot of business david, olsavsky is a straight

guy. they're very confident no panic button there. they really think business is fine >> you know, i heard a relatively positive take on it as well, on aws. first of all, they came out of the quarter roughly 11% growth rate >> right april was 11%. >> but also, it had to do with comps and the idea that azure has a much more fortune 500 base, and ceos there were earlier to start cutting, and there was a point at which azure was decelerating in growth, and now it's reaccelerating, in part because they were already seeing the cuts from cfos however, amazon, the biggest, has a lot more customers who are smaller in some way or vc-related, and they have been later to cut costs they have. they won't comp those until the august quarter, let's call it august, and so you're just a little later with amazon in terms of the re-acceleration >> we're going to be talking

about a bunch of smaller public, admittedly, literally the equivalent of dot coms, frankly, when i look at it. i'm talking about pinterest and snap david is 100% right. this is about just -- guys are just cutting back now. but by the way, can we give them something here they recognize that they spent way too much they are rationalizing every one of their businesses, whether it be grocery, whether it be, you know, just simple one-day, same day, and i think that we forget that they have a lot of firepower if they cut fat. >> right >> and they're doing it. they got no credit for it because all anyone talked about was -- >> you're referring to operating margins in north america >> that's what you should be focused on, for heaven's sake. this company has the possibility of making a huge amount of money away from it amazon ads are very good they're really starting to make some money on prime. they're starting to make money on, when you go to your tv set,

and you don't hit up paramount plus, you hit up the program, and it goes right to amazon. i felt that they were on their game on everything but this, and they are saying, line in the sand, they're going to do 10%. amazon web services is not going to go much lower >> meanwhile, as you know, the stock was up a lot, and then they had the call, and then investors started to focus on the growth rate at aws, and it reversed >> and jpmorgan had a similar call to you, and i'm with jpmorgan >> you are >> yes, i really am. i've been critical of these guys, waiting for them to finally start being more rational about spend jassy, religion. >> the retail business still doesn't make any money >> but they are at least not going to just -- they're not throwing in the chimney anymore. they're starting to really evaluate projects that don't make money i wish that alphabet would do this and by the way, a.i., i do believe -- look, yes, microsoft has leaped ahead, but when alexa

listens to your every move and starts programming your stuff because you're talking to your wife, i think that's a.i >> amazon designing its own chips like even else now apple has its own chips, tesla >> and disney has 45,000 chips that's how much it costs we haven't even mentioned how great -- pat gelsinger, nicest he's been. >> you want to do intel really quick? >> the stock is up, even though they've lost a lot of money. >> the bottom. how much more -- i mean, look, i just think that it's better than horrendous >> they do guide up the june quarter on revenue, not eps, and we got a couple upgrades today wedbush goes from 20 to 30 they say it's hard to imagine a situation where things get worse. >> that's what people -- david, this is a reason to buy a stock. >> hard to imagination a situation where things get worse. >> it's so bad, it all up from

here >> i've heard that before, and then it just gets worse sometimes. >> first republic, at $15, i heard that >> yeah, we've heard that a lot. give us the long-term -- the 20-year intel if you can go back to that day when paul said to steve jobs after jobs said, i'd love you to build us some chips for our phone, you think that was a moment they regret >> i think that andy grove was the greatest andy grove and gordon moore built this company let me tell you that when you think about this company, you think about nvidia >> look at that. >> nvidia, when you speak -- that's something, isn't it when you speak to jensen huang, the only harsh terms he ever has is he blurts out, moore's law is dead that's gordon moore, and the idea that you can keep shrinking the forum size there's no more gain from two to one, these, you know, these

nanometers there's no more game, so let's stop it. let's put a lot of great cards together and create a.i. that's what he did but it took altman -- it took those guys to figure out how to change the world they changed the world altman changed the world >> and this guy, brockton, actually he's the secret. >> we don't give him credit at all. we'll find out in four years >> he's the real guy there at open a.i >> are you saying that altman is the face man benioff? powell we'll see him this weekend i'll ask him >> altman's done interviews with everybody, but not me. not us >> not us. we're losers >> thank you for that. >> we didn't get darren woods. i thought one of our colleagues went to guyana with him. >> i didn't go with darren to guyana, but we did go a lot of plaess i had him and i lost him >> what happened, david? really, tell us. >> i know we have to go, but i just want an answer. what happened?

>> we are good we are good. you know what's not particularly good is first republic >> in the a-block? >> i want to do an update because there is a statement that we've gotten, and a few other things, and i just wanted to share sort of where we stand as we head into what is going on an important weekend for the company, pivotal weekend there's a lot of different stories out there. first republic tells me they're engaged in discussions with multiple parties about their strategic options while continuing to serve our clients, but you know, the open market solution that i talked about on tuesday, that many others have reported on since, still hasn't come together. the government really has been reluctant to get involved, as i've also reported, in any way there's no leadership by one or the other. and so, as we head into the weekend, it still appears the -- that that statement is kind of hard to fully understand, but

the government's lack of wanting to be involved in some way in forcing these banks to buy the troubled assets at a premium or some other open market solution leads you to one that wouldn't be, a closed market absolutely >> then you're talking about on monday, the stock hopes at goose egg. >> possibly. >> the fdic has to make their move you do have a lot of potential buyers, but of course, it comes after so-called receivership it's a fluid situation we have no sense for how many -- >> how long can they do this game >> it's a great question, jim. and i don't -- i'm getting some answers, and the answer is the window is closing fast and that's from people who are involved the window's closing fast. you can all decide what that means, but it doesn't appear likely that this bank has a lot of time left >> what i don't understand, there were long portfolios --

that loan portfolio, you have to pay full boat for and get a guarantee from the feds. >> that's not the way it's going to go. it's just not. >> that's what you need to do it >> treasury's not been involved. the white house -- fdic, obviously, is focused. >> it's not good >> you know, i know that's not a lot. we may have more as the morning goes on to share, but at this point, they have not gotten what they hoped would be leadership from the government in terms of really getting those banks together >> without leadership -- >> to do this private market solution >> they're just going to -- fdic will assess everybody, and then we move on >> then we move on the thing is, who comes out with the prize? you're not going to have to pay above market for it. you're not going to have to take the hit to book value for it that's the question. >> someone's going to get the debt -- >> it will still be valuable >> but the big -- their big groups that they have, remember,

they are one of those companies that has really the talent can go out the door. >> a lot of it has, and that's also part of the problem >> what do you get fine art >> meantime, we are expecting the reports from the fed and the fdic on sivb and signature we're watching these capital one comments about unemployment going to 5% by year-end. that's what they're bracing for. >> look, i once had it to do with richard fairbank. he's the ceo many years ago i said, there's no way they can sustain these losses, and he explained to me the model. their model is, look, we have a lot of losses, but we have the highest rate, and people pay it, and we give credit to people, and i think that he has historically had more of a grasp on unemployment and what can go wrong than anyone. i'm a huge richard fairbank fan. he is so smart >> he said last night, we tend to lead by a couple of quarters. we saw it in covid we saw it in the great financial crisis they are a canary, at least at

the low end. >> let's not worry about them, in the sense, they know how to do this. let's take their communientary situation that could occur richard fairbank -- >> would you tell people who richard fairbank is? >> he's the ceo of capital one >> i just think sometimes, if i missed it, maybe other people did. >> very good point yes. i just think he's a titan, and he may have higher loan losses, but this man is -- you don't want to bet against his economic view, even though he's a little more dire. but boy, this guy is -- capital one is interesting >> okay. >> yeah. we'll talk more about financials after the break, including some of these layoffs at lazard and what they're thinking about the ipo market we'll get to energy. exxon, chevron, better than expected earnings. amazing q1 mserics and we'll figure out what's going on with snap and pins in addition to amazon when become back

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got a pair of energy giants out with earnings, despite this decline in oil and nat gas, highest q1 profit in 140 years, their entire history on the exxon side >> yeah. i mean, you know, they -- they continue to make a lot of money. and will continue to for some time darren woods, of course, talking about, you know, the pressures they're under from the

government do more for sustainable energy but also produce as much as you possibly can >> there were some quarters in the 1880s. >> those were good days. >> heavily reliant on carbon >> they had a -- i was talking -- >> on whale oil still. >> i was talking to mike wirth, we were talking about the idea of having 100% of the oil market and you could print money there. but this was not that. what mike did is he's giving money back he recognizes that he's got tremendous permian assets. he's happy to give you the best dividend, and give you the best buyback, and i just think that that doesn't matter today, but if oil were to go up, i mean, this is the one to buy i'm a mike wirth backer. >> you've always been more preferential towards chevron than exxon >> differential. >> differential? preferential >> doesn't matter. they're the same why? because i think mike wirth gets

up every day and thinks, how can you make more money for shareholders >> i made up a word, didn't i? >> people do that all the time on tv. i would take mike in terms of what he wants to do and reservation of capital and shareholder and dividend, but i have to tell you, look, darren's impressive i mean, he wasn't -- david, he got an environmentalist to the board and he starts making more money. they should all put the sierra club on the board. >> they do have an interesting board at exxonmobil, and it's -- it does -- so far, so good >> it's pretty amazing >> low-carbon solutions didn't really get into it with the "squawk box" gang in terms of whether they should be spending even more, because they are starting to see commercial applications for the technology, and it is going to become a potential serious revenue producer over time >> look at what ge said this week about renewals and profitability. >> ge is talking about making money in renewables next year as they do the splitoff that's a great point exxon has more to rationalize. you could argue that exxon --

well, apparently it's just the biggest -- >> i have seen it. i've been there. you know, they get -- they could got to a million barrels >> maybe you can get darren on the phone. >> and the pardermian eventuall. >> i think chevron's permian assets, 2.2 million acres, and he's got other guys drilling on it for him >> i'm going to see darren at milken >> that's coming up next week. >> we'll have film >> we'll have some film if you want i could bring him on again if you want, but it seems kind of -- friday to monday, really would you want to hear from him again? >> what changed over the weekend? >> really? i could do that, but i think that's not a good look what do you think, jim >> maybe you'll have a t-shirt on >> i'm dead serious. you tell me what to do here, i'll do it >> i think you keep doing what you're doing that's what you do just do the do >> that's a quote. you keep doing what you're doing because that's what you do >> the stock has been a one-way

ticket >> it is what it is. >> short oil, and invite me to your funeral >> actually, reuters poll today, $90 by year-end is the consensus. >> yesterday, i had sheffield on from pioneer, and he said, bottom right here. bottom bottom opec plus. bottom you can -- bottom. and by the way, i'm not going to mention the outlet, but the outlet did not call him on the, i'm being sold exxon i would have checked in with the man. >> yeah, that was a weird story. >> wasn't it cost the shareholders a fortune. >> we'll get cramer's "mad dash," countdown to the opening bell after a short break don't go anywhere. ♪ ♪ a cyber-attack can grind everything to a halt.

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all right, let's get to a "mad dash" as we count down to an opening bell, get the final trading session of the week started in about seven minutes texas instruments reported earnings a couple days back. you want to come back to it now. >> i thought it might be a fluke, because they're talking about industrial weakness in texas instruments, auto weakness, but sure enough, chris says, look, this could be the beginning of the rollover, st micro didn't say good things mobile i blew up it's almost all owned by the nicest man in semis. >> intel, of course. >> but i'm saying we have a rolling correction first with pc, then with server, then it was datacenter, and now it's auto and industrial so, you got to be very careful, like on semi, which i like very much, i would be a little more cautious texas instruments could go down from here, but usually it all happens at once. >> is there a macro takeaway for that >> yes, the autos, gm didn't rally on that good quarter

tesla's not doing well ford reports next week the chrysler, not doing well people think autos are about to have a big downturn, and a lot of that is because of credit for autos but given by regional banks, which are being all hurt by first republic and by the morass that was silicon valley bank the reverberations of those banks being felt everywhere. the biotech companies. >> it's an interesting way to show how credit tightness can -- >> you were questioning my whole thesis >> i wasn't. >> you were. >> you have a mini-banking crisis you have tightening credit people have a harder time getting loans to buy cars, and then you end up with this. >> this is loans to buy cars, okay so, people have to recognize that what we're having is different -- it's not all happening at once. that's hard for people, because typically, the rollover happens all at once. it's not, and it's got the first republic problem first republic goes to goose egg on monday, all we're going to hear about is commercial and all

that stuff >> with first republic, there's no political will to do anything because there's no political hit. it's not going to be systemic. it's not >> but the vineyards, david. the vineyards. rich people get vineyards, and then they're going to get hurt they bought against their vineyard >> they'll get to keep their vineyards. >> harlan's good maybe the colgen i don't know >> we got a lot of other earnings movers to catch you up on, which we will do right after this you can catch us any time, anywhere, the sq"squawk on the street: opening bell" podcast. we're back in a few.

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the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. >> i don't know if it's that different. i mean, i come from a world of analysis, okay and trying to figure out what companies are worth and, you know, asking my analysts, like, deep questions so, that's the world i come from so, i just, you know, in this process, i mean, i put the best that i know -- i actually am not bad at this other thing i do i'm better at that than i am at this, to tell you the truth, but i took some of that world into here, that analytical sort of world and tried to think of the

different factors we want to find out beyond what these guys did. and listen, to tell you the truth, it's just one addition. this is a process. >> that's david tepper at the draft last night his panthers made alabama qb bryce young the first overall pick, as you know. what a cool crossover, right >> absolutely. and of course, frank reich, who is their coach, also played a role he was a great quarterback, frank. i talked to david this morning about this, and i thought he had mentioned that he likes meta he did but he said this he said, if a draft of cnbc talent was to be held today, jim cramer would be our all-around first pick he said that i just called him. >> congratulations, man. >> did you write that to yourself in your sleep >> no, i just -- you want me to get him on the phone >> they agree with you they agree with tepper >> really? wow. he reiterated.

>> the first pick is jim cramer from -- >> see, actually, i say it's not about friends. it's about money but david was a great boss at goldman, and he's been my friend for a long time. and i think it's very funny, because frank reich is a friend. and frank reich -- sure. >> i do like the part where he said, i'm actually pretty good at my other job. >> he's the best there is. david is still in there, trying to figure out amazon, google, i mean, he is. like amazon web services, and look, let's not forget meta. he was a big believer in meta. >> and what a week it's been there's a look at the open there, 4,128 at the big board today, it's green trees, celebrating 20 years of reforestation projects in the united states, and at the nasdaq, it's worth media group let's put a button on yesterday and how some of the technicians are saying maybe you take a crack at the mid-april highs >> i'm so glad you said that this is the mike wilson moment, right? one of the things that i saw

yesterday was that we have to put the rest of the idea that this was a bad earnings season yesterday was an amazing day i want to go to david on something that was a company that actually was up 10% yesterday, david and to me, it signified, wait a second, we see companies in a different light. the company is comcast and i need to know, when you go through it, should it have been up 10% >> well, i would never sit here and say it shouldn't have because it's the only stock that i actually own no, listen -- no on comcast, here's what happened you had a lot of people short. >> you did >> yes and so you had short covering yesterday. you had a better-than-expected free cash flow number, no doubt about it you had perhaps, at least i'm talking about losses coming to an end at peacock. you had no losses in broadband, and many people expected to come in and have losses at broadband, and yes, you lost video subscribers, but that's not an

important part of the business from a profit perspective. they don't make a lot of money on those that, though, the reason i talked about it yesterday was the impact it has on pure plays in cable such as warner bros. discovery, obviously, they have a huge streaming business. disney they're not -- none of these are pure plays paramount is closer to all of them were up, which is strange, because you have this continued acceleration in cord-cutting reflected in that number but as for comcast yesterday, it was a good number. it was a very strong free cash flow number. and a lot of people came into the quarter short. >> it showed me that free cash flow, which, you know, they've always been for profitable growth free cash flow here is so good at the other divisions too, connectivity, their business division, david, they actually, for the first time, really did talk about entertainment in a way that i liked, the super mario -- you got how great it is in japan, china. they're telling you the narrative. and if they can get the losses under control at peacock, which

they will, and then who knows what they don't have hulu who knows what's going to happen >> well, most likely on hulu is that we put it to disney, but you're right there's always the possibility given what iger has told me, and really those were his only public comments about hulu was from our interview a while back now, that they don't see general entertainment as their focus, and they are willing to consider anything with hulu >> they want that dividend, they got to do something. >> negotiations, as far as i'm aware, have not begun on hulu. it is an end-year -- i mean, early next year is when the deal would happen in terms of the put from comcast you see the stock has reversed we'll see. we'll see what really develops there. >> i know i work for the company, but the call was quite different. >> obviously, you also had wireless speaking of wireless, guys, it's worth coming to t-mobile, and -- >> t-mobile doesn't like the comcast wireless program >> what about their own wireless program? t-mobile shares are down 3% on that number, jim >> there are people who say, enough this thing ran into the quarter

like i've never seen just to go back for one second on comcast did you notice they have these new divisions so you can understand how much money they make it was incredible. they have a tremendous business. >> you really want to talk comcast, don't you >> well, i just thought that comcast -- to me, sometimes when you get a conference call that's different from previous calls and it's more penetrable, understandable, it really can make a tremendous difference >> well, it did. look, the stock has a little follow-through by the way, worth mentioning charter, which did not look particularly good, but moved up yesterday. i mean, the entire group moved up sharply yesterday on those numbers from comcast and charter reported earnings also, and they -- you know, the read i'd gotten that free cash flow was a bit lighter than had been anticipated, broadbandmay have been a bit light, but the market seems to be responding positively so, i want to go take a look back at that, jim. >> but that goes to -- that's

what i'm saying. there are a lot of segments of the market that people didn't care about, and suddenly, they've come alive i mean, cable? people haven't wanted to buy cable stock in ages. >> yeah. couple things on disney. wells today takes a look at the lawsuit in florida and argues that at the very least, it's going to cause both sides to lawyer up and probably meddle a little bit less in disney's day-to-day operations. that's the wells point of view there's also "the journal" piece, looking at how in the eyes of some florida gop'ers, the public is not with desantis on this issue. >> i don't think they are. >> there is some signs of cracking in terms of support for what some argue is a personal vendetta by the government >> i think that you have to be careful with bob iger. he's very, very smart. and he doesn't play for dinner and if he wants to take -- i'm not saying that you can take a governor, no if he want to take the governor on, he can do it he can make the governor look really stupid. have you ever been on the other side of something with iger and

how he makes you feel? he can make you feel real stupid >> he is very deliberate in his approach he's always very measured. he is a great communicator >> is he ever. >> but he importantly knows when to communicate and when not to and he's a very difficult foe. >> oh, i like that he's a difficult foe he can be belichick when he has to be, but he's certainly andy reid though he likes green bay, which is -- sorry, aaron >> by the way, again, to come back to what you were -- not just comcast, but charter. it is worth noting, and t-mobile, i mean -- >> which is down really badly. >> the mobile lines at spectrum, 5.978 million, up 51.8% from a year ago almost all of that is residential. i mean, that's -- they got a real company there in terms of wireless >> that's exciting >> almost six million subscribers. now, obviously, it pales in

comparison to the tens of millions, hundreds of millions that t-mobile or verizon, at&t, but nuonetheless, these businesses are growing quickly, and at the margin, that has an impact >> if we see the insurance stocks, i had chubb on last night, if we see that group, that's another group that's been in the dog house we have groups -- sectors that are out of the dog house now, some clown will come up with an etf, dog house, but there are certain sectors that have been untouchable that are suddenly interested. >> there was one last thing on media. imax, by the way, today with a double beat. system signings, highest since 2020, q2 >> people like roku. >> that stock is up 40% for the year people are looking at the bank rally, so to speak, yesterday, jim. even as spreads are not really repairing themselves that much and how far apart the kre and the qqqs can really get. which side gives >> qqq is going higher

>> and the kre follows >> yeah. i have to tell you, when you see -- even though he was just talking about industrials, that's very important. can we just say, the run in the consumer packaged goods stocks, not recession. it's not all recession some of it is, like, colgate reported today they're just doing better. what's happened, we've got a whole segment of the market where they've stopped -- no more price increases from the suppliers, but no one's cutting the price of a hershey bar no one's cutting the price of colgate dental cream >> that's new highs for the year of colgate >> you are seeing general mills. they are not cutting the price of cereal. mondelez, david, oreos oreos are so strong. i'm not kidding. he's making fun of me. >> i'm not making fun of you i love cookies

i eat mondelez cookie products every night way later than i should >> you swim every day. is that how you're able -- >> almost. >> campbell's is doing great michelle buck may be best in show such an amazing -- look at mondelez this is -- well. >> wow >> they know what they're doing. >> that's an all-time high >> they know what they're doing. >> i know. i talk about it all the time >> do you? >> they keep shrinking the size of their cookies >> i saw dirk van put at the wedding, the peltz wedding >> the wedding carl, it's just known as the wedding. >> there's a picture of me and my wife that says, woman with unknown body guard i'm a body guard for my wife >> you, dirk, ike perlmutter it was a great time. great time was had by all. >> you were there, david you know, they did the chairs, and david beckham got on the chairs >> really? >> yeah. how cool is beckham? he also had the eloquent -- dave didn't get -- i guess he didn't

get the invite >> neither did i >> by the way, i didn't get the invite to the tiffany opening party yesterday, which i heard was a blockbuster. >> lvmh. >> yes, bernard arneult was there with his five children >> really? the richest man? is there anything unhappy about that man >> a lot of our richest hedge fund were there. you had to meet a certain threshold to walk in >> tepper was at the draft >> that's good news for the city >> we need that. sl green didn't really put a good number. >> now they need the chinese tourists to come back, carl, because they spend a lot of money at tiffany >> it will happen. they're building buildings in china. they've sped up the permit process. >> they seem to be cracking down on u.s. corporations even more >> we're in the doghouse but you can get me you can justdo a chatgpt of me saying, you know what? as good as mao was, this guy's better and then it goes all over that

cramer said this >> and then you're a hero. >> we regime >> and then you're a first-round draft pick >> when you speak to jensen huang, that's what they're most afraid of. they need guardrails >> guys, we should hit snap, which is down 20%. we haven't really hit it off the call, evan spiegel saying demand in the first quarter disrupted by the changes we made to our ad platform to drive more click-through conversions. the changes, he says, are disruptive in the short-term, but they're optimistic that the platform improvements are laying the foundation for future growth >> i like you, evan. good luck. great line in "succession. >> close to new lows for the year terrible call. almost in classic snap fashion on earnings. >> they need to spend a fortune to be anywhere near meta this was like a horse race remember newspapers? well, when there's, like, one newspaper that is definitely more circulation than the other, all the ads go to that one, and

that's what's happening now. meta as a.i. cracked you don't need to do smnap. you don't need to do pins. >> what happened to pins pinterest shares are down 15%. neither one is getting any -- a good response to earnings. >> you need a fortune to keep up >> what does that mean, jim? what are you saying? >> well, because a.i. costs a lot of money you have to spend, like there' no tomorrow. >> if you're doing a large language model, the amount of data you need. >> zuckerberg is a one-man, you know, he's unbelievable himself, but he has a great vision of what to do with a.i. these guys just realized, wow, we're up against a huge and formidable opponent, and they're not powerful enough. they have no scale they don't have the bank account. i would be very worried at snap. i would be very worried. >> you would be very worried >> very worried they're not going to be a factor not a factor they have to spend too much. >> one of your trades, jim, that

is getting a second look is caterpillar on this flat year-on-year backlog, and some comments about better equipment availability means that dealers can wait to order more >> yeah, i think that there's three different firms that have a sell on it and i think that those firms should go back on my interview last night where caterpillar's got, first time, it's got -- it's been decyclical is the way i put it decyclical it just does not have that same sink or swim, up or down, and it's not dependent on one group. they've got oil. they've got china. but they have road-building, and the most important thing, of course, is that there's a trillion dollars of -- trillion. trillion dollars of infrastructure >> it's just hitting >> that's going -- they only have the nonpermitted. i know that if you want a road permit, none of that money's been spent yet they have multiple years ahead of them of the federal government making you buy caterpillar. these analysts are all concerned about q3, and i can tell those analysts that they should go and listen to dave tepper.

you better know what you're doing, because they're not -- they're, like, they're not seasoned pros, the guys who are against this thing let me tell you, they're going to get run out of town >> listen to what he told jim last night >> based on our first quarter results and the healthy demand that we see in most of our end markets, we feel even more optimistic that 2023 will be even a better year than we previously anticipated >> well, good. look, that man has been right the whole time he's changed it so it's not cyclical as cyclical as it used to be in the old days, remember, china's down, let's short cat. oil's down don't short this thing there's three firms that are recommending short they're shorting caterpillar >> i don't know what it is versus industrial, but it's 12, 13 times, something like that. >> exactly right and they're spewing catch. umpleby has been right these shorts are saying it's going to be like 2018. think about 2024

listen to what the secretary of commerce says about how much money is going into infra, and then short it at your own peril. these geniuses who are telling people to short it at these firms, i hope they all -- well, let me just say, they're going to be very wrong >> meantime -- >> i'm trying to be diplomatic >> it's been a busy day for data employment costs up 5.1 year on year let's get to rick santelli for chicago pmi. >> chicago pmi has a surprise. it's 48.6. now, the fly in the ointment, of course, is it has been over 50 since august of last year. it's in contraction mode, but 48.6 happens to be the best level since the 51.9 in august of last year and we can see that interest rates really haven't moved a whole lot. as a matter of fact, as this number came out, we've ticked

down a bit, and at current levels, we're down a dozen basis points on the week and actually we're down a dozen basis points on two-year on the week. we still have more data to go in the form of university of michigan sentiment top of the hour on an april final, and "squawk on the street" will return after a short break.

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doors were meant to be opened. take a look at the stocks so far this month versus the s&p. hasn't underperformed this badly against the s&p since 2019, and before that, you got to go back to '08 >> it's been a nightmare we have that rolling correction in semis we still haven't seen a bottom

in any of the areas that have turned down, whether it be pcs, server, datacenter, auto, industrial not a single bottom yet. and yes, intel can go up because of its own issues, but there is no doubt about it, that this is one of the worst cycles i have ever seen, and it's just because it's usually all at once instead it's this contagion. it doesn't help that china - >> even the upgrade by wedbush says people are still too optimistic on pcs and then arm and ad will take share. >> i think it's a dog -- there's a dog fight in every one of these. one thing that has stood up is nvidia nvidia has the right -- it's not chips but cards -- but only nvidia people tell me nvidia will roll over, but i say, how can it roll over when ever has to have a.i

how much does -- you have snap they have to go get nvidia they're 45,000 per car. >> like taylor swift tickets, getting some of these. >> yes. >> one of the great inventions we've seen, i guess. >> taylor swift in. >> gpus, nvidia. >> it's just not a -- it's considered a semiconductor but not really a semi. it's like what you have when you want -- it's gaming card souped up that's where they came from. >> right. >> i think when i looked at -- remember i said st micro, when i look at what's going on in autos, i wonder about autos. i think autos are the one i'm most concerned about remember, that's a big - >> a story on the tape we don't have enough repo men on seizures because we're getting to that part of the cycle. >> how is carvana doing. >> quick on lazard, cutting back 10% of the workforce the ceo says candidly things are not feeling as good as they were in december or january and time to act and i don't see any

imminent improvement in the ipo m&a. >> where is the takeovers? i think the -- >> but the activision blizzard was chilling. >> cma there, we'll be talking about that for some time this is a company that relies on m&a advisory fees. some capital market activity as well. >> stories. >> you don't have it. >> i'm not -- they're not in danger whatsoever. >> you get these companies that don't have a lot of work. >> how many ipos have we seen? >> nothing. >> j&j i thought they get it done because they truncated the road show. >> kenvoo. >> the spin. >> kenwood, kenmore, washing machine -- >> i would tsuassume we'll see in the marketplace it's not hostile for a new interest. >> interest rates are right. bring the deal look at pepsico flying, coca-cola, colegate, bring the

deal right now bring it right now. you guys do drugs. i do stocks. >> it's friday they're not bringing the deal on friday. >> first republic. >> yeah. >> stocks are trading up. >> well, we'll talk about it some more. >> meantime moderate gains for the dow thanks in part to intel the biggest gainer stop trading with jim is coming up next. interesting piece. let me bring in my expert. mmm... so many scratches... oh those are from my car keys. such a rich history. yeah. this won't do well at auction. but at at&t, it's worth a brand-new samsung galaxy s23. wait really? mmhmm. what about this? at&t's deal is back. wow. everyone gets a free new samsung galaxy s23 with a galaxy phone trade-in. any year, any condition. good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help!

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time for jim and stop trading. >> the stories we have not talked about at all, as a network we have to talk about, the demise of solar. solar has gotten too expensive versus nat gas, probably short term, but first solar, the quarter was -- half of the estimates and this is on the heels of a terrible quarter from end phase. these are -- a lot of people are saying natural gas at $2 has crushed these guys now i thought there was a -- really not to do anything, carbon versus noncarbon but the solar stocks among the worst this year and i would be careful. i don't think they're done. >> interesting how about tonight in. >> i have rockwell automation, one of those companies that is going to kill it when it comes to the chips act and ira

people have to recognize that money is coming. and it's going to be the biggest infusion since what they did during the great society under johnson. remember that, when he had guns and butter that was the lowest employment ever until now that the infrastructure bill is just the greatest thing ever. >> well, chips act, ira and infrastructure bill. >> we don't have enough caterpillar machines to go around. >> right. >> or human beings. >> these three stoojs are telling you to short it. you can take five years with caterpillar but we have to short it oh, geez. >> we'll see you at 6:00 "mad money" at 6:00 p.m. eastern time tonight when we come back we'll stay on top of the reaction of tech earnings from amazon, intel, snap don't go anywhere.

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good friday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with david faber, melissa lee with us on this friday live at post nine of the new york stock exchange. sara eisen has the morning off decent action after an eventful

night last night in the wake of the amazon results we're watching pin and snap and financials as we go into the weekend and fresh data crossing the tape let's get to rick santelli. >> yes our april final read, carl, on university of michigan sentiment, which means our mid-month read gets tossed mid month three for headline, 63.5, remains at 63.5. that's the best level since february look at current conditions, it moves from 68.6 down to 68.2 so 68.2. we lose 0.4 there, but it's still the best level since february of this year as well. and if we look at expectations, 60.5 versus 60.4 it improves by 0.1 the best since february. now let's get to the meat of it on the inflation remember, these aren't necessarily quantitative, they're more of a respondent survey

on the one-year inflation 4.6. it stays at its mid-month read the problem is that 4.6 it's not lower, so we have lower, lower, lower, lower in january, then popped a little in february and then lower in march and this final read moves from 3.6 in the previous month you can see it's sticky and 5 to 10-year inflation actually ramp up 0.1 2.9 moves up to 3%, the last time it was at 3% was november last year. last time it was higher was june of last year at 3.1. so these numbers are a bit stickier, but i do caution they are qualitative versus quantitative like all the numbers we've seen with the personal pce core and month over month and year over year inflation, may be coming down in so many metrics the market is paying attention to, but they're still lofty by historical standards melissa lee, back to you. >> thank you

we're 30 minutes into the trading session. three movers we're watching this morning. starting off with capital one under pressure after posting earnings well below street forecasts. the company citing difficulty with lending throughout the quarter, provisions for credit losses surging to $2.8 billion in the quarter up from $677 million a year ago meantime cloudflare dropping 20%. first quarter results missing and revising the full year revenue guidance lower, amazon losing premarket gains after executive on the earnings call kugds suggested cloud revenue growth would slow in the near term ceo andy jassy's bullish on the cost-cutting measures. take a listen. >> we have looked pretty hard at every single one of our businesses and i think while it's probably most visible given the size of it, the improvement in the operating margin and efficiency in our stores business i think every business is working hard finding ways to

be more efficient and, you know, as brian said, i think we're making really good progress, the fulfillment costs and operations network and stores business. >> the turnaround in the afterhour session was just amazing, carl, up as much as 12% on the news and then declined down 1.25% when they started talking about customers optimizing how they spend, looking for how to save money wherever they can save money and how they're seeing the step down in growth in aws in the month of april. this talk about cost cutting may have alleviated some of those concerns but all in all this is a pretty decent reaction from amazon given the stock up 7% in the prior two sessions going into the print. >> and 500 basis points is a big month on month directional change mkm says after cutting system for six quarters our revenue operating income estimates go up for the first time they say what's amazing is that aws, the second largest enterprise software company is a show me story at this point.

>> wow. >> which is a long way from where we were a couple years ago. >> at this point we've heard, you know, about the cloud businesses from the giants, from microsoft and alphabet and it was interesting they talked on the conference call about not seeing a major shift in balance amongst the major cloud players because that's the next question the next question is here, if customers are optimizing, competing for the long run, they emphasize that as well, they are optimizing their own business, amazon that is, for the long run, does that mean ultimately cost cuts to maintain customer relationships for customers that looking to find efficiencies and that means pressure on margins. there's questions here still about the story. >> we've been through price wars, though, in cloud before. >> we have. >> at one point it was driven by the entrants of amazon and aws and by the way, jim was pointing out this morning, some of the near term operating margins north america beginning to turn better because of the cost efficiency moves they've made. for the short term, execution

may be getting better. some of the earnings movers include snap and pinterest, remarkable turnarounds to the downside julia boorstin is watching some of that. hey, julia. >> hey, carl that's right pinterest and snap are suffering from concerns about their futures. snap shares down nearly 18% after the company's quarterly revenue declined by 7% which is actually its first year over year revenue decline ever and now the company's forecasting a worse than expected 6% revenue decline in the second quarter. morgan stanley with an underweight rating on the stock writing, quote, visibility towards faster ad growth remains low leading to an increased knee for ai-machine learning to improve the growth trajectory. pinterest is down about 13% on concerns about second quarter revenue guidance missing estimates and operating expenses growing. the company announcing, though, that it is opening its ad platform for the first time and

partnering with amazon to bring its ads on to the pinterest platform morgan stanley with a hold rating on the stock saying, quote, the new stramgic partnership with amazon is a potential key lever for pins to increase the breath of shopable ad content on the platform to lead to relevance and increased monetization a number of analysts noted the long-term potential for pinterest to turn into a shopping platform. it's worth noting that 39% of analysts have pinterest rated a buy and 15% of analysts rate snap a buy at this point guys >> when it comes to snap, we've already heard from the giants about online advertising and the commentary has been pretty decent actually. does that imply snap is losing out to them as customers start to focus on how they are spending and whether or not that spend is efficient >> well, in addition to all these macro economic pressures, and i do think that meta saw a

little bit more stabilization than maybe these other players have seen, snap is in the middle of an ad transition here they're shifting all of the ad interactions the way consumer interacts with ads to a new format and that is a headwind right now. they think it will be a tailwind, but for now that is impacting their ad revenue that's an additional factor that snap is grappling with amid all of these other challenges right now. >> down 19%. thank you. julia boorstin one name moving in the opposite direction is intel this morning. despite reporting its largest quarterly loss in company history, our kristina partsinevelos diving into the latest commentary from the street. >> the bar was really set so low for this name and that's why they beat expectations even though the quarterly revenue dropped 36% year over year you said the worst net loss, quarterly loss, for its history. so it's enough for wall street analysts to turn positive because that bar was so low. benchmark upgrading intel to buy, wedbush to neutral, both

saying the worst is now beintel and that is driving the name let's go over what intel did right. demand weakness would persist across all segments, but they see a recovery in the second half they're adding to the narrative pc sales have bottomed cost controls seem to be working with operating expenses lower. customers are sampling new offerings set for launch in 2024 they've had struggles in the past we're not all the way there yet. the ceo pat gelsinger said we still have more work to do and the cfo not satisfied with the results. gross margins fell short and server and networking marketses have yet to reach their bottoms as clouds and enterprise remain weak wedbush, arm is going to go public and pat gelsinger is entering his third year and said this is all part of his

turnaround plan. let's see what he says today on cnbc at 4:00 p.m melissa? >> thank you kristina partsinevelos let's get to the broader markets and the last trading day of april we're doing pretty well considering the huge decline that we're seeing in amazon this morning down 4%. considering the run up that we've seen going into today, mike santoli is here at post nine to break it down. the nasdaq up 3% in the past two days. >> yeah. >> i mean, this is pretty heroic i think. >> sometimes the market tells you what it was most worried about once we get news and i do think the slate of news we got this morning on theeconomy at least showed you people were a little worried about wobbliness in the consumer and in the overall, you know, kind of activity level and i think that between yesterday's gdp, today's income and spending and then the chicago pmi, it's like okay, it's a steady state economy, nominal spending nincomes and growth are okay, however it's lagging and it's all equivocal, we don't know if that's the

case, with he know inflation is sticky we'll see if it changes the equation for the fed in terms of the market, flatish week, flat month, we know why. because this sort of winners within almost every sector but especially in tech and growth, have done very well and piled on the market cap at the expense of other areas of the market and actually if you look at the largest 50 stocks in the market, relative to the russell 2000, 2,000 small ones, it's at a peak that ratio, relative performance of the very largest stocks, and over a 10-year span it has had several of these, that's the highest one right now, okay, so what does it mean when you get to one of these short-term highs? it doesn't always mean the rest of the market is about to fall apart. sometimes it has preceded a correction, but 2016, february of 2016, that was the bottom of a correction this was high in april of 2020 the difference here is, the big ones are going up and the small ones are going down. not just the big ones are going

down less. we can talk about what the implications are but it's the market saying growth is getting more scarce, we want to go for better balance sheets and more predictable growth and willing to pay up for it the cheapest stocks in the market are doing the worst. >> if you're small you may be credit constrained to giant names. >> huge part of it. >> incumbent favorite. >> no doubt about it the russell 2000 and the micro caps have traded in line with the banks. we know that it's even happening within sectors. so exxon has destroyed the equal weighted energy sector this year and actually for the last year it's quality predictability and i think the real debate, the bull/bear debate is, is that just kind of this temporary phenomenon where, you know, your best players are on a hot streak and eventually they're going to cool off and the team starts to lose, or is the other stuff correcting, and it looks like it can get oversold and we can kind of muddle through from there

>> before we breathe a sigh of relief, next week we get apple and then a fed decision. you would think with all this talk of stabilization and feeling things are better than expected that you would be like okay, the fed might hike again, though beyond next week's meeting. >> it's true i think we're going to get locked into that fed stay in neutral. a quarter point next week is baked in after that most people are thinking six, seven weeks later maybe another quarter. that's not a pause but that's also not the fed really slamming on the brakes yet. >> yeah. >> we're going to be talking about may, might, or could. >> that's right. >> and whether that line stays at all. >> in may. >> we'll be doing all that. >> thanks. mike santoli the road map for the rest of the hour including more on first republic ahead of what may prove to be a pivotal weekend for the sfwhoonks reporting a beat on earnings, highlights from the

conference calls wrapping up. >> wrapping up april to may, your investing pyblaook is still ahead after the short break. don't go anywhere. i'm bill lockwood, current caretaker and owner. when covid hit, we had some challenges like a lot of businesses did. i heard about the payroll tax refund, it allowed us to keep the amount of people that we needed and the people that have been here taking care of us. see if your business may qualify. go to getrefunds.com. and it's easier than ever to get your projects done right. with angi, you can connect with and see ratings and reviews. and when you book and pay throug you're covered by our happiness check out angi.com today. angi... and done.

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comcast business. powering possibilities™. we moved out of the city so our little sophie could appreciate nature. but then he got us t-mobile home internet. i was just trying to improve our signal, so some of the trees had to go. i might've taken it a step too far. (chainsaw revs) (tree crashes) (chainsaw continues) (daughter screams) let's pretend for a second that you didn't let down your entire family. what would that reality look like? well i guess i would've gotten us xfinity... and we'd have a better view. do you need mulch? what, we have a ton of mulch. energy giants exxon and chevron reporting before the bell today pippa stevens listening to the conference calls. >> both companies beating top and bottom line estimates during the latest quarter with exxon reporting profits for the first three months of the year despite the decline in oil and gas prices and with record payouts to shareholders the companies

are sitting on a lot of cash and there are questions about what they might do with that. on the call just now, exxon's ceo darren woods asked about possible acquisitions emphasizing any deals would be focused on value rather than volume he added the company is comfortable with the current cash level saying it's a buffer when moving into the bottom of a cycle. executives emphasizing the importance of growing exxon's dividend noting roughly 40% of the companies shareholders are retail investors woods adding the company is on track too cut costs by $9 billion by the end of this year relative to 2019 chevron's call kicks off in 45 minutes and key things include commentary around the permian production and capital spending plan exxon just now hitting a new all-time high. >> thanks very much. crude oil is heading for the sixth consecutive month of losses that's the longest run of monthly losses in more than eight years. ed morris global head of

commodities joins us and warned about getting too excited about thinking oil will go higher. so good about resisting the temptation to think too bullishly. what do you make now it's this opec gap >> well, we're moving into different season we're moving into may which is traditionally the lowest demand month of the year. but it's also a month when refiners start gearing up for summer driving season, so we think, you know, we're close to what you might call a bottom based on fundamentals. what we're seeing in high frequency drauts inventories beginning to draw after building tremendously that was kind of the main incentives that countries mad making the announced cuts for may. we'll see how much cuts they put in the market. but undoubtedly summer is going to be stronger than what we've seen unless the world goes into a recession more quickly so, you know, one of the things to look for is what the fomc is

going to be doing. >> right and i noticed yesterday the russian deputy prime minister speaking on behalf of opec said there's no need to cut more. do you see that view changing among the cartel >> well, look, a day before they announced the cut for may, the saudi oil minister said we're -- we said what we said and we're going to be here until the end of the year. they're keeping their cards close to themselves and acting like the central banker of oil we can't anticipate because they say they're not going to do something a day before they meet they're not going to do something. we're in a month by month situation again as we have been before they said cut this out we're going to do things a year at a time or half a year at a time we don't really know on the other hand what we do know is that we are close to the lowest demand month of the year and if i were in their shoes i would wait to see what next month brings. >> doubts about recovery in klein, playing out in the

chinese stock market in particular and i'm wondering if that's sort of the part of the oil equation that you're revising lower in terms of demand? >> well, we have to year to date we had a tremendous month a month ago in terms of imports into china they were close to a record levels or refinery rents were at a record level exports were extremely high. if we look at what we think demand was, we think china had to have been building stocks by at least a million barrels a day. there's a case to be made it was more than a million barrel a day build. we're seeing on the import side reflected on the export side and not necessarily reflected in a demand surge, at least not year to date. >> ed, we made note yesterday of corn lowest since july wheat lowest since july of the prior year lumber, lowest since may of the prior prior year are all of these tells or not? >> well, on the ag side, they've

had a wonderful year outside of argentina. we expect record crops in russia we expect record crops in brazil we have a really wonderful set of, you know, plantings and the planting season in the u.s the market is looking for oversupply and unless weather, an unknown, changes abruptly between now and the season, we don't know but the supply demand balance looks to be on the high side there's speculation about whether the deal that russia cut with ukraine is going to be maintained that's a deal in which russia is allowing ukrainian wheat exports. we think they have every incentive in the world to keep that arrangement going they are major suppliers to the countries in emerging markets, particularly in north africa and the middle east and in east asia and the last thing they want to do at the moment is to spoil in any way their relationship with

countries that have stayed neutral in terms of the combat between russia and ukraine. >> ed, thank you good to see you again. ed morris at citi. a check on markets as we are close to session highs here. 137 on the dow to the upside and pretty much highs for the year on qqqs. what if beer could get to the right place, at the right time, all the time? not like that. like this. getting this beer... all over the world... right when they need it. yes, with ibm consulting, ai-powered software can help automate your supply chain— so beer can be ordered, produced and delivered more efficiently. so happy hours keep going. salud! and the beer keeps flowing.

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introducing the next generation 10g network only wha from xfinity.ate? the future starts now. this week saw many of the notable regional banks report quarterly earnings which mostly underperformed the broader banks. leslie picker is taking a look at the revisions and financials. >> first republic emblematic of the banking sector, the regional banks you mentioned, shares currently lower as investors weigh reporting that a rescue plan may be in the works the stock has lost half of its

value this week alone after first quarter results is showed a flight in deposits and analyst price targets average about 35, 45, nearly one sixth the level that first republic is trading at the last few weeks of bank earnings have seen sizable revisions, mostly to the downside and as you can see from this chart here put together by jefferies, jpmorgan really an outlier in the top right quadrant with gains in its stock price and a boost in analyst earnings system. its peers, wells fargo, bank of america saw negative revisions despite shares increasing during the mid-april earnings season. the bulk of those larger cap regional banks fall into the lower left quadrant, zions, key bank, both experienced negative eps revisions and declines in their shares this bank earnings season which pretty much ended this week led to deeper declines in regional

names widening the gap between financials and broader s&p and solidifying first republic's place as the biggest laggard in the broader index. guys >> we're so glad to have you back on the beat, but we need to take a moment to congratulate you and evan on the addition to your family. >> thank you. >> i think we have photos. >> that's noah she's -- she's about 5 months, ready to fly eating food and sleeping like a champ wow. >> i enjoyed the time but i have had major fomo with the news flow. >> you didn't miss anything. >> nothing. >> nothing to worry about. >> when azure was born there was a major pandemic and now a banking crisis so i think i -- you know, i have pretty poor timing that's all right what's important is you're back and plenty to cover. >> thank you.

>> a lot left to chew on, that's for sure. >> from chew toys to the news. >> exactly. >> leslie, welcome back again. >> thank you after the break, we'll turn back to amazon the stock dipping lower on the cloud growth concerns. we're down a percent in the after-hours session. we're down 3% right now. we're back in 2.

. wants to come back to something leslie was talking about. it's a fast moving situation and we follow the fate of first republic a bank left hobbled after that mini banking crisis of early

march. we've been following it ever since. latest i can tell you at this point is -- there's been a lot of different reporting here -- right now the focus seems to be on the fdic talking to banks about a solution but a solution that would include receivership. so talking to a number of banks is what i'm hearing. getting their best bids essentially. what would you pay to own this franchise. but that would, obviously, be part of taking the bank into receivership and then announcing a deal under which name the bank, unclear at this point you can guess, of course, in terms of the group of banks we may be talking about would then continue to operate first republic, but under its own. several banks are being asked for basically what i'm told are their bids, and again, most likely in a receivership scenario first republic, for its part,

gave us a statement this morning saying they're engaged in discussions with multiple parties about strategic options while continuing to serve clients. and i am told as well that there is still this hope for this what they call open market solution, which would not include receivership, but would include some sort of aid from these banks but that seems unclear for most of the week at this point we started reporting on this tuesday morning. that would require the government to force the banks to do something that is against their overall interest to a certain extent by saying you must do this as in buy assets off the balance sheet higher than their mark to market and things of that nature. we continue to follow it closely, and, you know, this weekend would be pivotal if not as soon as this evening, perhaps, for first republic. what do you get if you are one of these banks you get a lot of high quality

customers locked in in part because of their mortgages with the bank, receivership allows you if you were an acquiring bank here to break leases without any penalty, so branches, for example, you don't want, you don't have to take but it is interesting because that's not viewed as a bailout even though that will actually cost really the other banks money because you will increase assessments, whereas the open market solution is not a bailout but the government doesn't seem to be willing to force what needed to happen, perhaps because there's no political fallout if this thing does go into receivership and there's no systemic risk if it goes into receivership >> what happens to the assets that banks didn't want the whole issue with banks snepg is taking on those assets and having to have a loss immediately basically. >> if there was a buyer of first republic, for example, you would have to mark all the assets to where they really should be and you would take a hit or a hit to

your own book value, hence nobody wanted to do it. >> in receivership how does that change >> the fdic takes the hit. >> privatization the losses without privatizing the losses -- >> the fdic takes the hit on that to a certain extent and that would be where they take another $25 billion, $22 billion, whatever the number would be, and then you, obviously, have a clean bank in a lot of buyers would be interested in owning even what's been an exodus of their fas to other institutions. >> yeah. >> it is remarkable how different it feels than the episodes in march. >> yeah. in part you credit to the regulators because they had created this space that allowed all the regional banks to report, the markets to become calmer about the scenario under which first republic might end up in that state

there is still time for things to change and we will update you if we hear that. that seems the conversations about what's your best bid for this bank including, of course, the fdic stepping in and taking receivership and the hit on the losses in terms of those assets? >> the stock is halted down 6.8% right now. it's worth noting that the regional bank index the cre is up 2%. to your point, david, earlier this seems to be a very first republic story there are firewalls in terms of the impact on other banks and maybe that's a good thing overall. >> meantime we're expecting at some point that report from michael barr at the federal reserve and later on, perhaps, the fdic about lessons learned from svb and signature, it's strange they're converging on this day, if, in fact, this ends up being a newsworthy day for frc. >> i think the question, of course, will be, if they don't find what they had hoped beginning really the beginning of the week, for weeks past,

this open market solution as they continue to refer to it where you get the banks to come in and give you a lifeline essentially buying things above the value, yeah, you end up where many people thought first republic was headed in the days after svb and signature went down. >> is there any sense as to which bank would be interested in whatever is left of frc >> there's quite a few is my understanding. hard to get a specific number, but i'm told several, whether it's jpmorgan or bank of america or wells or pnc. you could go through any number. i don't want to say those are all the banks because i'm not sure of the names. i have not been able to ascertain them enough to say those are absolutely the names so that's more speculation. >> okay. >> longer term, goldman has a desk note out today. market doesn't have clarity on the growth drag this will result in collectively over time. they say we're of the instinct that any impingement on the provision of bank credit will

slowly feed through a drag on the economy they view would be a dwrids outcome given how difficult things looked six weeks ago. >> right to your point about the reports being released expected within the reports are potential regulatory fixes, i don't want to say fixes, because it may not be that specific, but a road map or an idea of where congrat regulation could be heading we'll keep you posted and look at first republic by the way, can we put the chart up again? >> it's down as you might expect given we're sharing these headlines. the stock is all over the place. again, it's still a alive but unclear where it's fate is monday we may have a much more distinct answer. >> all right let's turn back, meantime to amazon under pressure after executives on the call suggested weakness in cloud growth in the near term. joining us james lee, who has a

buy rating on the stock raising his price target from 135 to 145. great to have you with us. >> thank you for having me. >> when i talk to investors about amazon their number one issue with this company is the valuation. that was even prior to the earnings with the earnings out and seeing the slowdown in cloud is continuing in april, how do you justify to your clients the valuation, priced for high growth when we're not seeing that right now >> okay. good question there, melissa i think valuation is [ inaudible ] at this point in time we value the stock based on two-year forward ebitda and traditionally we've seen amazon in the range to mid to high teens and at the current price right now you are probably trading around ten times forward ebitda, right. with the fundamentals being positive on retail business. they did really good job on expanding margins on retail by

driving efficiency on their fulfillment centers, at the same time cutting their head count as well and also aws, even though it's deceleration into next quarter we're projecting about 10% growth, we're close to the trough with potential recovery in the -- towards the end of the year we think the risk-reward from the valuation and also from the fundamental inflection point view is very attractive. we like the stock here. >> given that we've heard from all the major cloud players at this point, james, and yesterday on the conference call the cfo made commentary to the effect of we're not seeing a shift in balance amongst the major cloud players, what's your takeaway here hearing what amazon is guiding about april, but also hearing what microsoft and alphabet has said? >> yeah. >> i think one things investors need to keep in mind is that amazon runs a consumption. so in a down economic cycle

we've seen today, you're going to have a double negative leverage in terms of pricing and volume but when the economy starts to rebound specifically, we should see that benefit translate into amazon's revenue growth. so in the short-term, it does look like they're losing market share against peers, but i think structurally they're not. >> james, interesting takes this morning, really through the lens of microsoft, bloomberg says that -- nadella rightly smells blood in his quest not just to dethrone google on search but amazon through a.i. and take a crack at gaining share against aws. i wonder if you think they are the white rabbit at this point >> that's an interesting point and key debate for investors right now besides market share, what about amazon's position or aws position in a.i. i thought management did a good job defending their position on

the call and lay out two differentiators on the earnings call first, they are using their own chips to process gen a.i that means the new economics could be much better than peers. number two, you know, they are allowing, you know, enterprise in aws to run their large language model that means, you know, they could potentially pass the savings or cost savings to clients and now allow them to have a better pricing in the market lastly, they can use their large language model to enhance applications of alexa. from that perspective i thought they did a good job laying out how they're positioning on a.i., and if you think about gen a.i., we're still in very early days of development, so i don't think amazon is late to the party. there's still a lot of opportunity for them to gain share. i think one important thing they decided to do consciously is,

you know, allowing customers to extend their contract to long term and save money in the near term what that does, keeps customers on the platform and allow them to capitalize opportunity in a.i. long term. >> james, great to have you. thank you. james lee, mizuho. >> thank you. >> as we go to break the biggest s&p laggards for the month you will see frc in there, right at the top, obviously, on a big news day tesla as well at number 4, down 22 some of the all-time highs today a lot of consumer and housing. chipotle, mcdonald's, pulte, yum, mondelez, pepsi, even exxon. we're back in 3.

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do the work, before the work. bodyarmor lyte. more than a sports drink. one of the last trading days of the month the dow and s&p big month in may with the fed decision let's bring in devon kaclue who oversees $470 billion. we got q1 gdp under our belts

and i guess the question in the back half will be about recession. is it your base case >> i think so. when we think about devising interest rates and the issues in the u.s. it will feed to through slower growth in the u.s >> for how long. >> i think it's going to be difficult where it bottoms out and that's one of the big questions the market is trying to determine i expect it going into 2024. >> and how much can be offset globally by any kind of resurgence in china, for example? >> i think that's one of the interesting things china's recovery is pretty tepid. one of the things we hope is it's going to build up a head of steam, but so far, it's not doing that yet it's going to be hard to say that's able to offset the slowdown. >> it's remarkable when they first started to reopen we got a bunch of target increases for the year, right, in terms of their global growth. >> that's right.

>> and anecdotally we began to hear from byd and maybe multinationals it has taken a little bit longer than some were thinking the dow is a good example this week as well. >> yeah. i think there's a couple things going on there if you think about what's happened in china over the last few years, you've had the crackdown, the covid lockdown and the property market going long and it's going to take time to build up domestic confidence. that's the key we haven't seen yet domestic confidence coming back into the chinese market. >> there's also an assumption that recovery in china should be model after the recovery in the u.s. but they never got the stimulus checks we did there wasn't that balance sheet by the customer because they were hammered by their property values going down at the same time with no income replacing whatever income that they would have gotten otherwise because of the lockdown that seemed like a big, i don't know, misperception about that chinese -- the expected chinese recovery. >> absolutely. there was no way it was going to be a v-shaped recovery because

of the points you make, and i suppose the other thing is just we really need to seat property prices start to rise the wealth effect to build the confidence as the data points come through in china they will be increasing optimism about the chinese comm economy. to be honest it's about the chinese consumer that be that will be the driver. >> what about property prices and your expectations when it comes to how long it will take or spark what has been a fairly steady decline and a fairly depressed sector there >> yeah. we've seen a pick-up in secondary transactions in china which is a good leading indicator. when you start to see property prices picking up. for two things that need to drive this economy going forward, one is primary transactions and therefore activity on the back of that and property prices. but you've got to balance that with the government's desire not to see speculative activity. so in terms of our view, the recovery in china is going through but it will be moderate because one of the things the chinese government has to manage is the stop-start, trying to

make sure things don't become too speculative. >> turning to the fed next week, can we -- do we have the space to do another 25 or do you think it matters that much >> i think that definitely has the space to do that because certainly we don't see any rolling over significantly in the u.s. of the consumer we haven't similarly see what's the flow through from financial problems here and that's one of the really big issues because when you think about the financial sector it's a liability issue. it's a liquidity issue i think on that one, that's where the regulators, perhaps, have missed it and as a result of that, you're probably going to see significant regulatory changes going forward and we need to think through about what that means throughout the banking system and how that acts as a - >> you think that will be a drag on overall growth? >> absolutely. >> the dplaeger to changes alone? -- regulatory changes alone? >> absolutely. >> how would the mechanism work, do you think. >> the first thing they will have to raise capital ratios and delever and the second thing is

when you look at what the alternatives are for depositors they can look at money market funds. there's a liquidity constraint coming through the banking systems and that's what i would worry about with regard to the u.s. >> in your view has that been reflected in s&p in s&p estimatr gdp estimates? >> no. >> how about the debt ceiling, figure it all into the way you're thinking or what you're hearing out there? >> not really because most people think that the u.s. government will blink again or the parties will blink again in terms of agreeing to something so, we've seen these games of chicken in the past, and typically there's been some sort of resolution arrived at. >> what is your s&p earnings number for the euro next >> we have s&p coming down in terms of earnings, i can't remember off the top of my head what that number is, but certainly lower. >> anything regarding the number of companies that met or were able to raise guidance done anything to alter your view?

>> not really. one thing i would say is from the tech sector, and i'm ex excluding the e-commerce plays, we would say that actually we reached the bottom and things are looking better inventory levels have cleared and we're more positive about that area. >> certainly explains some action this morning in the wake of some prints great discussion thanks for coming. coming up next hour, we have the ceo of imax with us, getting a nice boost up almost 9%. one name going down 95% since going public two years ago. we have all the details next to m to find great talent. but with upwork, there's highly skilled talent from all over the globe. right at your fingertips. ♪ this is how we work now ♪

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gainers on the s&p charter topping the list, second day in a row at least that stock has seen gains. yesterday on earnings, today on our parent company comcast having stronger than expected free cash flow as for good news, how about some well not such good news. take a look at wheels up, down 95% since it went public back in july of 2021 now the company is talking with bankers about, let's call it, next moves robert frank joins us to discuss what that means.

robert >> good morning, david well, wheels up in talks with financial and legal advisers about potential restructuring or capital raises its market cap falling from over $2 billion when it went public two years ago to just under $120 million today. the new york stock exchange notifying the company it would be delisted because of that sustained low price. planning a reverse stock split to stay in compliance but it has a lot of other challenges. its cash holdings now at about $580 million, but had a net loss of $555 million last year. analysts expect further losses this year. sources tell cnbc the company is talking to advisers about a range of alternatives. maybe going private. maybe getting a cash infusion from delta which already has a 24% stake in wheels up, or some kind of restructuring. it's also cutting costs and improving efficiencies aiming to

be profitable, it says, in 2024. right now overall jet demand is slowing a lot from those pandemic peaks charter volume down 15% so far this year. wheels up saying in a statement, it is, quote, always focused on evaluating a full range of business strategies to enhance our profitability and shareholder value while continuing to provide exceptional service, safety and reliability to our members david, they have about 12,000 members, so both shareholders and members looking closely at how this company is going to navigate >> you know, if there were to be a bankruptcy, what happens to both those -- you know, those who are users or those who have given deposits, for example, where do they end up >> as you know, the founder and ceo, the ultimate optimist and marketer, he's not talking about bankruptcy right now you they're staying the course, telling shareholders and members, we're going to be

profitable by 2024 their fundamental business model is losing money. you know, when they fly people, they are losing money. so, they've got to cut those costs. they've got to hope that they can gain more revenue from existing clients that's their plan for now. >> yeah. we'll be watching it robert, thanks for bringing us up to date on what hasn't been a great story there, wheels up as for a good story, though, the market up about 0.33% on the s&p right now. the nasdaq also a bit higher amazon a laggard down over 4%. that's part of the coverage. the next hour of "squawk on the street," that does it for this hour ayitekd,veborydy st wh us

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(seth) hey, mom. i gotta call you back. (vo) switch and choose the phone you want, like the incredible iphone 14, on us. (cecily) on the network worth bragging about. verizon good friday morning. i'm carl quintanilla with melissa lee. got news out of the federal reserve. steve liesman has that for us. >> carl, thanks. the federal reserve out with a report about the failure of silicon valley bank in which it will blame the svb, the supervisors and talk about changes that need to be made the first case it says that svb was a textbook case of mismanagement. that it failed t