capital one as well. and then travelers, which is a blue chip and blackstone, huge nonbank lend were many different aspects to it. so there is a lot to watch i'd also note las vegas sands and other big casinos big right now. >> "fast money" starts right now. right now on "fast," netflix chilled with the stock dropping after hours. we'll go inside the numbers. plus, tesla posting record quarterly revenue, even though margins drop nearly 10%. shares stuck in neutral right now. and later, ai coming to apple? shares spiking on reports they are working on their own version of chatgpt should investors worry when a single headline can send a stock to new record highs? and a carvana comeback, pulling off a major debt deal on the back of a monster stock rebound. is this a rebound for real or a fresh coat of paint on an old

ja jalopy karen finerman, dan nathan, and guy adami. we start with netflix shares under pressure the streaming service missing new estimates, giving sales guidance for q3 that was lower than expected. julia boorstin is here with all the details. julia? >> netflix shares down over 4% in after-hours trading the revenue miss comes despite it adding about triple the number of two subscribers as expected, about six million. the company also guiding to higher than expected subscriber additions in the same range going forward, mainly thanks to the roll-out of page sharing all this comes despite the trend of lower than expected revenue per user, which is on track to continue the company does seem bullish on new initiatives, writing, quote, we expect that our revenue growth will accelerate more substantially in q4 '23 as we further monetize account sharing between households and steadily grow our revenue they say they are confident that

over time they can develop a multibillion incremental revenue stream from ads. now the strike was only mentioned once as netflix updated its 2023 free cash flow estimate from at least $3.5 billion to $5 billion for the year, reflecting lower cash content spend due to the wga and sag-aftra strikes. now netflix co-ceo are sure to face some questions on this topic of this strike and how well-positioned they are to ride it out melissa? >> julia, we've been focusing on how well-positioned netflix is because of the strike, because of their production overseas, because of their bank of cop tent already how will they be impacted if they have to pay more in terms of, you know, royalties to these actors as a result of this >> well, that all depends on how the negotiations turn out. i think there is some assumption they will have to spend some amount more. the question is whether it's

dramatically more or not when it comes to the kind of increases that the actors and writers are looking for, to a certain extent, it's increases along with inflation there are things like that but then for the streaming business, there is an assumption that both of these guilds do want higher compensation so i think it all depends on where it nets out. but that's a separate question from how long the strike lasts i think if it only lasts a couple of months or a shorter period of time, the impact will be less significant. once it starts to last potentially into early next year, if it lasts that long, then it could really impact netflix's ability to grow subscribers or even retain subscribers in the key u.s. market, where is its subscribers are most valuable. >> julia, thank you. a reminder, 6:00 p.m. is when netflix holds its investor presentation, if you can call it that dan, what did you make of this quarter >> it's fine they're expecting two million and came in at six and operating margins are better than expected. all the issues you're talking hereby with the strike, we won't know for a while

but when you talk about what they're saying about revenue growth re-accelerating next year, the street has 13% year-over-year growth with 29% expected earnings growth the stock trades about 30 times. we've been saying this karen bought it in the hole. that's what they say, back in the day late last year because it had never been this cheap and you thought they would get some stuff right they seemed to have gotten some stuff right on the subscribers front. the content is going to be a bit of a headwind. the truth is when you look at that expected earnings growth, i think a lot of analysts are expected capturing the sharing of passwords, whether it be through an ad-supported tier or not is going to be god for earnings now the interesting thing, i'll just say this, out of the nearly 60 analysts that cover this stock on wall street, half of them have a buy rating on, that which is really interesting to me and the fact that the stock is only down 4% on that guidance and that misleads me to believe that people at least investors are positive predisposed to this name right here. you don't have to buy it here, but it wasn't a disaster, especially for a stock up 200%

from its lows. >> that to me is the most relevant thing going into this earnings that bar was set so high and on many metrics, they met it the super bowl scribers is great. the geographies, each one was down a little bit on revenue per subscriber 10 that's where that miss comes from there is a lot to like about this, except for how expensive it has gotten. and, you know, i've been wrestling with this one so much because they're doing everything right, but it is far from cheap. i feel they couldn't have put up number that would have supported this run, you know, that it was too -- it was less than 300 four months ago >> i mean, they had a run and had another run on the back of the strike because people believed that it was so well-positioned. >> exactly what i say, the bar was set far too high on this that's exactly what you're seeing right now they had almost six million new subscribers which is absolutely fantastic. but if that's really not translating into the kind of revenue the street is happening

which was happening, it's going to price lower i think this is one of the companies that has ridden up this ride with people going back towards risk assets, but it can't be justified to a certain extent and it's already been priced in with what's happening with the ad-supported tiers and subscribe is i think at a certain point in time you have to take a step back >> guy, dan had referenced the fact that he would have thought the stock would be lower on the back of what they guided to. so that would be bad news, good price action do you agree and if that's the case, does that bolster a bullish view of netflix? >> yeah, trying to wrap my head around obviously the revenue miss which is slight is concerning. and they're obviously saying it's the back half of the year story which they'll make up ground, which i get. here is the question, though if they reported this quarter with the stock trading, you know, 75 to $100 lower, what would the price action have been we're looking at through the lens of what the stock is doing, which i totally understand

let's just take a step back. stock's up 160s %160%ish we almost, and this is what i was hoping for, filled that gap that we had from january of 2022 you can go back and look, that ridiculous move to the downside. so that gap still is in place. people say all right, they'll start to look at valuation given the run. and at 30 two times-ish, it's sell first, ask questions later. dan's point was spot on. this was a fine quarter. and if you believe them in the back half, it's still netflix's world. we're all living in it but you've seen this stock have huge moves to the upside and now back to the downside the question is what your reentry point? i'm trying to look for it in the chart. just eyeballing it between 410 and 415th. >> let's get reaction from gene munster of deepwater gene, nice see you your take here what's your number one question about this quarter

>> i think guy just said taking a step back. i'll take a step forward here and think about the dynamic in the month of october and the month of may of next year. netflix, everything is working with the password crackdown and the ad model we saw it in this surge in the number of subs that's impressive. but when i think about going forward, we're going to start to anniversary that that was october of last year they started the ad model and may of this year the password crackdown. this is what has been powering the business and we look at the guidance, and it was muted, a percent below. this is a growth story that they've been pulling every lever. they're not going to be able to pull the lever to the same degree in 2024 as they are doing that today and invest shores be aware of that there is another vector to netflix's business that's going to emerge over the next two to five years a year ago, netflix first mentioned tiktok as being negative so some of their engage

ment i think we're just in the cusp of this. i think traditional content companies are going to have to navigate and embrace what is a more fractionalized targeted greater type of economy. and i think netflix needs to address that my view is this quarter is great. but i think if you fast forward a year from now and five years from now, i think it's going to be a bigger headwind for netflix. >> gene, it's karen. thanks for being on. do you think that phenomenon you just talked about, the creator economy, how does that pair up with the sort of distress that so many other streamers are under right now and how they may consolidate, and you'll see less competition to netflix from that phenomenon >> cost of creator economy is almost nothing if you look at what production costs were 20 years ago, five years ago, they were much higher so the creator economy has had some difficulties, but there has been some i think just a surge in the amount of i think overall it's going well for them

i think that the tools that some of these platforms like threads, for example, twitter just announced ways that creator economy can make money on twitter, i think they will improve. i'm a believer that with almost no costs, people can create their own content. that was the moat around content historically is the creation costs. but i think that yes, there are ebbs and flows to it, karen, but the trajectory around creator economy, it's going to be one of the topics that seems obvious and we're going to be talking a lot more about it in the years to come. >> gene, are you talking about in terms of competition just being time spent away from netflix? because they've talked about time spent away from netflix for a variety of reasons, gaming, whatever it is, they've cited that in their conference calls in the past. so it is that? or is it truly that people will choose to watch this free content on whatever platform versus content that netflix has to pay snore for

>> i want to emphasize i'm an old man i'm 52 years old this type of content is less appealing to me. this hyper focused content what i'm saying, melissa, gyming is another vector that netflix has talked about i'm saying there is a whole another category of content that is tiktok times 100 in terms of these. and i think it's going to steal share away, tension away from how netflix is going to be selling their subscribers. >> all right gene, thanks we'll see you in just a bit for tesla. let's get to tesla in the meantime earnings. the ev maker beating the top of the bottom lines but shares stuck in neutral here in the after-hours session phil lebeau bowe joins us from dallas to take usinside the numbers. phil >> much better than expected numbers. it's not reflected in what you're seeing with tesla shares after hours in terms of how they're trading. but the numbers were better than many people were expecting when you look at the earnings in terms of profit as well as the revenue, 91 cents a share was the earnings for the second

quarter. the street was expecting 82 cents a share. revenue better at 24.93 billion. but the big question is what would be the margins weaves in the second quarter they've been coming down, the gross auto margins steadily over the last year, year and a half and as you see, they came in at 18.2%. why is that significant? the street consensus was 16.9% the whisper that a lot of people said, well, look, it's around 17.5 that's what woe would be expecting. 18.2% better than expected and then there is the question of whether or not they would raise their guidance in terms of full-year deliveries remember, their guidance has been to deliver 1.8 million vehicles this year they're about halfway through the first two quarters of this year they reiterated that guidance of 1.8 million, even though the street right now is at 1.84, and a lot of people expect them to raise their guidance down the road they're not doing it at this point. shares of tesla this year, a heck of a run this stock has

had, especially over the last three months remember that the conference call with elon musk starts in about 15 minutes, and you can bet there will be a number of questions not just about the price cuts and the competition that is out there, but i bet, melissa, there is going to be more than a few questions about ai gee, i wonder what he is going to say >> full self driving phil, thanks phil lebeau. it almost feels right now, guy, with the stock with what it is doing, which is basically nothing in the after-hour session that it's a hold your breath moment, how they're going to talk about automotive margins x credits for the back half of the year the stock is counting on a pickup, some sort of troughing into the back half of the year >> yeah, and that's what gene talked about last night, i believe. and that's what i'm sure he'll talk about again and good for tesla, by the way they cut prices, but they were able the make up for the price cuts vis-a-vis this margin number by the fact that they've become a more efficient company, vis-a-vis the gigafactorys,

their supply chains. you have to give them credit without question, as a lot of people thought, sub 17 was coming in. it did not now the question, and gene can answer this, is this the trough margin are they going to start to build on economies of scale type of thing? and does a trough here continue to go back the other way i don't know the answer to that. and i think that speaks to exactly what you're talking about in terms of the price action clearly, the market is sort of struggling with that right now as well. >> that's funny. guy just said you got to give them credit. i think investors are giving him credit since the stock gapped down 10% when they reported q1 in late april, the stock is running 100% think about that think about that in market cap terms. it's $925 billion market cap company. and as far as i'm concerned, if the headline that some of you guys are reading is it was a much better quarter because they beat by 10 cents, if you think about how many times they've had to cut prices just to get to where they are as far as deliveries, and if you think about wait times have gone down

and backlog has gone down. some of these things with the margins, i don't think the consensus was 16.9 i think it was higher for gross margins x credits. i know a lot of folks came in at 19% last quarter i think consensus was closer to 18 or so to me, it's just -- the fundamentals aren't really getting better right now so you have to have a lot of faith that the margins are going to trough and that you're going to see greater demand and they're going have more pricing -- >> wait times and delivery tiles, what they're coming down because they're more efficient >> i don't think so. i think it is about demand i don't know you tell me. >> what do you any >> i wonder how much of that obviously getting more efficient, which is great for them but also, they have a lot more demand you have all of the regular car companies coming out with their electric vehicles, and it is going to put pressure on their customers as we look forward i think from a valuation standpoint, the problem with tesla, when you look at the eight largest companies that have been leading this whole

rally, they're the only one of them who has forward profit margins that have come down. all the other ones are increasing when you're trying to justify how high these valuations are, you have to expect there has to be a trough, which is what you're talking about if it's not there, i don't think you can justify the 70 times earnings >> guy >> it all makes sense. i don't see the bull argument. you see the bear argument. i've been offsides in terms of trying to figure out where it should go. i think the fact that it is not doing anything in the after hours, it goes back to your earlier point. good news. now you wonder about the price action it's had a historic run, clearly. we have seen this stock sell off. it would make sense i think fo a number of different reasons for people to start take some money off the table, especially, you know, if the broader market were to ever give something back tesla is not going to be spared from that. so there is something here, i think, for both sides. >> all right for more on tesla's results, let's bring in our package tonight. tasha keaney at ark invest, and

gene munster is back he is of course the managing partner at deepwater management. tasha, i'll start with you do you think we've seen the lows for gross margins x credits from tesla? >> i think as tesla said, i would expect credits to be, they already are a smaller picture than what they once were thats going to dwindle over time we've modeled tesla's future growth based on wright's law we know they are decreasing cost per vehicle, which is very important. i think the cyber truck is going to help with that, and we know that the first vehicle was produced or is coming out so i think longer term, we actually think gross margins could be about 50% if you look at the five-year forecast. it's not just driven by electric vehicles it's driven by ai, which you all touched on we think tesla is going to be a leader we think they could take a very attractive rate off of gross revenues, off of autonomous

service. that's going to be the story today. not enough people are talking about tesla is one of the most important ai stocks to be talking about at this very moment >> so the gross margins of 50% in five years, is that built on this notion that it is an ai company, and that you need to have that robo tax be part of the business in order to achieve that if you look that out, is that basically going to not inflate, but make those margins look a lot better because the auto margin isn't going to continue to be low? >> no, i think auto margins will also improve as vehicle costs decline. we've modeled -- wright's law says for every cumulative doubling in production you get a corresponding reduction in price. if you look back over the past 100 years, this models what the auto industry has done extremely well we think it will be the same thing with electric vehicles, with tesla we to think that autonomy longer term is going to be driving

te tesla's margins. hey, they're in a great position if you look at what they reported, you know, miles and full self-driving are over 300 million cumulative to date compare that with competitors like tesla and wemo that have autonomous projects. that's in the low millions and tesla is averaging over two million miles a day at this point in full self-driving, even more when you look at the total fleet, what's not in full self-driving so they have a data advantage that is unparalleled in this industry and i think it would be extremely hard for anyone to catch up with them at this point. >> right and gene, i think you're the same belief in terms of tesla, the long-term story. but right now we're very concerned given where the price of the stock is about the short-term story do you think that we'll get indications tonight on this conference call that we are seeing the trough in margins at this point and if we don't, what happens to the stock? >> i think the cfo is going to

outline the trajectory of margins going higher i think that it's going to be this year. it might be in 2024. but i think he is going to talk about that kind of vector going higher and i think that that is going to be enough if i'm wrong and they say expect margins to be flattish for the next year, the stock is going to go down in the near term right now we have essentially a third of the results this is all good but as you said, melissa, at the top of the topic is this is all about the conference call and the commentary about margins most investors don't have the patience to wait around for two, three years. they want to know what's going to happen near term. i would add another important topic that wasn't covered with the panel related to this in terms of what's the stock going to do and what could get it moving cyber truck is a big deal. the ford f-150 is a huge deal. they sell about 600,000 of those a year ford is acknowledging that they are worried about this vehicle investors, when they get on the road, this is like nectar for growth investors is to see a new

type of technology that is getting out into the world so i think you're going see that and i want to preface that with a piece. i think the cyber truck is going to be late what they said in their shareholder deck, they said expect it in the back half of the year previously they said the third quarter. technically the third quarter is the back half. but based on the tweak to the language, i say it comes out in the end of the year. but another month here, another month there, it doesn't matter they announced it in november of 2019 invest verse been waiting a long time and i think the stock goes up when cyber truck comes out >> tasha, to focus on the shorter term you know, looking through the investor deck quickly, short-term uncertainty was a phrase that came up repeatedly through tesla's commentary when it came to managing cash flow and just sort of managing its business did it strike you that tesla is being a little more conservative than it normally is? >> you know what

i think if you look back five years ago, yes, tesla has gotten more conservative over time. i wouldn't even say -- i think investors likely welcomed that we see that in the forecast there, they're sticking to the long-term targets and the targets for this year as phil mentioned that they laid out so i don't think that's a point of concern i'd agree with gene. i think the cyber truck is really crucial here. we think it could be as mainstream as the model y, if you look at goodle trends data so i think a lot of analysts are expecting that volumes won't be as high as they will be. i think it will surprise and again, we know it's a very innovative design, very cost-effective to produce. so i would look out for that this year. >> all right thank you, tasha keaney of ark, we appreciate it and gene, let us know if you hear anything on that call >> will do. >> dan >> they make great bullish points the stock is up a lot in the last few months. while i don't believe that the fundamentals have gotten that

much better, i believe the demand picture has gotten that much better, so i'm clearly offsides or are on the wrong side of this and it's reallyinteresting in three months how you could have been very much on the right side of this fundamental move i don't think anybody could expect the sort of rally that this stock has had and i'm not even talking from the january lows i'm talking about since they printed that q1 quarter and gave that q2 guidance so make no mistake about it. you better buy into full self driving and autonomous taxis and ai and all the other crap they can come up with to justify this thing being a trillion dollar market cap otherwise, don't forget, this stock sold off 75% from its all-time highs in late 2021. and that certainly means it could do it again. i'm not telling you it's going to happen again, but a lot of things have to go right to justify where it is right now. >> i know we could buy the gas, but 50% margin, that's kind of a stunning number. >> yeah. >> i don't know where it puts the valuation off of that. but that seems -- >> 50% in five years.

>> aggressive. >> it's a big climb. up next, is this market becoming addicted to artificial sweetening apple the latest mega cap name to see a pop on the back of an ai headline. do investors need to fear this frenzy we'll debate that. the travel trade we'll going into the numbers for united and las vegas sands thcoerceale nfen cl highlights minutes away "fast money" is back in two. ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ ♪ this is spring semester at over 13,000 us school districts, which have become top targets for ransomware attacks.

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welcome back to "fast money. a new milestone for apple, closing at a record high the stock popping after bloomberg reporting that apple is developing its own ai model look at this 2% surge in the intra-day. for this massive company, we've seen similar surges in recent days on ai headlines from the likes of microsoft and alphabet. dan, you flag this what struck me is the gain it can make on news that it's working on something that its competitors have already gotten out. >> right >> so it's playing catch-up and the stock is going to beginning market cap on the back of, they it's funny as it does that, to move a $3 trillion market cap company 2 or 3% on a headline and then what we saw on the opposite, microsoft sold off 2%. we saw google, alphabet sell off 2% or something like that over the course of the day. so there are these direct

relationships. and to me, they don't really matter if the article, if you read it, that came out on bloomberg, apple was caught flat-footed. >> right. >> there is nothing in there there is no there, there of course they're working on this stuff we've been talking about this for months they've been embedding this stuff into large parts -- >> siri. >> for a decade plus are they caught flat-footed on a chatbot? this is the moment we're in. this is what is exciting this is only thing driving the stock market right now we talked about it last night. if you're not there, then you're left out of the conversation and tech ceos who have big valuations don't like to be left out of the conversation. it looks like they're not being innovative and salesforce, they launched their pricing of their enterprise chat stuff, and that stock went up 3% today so we're in a moment >> yeah. you're a believer in ai. >> i am a believer in ai >> an investor in nvidia at some

point, we made fun of it before. >> pixie dust element. >> there is. i saw nvidia spiked at the time of the apple news and ended up selling off. we're in the very early stages and i just come back again and again to the picks and shovel business you don't need to pick the right one. you just need to pick that there is going to be tremendous demand for a long time. and if you -- if you believe that, which i do, then this multiple isn't so crazy. >> but if ai is the driver for the biggest seven, eight stocks in the market at this point, does that make you think in assuming there is a little bit of froth to this ai theme. does that make you concerned about the fragility perhaps of the rally we built >> to a certain extent people are a little overexcited about artificial intelligence short-term i agree with you i think longer term this is a huge story and it's really going to add to productivity in the economy. but yes, i think some of these things are getting too frothfroy

if there is a pullback, it's probably the seven or eight companies. i don't know how much you can justify that on just mentioning ai or an article about a rumor coming out about ai they're doing. i don't think that justifies these higher valuations right now. up next, shares of united and las vegas sands on the move after results of bringing the numbers from the quarters next plus, off-the-chart shares of carvana, now up a thousand percent. yeah, that's right a thousand percent since the start of the year. the latest surge, and how the company hopes to put its near death experience in the rear u'ew mirror. yore watching "fast money" from times square. back right after this.

welcome back to "fast money. earnings alert on las vegas sands. shares are lower by almost 3%, despite a top and bottom line beat the company also reinstating its quarterly dividend contessa brewer has the details. contessa >> remember michelle adelson used to get on the earnings calls and say yay, dividends rob goldstein took great joy in repeating that 20 cents a share starting in august and the company indicated intentions for future buybacks all right. the key earnings metric in casinos is adjusted property ebitda and sands reechl ed 88% of 2019 levels sands' occupancy is approaching 90%. and luxury retail there is pushing revenue in that segment to 93% of prepandemic numbers. on the call, company executives pointed to a sharp acceleration in june and a more profitable mix of customers coming for concerts and restaurants and

non-gaming options in singapore expectations still significantly off. yet marina-based sands occupancy is 9 7%. the average daily room rate almost $600. and record revenue in its mass segment for the quarter. overall, melissa, i would say this was bullish commentary from the company. >> all right, contessa, thanks contessa brewer. so guy, why down 3%? >> first of all, contessa is doing an amazing job in this space. why? because i think the high end of consensus was about 52 cents or so on eps. i have them coming in at 41. but even if it's 44 cents, i think it was a run up into earnings people taking money off the table. if tim were here, this is what he would say i would not run too far from las vegas sands, nor would i run too far from wynne the fact that they're reinstating the dividend, this was a very good quarter. you see the uptick in macau growth it's all right in front of them.

for both wynn and las vegas sands, valuation is okay i think these stocks are fine fine, mel. united airlines shares higher after a bet on top of the bottom line. let's get back to phil leb go who has the details on that. >> hey, melissa. also listening to the tesla conference united, a heck of a report for the second quarter, beating the street at the top of the bottom line the bottom line, 99 cents better than expected, coming in at 504 -- or 503 a year the street was expecting 404 with revenue coming in at 14.17 billion. better than expected the revenue, if you lock at the numbers within the numbers, it was strong across the board for united revenue was up 14% for the second quarter with a pretax margin of 15.3%. passenger revenue per available seat mile, what we call prasm, up 2.2%. that's the demand, people who want to get on a flights, whether domestic or international. and they're also raising their

full year earnings guidance. it is now the range of 11 to $12 a share. previously they were expecting 10 to $12 a share. now they're saying, look, we expect a strength in the market to continue, at least through the end of the year. that's one reason why they're raising their guidance to 11 to $12 a share. lots to discuss with united's ceo scott kirby tomorrow morning. not only about the strong quarter. we'll talk a little bit about the issue, the operational issues, the weather and the schedule problems that they had at the end of june, right before the fourth of july and their belief, united's belief that the strength you're seeing in demand, melissa, continues through the fall where it usually slows down, well into the holidays >> yeah, we heard that from the others phil, thank you. phil lebeau, and also posted on the tesla conference call. karen, what do you make of united >> very impressive especially on the heels it's had a very nice run. kudos to guy and tim who have really been on the airline trip, i guess. that prasm, tim would like that

if he were here, that international travel is really impressive and also, i think there might be a little bit of sandbagging. if they beat by a dollar on this quarter and only raise the bottom end of the guidance, and yet talk about the strength leaving the quarter, that makes me think that that guidance is conservative so a lot to like >> yeah. court? >> this is especially movie considering they had all of the issues with the flight cancellations due to weather and the air traffic control issues and even with, that you're seeing how much demand there is towards travel this is really optimistic on a, airlines in general. i think it's good for united and their sector but also the consumer in general. clearly they are not slowing down any time soon that's what i hear when i hear the calls. >> some headlines out of the tesla conference call. tesla ceo elon musk saying tesla production will decrease slightly that's all we have right now the stock is down about .75% of a percent. big blue earnings. next, carvana's extreme makeover the used car company completing

a major debt dealing to sell a truckload of new shares. is this comeback for real? we'll break it down and get the action next. "fast money" will be right back.

welcome back to "fast money. the carvana nirvana continues. shares jumping more than 40% on a deal to reduce its debt by $1.2 billion also filing to sell 35 million class a shares the used car retailer stock is up more than a thousand percent this year alone. carvana ceo sat down with jim cramer moments ago. >> '22 came and we were positioned for another year of growth and car prices went up and interest rates went up and it got more expensive for our customers. and we overextended and we had a lot of work to do to catch back up in q1 we had negative $360 billion of ebitda which is not a good number. but in the last 15 months, we had 155 million positive this quarter. and that only hatched because our customers love our model >> be sure to catch the full interview top of the hour on "mad money." in the meantime, karen, this is one that you love to follow >> i love to follow. when i called their demise a

long time ago, that certainly didn't turn out to be right. there is a lot going on. the numbers are better they're still not great. there were some one-offs there however, what was really the issue here was the capital structure. the debt was overwhelming, and now with this ability to sell shares, here at this price, that solves that as well as their ability to restructure and spread out the maturities. so what was an option, they now have a lot more time the stock traded almost like an option but now at $10 billion, it's no longer an option this is a giant, giant victory lap both for the garcias for doing this, and for the meme community. >> right. >> because they were true believers. >> right. >> and this is really kind of an extraordinary turnaround, even though i don't know that the business model is -- gets the stock here but that doesn't matter. early in tesla's history, when they were really on the ropes in terms -- >> bleeding money. >> they're off the ropes for now. not forever, necessarily, but they bought a lot of time, which is huge. >> right

the carvana options pits buzzing today. one trader thinks the stock could fall back to earth by the end of the year. so maybe the lifeline is short-lived. mike khouw has the action. >> yeah, so carvana was -- saw more than three times its average daily options volume that made it the sixth busiest stock overall. that puts it ahead of names like microsoft and meta, alphabet, disney and so on so pretty extraordinary in terms of the volume. now a lot of that flow was very short dated bullish call, including a purchase of nearly 80,000 of the 59 strike calls. those trade for about two bucks. those folks are obviously betting that the big spike we saw today could continue through the end of the week. but if you logistic at the institutional flow, we saw a lot of activity in the november 20 puts with saw a block of 4,000 of those trade early in the session. and another block of 3500 trade a little later that was for about a buck and a half a contract. now to put things in perspective, the stock would need to fall fearly 70% for those to profitable. i think what that buyer is doing

is probably betting the short squeeze. i think that's what we're seeing right now. may end and you could see a reversal >> a short squeeze, really i say that sarcastically guy, in the meantime, it has this lifeline in the economy could improve within this time frame. >> yes >> in terms of the used car future >> listen, i could play third base for the yankees given their problem at the position. it's not going to happen listen, the fundamentals of the company were deteriorating there is a reason why the stock had a 300 handle and then a 3 handle it was a declining business. and i would think karen just alluded to it. i don't think the business has improved maybe the structure of their company in terms of debt and were able to buy themselves some time to improve. and shorts are getting squeezed. and you see what happens so we're back to having these conversations. at some point, though, the fundamentals of the company have to line up with the underlying share price. and we will get there, but we're

clearly -- look in the after hours. i think it's north of 62 now so we're not there yet >> all right mike khouw, thank you. for more "options action," tune in friday, 5:30 p.m. eastern time up next, shares of ibm fractionally lower after misses on revenue we'll dial it up and debate that when "fast money" rerntus.

welcome back to "fast money. we do have some headlines coming out of that tesla conference call let's circle back to "fast money" friend gene munster elon musk is actually talking. he is talking about ai spending too. >> yeah. that is not surprising he has triple downing on their initiatives around full self-driving in two ways, melissa. first he said they will have 100 x increase in the number of miles that will feed their sfd model by the end of 2024 that is staggering he followed up by saying they're in discussions with another automotive oem to license the fsd technology i had to double-take that when i heard that it's been speculated i checked the stock. it hasn't changed much i would have expected the stock

to have moved up on that so that was the biggest takeaway we haven't got the all-important commentary on the margins, and we did get some commentary about that 1.8 million delivery number for the full year. i said i was a little disappointed wish that number would have bumped up after they had such a strong june quarter. now we know why. they're doing a retooling in some of their manufacturing. it's likely related to model y highlander this is the upgrade we've been waiting for a long time. so that's going to have a negative impact on some of the production and likely deliveries in the september quarter they'll pick it up again in december but those are the takeaways. >> so licensing full self-driving software to oem, that's potentially recurring revenue. what's the bigger picture in terms of having more autos out there using tesla software >> well, the bigger picture, this could change the trajectory of the stock and it really comes down to the margin profile and this has been orbiting so long around the tesla investment

case and hasn't landed the whole fsd piece, it has been muddled in regulatory and technology challenges. and so if they could get that focus and set aside and get it out into the marketplace, it could be massive and not just for investors i think for humans too leon said on the call their 10 x is safer than a typical car. i believe that humans are not good drivers. they're mostly distracted. thing is a big deal for investors specifically around the margin opportunity with fsd. >> we're also getting within headline, gene, about the 4680 self production. it increased by 80% in q2 over q1 was that expected? >> yes it's coming off almost a zero base so it should be growing leaps and bounds but 4680 is important because that means that you're going to get longer range for paying less

for the car. that's one of the big competitive advantages that tesla has had is that value per range. and that is one of the sticking points for a lot of people going electric is the range anxiety. so i think fsd, the 4680 is an important piece. it's important to the lower price. robotaxi, elon has talked about it on the call here. he said their manufacturing is going to be different than they've ever manufactured a car. i'm excited to see what that means. this is going to be in monterrey, mexico. but i think the 4680 is really, it's a boring piece to this, but it is fundamental to tesla continuing to maintain its lead against the traditional automakers >> all right, gene as we watch tesla shares dip down 1% in the after hours netflix conference call kicks off in ten minutes' time up by 6.2% a disappointment on the revenues as well as q3 guide came in a little light coming up, ibm on the move

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welcome back to "fast money. earnings alert on ibm. shares are lower after reporting a mixed quarter.

eps coming above estimates revenues falling short of expectations kristina partsinevelos has the latest >> revenue came in a little light for the second quarter in a row. but i spoke with ibm's cfo earlier, and he told me the miss is entirely due to currency fluctuations on the earnings call, which is still under way right now, management said their infrastructure business was also down 14% in the quarter and had a, quote, as expected impact to ibm's overall revenue growth over the quarter of course, due to cyclicality. but the company did reaffirm its full year revenue guidance of free cash flow of $10.5 billion. i also asked cavanaugh about the product mix in the second half he said he expects software to be the main driver driven first by its red hat subsidiary. think hybrid cloud products which grew 11% year of over in q2 and a new $4.6 billion acquisition of aptio they have a lot riding on this, but that deal still hasn't closed and cavanaugh like arvind

krishna both saying on the call they believe that both hybrid cloud and their ai strategy will help them hit their revenue goals. but ibm just launched their b-to-b application called watson that was just last week. the financial benefits will take time to settle in. when asked about monetization on the call, ibm said they don't want the quantify it yet >> didn't they get the memo? thank you, kristina partsinevelos. >> they mentioned ai many, many times. they got that memo >> not really helping the stock right now. kristina, thanks down by less than a percent here dan, back in 1980, ibm was the apple of its day it was 7% of the s&p 500 now look at it >> max is a genius watson they pull out watson whenever there was a craze. chess in the '90s, blockchain. that's watson. that's their thing i don't know i mean, listen it doesn't seem like any of their businesses are particularly doing that well, and they seem to be chasing. >> up xtfil adne, natres

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final trade time guy? >> stay with delta airlines, sister >> courtney? >> va. take a look at euro with the dollar weakening here. >> karen >> yes cvs. i think this one has bottomed. very low p/e still lots of upside >> dan >> if you're not one of these

people, the meme stock traders, i wouldn't be chasing this carvana. >> by the way, carvana ceo interview with jim cramer coming up at the top of the hour. that does it for us on "fast money. thanks for watching. stay tuned "mad money" with jim cramer starts right now my mission is simple. to make you money. i am here to level the playing field for all investors. there is always a bull market somewhere and i promise to help you find it. mad money starts now. hey, i am cramer and welcome to mad money. my job is not just to explain but to entertain, to teach, and do it all. call me at 1-800-743-cnbc . now that wall street realizes that we are in a bull market,