♪ to help you see untapped possibilities and relentlessly work with you to make them real. ♪ good thursday morning, i'm sara eisen with mike santoli live from the floor of the new york stock exchange. earnings are driving the market with netflix, the big laggard.

oakmark selling out of that position we'll ask the portfolio manage what they saw coming. ceo of philip morris international with us on the company's quarterly results and ambition of a smoke-free future and the company's entry into cannabis. regional banks on earnings, a pulse check on how they're faring post-svb crisis in march and the landscape for financials and, of course, lending overall. markets, you call them mixed. i think most stocks are down the s&p 500 down 0.3% up off its morning lows which was down 0.50%. the nasdaq down 1.2% a lot of the big growth stocks that had run so much this year into earnings, running into, i would say, mixed results from netflix and tesla. there's gives and takes on both of them. based on how the stocks had run and maybe investor expectation, getting a reason for incremental bullishness, maybe they didn't get one today. >> i called them blemishes in

the last hour. it's not like netflix and tesla weren't disasters, weren't big misses they didn't signalanything challenging about the macro economic environment for both stories, both big weights, they impact the nasdaq. they also had huge runups into the results and there were a few things you can pick apart with the netflix on guidance, with tesla on potential price cuts coming even dan ives of wedbush and i know he's bullish on tesla, he raised his target today and said this is the trough on auto margins. >> i would say long-term story is unchanged for both of them. if you loved them before, you probably still are sticking with them it is the context. it's a test of how far markets have run into this you see things like microsoft back off as well even though they got a price target increase it's a little bit of a challenge to people who felt like up was going to be up every day, and now we're just getting a two-way mark >> we're in earnings mode, clearly, and trying to read all the signals from the economy it really does depend what

industry you're in if you're in casinos or airlines, it's great videos, electronics, more challenging, potentially as far as the macro data, another drop in jobless claims, which i always look at that is not a lagging indicator, like some say unemployment numbers are. it's weekly numbers that don't show we have a big layoff problem in this country. and philly fed showed some interesting tick up in the future expectations and activity. >> we have to talk at some point about the leading economic indicators which continue to paint a negative picture on -- however, it feels like something is going on with the lags. >> the lags are getting longer. >> that's right. and they persisted for a while let's get deeper into the netflix story. our next guest selling out of that position in the second quarter ahead of results that we got last night the street is now souring on oakmark portfolio manager mike nicolas joins us on that move

and other moves oakmark is making it's great to have you here. i know the sale of netflix came in the context of your sort of rotating the portfolio a bit, taking some profits in some of the growthier holdings and rotating into stuff that hasn't run as much. let's talk netflix how long have you owned it in oakmark and what was it that got you out of it? >> first, mike, thanks for having me. at oakmark we've owned netflix for quite some time. it's been a long-term holding within the oakmark fund. there was nothing specific other than valuation that ultimately triggered our decision to sell the shares in the past quarter i think as we look at the broader markets, last year we were seeing unusually attractive opportunities to invest in some of our faster growing nontraditional value investments like a netflix or an uber or an adobe. you know, we thought gap accounting was doing a pretty poor job of reflecting the underlying economics of those businesses but, you know, trends have

reversed this year and the market backdrop looks quite different. the russell 1000 -- excuse me -- yeah, the russell 1000 growth index has outperformed the value index by 26 percentage points year to date which more than erases last year's recovery in value. so, we're now finding better opportunities to invest in out of favor businesses that trade cheap on traditional value metrics like good old-fashioned earnings the five names we purchased this past quarter, certainly not flashy, but they trade half the multiple of the names we sold. we think look attractive on a risk-adjusted basis. >> and we certainly would like to talk about some of those names. baxter international, carlyle, first citizen bank shares. just a quick follow on netflix and the valuation. we all remember the stock did trade well above $600 a share not that long ago when earnings were lower is there anything right now in terms of the pace of growth at netflix or any of the initiatives that gave you pause going into this quarter's print or, again, was it just a raw

valuation call >> yeah, it was much more of a raw valuation call from our perspective. we certainly were trying to factor in the benefit they could get from cracking down on password sharing and broadening out the ad tier. it was nothing more than valuation. we think it's an extremely well managed company and a terrific product. >> i noted your ownership of first citizen bank shares, which you like this is obviously the one that got all the attention when it bought svb and got a lot bigger. what is the thesis here? we saw that giant runup on that news, but now people are wondering what comes next as far as profitability and regulation for all these regionals. >> yeah, specifically to first citizens, we think it's a really high quality regional bank with a history of strong operating results throughout economic cycles you're right, prior to a couple of months ago, nobody was talking about first citizens even after this highly accretive acquisition of silicon valley bank out of fdic receivership,

there's still only a handful of sell side analysts that cover the stock, which is somewhat unusual for a top 25 u.s. bank what we like about the company, its low cost deposit franchise, history of prudent lending and the geographic concentration it has, in the southeast where the population is growing faster one other nuance we really like, too, is first citizens has a pretty unusual core competency if you look at the performance of this bank since ceo frank holding took over some 15 years ago, they've compound tangible book value per share at nearly three times the base as the average top 25 bank. i put that record up against anybody in the industry, including jpmorgan, who we have a tremendous amount of respect for. so, with the shares trading at tangible book value and single digit multiple earnings, despite the appreciation in stock price

so far year to date, we think it was aworthy addition to the portfolio. and one of the few banks that's had a knack of adding value during countercyclical times >> mike, you mentioned going for some out of favor names. baxter international would seem to qualify there you know, it seems to be a little victim of concerns about profit margins it looks cheap but it's been a nice, long-term grower is there anything to think there's a catalyst here in the medical products business? >> you know, i don't know if there's a specific catalyst. we don't tend to be too short-term or catalyst driven at oakmark. we think much longer term about what a business is worth you know, in the specific instance of baxter, you're right, there have been some ripple effects related to covid. semiconductor shortages, other inflationary pressures that have certainly weighed on the margins and the stock price. i think that, you know, to some people, you know, surprise them. this is historically a very

stable and predictable business. but we see a number of levers they can pull to ultimately restore those margins closer to historical levels. and, you know, we were able to repurchase shares at half the price that we last sold baxter in 2019. and our estimate of normal operating margins we were paying a low double digit multiple of eps. prior to covid this stock regularly traded at 20 times or above. the sentiment is obviously quite -- it is out of favor. we think it will eventually recover as margins do. we think it looks like a very good value at today's level. >> rotation out of the loved growth stocks, out of favor value. that's what the market's up to this morning as well we'll talk to you soon, mike thank you. >> thanks. airlines top of mind for investors with united and american both reporting this morning. our phil lebeau spoke with both ceos and joins us from dallas.

what were your big takeaways, phil >> sara, lease start first off with american airlines i think some people might be saying, wait a second, they raised their guidance for the full year, strong second quarter, why is the stock selling off? their guidance for total revenue per available seat mile in the third quarter down 4.5 to 5 to 6.5% basically because of how strong the third quarter was last year. that's a little below what analysts were expecting. the concern is the pricing pressure may not be there. when we talked with the ceo robert isom this morning, he made it clear they continue to see extremely strong demand and execution at this point. >> we set out to be reliable and profitable, strengthen our balance sheet and it's all coming together. you don't have too many quarters where you have this big beat and record revenues, record operating profit and double upgrade from fitch on top of that, record operating profitability, reliability as well our team is delivering day in

and day out. >> meanwhile, when you take a look at shares of united airlines, reporting after the bell yesterday, one of the key story lines is that they're raising their full year earnings guidance it was $10 to $12 a share. now they think they'll make at least $11 a share, perhaps up to $12 a share. when we talked with scott kirby, the ceo earlier today, he indicated that what he's encouraged by is the fact that the metrics, that everything the way it's set up for the industry, continues to be strong >> our strong results are a surprise to the street but they're not a surprise to us it's really a validation of the united next strategy we've been talking about for a couple of years. really the structural changes both internationally and to a lesser degree domestically really have reset the industry to a different level we expect to grow margins next year we think it's a multiyear trajectory and really about those structural changes coming out of covid >> take a look at the other

airline stocks and how they're trading today. these are the other carriers we're waiting to hear the results for the second quarter we'll get some of those next week and then in a couple of cases, the week after that bottom line is this, guys, the airlines continue to see extremely strong demand, limited capacity, but this selloff in american gets to what we may start to see a little more of with airlines. a question of whether or not the pricing power is as strong as it has been over the last year. >> yeah, investors absolutely asking if it's as good as it gets for a while for the group business undeniably strong at the moment phil, thanks. still to come, the ceo of regional bank is with us that stock is down along with the kre. >> we'll get to tesla. a lot of focus on margins and a.i. help answer some key investor questions with the stock dow7% this morning "squawk on the street" will be right back i'm a veteran of 2. i served three overseas tours. i love to give back to the community.

i offer what i can when i can. i started noticing my memory was slipping. i saw a prevagen commercial and i did some research on it. i started taking prevagen about three years ago. i feel clearer in my thoughts, my memory has improved and generally just more on point. prevagen. at stores everywhere without a prescription. you founded your kayak company because you love the ocean- not spreadsheets. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

earnings interviews dominate this morning take a look at synovus, shares are lower, posting a bottom line beat but net interest income coming in within consensus joining us now in a cnbc exclusive is synovus ceo kevin blair. welcome back good to see you. >> thank you, sara it's great to be back with you >> first thing is everyone looks at deposits with some of these numbers on the big and small

banks alike. it does look like you continue to see stabilization there is the worst behind you as far as some of that panic selling, panic moving money out of deposits >> yeah, i think from a solvency standpoint in terms of being able to maintain and grow deposits, i think that story line is past us and we're moving onto a story line on what is the cost of deposit as you look to grow and as you suggested on the lead-in, one of the things we've done at synovus is to make sure if we're lending money, we're lending money to clients that have a full relationship with us and we're getting the proper returns as the cost of liquidity increases. it just puts a demand on the bank to be smarter, how we deploy our capital and ultimately make sure we're getting a good return for the use of that capital. >> looks like there was -- you did lower the outloom for loan growth why is that? what are you seeing? >> two things. number one, as we talked about in the past, with the economic slowdown, there's lower demand from our clients and for us, we

made the decision during the second quarter to sell a portfolio of medical office buildings, which represented about $1.3 billion in outstandings we did that, so it's a pristine credit quality portfolio when we look at the environment today and we think about the returns that we have to earn on our capital and you think about the constraints around liquidity, it had a high single digit return on equity one of the things we want to maintain through this environment is stronger returns. so, when we have the opportunity to optimize the balance sheet by reducing lower returning loans and then take that capital in liquidity and redeploy it into asset classes and loans that give us a higher return and ultimately can be more scaleable and expandable from a client stand point. >> kevin, talk a bit about the credit quality trends you're seeing you did have net charge-offs a little higher than expected and outperforming loans as well. is that something that you expect to continue how would you characterize the

environment there? >> yeah, mike, we use the word normalization because we're coming off historically low levels for npls and chargeoffs as we think about the full year of 2023, we're expecting chargeoffs to be between 25 an 30 basis points, which is where we expect it now, the second half of the year, we expect chargeoffs to be up over the first half, but we'll still come in line with where our original expectations were you know, in this sort of environment, when you continue to see a slowing of the economy, you're going to continue to have some drift in credit we've tried to foreshadow that by, you know, noting that we expected that. so, this quarter was really more in our expectations. as we look at it going forward, we don't expect there to be a great deviation from what you've seen this quarter. slightly higher npl, slightly higher chargeoff we reserve for those and we don't expect them to get out of the range we've seen this quarter.

>> one of the marks on earnings was that your decision to sell this $1.3 billion medical office loan portfolio, can you talk a little bit about why you made that decision? and what your overall goals are here when it comes to commercial real estate. >> it's really balance sheet optimization we're looking at it from a business mix perspective but it's really about returns and optimizing our returns when you look at the $50 billion of loans we have on our balance sheet, we want to make sure we're getting an adequate return on the capital that we are deploying. so, we -- during times like this where you have to go back and look at the liquidity costs, you go back and find asset classes or individual loans that you don't feel are giving you the return that you require. and that -- and this particular decision, we made the decision to sell the portfolio at a very small loss it shows you it was a pristine credit portfolio now we can take that $1.3 billion, pay down wholesale funding or redistribute it to

clients and asset classes that are going to give us a higher return i just think that's what you're going to see banks doing in the near future, is trying to optimize the balance sheet, trying to optimize their business mix to improve returns when the interest rate environment continues to put pressure on the margin >> so, this is what i'm trying to figure out. i think investors are, too, whether it says more about your concerns overall with the economy, which it sounds like, or specifically if it's a warning sign about how you feel about what's to come in office, commercial real estate >> yeah, it really has -- i would say neither. number one, thiswas not a credit decision. this portfolio performs very, very well. in terms of the economy, it just allows us to take the liquidity we have on the balance sheet and the capital and find higher alternative returns. so, it really isn't even the slowing of the economy or what we're concerned about from a credit standpoint. it's really about maximizing returns. >> are you concerned at all about the regulatory environment going forward and your ability to perform and the returns and

that kind of environment >> well, obviously, you know, the tailoring that happened will affect the banks that are $100 billion and over we're below $100 billion so, none of the discussions that have happened recently will impact us directly one of the things i've said in the past, as a $62 billion bank, a lot of our practices today would be consistent with what you see banks over $100 billion doing. whether it's stress testing, liquidity coverage, those sort of things. we've obviously got to continue to hone our game, improve our overall risk management practices, but we feel very, very comfortable with where we are today. i don't anticipate any of the changes that are being contemplated for over $100 billion banks having a huge impact on us. >> could be a competitive advantage then kevin, appreciate it >> well, sara, thank you i look forward to being with you again. >> you, too. kevin blair, chairman and ceo of synovus. the ceo of philip morris is

coming up later this hour. the eps was a beat, full-year outlook somewhat gloomy. that interview in about ten minutes. we're watching taiwan semi, reporting its first profit drop in four years as the slump in electronics demand slipping. some concern there about the end markets. stock down more than 4.5%. alling each other rock stars? you're a rock star. you are a rock star. no more calling co-workers rock stars. look, it's great that you use workday to transform your business. but it still doesn't make you a rock star. so unless you work with an actual rock star. hi, i'm ozwald. hello ozwald. pam, you are a rock- i wasn't going to say it. ♪♪

welcome back travelers kicking off earnings season for the insurers. the sector is struggling to start the year, but can things turn around? contessa brewer has been looking at that. what did we learn? >> the real catastrophe for insurers this quarter is catastrophe. travelers, allstate and hanover all have releases this morning

blaming 18 or 19 u.s. storms for a huge financial hit allstate says its q2 catastrophe losses were $2.7 billion in insurance combined ratio is really the key, that is what's paid out for losses and expenses, divided by what's brought in through premiums. more than 100% means you're losing money allstate's combined ratio was 111% travelers' combined ratio was 106.5% and its catastrophe losses, $1.5 billion hanover says this will be the second worst quarter since 2011. wind and hail are increasingly problematic for the carriers in despite of the increased premiums they're bringing in why are shares up today? you can't control the weather but travelers reported great results in business insurance and in margins those are all factors it can control and is and, by the way, insurance brokers, of course, get paid when premiums rise without taking on additional risks

mcclemons beat on all metrics. up year to date almost 15% sara >> very strong chart, contessa. time for a news update with sylvana. good morning at least 16 people were hurt and dozens of buildings were destroyed by a tornado in north carolina wednesday the national weather service reported the ef-3 twister traveled nearly 17 miles and had winds up to 115 miles per hour the tornado tore through a pfizer facility north of raleigh and toppled trees onto interstate 95, shutting it down for about an hour. police say they're unable to verify statements made by an alabama woman who disappeared last week after calling 911 to say she saw a toddler wandering on the interstate. she returned home two days after she vanished carlee russell told police she was abducted by a man and woman but police said leading up to

her disappearance, she made internet searches about amber alerts, the movie "taken" and how to take money from a registry without being caught. broadway could be the next to face a shutdown the union that represents 1500 stagehands and backstage workers is giving members two days to vote on whether to authorize a strike they're demanding better pay, health care benefits and housing for touring crews. sara >> thank you as we head to break, want to look at the european markets, which are set to close in just a few minutes. mostly higher. rebounding after an initial move lower on the back of waeshg than expected tech results here in the u.s. tesla, netflix, those heavyweights dragging down the s&p and nasdaq minding stocks in ureurope leadg abroad ♪ ♪ opportunity is using data to create a competitive advantage.

♪ ♪ it's raising capital that helps companies change the world. it's making complicated financial concepts seem simple. opportunity is making the dream of home ownership a reality... ♪ ♪ ...writing new rules and redefining the game... ...and driving the world forward to a greener energy future. (applause) ♪ ♪ opportunity is setting a goal... ...and charting a course to get there. sometimes the only thing standing between you and opportunity... ...is someone who can make the connection. at ice, we connect people to opportunity. i did have hearing aids from another company... i was just frustrated... i almost gave up. with miracle ear it's all about service. they're personable... they're friendly.

i'm very happy with them. we provide you with a free lifetime of aftercare. meaning free checkups, cleanings, and adjustments. i see someone new... someone happy... it's really made a difference. call miracle ear at 1-800-miracle and schedule your free, no obligation hearing evaluation today.

just about two hours into trading. let's go post to post with bob pisani >> we are showing signs of running out of gas, with good reason the valuations are really an issue for the overall market the s&p is up seven out of the last nine days, new highs. look at some earnings reporters today in terms of running out of gas a little bit

what's been better than home builders dr horton had an excellent result but they're running out of gas the numbers look good. lack of inventory for existing home sales is really hurting them orders up 37% year over year that's an maamazing statistic. a new high for the stock and immediately it goes to 122 that's a $10 swing in a couple hours. that's an 8% swing in the stock when you're at a new high and all of a sudden you have a new intraday move, that's a sign of buyer exhaustion, people aren't sure how much further they can push the stock up and you have sellers taking profits it's not all bad news. i keep pointing out these large regional banks, every day they're up a small amount. comerica one of the highest levels since march zion had a good report yesterday. stock up today key corp, wells fargo moving to

the upside, the bank etf at the highest level since march. that was the banking crisis. so, this is -- the banks are really weathering the earnings season very, very well then there's some outliers contessa talked about travelers. i want to point out how unusual this miss was, 6 cents an estimate of $2.08 catastrophe losses were off the charts here. and it's astonishing to think, how could they possibly have a miss like this and be up 2%? because they keep raising the premiums all the time. not only do they keep raising the premiums, people keep renewing them. the renewal rate, which is how many more people are renewing at the chaprices they're charging s higher you see what's going on, you have enormous losses

allstate reported enormous problems >> says something about the overall inflationary environment. bob, thank you tesla price target changes grabbing our attention from "the desk of" segment all eyes on margins. only falling about 40 basis points below expectations, but part of a larger downward trend amid a series of price cuts for tesla. despite this, there were some bull calls with mizuho then there's oppenheimer calling for a show me story on tesla, maintaining a sell call while raising the price target to $125 it's at 57% slide from here as they ascribe, quote, no value in robo taxis, robots or other ancillary businesses a little disagreement but doesn't seem like a thesis-changing quarter for tesla. and the reason people think it's selling off is because they were a little cautious that maybe more price cuts are coming

although dan ives pushed back against that. >> guggenheim has been bearish already. they bumped the price target up a little bit but i think it all comes down to how much value you're willing to ascribe to the nondirect auto business because the direct auto business was shown to be in the quarter about what we thought it was going to be coming in. on a year-to-date basis they're on track for the delivery forecast for the full year, margins probably better than feared, i think is the way people are characterizing them not a lot of visibility there's going to be relief on pricing and margins. you know, adam jonas at morgan stanley who has $150 price target, equal weight, but has been receptive to the long-term tesla story says the auto business, he ascribes $94 a share in value to that $250 price target. everything aside from just pure auto sales, which is the mobility business, which is software, which is down the road, you know, network services, all the stuff that are

layered on top is where the value lies that's why you have a $900 billion market cap company in tesla when you're talking about maybe $25 billion in cash flow in two years. >> which is why the quarterly numbers almost don't even happen that much. >> we do get the delivery numbers beforehand it is eye of the beholder. we know tesla stock sometimes doesn't do that well when it's all about the numbers actually that were right in front of us it's about the hopes for what this is going to become and how big you think ev and self-driving -- >> some thought they might upgrade to 1.4 million delivery forecast and now they're talking production line because they're upgrading them. >> as they spend more on a.i. and free cash flow goes down. morgan stanley seeing light at the end of the tunnel for bud. they assume coverage on that stock. anheuser-busch at overweight, raise the price target to $58.67, implying 17% move higher they say while investors sit on the sidelines, they expect the company's august report to

provide clarity and margin improvement for fiscal 2024. the analysts who cover the stock are trying to figure out if there's going to be a full recovery here. they want them -- they want the company to quantify the damage, which they have want fully done. or done at all really. >> very hesitant call that maybe the worst effects of the bud light might be in their volumes already. also trying to put it in context, i guess, in terms of the company's overall global sales. obviously you don't like to see the market share go down in the u.s. but it seems like it wasn't a huge percentage of broader bumps. also modelo top market share, and also owned by the same company. they own it. they've been the perfect beneficiary of the bud light decline in sales but it's interesting it's not a full net loss. ceo of philip morris coming up after the break the stock underperforming the s&p this year by a wide margin can a tobacco company still

attract ves instorin this day and age? that exclusive interview next.

looking for some ideas as earnings season ramps up morgan stanley says look no further than microsoft this morning the company -- the firm reiterating the stock at overweight, calling it a top pick heading into results next week however, microsoft backing off 1.1% i think the story is pretty well

known. >> a lot of optimism. sticking with earnings, check out shares of philip morris international, the tobacco company behind marlboro and other brands, posting a beat on top and bottom lines in q2, increase in shipment volumes from last year joining us first on cnbc is philip morris ceo jacek olczak what kind of environment are we seeing for cigarettes right now as you're trying to transition the company at the same time as having this very large legacy business >> we're very happy with the quarter, this quarter results. we are just continuing very successful trajectory, transformation leaving cigarettes behind, going smoke-free at the end of this quarter, 35% of our revenues are already coming from smoke-free products. the shipment volume growth is very much driven by the growth of -- it's also translates to

the double digits -- top line added growth and very strong eps growth so, i think, you know, philip morris is an example of a very successful transformation when you can change completely, rearrange your business, work on a product, which obviously we know that the roduct, the cigarettes have negative impact on our society and we are trying to grow and become a smoke-free company. i'm very pleased another quarter that you can have a very successful transformation and at the same time offering good return to shareholders >> how far along are you on the journey to smoke-free? how much of the business is it -- i know you are trying to attract a different base, ones that has shunned cigarette smoking for years. is that working? >> we are also thinking about other products, so we will

invest behind the wellness we're very interested in the cannabinoid space, medical cannabinoid space, very interesting investment and calibration. that's obviously that's years ahead of us, once we start bringing more material results, more material impact to the company but i think it's absolutely right time for philip morris international to start investing in this domain today we're focusing today on converting our business into the smoke-free, into the alternative to smoking we spoke many times about a spectacular success of iqos, we recently entered the u.s. market by acquisition very successful category, nicotine pouchs 50% year-on-year volume growth it's spectacular we still have 65% to go, if you

like, to make philip morris smoke-free but we're on a good trajectory to deliver it. >> what is the pricing environment around the world as you experience it? i know you've had some benefit there. i wonder how it differs between traditional tobacco products and smoke-free >> traditional tobacco products enjoyed a relatively attractive price. alternative to the classical cigarette products actually are better elasticity. so, in this quarter a very strong pricing contribution to our top line i believe that's going to continue despite the fact that obviously there are pressures coming from inflation, pressures on disposable income but i think in our category we're on a better side of the equation. >> there are some reports that you have acquired a cannabis company, which is interesting because i think you've been reluctant to get into cannabis

first of all, can you confirm it and what's the strategy here how has it changed >> i think you're referring to the reports. yes, we have a collaboration with a company in israel, a very special startup. with have a minority position there. we collaborate in the product, this is medical, pharma space, this is in the space of pain management very interesting technology, which i think philip morris capabilities and pharma capabilities, our wellness and health care arm, can come together to bring these products to the market. it's exciting about this we make it clear, we are not interested in recreation in part of the market. we're very interested in the medical part of the market. >> thanks for clarifying good to see you. >> thank you very much. >> jacek olczak of philip

morris. a lot more on netflix results coming up. former nbc entertainment chairman ben silverman is with us netflix shares now at session lows, down more than 9%. don't go aaway has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

netflix disappointing investors this morning the stock trading down more than 8% despite a beat on earnings and smashing net ads expectations by more than 3 million. a miss on revenue driving some

downward momentum, driven in part by a revenue miss and tepid third quarter guidance as the company said it was too early to break out revenue from their new ad tier. with his outlook on the company, former nbc universal co-chair ben silverman. it's great to talk to you. wall street leading into this report has been giving netflix a ton of credit for being kind of the undisputed leader, having basically everything that it would take to withstand this tough environment, the head start in streaming, the amount of content they have in the tank to go against the writers' strike, just in general this pricing power and a new ad tier. so, did anything change in all of that with what we heard last night from the company >> i'm content creator, not a stock expert, but i read those numbers and was so impressed 5.8 million subscribers added and i see, you know, just a

giant business with over 223 million people paying every single month to subscribe to the service. it's, you know, bigger than multiple super bowls every single week, watching the service. so, i'm service. i'm impressed with the platform. they're profitable and they are a great partner to supply as a producer, creator and production company. and i do think between their huge international programming accelerant and lead from subscribers coming with giant population that is are only growing like the middle east and africa that they still have a lot of runway and are still the undisputed king and they wills have a balanced platform in terms of they went early into documentaries, the untold franchise for them, which is an incredible series of documentaries. they make nonscripted formats.

they make scripted shows, korean dramas, they make indian dramas, american sitcoms there's so much inside it and the ecosystem, i can't speak to a stock going down 10% after going up 62% because 62% is a lot to me. >> no, for sure. there's no doubt about it that most of the story, at least as the investment community sees it, remains intact i do wonder what your assessment is right now, though, the overall streaming economy this moment with the strike because all the competitors are struggling to one degree or another. there seems to have been this period of overspending, overproduction, and now reality is requiring maybe some discipline on production, maybe the pie is not going to be as big. whether that helps netflix or not, how do the other competitors navigate this? >> it's really bad, honestly i've never felt that before in the history of my being in the

content business and i'm also watching as players in linear cable are being hurt and broadcast are being really hurt coupled with advertising market that is softened and is softer than it was in previous years. and it's a lot of issues that are faced by providers and the high-level competition that being said, there's still so much appetite for great content and so much opportunity and look at how the cable systems got debundled into all of these streaming platform, but my monthly bill has finally caught up to my old monthly bill and, in fact, surpassed it that was not what one of the goals was in this next iteration of content distribution. >> who gets hurt by that who gets dropped in that scenario first >> i do think that a lot of those traditional cable networks

holding on for dear life are challenged, in news, information and sports i think they're highly challenged as those subscribers turn to other opportunities or the cable systems just can't afford to pay them their per subscriber revenue that they used to be able to pay them. an average cable network could demand 10 to 25 cents per dollar per cable subscriber in the area as will the fact their reach has diminished hurting their ability to deliver larger advertising dollars as well. there's this perfect storm going on i am excited about what is unlocked by a more disciplined approach it's easy to overpay a movie star to do a series but hard to

create a star and i am excited about that return. >> on the strike, two questions on this for me, who gets hurt the most does netflix fare better when it comes to the writers and actors strike and how long do you think this will last >> they will all benefit from short-term savings and from being able to push costs out and re-examine a lot of deals they're in, force and suspend or stop many of the deals that are recurring payments, but the people most hurt are the ev everyday workers in so many cities and states and countries. over 700,000 people are already impacted, and these are not

high-flying famous people sitting back with giant nest eggs these are makeup artists and costume designers and lighting people and the production personnel who work on these shows and movies are not working. that is a huge economic burden and is depressing among my peers and friends. everybody wants to be at work and needs to be at work. i feel for those lost in the conversation i think it's near term success being able to cull and cut and if it goes on too long, to your other question, and continues past september -- >> oh, no. i wanted to hear the rest of that if it goes past september. >> i don't think it's a good

thing. >> it's helping them, his point was, because it's forcing cost discipline on budgets but in a few months -- >> no winners. >> wall street is zzbuing about extreme heat and cheap energy prices we'll explain.

somebody would ask her something and she would just walk right past them. she didn't know they were talking to her. i just could not hear. i was hesitant to get the hearing aids because of my short hair.

but nobody even sees them. our nearly invisible hearing aids are just one reason we've been the brand leader for over 75 years. when i finally could hear for the first time, i started crying. i could hear everything. call 1-800-miracle and schedule your free hearing evaluation today. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

as an intense heat wave sweeps across the globe, americans burning up natural gas to keep cool the price have is been staying low, down 60% compared to a year ago thanks to a mild winter leaving a lot of that unused in storage. now the prices are starting to inch up. nat gas up more than 20% in the last three months on pace for its first positive week in the last three >> as long as the heat wave persists, you might have a bid here we dodged such a bullet. we were afraid of the supplies during the ukraine invasion and all the rest of it it seems it's not a burden on storage. the price is where it was 25 years ago.

>> saving grace. s&p is under a little pressure, it's selling off almost 10% by impressive numbers >> another one of these rallies. >> energy and materials. that will do it for us now "the halftime report" with scott wapner at post 9. sara, t. growth versus value. that debate is back and that's after the dow continues its surge. the nasdaq pulling back today. we'll debate where your money will work best in the months april head with the investment committee. josh brown, kari firestone, amy raskin and jim lebenthal the dow is good for 278. just shy of 1% it's a red for the s&p and the nasdaq 385 is the yield on the ten-year note jim, i come to you first because i do feel like it's time to have