constant contact. helping the small stand tall. good wednesday morning i'm carl quintanilla with sara eisen live on the floor of the new york stock exchange. this morning, former fed jis chair rich clarida is a surprise move to the upside coming this week on the inflation front. >> aiece with us, taking sthook lower this morning we'll ask him went what wrong for advertising this quarter >> later, speaking my language, d the pop star joining us. and stocks up and down up and down the pain continues to be in

technology, where teeing off of last week where we saw this big rise in yield. the nasdaq down 1%, s&p down a third of 1%. i would also just throw in oil, which is making new highs for the year, despite concerns about weakness in china, about potential weakness in the united states oil just marching higher this morning, which is raising some questions about inflation tomorrow and just how sticky it's going to remain in the months to come as the fed tries to fight it. >> got to 8411 this morning, that is a fresh high gnat gas, the high since march as we're once again worried about the situation in europe and whether or not that will drive prices even further going into the winter months >> plenty to worry about topping the tape this morning, the s&p 500's round trip, now flat in price. eps dating back to january of 2022, yet rates are up, gdp is higher rates have cooled. what does it all add up to

mike santoli here to break it down this is such a mike santoli kind of story the fact that we've gone nowhere. nothing's really happened here type of story. but plenty has happened below the surface. we're trading right where we were two years ago in the on the s&p 500. and we've been tracking that same rally from the spring into the summer of 2021 the difference, yes, the earnings level projected for the next 12 months is the same as it was in january of last year. we have the same p\e multiple, therefore, i think the difference is, one, the nominal size of the u.s. economy is 10% bigger there's a little more certainty, we think, that those profits can come through, certainly because we've had our little earnings trough, margins have improved, again, the economy is bigger but also, back then, we had five percentage points of fed tightening ahead of us right now, we don't. committee don't know what the net effect of all of that will be, but we don't have it but i think it explains the last three or four weeks of the market kind of being in this

sloppy, wait-and-see, stop and look around, have we already priced in enough zone, since the july 12th cpi report for june, it seems like that was a mission accomplished moment. since then, the bar is higher for having macro data. oil, that complicates the story for headline competition going ahead, and generally, we know things get a little bit choppy sometimes in august. >> meantime, reuters poll, most strategists seeing the ten-year having peaked this cycle >> i think on a contrarian logic basis, you don't want to sew that, but the upper end of the range has held again it was, we were going to break out, and we didn't it seems as if that's at least the premise, you can't tail cool comfort that we won't have to deal with the rates. credit spreads have been okay, so credit costs are tame more spreads are not great you have mortgage, 30-year fixed below 10%.

>> take a big drop and it's not all clear, it's just kind of good enough for now. >> and i wonder, when you mentioned this, even from rates have peaked, are we still heading for a higher level of rates. it doesn't necessarily mean we're going to plunge with the forecast not showing a pretty large recession. >> that's right. >> and is that going to be an equity headwind? >> the wear and tear of loans rolling over, companies absorbing higher interest costs. you have floating rate debt. without a doubt, it will have an effect the absolute level of rates is not that punitive. you're talking about 4%, but you're talking about maturity walls in the future. >> and i don't even know if it's a wall it's like the treadmill starts to go on incline a little bit, and you have to try to recount for that >> tell that to someone trying to buy a home right now. >> for sure. >> 7% high >> thank you, mike

the market looking ahead to inflation numbers this week, tomorrow, cpi, ppi, wholesale inflation on friday, that could spell out the fed's next move. our next guest expects a slight reacceleration for the july number, but says any inflation improvement doesn't mean a soft landing and expect a recession by later this year or early next joining us now is former fellow reserve vice chair, pimco global economic adviser, rich clarida good to see you. >> hi, sarah, good to see you. >> what are you expecting tomorrow do you think we'll have a problematic number >> we're looking more at the core number. the headline number call actually pop up, because of the base effect, but a good print on core in the last report and we expect a similar print we could be wrong, but a core number in the range of 2.5% annualized, and that would certainly be better than we've been having. >> so what will that mean for september, for the fed, or november

>> you know, i think the fed is truly data dependent now i think that the that they emphasized that they could pause in september, they could hike. i think they'll want to keep their options open in particular, sarah, they don't want to declare mission accomplished too soon, but they can't be tone deaf they do need to acknowledge that the data is improving, especially on the price inflation side less progress on the wage inflation side >> why don't they keep hiking? market is not expecting another hike for this year if there's still work to do on inflation and they haven't destroyed the job market, whibt just keep going? >> i tend to agree by you. i'm not on the committee and some of the rhetoric including recently from john williams and pat harker have indicated that

they're receptive to the idea that they could be done. but inflation forecasting has not had a good track record in the last three to four years, including mine and although there's a case for forward-based policy, you know, right now, i think they actually, i hope they do look for inflation to come down durably and stay there and so i think it's too soon to declare mission accomplished >> although, rich, you were asked about a month ago about some of the market wages of a march cut. and you did suggest at least at the time that a cut in march or an indication that the march meeting would involve cuts makes some sense you still feel the same way? >> i do, and i'll tell you why under the fed's -- remember, the fed's base line projection at the june meeting had that additional hike in in the s.e.c. docs and under that projection, they had inflation, core inflation

next year falling into the twos. so if we're sitting at the march meeting with core inflation on a year over year basis in the twos, they will begin to entertain cuts but that's only conditional on getting there. there's a lot of road to travel between here and then. under that base line outlook, that's a sensible thing to start thinking about for next spring >> so does that mean we're in recession by then? >> well, i think, i think the odds of at least a technical recession is declared by the nber are more likely than not. historically, when the unemployment rate has risen by half a point, it's been declared a recession. my sense is that we're going to need to see some modest rise in unemployment to get wage inflation into the ballpark consistent with the inflation

target there are others who are callinging for a very soft landing without a recession. we get some rise in unemployment staying in the mid-4s in order to get inflation into where the fed wants it >> because there's a few in the market, with no soft landing and the data continues to show that that might happen, if inflation continues to come down and the economy continues to reform, yes, we're seeing rising delinquencies, not a lot of distress out there how probable is that >> i think there is some likelihood i would say more probable is what i just called the softest landing, with a technical recession, maybe a quarter or two of negative -- of growth again, everything in life that's worth thinking about in markets, at least in markets, if not in life is a probability.

and i think the odds of a really soft landing are less than those in really the scenario of the fed itself has described in the sep projections. although, you know, i understand why they don't want to use the "r" word, but i think that will ultimately be part of the adjustment here. >> i wonder be you're starting to think about how jackson hole gets framed. if we set this told that we're resolute until further guidance or talk about some victories, i guess. >> that's a great question because obviously, all eyes on jackson hole this year, as in most years i would expect the chair to do a couple of things i would expect him to review the track record thus far of the rate hikes, what they've delivered. the positive developments they're seeing in the data, but also, i would expect the chair not to use it as an opportunity to declare mission accomplished,

to emphasize that they'll be resolute and the ultimate destination is getting inflation over time back to target i think what he will want to avoid is being interrupt ed as reinforcing the mission accomplished theme the fed has done, that would ease financial conditions and of course, the other thing i do expect him to say as well is repeat what he said, which is that part of their adjustment will be to keep rates at restrictive levels for some time. i think he'll make that point as well >> but it's not the sort of policy shift signal where we've seen in prior jackson holes, it doesn't sound like >> i don't think there's a need for that, sarah. last year was an historic event, where the chair used jackson hole to really reinforce and double down on the decisions at the june and july meeting to hike by 75 and keep adding until the job is done he said, a couple of times,

acknowledging some pain in the labor market so i don't think the stakes are quite as high as last year i think we'll see a fairly balanced assessment and set of remarks from the chair >> that's interesting. the financial conditions element, i think about, because of what the chair told vchair in portugal the whole, don't fight the fed thing. >> he had an opportunity to shoot that down and he did not >> well, sarah, are you referring to your interview with the chair, i believe at sentra i watched it did not make it to sin tra this year. i thought it was an excellent interview and i noted at the time that he did not take that opportunity as he has on past occasions. i think chair powell wants to leave the door open to an eventuality, where they need to hike some more, keeping rates

restrictive and keeping the focus on the ultimate mission, the important point at the fed is they need to be consistent and they can't be tone deaf. and so i think so far, give them high marks for that. >> really great to have you here >> thank you, richard clarida, former vice chair of the fed >> still to come this morning, the technical take is the recent market downtrend here to say or are we setting up for a bounce we'll discuss with katie stockton plus, shares of iec plunging as results disappoint, but management says they see better times ahead as they debt back to basics ceo joey levin joins us. we're back in a moment o you mea? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq,

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watching nvidia today, down more than 5%, touching its 50-day moving average, first time since january stocks down 9% so far this month, while the s&p is still holding its 50-day average next guest says to hold on tight. the recent downgrade prompting her to downgrade her short-term bias of the s&p to neutral today. and she says the likelilihood of the correction has increased joining us, katie stockton always good to have you. good morning >> good to be with you >> so wants if we do get back to that 50-day? >> it is initial support for the

s&p 500, natural place for the bounce to develop. unless it's broken, i think we have to trust that this is a short-term pullback, not the beginning of something in terms of a severe corrective stage we have some impact to short-term momentum. that prompted our downgrade to short-term neutral we've been short-term bullish in may. and if we see it carry over, that's where we'll start to recommend, you know, hedging strategies, and managing risk. if we see the downturns carry over to those gauges, the implications would be for up to 2 to 4 months of corrective price action and that, of course, is something that would be worth repositioning around one easy thing that we recommend watching is the 20-day moving average. it is still pointing higher for the s&p 500, but with all the weakness from apple and microsoft and nvidia, the nasdaq

100 seems to be losing the support of its 20-day moving average. and we actually moved to an equal weight bias for the technology sector, which we previously have been overweight. and we could maybe stay with just for a couple of months. but to us, it does seem prudent at that time >> you mentioned the nasdaq. we just mentioned nvidia apple had its worst day of the year on friday is there a chance for you if we do lose some of the mega-cap tech leaders, that can be made up by energy or materials or something else >> i don't think the footprint from energy and materials will be big enough to allow the major indices to forge higher without the support of the megacaps. noting also that the breadth, that while it improved very notably since may, it is now also overbrought the data is poised to come in as well, the same way we saw the

sentiment data it was suggesting that the market was in this extremely greedy territory and with the pullback last week, i'll it very modest for the s&p 500, we did see that sentiment data come up a bit and that creates another risk saying nah there's a corrective face, even though we don't see it yet, that is, of course, what we're looking for, and we do have it from apple, from microsoft, which failed to get through that 350 resistance level and we see a little bit more downside >> what about the relationship between yields and stocks? because sometimes stocks like rising yields, they signal that we're going to not have a recession and things are looking better in the economy. and sometimes they worry about it, because it means higher for longer in terms of rates, the impact for the fed, and what that's going to do to the economy. >> the correlations tend to

break up over shorter time frames we do look for a pullback in treasury yields, and a rebound in the treasury bond market. treasury bonds do tend to do better than equities, when equities are in a corrective mode so we would keep that in mind, certainly, they are perceived as a safer place to put your money. for yields, though, we do think that the longer term uptrend is still very much in tact. once we see the pullback run its course in ten-year yields for one, we would trust that we would see more upside from yields, and of course, we'll have to recalibrate accordingly, if we were to see a breakout above about 409, that's a resistance level for the ten-year yield, the next resistance is 434, and that could have an impact more now pack to the 50-day moving average. >> pretty fascinating. we'll see. south of 4,200 would start to give some folks jitters, i imagine, katie

we'll see what happens, katie stockton >> thanks. >> thank you >> when we come back, china inflation falls for the first time in two years, and that could have big implications for the global economy we'll discuss. >> and we're watching shares of walmart continuing to hit all-time highs earnings coming next tuesday bank of america raises to 190. says that higher margin businesses are growing, especially digital advertising on a pttrey easy margin comp we're back in a moment

watching liv today after an initial pop of about 14% after hours. stocks lower as investors delve into the numbers the company taking a cautious approach to q4 and the guidance as it invests in lower prices narcoticing. j jeffries says the strategy will lead to more ebitda pressure the surge pricing continues to be wildly unpopular. >> no kidding.

no one likes to pay extra. european markets have to close in just a moment, but the story abroad today is in china, with the chinese economy now technically in deflationary mode seema mody has been tracking the story, and i feel like there's this debate among strategists and economists now about whether china exports its deflation and it's good for the global fight, or whether it's more worrisome of what's happening there in the economy. >> that seems to be the big question what does that mean for the rest of the world exports and imports? but that latest data certainly showing that the company is now in deflation with core prices specifically down 26% year over year we've been seeing the market reaction to all the negative news surrounding ing china's economy. down about 7.5%, just this month. so paring back some of those gains it saw in the prior month. today's market reaction, a bit more muted, slightly positive, in fact. that might be more related to one, the expected stimulus, expected some time in the fall and the rumored executive order

on outbound china investments. which according to reports is not being seen as reverse cfius. instead, it's expected to be a narrow set of rules that apply to u.s. private equity and venture capital firms with focus on ai, chips, and quantum computing. we spoke to the counsel on u.s./china special relations team the biden administration has been careful toemp size its sbepgs not to contain china or curb the country's development, but narrowly aim at restricting the army's access to advanced technology the bigger risk is if we see beijing retaliate with further export controls, potentially taking him at u.s. companies that do business there we've seen some of the names that have exposure, trading lower right now. of course, the effect that we've had on deal flow u.s. outbound investments, 20-year low. vc investments have fallen as well and the other chart we brought up here is the chinese yuan, now down about 4.5% so far this year

continuing the decline last year, worth noting that the offshore yuan fell by around 9% against the dollar it's continuing that decline, with the economic data is really not holding up >> i think it's crazy that pork prices are such a big driver of china gdp. what are the market expectations now for stimulus >> i think now, it's just about timing the chinese are similar to the u.s. on vacation right now in august so the expectation is that some time in september or october, when people return to the o office, that's when you could see a stimulus being announced by beijing but right now we're waiting. >> it's interesting, the property element is making some consumers nervous and the crackdown on business is making some businesses nervous. so they're trying -- a weakness sentn't across the board >> let's see what we get with

that captured and how china responds, the impact that has on -- >> k webb? >> not great, down another 6% just this month. but it's been volatile everyone understands what the outlook is from here >> seema, thanks hugely important story our seema mody >> hey, bertha senator dianne feinstein's office confirms that the 90-year-old congresswoman fell in here home and was briefly hospitalized yesterday according to a spokesperson, she went to the hospital as a precaution and returned home after her scans came back clear. there have been questions about the senator's health following her near three-month absence from the senate earlier this year due to complications from shingles and after she appeared confused during a committee meeting last month. a haiti nonprofit says that an american nurse and her child were safely released by their

kidnappers the group said alec dorsenville and her daughter were held hostage. and a new york city beach reopens just over an hour ago after a rare shark attack on monday night that left a woman seriously injured with leg bikes. city officials have deployed drone, land, and boat surveillance to search for sharks in the water since the attack, but so far there have been no sightings. we finally get nice weather and then we have shark sightings >> i hate that story it scares me a lot >> thank you, bertha when we come back, two big earnings interviews. we'll speak to the company of aic, the stock is down today >> and then we'll get to the ceo of duo lingo

the stocks getting a nice bump as the jmp analyst put it, the amazing execution continues. we're back in just a moment.

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take a look at shares of roblox this morning, ugly. down more than 20% the company posting a wider loss than expected for the quarter. bookings were also below estimates, and there's the share price reaction >> a couple hours into trading, let's get post-to-post with bob pisani >> again, sector's weak here,

but there are new leaderships emerging in the market and that's a positive find despite the weakness in the s&p 500. i keep talking about energy. i've been a broken record on petroleum for two weeks now, up 16 and 17 days, that is almost extraordinary for any kind of energy company oil's up, natural gas is up. this was 115 just a short while ago a little over a month ago. every day, schlumberger, some of the other smaller exploration production companies, as well as it requires all moving to new highs here another leadership group recently has been health care. we've heard about pharmaceutical doing better even some of the big service providers. humana has been up nicely, up 15%. and it started off the year terribly, has been rallying as well in the last month if you want a simple sign that the whole remodeling boom is kind of over liquidators. it's not called that anymore it's just ll right now but this was the big winner. remember during covid, everyone

rushed to remodel. at one point, this was a $34 stock. $34. it's $3.27 now this is a close to a new historic low this stock, they went public a long time ago, right at the end of 2007. but that's fine, the whole remodeling boom is over. another group that's not participating in the sort of resolving market that we've been getting here is consumer staples names. the ceo of kelloggs will be on tonight. this is close a new 52-week low. we've seen some names out there, campbell's soup, for example, or conagra, generally just having a tougher time overall, because of smaller consumer sales overall number are up, volumes are down a little bit, costs are getting a little bit tiger the important thing is we're down sixover seven days in the s&p 500. pay attention to the rotation going on we're having a little trouble, because technology has been a leadership stock, a leadership

sector that's now a little bit easier let's see if we get other sectors taking up the slack. >> bob, thank you. let's turn to aic, the company behind brands like "people" magazine, daily beast, and angie plunging this morning, more than 13% reporting a miss on the top and bottom lines among a still-week advertising market. joining us now in a cnbc exclusive, joey levin. thanks for joining us. so what happened here? we thought we were starting to see some green shoots in advertising. >> we are seeing some green shoots at least in our advertising business we turned around profits profits were up a hair on that business and our outlook for the second half of the year is -- continues to improve i think people were -- we focused on the back to basics theme, and that generally seems to be working. and even in the month of june, we had a little bit of growth. i don't know if we'll hang on to

that growth in q3, but q4 looks good from a growth perspective >> i think it was the add spending that had people wondering if we actually are seeing a real turnaround in ad spending >> i don't think that the ad market overall is strong i think the ad market overall is still in a not-great shape i think it's stable, but i don't think there's really signs that it's improving some of the performance marketing stuff is working pretty well, because the consumer spending still seems to be to be working pretty well i think that it was probably more focused on our angie business >> so what's the story there when does that return to growth? >> yeah, i think 2024 is when angie returns to growth. the story for this year on angie has been getting the product right and getting the customer experience right and we've made some changes in the business, in some demand channels and those were particularly pronounced in q2 again on the profit side, we're

up meaningfully year over year in profit. i think we generated $55 million of cash year-to-date at angie. we're up $110 million in cash year an year at angie. but you know, the thing will be getting back to growth and back to revenue growth, not profit growth and i think that happens in 2024 and 2032 is really rebuilding to get the product in a place that we're really excited about and our customers are really excited about. we're starting to see it on the pro side with angie. and what we're seeing on the service professional side, they're sticking with us longer, they're paying longer, getting happy area, and that means we're moving in the right direction in the product. >> 100 days today on the writers and i wonder if it goes through year end, if advertising really has to deal with bigger questions about demand from that

business, from the media business at large. >> for sure. the strike is bad for spending on entertainment advertisers we'ring that and i expect that to continue as the strike continues. that's not a good settlement for dollars right now. there are better segments, but that's not a great one, because of the strike. >> as consumers, we're in a period now where we're watching inflation roll over a bit, you have some real wage growth isn't that positive driver for consumer spend generally, what you're saying is true our businesses that have exposure to consumer spending. involved with gm resorts, with touro. and we can see it on the performance marketing side and product purchases that happen,

those things are all very strong right now. the consumer spending is strong. certainly what we're seeing right now is strong. >> i'm curious how you're thinking about the boom in generative ai and whether it presents a risk to some of your content properties at meredith >> look, all great new technologies create risk and opportunity. we're certainly focused on both. on the opportunity side, we're seeing real enhancements in product at this time we're seeing that there are things that we can do, where we can show content to our readers on our site, that incremental content where we can use ai to figure out what their next question will be we can use ai to answer that next question by using our content and dynamically create content in ways that we think are pretty exciting. and the way that people find content could change with generative ai. people really start to engage

with the large language models and say, i want to look this way, there are new opportunities for finding audience, like people come to those sites right now and get answers. a lot of times they're looking for verification of those answers and that with happen now, what we're seeing in some of the ui is linked to our sites where users come to learn more and that could be of benefit to the site, too. >> finally, just on the stock move, the conversations we're having with investors today, centering mainly around angie. is that the big concern? >> that's the main focus right now. look, i think we have a phenomenal opportunity in angie. i think, again, this year is a building year and we're making tough decisions that impact near-term profits. but we're up meaningfully year over year on profit. we think we have a good, profitable business. we have to get back to revenue growth and that will take a little bit of time

>> the stock overall leading into the quarter has had a good year-to-date performance there's that joey, thank you. appreciate the time today. >> joey lavin. still to come this morning, disney, espn, and penn sports teaming up in this $2 billion deal we're going to discuss what it means for the future of sports betting as we look ahead to disney earnings tonight. >> the deal has penn rifle draft kings heading lower, but jpmorgan sees the price weakness as a buying opportunity, taking the stock up to nerautl. we'll cover that as well we'll be right back.

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disney's espn and penn gaming teaming up in a new $2 billion deal julia boorstin has the details and what it means for disney in particular >> this is disney's biggest move yet into bedding as espn launches a bedding sports book it's partnering with penn entertainment, which is rebranding its barstool branded sports book and divesting of barstool sports. this new service is called espn bet and set to launch this fall in the six states that espn is legal. it will be espn's exclusive betting platform and penn is paying espn $2 billion in cash and stock in exchange for those exclusive rights to espn bet for ten years. espn does hope this deal will drive greater engagement and the brand licensing will drop right toast pn's bottom line all of this follows disney ceo

bob iger saying he's looking for minority partners to take a stake in espn. they're talking to the nba, and nfl. their sure to be in focus this afternoon in disney's earnings report, wells cost wuting disney's revenue is expected to grow 4.6% while earnings per share are expected to decline from widening losses in the customer business. >> boa wonders whether or not this drou lowers the possibility of taking a partner stake in espn are these dispositive of one another? >> i don't think so necessarily. i think that they see a real opportunity here to simply monetize opportunity around sports betting every time a new states thorzs sports betting, it expands the potential, and they want to make

sure they have a partner here. i think that's part of the equation to me, this is not including them in any way from making a partner to take a minority stake. it would make a lot of sense if they could get one or several of those to take a minority stake it would incentivize them to figure out the best way to maximize the audience whether it's on streaming or linear or both as they bring espn more directly to consumers. >> it's pretty fascinating, iger is in peak politician mode at the moment julia boorstin ahead of disney do not miss steve boorstin on closing bell overtime. >> ahead, the ceo of duo lingo ahead. the stock now up more than 100% so far this year

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for today's tech check, we're talking to one of the biggest earnings movers of the day. duo lingo reporting a beat across the board, raising guidance for the fiscal year, clearly speaking the street's language joining us this morning in an exclusive, great to have you talk to me what you think is driving the price action today >> thank you for having me

in general, our performance keeps being very strong. our users have grown very strongly over the last several years and it's because we keep on making the product significantly better we're a product-driven company and over time, our app keeps getting more fun and more effec at teaching languages. since people love it, they also subscribe and then we make a lot of revenue from that that's helped us out quite a bit. >> can you help viewers understand where we are right now in sort of the learning language model trajectory? are things being learned and absorbed in the model at an even faster rate than in the past >> yeah, i mean, we're teaching better and better. literally every week duolingo gets a little better at teaching and it's because we have a lot of users we have millions and millions of users who use the app every day and we use their data to teach

better we're -- duolingo is not quite as good as a one on one human tutor just yet but it is as good as a classroom people are very happy with the amount they're learning. in terms of the market penetration language learning is a huge market in the world it's about $60 billion a year spent on it and about 2 billion people learning a foreign language. we have a lot of room to grow. we're still in the early days for the market penetration for duolingo. >> that's the biggest question that i see from analysts trying to value this stock is just how big of an addressable market you see ahead of you for language learning and potentially expanding broader than that into a broader learning kind of application. >> yeah, for language learning we believe we still have a lot of room to grow. there's about $60 billion a year spent on language learning, the majority of that spend is spent offline but the market is shifting online and we are the largest online provider. we expect over the next few years to capture a lot of that

i think that that's a big thing for us the other thing that is important to say is in many countries like the united states we're growing the markets about 80% of our users in the u.s. were not learning a language before duolingo. so there's a lot of room to grow for language learning, but we're also expand to go other subjects we've recently launched a math app, we are working on a way to teach music as well. over time you're going to see us get into other areas of education and hopefully do what we did for languages but for matt and music and other subjects. >> what about ai there was some questions about whether it was hurting the learning apps. this week ai is tech's best friend how does it affect your business >> we've been working on ai since we started duolingo, for over a decade we've been leaning in on aie i used to be a professor in computer science and one of the classes that i taught was ai.

from the beginning our goal has been to teach as well as a human can, but with a computer so we've been using ai for a lot of things, we've been using ai to personalize what we teach for example, on duolingo wheneveryou're doing the exercises we watch you're doing and the computer tries to figure out you may not be so good at the past sentence so we start getting you more exercises with the past tense over the last nine months we've seen large language models, generative ai and we've seen that come in and we've started applying it. for example, we are using it for practicing conversation with you, we have a in you feature called role play, part of our higher tiered subscription duolingo max that let's you practice conversation. in general i think ai but specifically generative ai will help us teach closer to the way

one-on-one human tutor would teach. >> the education case study one of the huge promises of the technology the innovation pretty fascinating. we will watch it closely luis, thanks so much luis von ahn joining us from duolingo. when we come back, jet charter firm wheels up received funding from delta as there is, quote, substantial dbtou it can continue operation we will share more details after the break.

private jet firm wheels up hitting turbulence this morning as investors wonder whether it can continue operations. our robert frank has the details. it wasn't that long ago that the founder was at the stock exchange taking it public. >> that's right, sara. this will be a day to remember in the history of wheels up, maybe a short history. wheels up was scheduled to release earnings today, instead it's postponed earnings, canceled today's calls and announced efforts to try to stabilize the business delta airlines have a 20% stake, they will provide a short-term capital infusion i talked to phil lebeau, this is

more like a short-term loan probably backed by aircraft or other assets wheels up also selling the aircraft management business and said they are involved in discussions around strategic business partnership, unclear what that will mean. wheels up was valued at $2 billion when it went public just two years ago. the founder promised to become the uber or airbnb of private jets but it never posted a profit, lost over $500 million last year, over $10 o 1 $100 mi the first quarter. private jet demand surged during the pandemic but analysts say it has cooled charter prices and memberships have been falling. we will see whether they can find a path to get a little altitude but right now as you can see that stock way down over 40% today, it's market cap under $40 million now. >> wow robert, in contrast, we

mentioned with cramer this morning blade and their earnings and the way they've been able to pivot away from, say, the leisure private aviation market. >> yeah, and blade has pivoted more toward a technology company, focused on ev drone-like air taxis and that's been their strategy all along. with wheels up they were just saying, look, we're going to go to the traditional private aviation space but use technology to disrupt that blade is worth four and a half times what wheels up was which was once two times what blade was. they went public about the same time, diverging paths for these two companies. >> what is it today, wheels up wework also warning bankruptcy i guess high rates and a weaker demand environment impact a lot of companies robert, thank you. tomorrow don't miss an exclusive interview on "squawk on the street" with the ceo of x

which will be live from the company's headquarters a lot to get through with her including how she plans to bring back advertising in the business of x. >> and what has not been a great tape today, dow down 220, got the s&p eyeing the 50 day not quite there but certainly weakness in mega cap and tech. >> courtney reagan is in for the judge, let's get to post 9. thank you very much, carl and sara i am courtney reagan in for scott wall ner we enter the critical 24-hour period ahead for your money. we will have a key inflation report on deck plus more earnings coming your way joining us for the hour is joe taranova let's get a check in on the markets. as we take over at the exchange we are seeing the lows of the session for the dow. you can see a noticeable down trickle in the last hour information technology, big cap

stocks are