good thursday morning. i'm carl quintanilla with seema mody charles schwab's liz ann sonders coming up with jackson hole kicking off. and randy kroszner weighing in and breaking down the likelihood of what he calls a hardish landing. the ceo of autodesk after earnings as that stock jumps on revenue beat and more enthusiasm about a.i. let's take a look at markets. with the dow, s&p and nasdaq all trading lower. the nasdaq down 0.8 of 1%.

topping the tape today, jackson hole, as comments from philly fed president hashger seemed to turn the market a bit. both nasdaq and nvidia losing early gains. mike santoli is with us on the floor. i don't know if it's harker, necessarily. >> it was nonhawkish, to say the least, if that's the message we'll get more broadly out of jackson hole, i think it's acceptable to the market bond markets didn't get a jolted f jolt from that to me the setup has more going on, which is to say we had the minimally qualifying pullback, five minutes from the highs in the s&p 500. a luke warm comeback, people say this is make or break in terms of the trend and nvidia comes out, a rational response, which is, extremely high expectations, largely met, stock mostly priced it in, but no real coat tails because it's an nvidia-specific story

when you don't get a flush of buying frenzy on that nvidia news, we're settling back. i don't think it's determining this bounce has failed but it shows you we're in more of a neutral position market wise. >> or the market is more focused on what's happening with the market, two-year at 5% now >> i think there's no doubt the focus remains intense on what is going on in the bond market. we are having a firmness in yields today, so yesterday you had yields back off at the long end. today more or less holding their ground so, i think it's another source of discomfort. i think it's one of those things where rear retro fitting the weakness in stocks, to some degree putting it all on yields. i think it's a factor. earnings estimates have continued to move up if we thought a month ago, as many did and probably should have that we were excessive in terms of sentiment, in valuation, in positioning, a lot has been moderated but maybe the job isn't fully done that's the way i would think about it the yield story reflects that.

you are having restrictive action in terms of real yield on the long end in theory it's going to slow the economy and make bonds more competitive. at the moment it's the worry point right now as we correct seasonally in the stock market. >> goldman had a great desk note saying we were surprised last night at the lack of institutional interest in nvidia post-earnings relative to the prior quarter where they were getting ten-plus calls per hour. i wonder if that means we're at a tech exhaustion point. >> or people's eyes got so big after the upside guide in the prior quarter that what could you possibly do for a follow-up to that? maybe that's an explanation for it and, again, microsoft got the faintest of bids on this i do think it's a matter of, hey, we're three months away from nvidia dazzling us again. what's next in the near term. >> really, hours after the print? >> it's off the highs of the day, 1%. >> happiness is a moment before you need more happiness, is what

don draper said. >> it's all about context. staying on the market, our next guest says with the path of least resistance with stock seemingly lower, rate stability, clarity on monetary policy will be key joining us charles schwab chief investment strategist liz ann sonders. great to have you. >> hi, carl. >> what's going to deliver that? can powell help deliver that >> i'm not sure. the real question is whether he makes comments specific to breakout on yields on the upside it's sort of a tough needle he's trying to thread in terms of still probably finding frustration in his inability to convince markets that significant rate cuts are not happening next year. so that, to me, is probably first priority for powell, but i'm not inside his head. but that's what i'd be looking for to see what his comments are

with regard to the breakout on the upside in yields >> right it's been interesting. last week -- it was just last week we were talking about the blowout in retail sales, consumer flush with real wages that were inflecting positive. and now it's about sort of global pmis and maybe we're not looking at the growth trajectory we thought is that part part and parcel of the environment we're in >> it's been a unique economic cycle and there are so many cross-currents on a day-to-day basis whether it's dividing the economy into goods versus services, trying to figure out the excess saving story and whether that's been a driver of strong consumer spending or whether it's more the attachment to the labor market. you did see better than expected retail sales but those are expressed in nominal terms there's still enough inflation that in real terms we haven't made much movement in a metric-like retail sales in the last couple of years and then you've had some of the pretty concerning stories about

shrinkage. and i think the sort of enthusiasm around that atlanta gdp now cast hitting 5.8, that start to be tempered by virtue of some additional data that's come into your point, pmis, some of the data today, durable goods, showing maybe the economy isn't quite as robust as we might have thought on that day that gdp now came out at 5.8. >> and harker mentioning the impact of the student loan repayments, which will resume in october. not to mention a number of retailers, liz, from walmart, macy's among others. referencing how that could put more pressure on the u.s. consumer how do you -- how are you factoring that in? >> so, given the limited penalty associated with not paying student loans, we'll have to see how much take up of the moratorium happens it is the case that we have started to see pressure on the consumer if you break the excess savings,

what's left of it into income cohorts, and on the lower end of the spectrum, much if not all of it and then some is exhausted. that's why you're seeing this increased use in revolving credit you are starting to see delinquencies kick in, and credit cards tends to be more concentrated in subprime but even up the income sector, they want to provide the fine-tooth comb details, there is more of a focus on, you know, nonbrand names we've seen the pressure in terms of unit volume it's important in this environment with any consumer data to look at both the nominal data, which is how it's typically reported, but also the real data, which is a bit more somber >> we're in this interesting time across the country, liz, where there are either unions threatening a strike or already on strike and some have been successful getting those pay raises i look to u.p.s. as an example

now we look to the union autoworkers and see what could happen there just curious how that could play a role in wage inflation and whether powell, perhaps, addresses that in his speech >> so, i think it brings up a really good topic, which is the -- i think the transition that we're likely in the midst of to a very different secular environment. this has been our thesis for a while. i think it's starting to show itself more clearly, which is i think labor taking a greater share of gdp basically labor pulling power away from capital or labor representing a larger share of gdp than profits where it was opposite with profits representing the highest share of gdp i think we're seeing it there. as it relates to the tie-in to inflation, i think we're entering a period that predated the great moderation the 30 years or so from the mid-'60s to the mid to late '90s look very different in great

moderation and it was a period of more elevated volatility. and a global economy more subject to supply shocks and i think that's likely what we're transitioning into that's not the same thing as saying inflation is going to stay high in perpetuity, but more inflation volatility and one of the drivers of that is probably labor sort of, you know, taking some power away from what had been the power of profits. >> yeah. that pendulum after 40 years starting to swing for sure you know, liz ann, there is still a camp that whether it's nvidia or just earnings guidance for the quarter in general that there's no reason to think the trough earnings thesis is broken that earnings are going to start to rebound somewhat. and that's going to lead to a supportive q4 and maybe into '24. do you have a problem with that? >> not necessarily the question is what is the lift to the extent we have seen a

trough i'm not so sure we have seen a trough calendar year 2023 estimates have been nudging up, but that's largely because of what were better than expected seasons in the first and second quarter you haven't seen much movement in the second half of the year i also think companies are not providing the same kind of precision around guidance. and i think what that's left analysts to do is be morneau near term in nature as far as adjusting the out numbers. wait for the earnings season, listen to their companies, maybe make an adjustment to one quarter out. i'm not sure how much true validity the out quarter into the fourth quarter had i wouldn't bank a lot on those consensus numbers as if they're close to reality we also have to remember that the rally off the october lows last year was all multiple expansion without yet any benefit from earnings. with the breakout in yields and higher discount rate, all else equal, that has put downward pressure on more highly valued

segments of the market i think we need to see stability in earnings. i'm not sure we can bank on that term coming simply because that's what consensus shows for the latter part of this year. >> that's a great point. corporates are already undercovered and people make fun of revisions but what are they supposed to do work with what they have liz ann, thanks. great to see you liz ann sonders. >> thanks, carl. nvidia earnings making a splash after thebell yesterday but well off the highs and now just up 1% versus the nearly 7% it was up at the start of the show -- start of the hour it seems to be buy the news, sell the event because the quarter was impressive revenue and earnings saw triple digit gains year over year in the second quarter jenson wong telling investors it could climb as it sees $1 trillion joining us is aaron.

what do you make in the price action in nvidia losing steam here does that suggest to you that markets are losing a bit of confidence in the company's run rate >> yeah. i mean, i don't think it's confidence i think it's just the market reflective of what was a high bar going into this print. they delivered phenomenal results, beat revenue on a big guide upward for the july quarter by, i think it was 23% beat the bottom line number by 37%. i don't think anything has changed. the expectations were high i think we have to digest a bit. we're seeing stocks down 2% this morning as well. again, i don't think anything has changed in the narrative in nvidia i think it's just the expectation. >> unlike a lot of companies, nvidia is not dealing with a demand issue, right? i wonder on the supply front, i mean, with demand increasing so much, is there something to be said about whether this demand can be met and whether wall street is overlooking an

inventory issue over time. >> one of the things to consider there is that's a key focus for nvidia and the emphasis on the fact they can grow supply, not just this quarter but seq sequentially over the next handful of quarters. if you look at metrics, inventory and purchase obligations were up 53% sequentially coming out of the july quarter that's expected to continue to grow they are clearly chasing demand. i think it's also important to note, and i think what's showing up in nvidia, it's not a chip company. it's a platform story. they're selling systems that have 35,000 components in them they are selling networking gear that doubled year over year and i think we're at the early innings of seeing the software monetization as another leg to the growth story in nvidia as we look forward. >> aaron, you go from 500 to 600, which is sort of like within the middle of the street. i just wonder if i can get you to pass judgment on some of the outsized targets out there the 800 to 1100s we see.

what are they getting wrong, if anything >> we're trying to stay realistic on valuation so, our number at 600, about 37 times our calendar 25 eps estimate which is about $16.20 we're trying to stay consistent there. the stock has traded historically over the last three years at 42 forward 12-month pe multiple you do see estimates, you're punching above 20 bucks of earnings power looking into calendar '25 we want to be conservative but clearly the momentum's at the back of nvidia we think estimates can continue to move higher and, you know, we'll see what happens with numbers as we move out over the next couple of quarters clearly it's an expectations gain we think there's still upside momentum in the story. >> aaron, thank you. watching nvidia trade at $478 a

share. randy kroszner is next on his call for a hardish landing and then later on, one payment stock has lost about a quarter of its value the past two months a delayed recession makes it the perfect time to buy. wel 'lget to that call when "squawk on the street" returns the first time you connected your godaddy website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

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we need to take some time to figure things out. and you hear this plea from community banks loud and clear i'm hearing it even from business leaders let us absorb what you've already done before you do more. >> philly fed president harker today offering his thoughts as we look ahead to chair powell's speech tomorrow in jackson hole, which our next guest thinks will be a total contrast from his remarks at last year's conference while still leaving open the possibility for more hikes if needed. joining us this morning, former fed governor randy kroszner and steve liesman, who had the harker interview, wrapped up that conversation, made quite a bit of news. randy, let me -- i guess, what could be as hawkish as last year, how do you expect tomorrow to turn out? >> yeah, i think it's going to be completely different. last year inflation was rising and they had pivoted from saying it was transitory to being the number one priority. you ripped up the usual speech, made it much shorter and said the same thing eight times inflation is our priority. this year he doesn't need to do

that because they have made inflation the priority, they've raised rates really rapidly, inflation has come down. i think we'll pivot back to a more standard speech where they'll be talking about the prospects for the labor market, the prospects for inflation, he's already talked about how things are a little more balanced or getting close to being balanced i think he'll leave open the possibility of more increases, but it's going to be a very different speech than last year. >> steve, in your interview, harker did say that the fed would possibly cut interest rates sooner rather than later, but he didn't -- he wouldn't answer if that was early 2024. he said we still need to see inflation move in the right direction. but curious what your read is. >>. >> i think you had it right there, seema i basically heard him say if inflation comes down, we can cut interest rates not necessarily, though, in order to ease financial conditions as you know, if inflation comes down in the nominal funds rate

remains the same, the fed is effectively tightening i don't think patrick is somebody who wants to be doing that he said we've done enough here, we are restrictive we need to have restrictive policy in place for a while. the art in the science of monetary policy is how restrictive do you need to be? i don't know that the fed absolutely knows that except it looks out its window to see what's happening with the economy. right now you could make an argument we seem to be able to have decent trend or above trend growth and bring inflation down. there's not a really good explanation for that other than the fact that some of inflation ended up being sort of transitory, some of it responded to fed policy, some may be winding down over time as fiscal policy runs off. but i think the fed and i think what powell will say tomorrow is we're in a place we can hang out and watch for a while. i don't think he has to lay down a major landmark policy speech as he did last year because i think the outlook is much more uncertain as to what the fed needs to do.

>> the other headline that steve got out of harker, randy, was this notion that his contacts in his district are saying, hey, let's wait for the economy to absorb the hikes we've already gotten is that sort of what's leading you to, i guess, we call the hardish landing? >> well, certainly they're the long and variable lags that friedman talked about 70 years ago and we're still talking about this now we certainly have raised rates very rapidly we've seen very little impact on the labor market as steve said, that's kind of unusual that we can kind of be where we are now, maybe we can have this disinflation, we haven't seen that before, bring the rate down without the unemployment rate going up i think over the next six to nine months we'll see more of the impact of these -- of these interest rate increases. and exactly as steve was talking about, it's the real rate that is the most important rate for investment decisions that is the difference between the inflation rate and the

interest rate. interest rates have gone up significantly. inflation rate has come down significantly, so the real hurdle rate for investment is up and i think the fed's going to hang tough for a while they don't want to have something happen like happened late 1970s, early 1980s where inflation came down, the fed cut, inflation took off and they had to go to double digit interest rates. >> steve, does powell mention china tomorrow should we make a about et? yes, no. during your interview with harker, he didn't seem as concerned about the deceleration of the economy. >> you know, i'm wondering about that i'm actually in the camp we could see a more significant deflationary or disinflationary influence from china harker said it could go both ways in terms of reducing some of the economic growth i don't think china's a big player when it comes to overall u.s. growth. i think it's a bigger player when it comes to prices. one thing that's interesting, i want to get back to what randy

was talking about, i think right now, randy, it seems like we're seeing the impact here, the lags are in place with this recent rise in rates. it wasn't something that harker -- concerned harker all that much but it strikes me that now that we have these upper 7s on mortgages, starting over in the business sector, it strikes me this is the lag we've been waiting for. and some of what you are saying about the slowdown is something in our future or near future >> yeah, i think that's right. gosh, interest rates haven't been this high on mortgages since before the global financial crisis now, because so much people are sitting on those 3% or below mortgages, they ain't selling unless they have to. but that's the thing i worry about that if the unemployment rate starts going up, that means people won't have a choice but maybe to move, suddenly supply will increase and that could put down pressure on prices. that would reduce people's

wealth, that could put further downward pressure on economic activity so, i think it's -- i think it's really unlikely we'll get through this with the unemployment rate not going much above 4% maybe, but i see that sort of playing out in the first half of next year. >>. >> interesting even as we're talking, collins is on the tape saying the fed has more work to do. we'll see what happens in the morning. randy, thanks so much. steve, great live shot as always our steve liesman. a lot more coming on the fed tomorrow at 11:30 eastern time we'll be joined by cleveland fed president mester. continuing later this hour, the ceo of autodesk is with us it's one of the top gainers on the s&p 500 after raising guidance look at boeing announcing the 737 max deliveries may be delayed due to a defect from supplier spirit aerosystems. the worst dow component today.

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i want to draw your attention to shares of dollar tree, the worst performing stock on the s&p 500 today better than expected results, but the stock falling after the company cut its guidance and spoke about pressure on profits due to inventory losses and slowing demand you'll see shares are down about 9.9% retail earnings, though, will continue tomorrow and even tonight with nordstrom, ulta beauty is one name i'll be watching across retail, that's one area of strength, beauty. both macy's and kohl's referencing uptick in sales. >> that seems like every retail earnings season we get a wide display of big winners and big losers this week it's been foot locker and peloton. >> dick's. >> and petco and yet abercrombie and guess have had 20% pops on their results. >> it's hard to get this overarching picture of where the

consumer is at because you have different stories coming out this earnings season clearly broader tone seems to be cautious from retailers. i wonder what the fed thinks about that going into jackson hole. >> we'll know in less than 24 hours. let's get a news update. good morning to you. former president trump says he will surrender to authorities in fulton county, georgia, later today not before announcing he has replaced his current lawyer with a new atlanta defense attorney unlike in prior federal arrests, there will be a mug shot and a county sheriff says he'll release it after the former president is booked. japan has started pumping treated radioactive water from fukushima nuclear plant into the pacific ocean today. it's a key step in decommissioning the plant after it was destroyed by a tsunami in 2011 the u.n. nuclear watch dog agency approved the plan last month, but china isn't convinced, today announcing a blanket ban on all seafood

coming from japan. and do you want to gamble on pickleball now you can. fanduel now has the option to bet on the professional pickleball association tour events the ppa also signed a deal earlier this year with amazon prime for global streaming rights seema? >> wow, fascinating to see how that market continues to grow. thank you. wolf research upgrading one payment stock this morning saying the delay of a recession presents a buying opportunity. we'll get to what that name is next. speaking of payments, watch affirm ahead of earnings tonight. the ceo will join us tomorrow after results. "sawonhetrt"n e quk t see ith meantime is back in a moment what do you mean? 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, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done.

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close to session lows. let's get post to post with bob pisani with the nasdaq close to session lows. >> nice to see nvidia up everything else they're selling right into the rally it started at the open the semis are all down here. let's taiwan semi. look at this right at the open here, 96.78. it's 93 now. they sold right into the rally the top was right at the op here you see this volume here, 5 million shares, that's heavy volume people are trying to sell a little bit at 11:30, 5 million, that's a lot of volume here same with everything else outside of semis the software companies have been

not doing too much recently. here's salesforce. opens at $212 and now $207 they sold right into the rally the same with everything else, service now, everything is basically down selling into the rally here i want to bring up vmware. if there's any beneficiary of what's going on with cloud infrastructure, these companies, these guys help modernize data centers. they've been a huge mover. opened at $167 and now $163. this is a broadcomm deal this has been a huge beneficiary of everything going on in cloud and a.i. it's also trading to the downside a couple other sectors, though, have held up a little better but are still down the banks are a little more stable this week with yields a little more stable in the last couple of days there's keycorp. these stocks have been down in the last several weeks the dividends have started to look attractive. they're on the very high side.

this is almost a 7% dividend yield right now. zion has 4, 4.5% there's a lot of banks in the 4.5% dividend yield. the prices have come down in the last few weeks speaking of more stable yields this week, a big beneficiary are utilities and equity residential and all of the real estate investment trust this is one of the big apartment reits. a lot of situations. a lot of yields in 4% and 5% range as the prices have kochl down this month. by and large, the story is very simple if big leadership has been tech and consumer discretionary and communication shortervices, tha little weaker. broadening out into other sectors like energy stocks but that broaden willing out theme has been much more muted in the last week, week and a half we're ending on a down note at this point we're trying to stabilize but that broadening out story that was so exciting in the first half of august has definitely become more muted.

back to you. >> we'll talk in a little while. wolf's discover call grabs our attention. shares are moving as they move to outperform, buybacks will serve as a catalyst. this past month has been rough for the company dealing with regulators about misclassifying credit cards and the ceo's resignation last week interesting call today it got cramer's attention. >> i heard that, carl, in the 9:00 a.m discover has been dealing with a ton of legal and compliance issues they talked about overcharging merchants for almost 16 years. that's essentially the way merchants categorize payments. if you have an amex, they can charge a higher rate because it's a higher end consumer they were miscategorizing the way they set that up the view here, though, is that it might be in the rearview mirror wall street is hoping, this is

all out in the open now. they have to deal with remediation but it's done. we can deal with that because we know about it. they're hoping they underspent on regulatory compliance in the past they can deal with this going forward. they acknowledge that. in the note they say the buybacks that were paused as a part of this announcement could be a catalyst. they're expecting that to continue carl, you mentioned pe ratio and the discount to peers. it's kind of an interesting one. discover is sort of this hybrid. it's a lot like american express in that it's a card network but also sort of a bank. it's that closed-end network versus a visa and mastercard which are just a card network. a little different there the comp is usually more around capital one or allied bank, and also some of the fintech an interesting comparison there. below historical averages. trading slightly above -- below capital one. potentially a discount here and bargain hunting by wolfe. >> i want to get your take on

affirm, company set to report earnings after the bell. it's down 30% in the month of august is that due to just broader concerns around deposits or apple's foray into fintech space? >> some of the big concerns have been around delinquencies. that's something to watch today. wall street is really focused on consumer spending and delinquencies in particular. affirm has argued they can tighten the belt when it comes to delinquencies and who they're offering credit to they say they have these algorithms in the buy now, pay later space. still very much a show me story. wall street and analysts are looking for affirm to prove that and say, it's a higher rate environment, the company is relatively new they haven't operated in that higher rate environment or anything other than zero interest rate environment. it's being put to the test here. this has been extremely volatile and one of the highly shorted names. that's part of the weakness you see in some of the volatility. this name can jump double digit

percentage points in a day, which is not uncommon ahead of earnings as well the upside and the silver lining for affirm is on the debt business >> that's helpful context with the stock down 5% today. thanks, kate. the so-called ad winter may be over as we get new advertising data on global spend. julia boorstin with that story this seems like good news. >> it does seem like good news a new study shows the ad market has fared far better than many feared it would this year. the global ad market is growing the at a 4.4% rate this year that is down from the 8.3% rate last year but it's far better than the 6.2% growth rate projected a year ago next year global ad spend is projected to continue its rebound and hit 8.2% growth. now, breaking this all down here, social media, such as meta

and tiktok, that's the fastest growing, followed by retail media, such as companies like amazon and alibaba then there are ads in connected tv, a space that netflix, disney and warner bros., discovery are certainly betting on another key trend worth pointing out here, the five biggest ad companies -- alibaba, alphabet, bytedance and meta are consolidating control with over 50% of global ad spend this year and they're headed to about 52% next year. now, further evidence of bytedance's growing power, there's another study out today that finds tiktok's global downloads reached their highest level in three years with more than 500 million downloads in the first half of this year. that registers at 18% year over year growth. so, there appears to be no evidence that the threat of a crackdown on the platform here in the u.s. is hurting either engagement or ad dollars carl and seema >> julia, got to get your take

on disney. we mentioned earlier, got to get above 84 or you're looking at a nine-year closing low on no visible news other than a piece in the ft that just talks about the need for linear television. >> there are so many questions still outstanding for disney bob iger has a lot of work to do there's questions about how he'll handle this espn transition to direct-to-consumer also this question about what he's going to do about the linear networks. there are a couple key factors and challenges that disney is grappling with obviously there's this question about cord cutting this is something impacting the whole industry but certainly having an impact on disney then the question for disney in particular about the fact it's raising prices for its streaming service. what we don't know is whether that will cause turn, whether that will impact their ability to grow user base and whether that will have a negative impact on the overall user number or if it will drive more people to the

ad supported version and have a positive impact because it's pushing people to dual revenue stream even looking at the analyst commentary here, 67% of ab lists have a buy rating on disney, 27% with a hold and 7% have a sell, this is a lot more than we've seen in a really long time >> interesting yeah, the dangers have turned. peloton can attest to that. autodesk is outperforming the headline grabber nvidia with their results. the ceo will join us next. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market.

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higher after delivering a beat on top and bottom lines in the second quarter and raising its earning guidance for the fiscal year joining us for a first on cnbc interview is autodesk ceo andrew ana anagnost subscription up 9% year over year is this a sign to you that the enterprise customer continues to spend despite the macro economic environment not holding up as as well >> you know, this is a great example of resilience, discipline and really opportunity out there. we're a very resilient business, unique in our space, pure subscription model and diversify from planes and trains, buildings to bridges, all the way to movies and games. we touch everyone. there's this relentless thirst

for digital transformation in all of those sectors when it comes to discipline, you know, we never overinvested in good times to fund everybody's pet project but we never underinvested in bad times to fund everybody's favorite investor that kind of consistency pays off long term. the opportunity here is, everybody in the built environment is suffering from a fundamental capacity problem and they need digital transformation end to end for their systems to make things work and to fit that capacity model. so, that's how we were able to beat out all the key metrics and that's why we raised the low end of our guidance. >> you did see billings fall 8% year over year on the call you mentioned a portion of your customers are choosing annual versus multiyear contracts. i'm curious what investors should make of that. >> yeah, so the billings is totally predicted. we signaled that to the street that's because we transitioned away from collecting multiyear

billings up front to collecting them to an annual basis. billings went down billings will increase over time as we move our customers away from up-front billings in multiyear contracts to the way they really want to pay us, which is annualized building and multiyear contracts. >> can you add more color on what you're seeing in your media and entertainment business this came up on the earnings call, how the ongoing strikes could potentially have an impact on post production and in general business overall how is that business something right now? >> certainly if protracted strike in the media/entertainment business could have an impact on our business people are in post production right now. when they're working in post production, they're trying t get the material out they already worked on. there's a nice overhang. if this persists for months and months, it's a challenge remember, with regards to our business, we're involved in everything that gets built out there. everything

cars, bridges, the tesla you see down the road, the bridge it drives over, spaceships, everything when you look at the built world, there's a lot of complexity out there and there's a lot of need for building and rebuilding and that's the key we're serving. >> it was interesting to hear the commentary that the trends are having you consider taking some of your more cautious forecasts off the table. i guess the question would be, is there still room left in the season or the year to where those cautious forecasts could be put back on the table >> well, you know what we're doing is we're guiding to what we expect to happen based on what we've seen in the first half we think that's prudent. that's the way you stay in front of things. that's the way you make sure that you're consistently delivering positive results. again, it's all about the discipline that we're trying to exact here we're confident in the guide we've given right now. and we'll see how the results continue to evolve over the next

couple of quarters. >> investors like what they see, stock up 3%. andrew, thanks for joining us today. >> thank you. coming up on the show, a look at the companies who say they want a challenge nvidia's dominance, but can they come close? details coming up. so i called innovation refunds. their team of independent tax attorneys will work with your cpa to determine if your company is eligible. [whip sound] take the first step to see if your small business qualifies. (fan #1) there ya go! that's what i'm talkin' about! (josh allen) is this your plan to watch the game today? (hero fan) uh, yea. i have to watch my neighbors' nfl sunday ticket. (josh allen) it's not your best plan. but you know what is? myplan from verizon. switch now and they'll give you nfl sunday ticket from youtubetv, on them. (hero fan) this plan is amazing! (josh allen) another amazing plan, backing away from here very slowly. (fan #1) that was josh allen. (fan #2) mmhm. (vo) for a limited time get nfl sunday ticket from youtubetv on us. a $449 value. plus, get a free samsung galaxy z flip5. only on verizon.

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nvidia's blow-out quarter renewing some faith in its ai dominance post that go record $10.3 billion in data center revenue, 141% jump from just the last quarter in today's "tech check" our deirdre bosa on companies trying to break that dominance. carl, dominance may be one estimate, ai-related gpus, most people know this it's not just about the hardware, the gpus there is an entire ecosystem that includes a key software layer, specialized computers,

that makes nvidia more of a one-stop shop for ai developers. some of that, like the software layer, is designed to keep customers within its system. for example, it can reduce flexibility for the biggest cloud provider aws, working with a lot of ai companies. so competition, while it is still far from challenging that dominance, it is beginning to emerge, and we dived into it on the software level a number of startups are working on tools that they say reduces the cost of training and running machine learning models compared with nvidia products others are targeting alternative software that would work entirely outside of the nvidia system, thus freeing up developers to use different chips. now one such startup is modular, and it just received $100 million in new funding from general catalyst, google ventures, among others i spoke to the ceo yesterday who said there are thousands of companies that want to use their product, but he couldn't name one or see if anyone is actually paying for it yet. a sign perhaps of the optimism

in the space but also how far there still is to go especially on the monetization front. on the hardware front, high costs, technical complexities, that has given nvidia its huge moat many startups have tried and failed it's really looking like big tech, amd, google, amazon, the ones that are making the biggest inroads and will continue to do so a shift in the cycle, too, could help competitors generative ai going from training to inference. training is building a model like chat gpt. you have to feed it all the data to get it up and running nvidia h-100s to do that inference, that next stage, is when the model begins to start thinking for itself, it's already built and is able to answer your questions. this part can be developed using other chips. so nvidia is now working specifically on this inference part, but it doesn't already have that huge lead that it's had in training, and it's already facing competition from

well-capitalized rivals developing their own ai ecosystem, and that's increasingly what this is about, building a one-stop shop, an ecosystem. that's where others are trying to catch up. >> it's a crowded marketplace, amazon, google and others trying to play a role is there one company you think has the best shot at threatening nvidia's dominance in the ai space? >> it goes back to thisquestio of big tech versus little tech or smaller tech. and we've been talking about this for decades, right, how do you compete with the mega caps that have so much money to spend on this, to put into this, but also the ecosystem you have a microsoft with a ton of its own enterprise customers. you have amazon, the biggest cloud player out there it can already serve a lot of needs and that gives customers and developers that are working on ai sort of reason to go with them versus a startup. what we're seeing on the startup level is a lot of money going

into this, nothing has changed, but raising questions whether there's a bubble and if they're going to be disrupted by the incumbents >> let's let the race continue deirdre, thank you, deirdre bosa with a focus on nvidia, which is still losing steam b uutp on the day and a lot of attention being paid to this new deal between shein and forever 21 good night! hey corporate types. would you stop calling each other rock stars? you're a rock star. you are a rock star. rock stars. please! do you know what it takes to be a rock star? i've trashed hotel rooms in 43 countries. i was on the road since i was 16. i've done my share of bad things. also your share of bad things. we know that using workday for finance and hr

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fast fashion company shein and forever 21 joining up. in turn smart group about be a minority shareholder in shein. let's bring in courtney reagan to explain what this all means >> shein, carl, for those who hey not know, is an e-commerce sort of juggernaut, fast fashion. they produce in small bachls and respond quickly to trends at extremely low costs. an example is a t-shirt at forever 21, fast fashion and low cost, maybe about $10, $9 pl

shein may be half of that price. with the two of them teaming up, they're sort of a sharing of expertise here so shein is getting access to physical stores, and how consumers like to stop in those stores here in the united states, and then forever 21 potentially is getting expertise with fast fashion production in responding to trends even quicker and more inexpensively than they already are able to. and then sparc is this holding group which is a joint ownership between simon property group and authentic brands, an operator and sort of a brand manager. >> how big of an opportunity is this for simon we've seen shares sort of lag this year. >> i think this is a big opportunity for both rumors swirling about shein wanting to ipo here in the united states because it does do a lot of its manufacturing in china, although it has no revenue there, there are a lot of speculations there could be questions from regulators, and we know donald tang, vice chairman of the company, has

moved to washington, d.c., and he tries to speak regularly with lawmakers and regulators to sort of assuage any worries they might have about the company doing business and growing here in the united states >> interesting implications for e-commerce, physical shopping, real estate thank you. tomorrow we'll have an exclusive with those players our sara eisen will bring us that meantime, 1% declines on the nasdaq and we've lost 4,400. >> as we await earnings from intuit, nordstrom, workday let's get to the judge carl, thank you very much. welcome to "the halftime report." i'm scott wapner front and center this hour, one down, one to go. now that nvidia has reported another blow-out quarter, all eyes turn to jackson hole for the fed chair's speech tomorrow. the mark's a bit on edge ahead of that. the investment committee sizing up what's at stake for your money. joining me josh brown, jenny harrington, jim lebenthal. let's take a look at the markets. the dow is down 200 points the lows of the