good morning, everybody. welcome to "squawk box" on cnbc. i am becky quick along with joe kiernan and andrew. this morning u.s. equity futures are in the green. these are modest advances at this point. dow futures up by 55. the nasdaq up by two. it comes after a mixed session for stocks. yesterday the dow is down by 120 points. the 500 was up by 4/10 of a percent. the nasdaq was up by about 1%.

treasury yields, which have fluctuated, yesterday were little bit lower on the news coming out of ukraine and russia this morning. they have picked back up. the two-year is at 429. but coin hit a new high yesterday, near $94,000, it's just below hat $93,000 and 400 this morning. >> will give you that news in just a minute. earnings and focus, we will hear from targets are around 6:30 eastern time. a profit is expected to search the $17.4 billion after nearly doubling sales from a year earlier. 's the latest on the transition from the incoming trump administration. we are joined now from west palm beach. good morning. >> reporter: hey, good morning. a lot of movement down here in west palm. some names are becoming official since we spoke yesterday. the first one, of course, howard let nick. the ceo of

fitzgerald and the cochair being named for commerce secretary, taking him of course out of the running for treasury. we will get that in a second. then we also had celebrity doctor and tv personality dr. oz being picked to lead medicare and medicaid. that would put him in charge of the department of health and human services. if both of those men are ultimately confirmed. we can confirm that linda mcmahon, the other cochair, will now be the secretary of education, having her leave the agency that of course trump and elon musk and others are now pledging to abolish. they are saying that mcmahon will be in charge of the effort to return education back to the states. a couple of points i do want to highlight on the appointment. one, it raises more questions than it has answers on the trade portfolio in this next administration because, in making the announcement, trump included language that said that he would oversee the tariff and trade agenda and would also have additional direct responsibility for the office. this would be a shift for ustr, which has traditionally been cabinet level on its own.

this will cause changes, could cause friction with congress as well. the senate finance committee and the house ways and means committee might not talk -- want to lose jurisdiction over that as far as who is in charge on trade and tariffs. then, of course, it takes let nick out of the treasury sweepstakes, which are starting to heat up we have more -- four contenders left that we know about for the running for treasury. we know that scott has artie interviewed you can see that tennessee senator bill haggerty spent most of his day yesterday with the president elect and with elon musk and others at that space x launch in texas. saying that kevin, the former fed governor is going to be down here today to talk with trump about treasury. so a lot of movement here and we still do expect that they are trying to get that team in place this week. guys? >> the process is still happening. in terms of people coming and i guess interviewing. nobody knows right now,

including the trump team who the treasury secretary is likely to be. >> if you don't hear from donald trump. >> some he had a great quote last week that nothing is official until it's entre social. nobody is knows yet, of course. it's definitely still in play. those interviews are supposed to happen today and there is questions too about both of the men that might be leaders. kevin knew there had been a lot of reporting and expectation that he's been angling for fed chairman to take jay powell's job when that one is up in two years. so what he wanted take treasury secretary in the meantime? then with mark rowe, there is untangling to be done as well. i wonder if both of those men are all in, depending on how these interviews go today. >> we have one addendum to dr. oz. celebrity doctor true and pd. we have roger altman on a lot, megan. he was a former clinton guy.

amazing guy. had a heart transplant. he asked for the best surgeon to do the heart transplant. it was dr. oz. i mean, he's the real deal. >> it's not like dr. phil. >> that's what i mean. that's done, that's over with. ben carson too. i don't know how long he was at johns hopkins but he was the head of neurosurgery. >> oh, yeah. i remember reading his book >> sometimes i think you wrote it by selling supplements on tv. he ran for senator but lost obviously. >> right. we can say too, joe, that carson was down here anyway interviewing to reprise his role that he had in the first trump administration. he's been down here in west palm. he was on our flight on monday morning and then yesterday was interviewing discussing the position. could be two doctors in the cabinet.

the other thing, at cms, one of the things he's likely to be in charge of is overseeing some of the cuts. potentially not to medicare and medicaid benefits but there's a lot of talk about rooting out fraud and abuse in that agency. that's likely to be a big part of his portfolio as well as talking about government efficiency and that kind of thing. >> great. thanks. let us know. more interviewing to happen. thanks. >> reporter: is a lot of day ahead. >> thank you, megan. in the meantime, space x conduct the eighth major test launch of its star system yesterday. it ordered a highly anticipated booster catch attempt after it completed the maneuver on the first try. at the mission achieved new milestones in its hour-long flight. starship successfully ignited one of its raptor engines in space and it made a safe landing in the indian ocean and remained in tact, despite a rough landing trajectory that was designed to test the limits. president elect trump attended that with ceo elon musk.

lately, you don't see one without the other. >> and senator haggerty too. >> running for treasury. >> they go. we have a lot more coming up in just a moment. our parent company, as we talked about earlier, comcast. planning to announce the spinoff of its cable prock properties. up next, we will have tom rogers who helped create the network that you are watching at this moment. he will weigh in on all of it. he is the former president of nbc cable. later, delta airlines. ed bastian will be he erfirst. it's leaders our right here. don't go anywhere. we have a whole lot coming up in just a moment.

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comcast is expected to announce today that it is spinning off its nbc cable networks. for more on this developing story let's bring in tom rogers. he is executive chairman of orbit gaming, former nbc cable president, and a cnbc contributor. tom, thanks for joining us. i would imagine, as someone that had the foresight to found the network and we always have you on to talk about this in the industry. you probably understand this move. i would imagine you are in favor of it. or think it's a good idea. >> i actually do think it's a

good idea. excuse me. i think a couple of these channels as my babies and my first thought was, the kids are going to be all right. this is a very good move in terms of being able to create an entity where cnbc and msnbc can get the kind of resources they need to expand their franchises, really put them in a position to exploit the opportunity of the streaming world. i think, within comcast, it's been pretty clear that these channels have been treated just as cable channels. really having an opportunity to get the resources to spread their wings has broad media franchises that can go way beyond the constraints of today's cable bundle. in getting those resources creates opportunity, creates opportunity for employees, creates opportunity to be much more creative in terms of how

you can imagine specialized business streaming services that are supported not by the household pocketbook is any channels within the cable bundle are today. support from corporationand investors who really could rely on more vertically oriented specialized services. and a whole new level of revenue streams. i'll look at this as a way for comcast to simply dump problem assets because the cable bundle is continuing to face court cutting. i look at it much more as an opportunity for some really strong media franchises to be able to broaden themselves. >> thanks. problem child is not something i would hope you would call us. >> he said the kids aren't going to be okay. >> even the problem child.

comcast, the first mover on this. they are not alone. this is facing the entire industry. what gives comcast the ability, they are in a better position to be able to do this probably. >> i think they can do in a way that creates a healthy spinoff. other companies are heavily burdened by debt. while i do think this creates a vehicle that would allow others to potentially take assets and put it in there, i think comcast is very resistant to burdening this with a lot of debt. so the fact that it can be capitalized in a healthy way to really give these franchises, not really on the new site, but on the entertainment side as well. an opportunity to drive things that they have it. when you're competing for resources against the olympics,

against peacock, against the nba, it's really hard for these channels in this kind of environment to get the kind of priority attention that they can get to expand and grow them. others may find this an attractive vehicle but i think comcast, given its what -- much more lucky bounce she, will be able to set this off in a way that is financially strong. >> tom, if you look at this, the wall street journal today reported that brian roberts would maintain one third voting control in the company. and that's a vote of confidence. this is not something that's being spun off to private act me and saying, good luck, fix it up. that sounds like exactly what you were just talking about. the idea that these will be companies that will be invested in. and that's one way to read it. >> absolutely. i think brian will be heavily and sent in to see this thing financially succeed. putting mark lazarus in charge of this, a guy that has cable

in his bones, and was actually one of the early employees at nbc cable back in the day when the whole division was being formed. i think it's a show of confidence that somebody of his merit is being put to drive this. i think mark will need to put in place here a couple of really strong business development executives. so this thing can sprout new opportunities and grow. with that, i think it can really succeed. >> tom, here's my question. going to put you on that development for a second and i'm going to give you a couple billion bucks a year. for you to invest. you can cquire assets, you can invest in the business, the core business. you can hire other people. you

can buy cable, you can bilinear, you can buy internet companies, you can buy gaming companies, you can buy sports licenses. of course, that would be in the nba or pickle ball. it might be. >> with $1 billion. >> it might be. but here's the question, name your number. $100 million a year, whatever the number is going to be. you need to obviously buy a business, by businesses or create businesses, or develop businesses that are going to grow to make up for that number every year to turn this into a growth business. my question is, what kind of businesses would you buy? >> these businesses are profitable today. very substantial revenue. they have distribution agreements in place.

obviously comcast had been put in place through its cable division. a very long-term arrangement. -- or merger that comes from some of these franchises. as i mentioned, i think cnbc has a long road of opportunity to drive itself into the streaming world in a way that it's not today. i think msnbc, for much of the last couple of years, who is the second most popular cable network on an all-day ratings basis. these channels have leverage in their own right, even though they lose the leverage of long-term of being tied to the olympics. >> just you know, my understanding of it is that the

olympics are actually still tied to channels like usa and some of the other things through 32. but that's actually part of the license. so there's a split that will have olympics and some other sports that you might not be thinking about. >> -- are put in place that will maintain some of the synergy and that, in and of itself, gives enormous leverage to the spinoff for distribution purposes. sci-fi, which is like a broad entertainment niche that has a massive following in terms of where that might go, golf obviously, huge following. these are all areas that can be exploited in terms of investment and whether you are acquiring assets that are anywhere from print to streaming assets, to

things that are developed from existing programs that now the opportunities for the broader relationships with the entertainment world beyond peacock, beyond the nbc youth family, opens up a slew of opportunities. this is what a business development exercise is about. you have a well-capitalized company with broad franchises that have leadership positions today and figure out how to get them out of their current constraints of being cable only plays. i think the sky is the limit. i can prioritize for you today where i put that money. once people are unleashed to be able to do it, there's plenty of opportunity in any of these areas. >> what should the name be? i just asked a.i. they all suck. i don't know. a new code to start with, i guess.

a wave rider? wave rider, quantum connections , next-gen cable. it's taken. isn't it? you have fiber flow network. you have anything for me? >> it will be a lot easier to name the issues that we have when we started cnbc, which was the first of the cable channels in the nbc family. the notion that we were using nbc when the broadcast affiliates figured that was sacrilegious, to actually allow the name nbc to be used in a cable content. we couldn't use the peacock on that network because of that for a long time. >> i remember. i remember that. bolster brought it back and said, remember? he said, why do we not have the peacock on our logo? we had some screwy little nike. do you remember? it was was horrible. >> we had hundreds of issues.

today, through licensing and the opportunities to grow this thing, it would be a lot easier than it was bit -- then. >> i don't like this. cable master solutions. i think we need to drop cable completely. i don't know. it's toxic. we have a lot of history together obviously. decades. thanks, tom. >> 35 years. >> 35. 35 and counting. >> good to see you. >> when we come back, a new report says president trump's department of government efficiency wants to make it easier and free to file your taxes. we've got the details on some

of that next. later th hr,isou we are expecting quarterly results from target. we are thinking that will ome out around 6:30 a.m. eastern time, that's when the usually hit. look at the numbers and the market reaction ahead of that. target shares up y about 2% this morning. we will be right back.

welcome back, everybody. shares of h&r block and intuit are falling after the washington post reported that president-elect trump's department of government efficiency is looking at developing a free app for people to file their taxes. h&r block's and turbotax are dominant players in tax preparation, generating billions of dollars in revenue on that service annually. those companies also have free filing options. but the ftc has and from advertising turbotax as free when most people have to pay to use it. back in march the biden

administration rolled out a pilot program for taxpayers to file taxes directly through a federal portal that the irs also has called, free file. it makes $79,000 a year or less. there were less -- lots of bugs with it during this launch and this trial. there are questions about if this would be an expansion of the program. whether they would start from scratch with it. but these are the types of shakeups that are moving markets every day. you can see h&r block down by about 7 3/4%. coming up, retailer target is set to report the reaction on wall street. later, cnbc spore is set to release its official list of the most valuable nhl team. and nhl coison gmmsierary bettman will join us at the 8:00 hour. coming right back. deadline in five! finished and sent.

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check this out. retailer target came with

earnings of a dollar and $.85 a share. that was well below the expectations of $2.30. that's the biggest earnings miss in two years. revenue of 25.67 billion missed expectations of $25.9 billion in expectations. and you can see that stock immediately getting hit by this. right now the stock is down by more than 8%. sales inched up by 0.3% during the quarter. that was lower than the street is expecting. they are up over 1.5% and down from the 2% growth at target saw just last quarter. from the fourth quarter target expected -- well below estimates of 1.3% growth. arrange for fourth quarter earnings guidance is 185 to 245. that's below the urrent expectations of 266. the stock is now off by 12%. ceo brian cornell said the retail giant encountered, what he called, unique challenges and cost pressures that impacted the bottom line

performance. i did speak with brian cornell and got a little insight into this. he said, on the plus side, admittedly this was a mixed quarter from their perspective. if you look at the stock's reaction they are saying, this was a bad quarter from the streets perspective. he pointed out a few things that he sees. very strong traffic trends of 2.4%. really driven by digital, which was up by about 11%. target 360, up by about 120%. -- $2 billion in sales in the quarter. those are similar things that we heard from walmart yesterday. walmart was able to say, yesterday, that they are looking at pretty strong consumer from their perspective, or an engaged consumer. brian cornell will say, when you look at things like home, apparel and hard lines, those things still continue to struggle. the discretionary spending. he says, what he is seeing right now is a consumer that is, in his words, being choice will still and on a budget. so they're looking for things.

they are seeing the consumer that's on a budget and maybe not engaging just yet they hope that will turn around in the current quarter as we get closer to the holiday shopping season. the part of the problem they face in this quarter was dealing with higher airport costs. trying to make changes because of the strike, the anticipated strike. moving things from the east coast and southern ports to the west coast. that's definitely added to their cost structures and came at a time when the onsumer was not buying as many things in a discretionary area they were expecting. walmart is much more tied to necessities that the consumer has. walmart had a great report yesterday. he said he tips his hat to walmart that happens with some of these issues. that is down. the stock is up by about 2%. we will continue to see how the street digests this. >> long-term holders are really in quite a bit of pain.

it was over $260. so it's almost half. approximately half of what it was in 21 or 22. we thought they had fixed everything >> they got rid of the inventory issues. >> yeah, the inventory issues. weird stuff. >> they didn't do that at one point. look, they both up, expecting the consumer to buy more than they did on the discretionary's. that, along with the maneuvers that they did. the costs that they did for the expected port strike that was cleared pretty quickly. but they did cost them. >> it's difficult for people to make ends meet still. the other day i got three things for doing that. i got some stuff for the dogs, i got some gas, and i got a couple of things at the supermarket. it was over $200. take a yearly salary, divided by 52 weeks, and then take

taxes out i just spent what could have been a pretty major part. and i got nothing. >> that's what he says. he says, there are still concerns with the cost of living, healthcare costs, cost of maintaining a car. all of that plays out and what he sees in the storeroom and he thinks that's part of the reason for the election. wyatt went the way it went. i asked him about tariffs, because that's a big part of the question too. what happens with tariffs in this new administration? he said, look, we have been immersed in tariff issues since 2017. they are looking at this, trying to figure it out. but they have a team that has dealt with this for the years and they are not as worried about that, saying they will work with whatever happens. the big issue, he says, when people are feeling pinched you will get them as easily in discretionary shopping trends. that stock right now is off by about 16%. joining us to talk target is karen short.

the retail analyst. karen, what do you think of what to brian cornell has said and what the company is saying here? >> i talked to them about the port strike and the shift to the west coast as opposed to the east coast. they are not surprising to me. if you look at what walmart said yesterday, discretionary, or they call it general merchandise. that's coming from a company that doesn't have as much focus on fashion. they obviously needed discretionary to work because that's 50% of their business and this consumer is just slow to respond.

it indicates a pregnancy for -- and a continued softness. this is certainly a disappointing quarter by a wide margin. they could -- with consumers finally coming out of the wood works to actually celebrate a holiday and there may just be a later conclusion to what the quarter is going to look like. i can see in stores they have cleaned everything up. they have gone more to basics and fashion. they just need a few things to start going their way. traffic is certainly not far behind walmart, in terms of walmart u.s. and that's a good sign. inventory is what it is. they need to clean out inventory . the stock is based on

premarket. close to 7 1/2 times -- probably more like -- >> right. karen, just a run through a couple of positive things that brian cornell pointed to. beauty was up 6%. food and beverage below single- digit growth. apparel was soft, admittedly. but he did say that they are continuing to takeshare. he pointed to all in motion. i know that's their athletic wear. they are saying, double-digit gains there versus someone like nike or ua or under armour, which is flat to down. so they feel good about some of those things. he said, if i stop there i would feel good about the quarter but obviously there's a lot that did not feel good. what will you look for? by the way, with the stock down 20%, what do you think of it as

how you would rate the stock? would you tell people to buy it or not here? >> we do have a buy on the stocks. certainly not liking what it's doing premarket. i understand that there are circumstances, some circumstances that were beyond their control. they have half the multiple that walmart is trading at. -- there's always been a debate when target is lumped into department store evaluation and when target is light it is creeping up more. now it's going down more towards companies that i don't cover. to the department store evaluation ranges, i don't believe it should, given his roi see, given how much share i can gain, given all the store closures are happening that it would benefit from. it will climb from here, there

might be more heavy lifting that needs to happen. >> thanks for your instant analysis. karen short, thank you. >> thanks very much. in the meantime, ahead of its investment day, delta air lines have fourth quarter guides. also issuing 2024 revenue guidance of single-digit growth. that's roughly in line with a 6% rise this tree had been expecting. ed bastian will join us in a couple of minutes right here on wk. squaw" weill talk to him about the stock marginally off. we will break it down and get into it all when "squawk box" returns after this.

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welcome back to "squawk box." getting closer now to the $94,000 level. this is happening as etf options are going live.

mckenzie joins us with more this morning pick >> in morning, andrew. this is what u.s. crypto investors have been waiting for. on tuesday the nasdaq list options on blackrock's $44 billion but when etf. they one of trading show that more than 80% of options volume recall orders to buy between. investors are betting that the token is poised for even more gains. and this is just the first of the u.s.-based asset issue stopper options. the other 10 providers will soon follow suit with several more slated to list on the new york stock exchange later today. this is really a significant moment for bitcoin adoption. rather than just buying and holding the asset this next stage is all about creating a new margin framework for between so that you can amplify your returns. being able to hedge positions and make it leverage& it's a big draw both to retail and to institutions. even though we have seen a lot of trading volume on the cme derivatives exchange, getting options tied to the spot crypto

products on the nasdaq is a big unlocked for traders because, ultimately, andrew, a more robust onshore derivatives is how you attract fresh investment, which is a tailwind for the price of bitcoin. >> it really boggles the mind, what i was thinking. you can write calls. you can buy puts to protect your downs. you can sell puts to acquire been going at a lower price. you can do spreads, you can do straddles. the volatility is so high the options must be exorbitant so you can sell options. and will volatility come down. >> if that happens, does that then put a cap on it? or does that -- >> can that happen? that is the tail wagging the dog. by definition, the queen has been volatile. you think options could really lessen the volatility of the underlying asset?

>> that's what some analysts are saying as you build out a more robust market infrastructure around this. you bring in more institutional money. but i will say, as far as building a what you can do with the spot crypto products, you have grayscale updating just this week to do a covered call etf for bitcoin. so you're saying hat those are the products that these issuers are indexing toward rather than having spot funds around these all coins. >> you just mentioned, 80% of the volume is an calls. so that must mean there are rich premiums and the calls come you can sell those. if it doesn't hit it then you can keep the premium. >> exactly. >> and it protects your downside goes down a little. >> thank you for coming in. >> i wonder if we are allowed to do that. >> i don't think so. >> we used to be able to do covered calls. >> really? >> yeah. you can do covered calls. you can do naked calls. that's the quickest way to go bankrupt.

>> when we come back. delta ceo ed bastian joins us on new guidance. we have that conversation straight ahead. later, nvidia is set to report after today's closing bell. we will tell you what to expect. "squawk box" will be right back. (holiday music) a puppy! everyone loves to find surprising presents under the tree. i love him! and weathertech gifts are always special too. vehicles are protected with laser measured floorliners for the front and middle... plus a cargo liner for the rear... and seat protector for furry messes. and with the pet feeding system he'll eat safely his entire life. add a cupfone to make sure the phone is secure while driving.

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coming up, delta air lines -- and ceo ed bastian will join us on the new guidance. as we head into a break, take a look at target shares this morning. they are falling sharply after earnings and revenue missed estimates. coming in lower than expected. that stock is off almost 18.5% right now. we will talk more about that as well in the next hour.

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welcome back to "squawk box." delta air lines have fourth quarter guidance. joining is now the table with a very special guest. >> ed bastian, ceo of delta. you guys will be laying this out for investors later today. we have a preview yesterday and you made the announcement a few minutes ago. the release went out. you are looking at, over the next three years, some sustained, durable, higher profits on a regular basis. how you get there? >> the themes for investor day today our differentiation. 's continued investment in the reliability of the service, the experience and durability so

that investors know what they can count on. we will get back to those later. when you think about that, one of the big risks this y it is f durable. >> and you know that is the knock. we talked to people on wall street and they say, these airlines go through a period where they are really good at trading stocks pick stay away from them as long-term investments. warren buffett has said that for years. why should people believe it's different now? >> when you look at the progress we've made over the last 15 years, the investment and quality, the investment in service levels, the investment in not just the expense for customers would actually experience for our owners, the free cash that we are throwing off, that's what's different. we are projecting, over the next 3 to 5 years, that we will

generate $50 billion of operating cash over that period of time. 50% of that will go back into the product. $25 billion over that period. the other $25 billion is going to get a balance sheet that is pristine, that is going to be a fortress balance sheet with potential in the back end of that excess cash that we could potentially use for our shareholders if we needed to pick >> this has been a challenging year. whether it's the excess capacity and industry, which is weighing on everyone's results, your results. there was the crowd strike situation outage and the lawsuit. what have you learned the most from all of this this year? >> it's about resiliency and durability. one of the things that are most impressed with as we close the year, and we are closing the year strong, is that despite all of those things, our profits year-over-year continue to lead the industry. they are relatively flat on a year-over-year basis. anticipating some pretty significant growth going into the new year. the overall experience that our customers are feeling are saying that delta is the premium brand in the industry and they are continuing to fly delta. >> can you shed a little light on the consumer?

we heard from target just a little bit ago. their numbers are far below what the street was expecting. out of the is higher cost. part of it is also them saying that they are seeing the consumer that is still on a budget, that is still very choosy about what they will spend on. discretionary was a big issue for that. walmart, even though they had strong numbers yesterday, did say that when it comes to the discretionary spending they are seeing a consumer that is still pretty choice he, pretty concerned about costs. what do you see? >> our consumer is designed as households with $100,000 or more of annual. that's 40% of the household in our country. that cohort, just in the last 12 months, has accumulated an incremental $10 trillion of wealth over this period of time. and their overall wealth has grown 40% since the pandemic. that's the consumer we are targeting, that's the consumer that's flying today. it's over 90% of the revenue

base generated at delta. and their number one priority for spending is not going to target, it's not going to walmart. it's going someplace. it's the experience economy. the experience economy continues to be strong. whether that's internationally, whether that's business, whether that's for trying to continue to find new places and new experiences to bring their friends on. that's what we are leaning into and we see no ending insight for that. >> on the lower end, spirit is in bankruptcy. frontier is trying to pivot a bit to go a little more upscale. but the low cost business model for airlines, is it dead for good in your opinion? >> it's a challenge right now. one of the reasons it is a chatty challenges because delta products are also catering for price-sensitive levels. not a significant part of our inventory. consumers are choosing delta for the value that we create. >> but doesn't that create an opportunity in that market right there? that's not your concern because your market is the over

100,000, i want the premium experience, i will the delta brand, i'm going to pay up. there's a lot of people under $100,000 in the u.s. >> there's no question that there was more capacity chasing that segment of the market than was necessary. we saw it this summer. you can see every airline that's in that segment is cutting back. whether it's through group c, a court order or southwest making changes. that whole half of the segment, that's not our target. the segment is under a lot of duress. they will get restructured and sorted out. but it's going to take some time. >> how do you feel about what you are seeing at boeing right now? >> we are waiting for the news on the max 10. i think it will be sometime before we hear about that. >> does kelly, at some point, say, here is my plan. aside from what he has said so far, it has been, we will get back to blocking, tackling and building airplanes the correct way. does he need to put out some concrete measurements in terms of what we expect to do in the next few spending time with his big customers in that regard, letting them know, keeping them posted, which i appreciate.

right now we're an airbus customer though. >> airbus customer, that hurts. what are you going to do? >> well, it's -- we have been tied to boeing. >> i know. i know. >> i mean, we -- >> i have a -- maybe a broader philosophical question. do you think we should have had more competition for manage manufacturers in the u.s. >> hard to build those things. >> we talked about we got into this us versus them situation. i don't know if that advance is just in the end or created some of these problems because there was only one competitor. i don't know. >> there's no question we prefer more options and more competition and i think the lack of competition was one of the reasons why when the final story on boeing is told, that that caused a lot of the -- being on the back heels. >> right. >> somewhat. at the same time, the cost to building these enterprises, these planes, the investment

that's required, the cost for the airlines to take a third product in, is massive. the amount of new pilots you have to train. >> you fly canada air and stuff like that. >> we have brieair in our regional. >> that's what i mean. >> and if they moved into the mainline space, it's a significant -- >> training. >> citations. >> wheels up. >> that's wheels up. this is a long cycle, highly capital, intensive business, and we need boeing to get fixed. there's not an option there. kelly's on the case, and glad to see him there, but it's going to take a long time before they get anywhere back to where they were. >> can you talk a little bit about crowdstrike and where the legal action that you are seeking from them, i think it's $500 million you are seeking, because you felt like you were really left hanging out to dry on the big issues too?

have you been in talks with crowdstrike. >> we filed litigation several weeks ago. it's in the lawyers' hands. they apologized and said they were sorry, but candidly that doesn't do a lot to the hundreds of thousands of people that were impacted in our business, our people as well as our customers. >> have they reached out for potential settlement talks yet? >> we had conversations, but when you get into the scale of how we were impacted, unfortunately the lawyers jumped in pretty quickly. >> good to have have you you here. >> i'm excite good. >> guess who turns 100 next year? not ed himself. >> he looks great. >> delta. >> we're going to be launching our 100th year as the keynote for the consumer electronics week in vegas and doing it from the atmosphere. >> that's crazy to think an airline being 100. >> we've been flying that too. >> they have a flight attendant

hired by howard hughes. is that true? >> i just last week gave her her 65th anniversary pin. >> heat cool. >> the first person we had with 65 years of service. it was cool. >> time flies when you're having fun. >> it's a wonderful industry. the advanced bookings look strong and we're going to have a good day with investors. >> thanks. >> it is just past 7:00 a.m. 7:03 right now on the east coast. you're watching "squawk box." i'm andrew ross sorkin with joe kernen and becky quick. among the stories we're watching multiple reports saying that president-elect trump set to meet with kevin warz and apollo global ceo marc rowan today. rowan has emerged as the top contender. axios says trump is looking at bill hagerty. spacex conducted a launch of its system yesterday, avoided a booster catch attempt but the

mission achieved new milestones in its hour-long flight. ignites one of its engines in space and made a safe landing in the indian ocean and remained intact. our parent company comcast expected to announce a spinoff of its cable networks including the one you're watching today. sources telling us comcast will remain ownership of bravo and the peacock streaming service. the spinoff expected to take a year to complete. we'll have a lot more on this later this hour. all right. let's take a look at the futures once again this morning. you will see they've picked up. dow futures indicated up by 77 points. s&p up by 7. the nasdaq up by 36. let's get over to contessa brewer who has a look at this morning's premarket movers. >> good morning to you. start off with shares of target. are we seeing a lot of action here. those shares have just plummeted after target reported earnings that missed revenue and profit expectations for the third quarter. target lowered fourth quarter

and full-year earnings guidance. ceo brian cornell said lingering softness in discretionary categories was to blame along with pricing pressures like the port strike that hampered retail giants' third quarter. you're seeing the shares off by 18% and that has now erased the stock year-to-date gains. we'll continue to keep our eye on that. but target is also dragging down other retailers this morning. we're seeing macy's down about a percent and a half, dollar tree off by 3.5%, kohl's off 1.5% and nordstrom. the whole retail bucket hurt by what target had to say this morning. netflix, reaching fresh all-time highs. it says 108 million people worldwide viewed that boxing match between jake paul and mike tyson last weekend. the shares are up almost a percent in the premarket, but for netflix it was the most streamed sporting event ever. there were issues during the fight, right. more than 95,000 people reported

outages at the peak. i had problems. it was glitchy, frozen. but pivotal analyst gave it an upgrade, raised their price target to 175 -- from -- they raised the price target by $175 to a street high 1,100. the shares are up. we'll watch those through the day. rounding out with bitcoin, maintaining above 93,000 and hit a new high yesterday afternoon. in part due to the listing of bitcoin etf options on the nasdaq as mackenzie reported earlier on squawk. a trump trade hasn't lost steam there either. the shares up about or bitcoin up about three quarters of a percentage. since election day, the president elect has proposed a national crypto stockpile, trump media in talks to buy bakkt. >> up 35% since that election results. >> unbelievable.

>> it is. contessa, thank you. great to see you. coming up, a deep dive into the president elect's pick for roles in his administration. then, taylor swift joining the chiefs, partnering up for a holiday movie. we're going to talk about that, nfl valuations, and the state of the league with kansas city chiefs president mark donovan. we'll be right back. ♪(voya)♪ there are some things that work better together. like your workplace benefits and retirement savings. presentation looks great. thanks! thanks! voya provides tools that help you make the right investment and benefit choices so you can reach today's financial goals. that one!

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for millions of families, like my own. connectivity is a big part of my boys' lives. it brings people together in meaningful ways. ♪ ♪ welcome back to "squawk box." another round of picks unveiled for president-elect trump's second term including trump-vance 2025 transition

chair key team chairman howard lutnick as commerce secretary. linda mcmahon tapped for the education secretary department he's vowed to undue and dr. mehmet oz as administrator. no pick or treasury secretary. joining us semafor's business and finance editor. we can go through those names. let's go to the treasury secretary bakeoff taking place down at mar-a-lago today and yesterday. what do you think the handicap is here between kevin warsh, marc rowan who has emerged, i don't know if you think bessent still in this, i don't know if there's another name, haggerty. >> those are the names. i think scott bessent is still in there. understanding this could all change by the time we get off the air, you know, my sense is

that scott bessent, kevin warsh, serious candidates, marc rowan is come up in the outside lane. we reported a couple weeks ago, has been in the transition team's sights and on their minds for a couple weeks now. i would say bill haggerty is a dark horse but very much in it. other names you hear thrown around, for different positions, kevin hassett. they haven't changed all that much with the exception of howard lutnick having dropped off and gotten commerce. >> what are the implications for apollo? it's one of the biggest private equity firms in the country, a publicly traded firm and marc rowan has been a boon to that business when he returned and came back and has really almost remade that company. >> yeah. i uldn't agree more. most ceos when their names get floated say i have the best job in america, couldn't imagine it. almost none of them mean it.

it's possible, he was asked in february whether he would go into administration, and he said yes, if asked. i genuinely think he does think he has the best job in the world. listen to him talk lately, they sound like they really think they are on the edge of a cracking a new financial system at apollo, talking about fixed income replacement, playing for a much larger pool of assets than have been available for alternative asset managers in the past. it's a really interesting question. i don't know. >> we're also, by the way, i don't know if it's up on the screen, it's on our screen, trump media, djjt, 30 bucks a share, do you have a view why that's moving the way it is? it's down a little bit now. it's crept up in a big way. some people talking about it getting into crypto. i've heard speculation, i don't know if you buy this idea, that at some point elon musk would want to buy it, merge it with x? i don't know. liz. do you want to comment on this?

>> that's floating around. i have no real reporting. i mean, look it had a bunch of moves the other day on the crypto stuff. it could be some of that coming off. i think the thing you have to keep your eye on with this company is that it is a huge source of donald trump's wealth. it's a public company. it's for sale every day. and i think you have to worry, think about, you know, people who might want to curry favor with the administration just coming in with a giant offer on that. it's a very strange situation. >> you mean, somebody coming in to buy -- the premium in this stock is somebody who is a benefactor, trump benefactor, who would want come in and just want to buy the asset or american corporations or foreign corporations will want to advertise on the platform or transact with the platform in some other way? >> i don't -- not sure there's a takeover premium baked into it now. i think this is political fervor

and retail enthusiasm. most sitting presidents don't have an asset that than can say publicly they would like to buy for a giant markup and then actually like put -- go do it. i think it will just be a really interesting thing to watch. it's been kind of a heartbeat of the campaign and really of donald trump's fortunes. you saw it move around some of this trials. so it's something we've never seen before. i can't really explain the move today except perhaps it got a little [ inaudible ]. >> a vanity buy over $7 billion, not everyone can decide to do that. i don't think anyone thinks it's a great investment, right. >> elon did a vanity buy of $40 billion. >> that's the richest guy in the world did that. >> liz, what do you make of the howard lutnick move and what's happened behind the scenes there and then also, by the way, he's been running a big company in cantor fitzgerald? >> yeah. look, it's no secret that howard lutnick wanted treasury and that

has been sort of a behind-the-scenes race that has captivated wall street over the last couple weeks. you know, we've reported that scott bessent's investment returns had been anonymously cherry picked version of them centered around a couple days ago. this was a really behind-the-scenes campaign. look, so, obviously, he didn't get it. i will say commerce is not the hall plaza of government it used to be. gina raimondo made that a serious cabinet job with a lot of interesting responsibilities. it's going to be at the front of a lot of the industrial policy, tariffs, of course. that's the other thing here, one of the reasons this is, perhaps, taken so long is that donald trump, as far as i can tell in my reporting, really wants two things. he is very serious about tariffs. we should take him fairly on his face when he talks about those, and he also really wants the stock market to go up, he wants to announce a pick for treasury to make the stock markets go up,

it has to be someone that institutional investors respect and finding someone who checks both of those boxes i think is tough >> that's what i was asking, is there a good cop-bad cop situation at hand? which is to say you have a treasury secretary who may fit the sort of mold of what you think the markets may like and say things the market likes, but actually the commerce secretary might work on the tariffs and those projects and maybe the treasury secretary doesn't have to like, but you have this dual setup, as opposed to putting all of the power or the voice in one individual? >> certainly could be the other job i would add is the nec director that sits in the white house, a little more domestic policy focused, but again, if you're treasury secretary, you're going to be traveling the world. you're going to be meeting with, you know, all these g7, g-8, g-20 leaders and are to defend these policies so i think it would be tough to have a treasury secretary who doesn't like them. >> great to is see you this morning. thank you. up next, the kansas city

chiefs and taylor swift partnering up for a new holiday movie. we'll talk about that. team valuations and the state of the nfl. that's next. and then, comcast expected to announce the spinoff of nbc's cable networks including cnbc and msnbc. media analyst rich greenfield joins us after this quick break. "squawk box" will be right back. time now for today's aflac trivia question. in the u.s. postal code system what does the acronym zip stand for? the answer when "squawk box" returns. i mean, you. wake up, come on man! you gotta tell employers to take another look at all the benefits they're offering. everybody wants to build the best team and offering aflac can help attract and retain that top talent. you know we like that top talent. and listen, i mean you gotta listen. aflac gives employees cash to help with unexpected medical bills. it's prime time to add aflac. ♪ request a call today at aflac.com/prime

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only on verizon. today's aflac trivia question. in the u.s. postal code system what does the acronym zip stand for? the answer, zone improvement plan. the zip code system was first introduced in 1963. kansas city chiefs partnering with hallmark for a holiday movie this year capitalizing on their new aylor swift fan base. mark donovan is the president of the kansas city chiefs. taylor swift fan base for the kz kansas city chiefs would you

have predicted this three years ago? >> i would love to say it was a marketing strategy but it is an authentic relationship and we're happy to have it. it's been nothing but good for us. the best thing i can say about the whole relationship and what it's had -- the impact it's had on us, taylor swift is authentic member of the kansas city chiefs kingdom. she's an authentic fan. it matters us to and we tried to respect that. >> patrick mahomes is probably pretty good and kelce not chopped liver at this point. the coach is like a tv star and he's pretty good. see where he goes after those -- give me nuggets. >> the nuggets. >> exactly. >> i don't know. i was -- i don't know. there's only one way for you to go from here that's down from what i can tell. >> our -- our goal is to consistently compete for championships. >> how many do you want to win in a row?

as many as we possibly can. >> as many as you possibly can. >> we're on the verbal -- we have the opportunity to make history and we made a lot of history in our franchise over the last decade. we have the opportunity to do something that's never been done in the national football league. i would say this about our team, led by andy reid and our general manager and, obviously, the direction of clark hunt, our ceo, but first day of training camp it was about the opportunity, we're on a stage here that we earned, we won the first two in a row, and now we got to take advantage of this. it's very positive the way we look at this opportunity. >> want to talk about the movie. >> i do. i'm kind of excited about this movie. i think you guys are going to lend to hallmark. how did this come about? >> it's an interesting story. we actually -- kansas city is a special town, special place, and the hall family who started hallmark are a bastion of our

community. so we actually went into the last playoffs and said our cmo came up with the idea and her team of could we somehow own the playoffs? >> you guys are the ones who came up with the idea. >> >> we did. we did this promo. it was a fake movie promo and we did it sort of honoring hallmark. they didn't know anything about it. we didn't talk to them about it. >> you didn't tell them about it. >> we did it. >> we got a call a couple weeks later saying we should talk. i joked with laura after the promo that there's -- there's a chance that we could actually make a real movie here and now november 30th, "holiday touchdown: a chiefs love story" will premier on hallmark channel, and it gives us the opportunity to, as you said, expand our fan base and they can expand theirs as well. >> is it seriously ripped from the headlines, like all of the dick wolfe things used to be, or using it as a -- as a vehicle for telling a different story? >> yeah. if you looked at the promo from

last year "falling for football" that was a different story. it was about fans. this one is a different version of that story and it's really about fans. it's about fan dom, about the unification of our fan base. and it does it in a very hallmark like way celebrating the holidays. it's a perfect combination of entertainment, pop culture, the power of the nfl, the power of our superstars. i mean, you got a hallmark movie that has donna kelce, andy reid, four of our active players. >> yeah. i was going to ask about the budget for this film. hallmark has -- one of the reasons it's done so well, it typically limited the budget of its films. how did that work in this context? >> it's an interesting model for us. it was different for them. it was different for us. we worked with skydance sports who has a partnership with the nfl to make sure that we could distribute it correctly. i think we all sort of had to expand our envelopes in how we do this. but it gives us this amazing

opportunity. if you talked to the hallmark folks today, it's put them in a different place. you know in terms of advertisers looking at this product on their station, versus the typical hallmark holiday . >> is there any blowback for taylor swift endorsing kamala harris for president? >> not that we felt. you think of an nfl franchise and family, any team you're going to have opinions on every end of the spectrum. we have that in our locker room. >> yeah. as we have seen. >> yeah. >> one of the things we talk about and andy reid leads this, and it's a cultural thing, we're going to respect each other. we can have different opinions, come from different backgrounds and have different beliefs but we're going to respect each other and that's how we're going to go forward. the same guys are fighting side by side on sunday afternoon for the ultimate goal of winning a game. you have to have that culture and that respect and support. >> i can't imagine the increase in value of your franchise in the last couple of years.

kansas city, i love the town. jazz and barbecue and everything else, but it's not a new york market in terms of valuation, but are you up near the top now after three straight super bowls? >> we're pretty proud of the run we've been on. we talked about it back in 2009 and 2010. 4-12 and 2-14 not successful as a football team and okay as a business operation. we talked about preparing for success. on the business side it was, how do we prepare and get ready for when this team actually excels on the field. it's great to sit here and talk about it now, because the strategy worked. when andy came in, when we turned this thing around with alex smith and patrick and with kelce and chris jones, and the success we've had has been exponential growth on the business side because we were ready for it and we prepared for that. now we're at the point of trying to maximize this special time. we think about this.

we're on "squawk box" talking about a hallmark movie that's going to premier on november 30th. we've been in four of the last five super bowls. we have to take advantage of this opportunity and that's what we're doing. >> do you look at these things as cycles? you talked a about this special moment and how you keep the special moment going, joe was mentioned like there's only one way, only one way from here, down. get to the top of the mountain and ski down at some point. and so how do you even think about that in terms of valuations? we were just showing a whole number of teams with great valuations, some of whom had their special moments by the way years ago? >> yeah. >> and then they have to actually rebuild themselves. >> yeah. i think the cyclical points are really good one. it is the structure of the nfl. i think it's the best structure in sports. but it's also the most challenging. parody is important. and it's set up to next season is harder the more successful you are from the schedule standpoint and tough to keep these teams together the way the contracts work. so we look at that every day.

we have a goal of consistently competing for championships. sometimes that's making hard decisions. andy reid and clark hunt have to decide what to do with players at the end of contract, who do we renew and not renew. those are difficult decisions for them and our fan base to accept. our goal has been to compete and we've been able to do that. >> love the raiders-chiefs, now it's the bills-chiefs. >> yeah. >> is that -- i hope the raiders are back. something about the chiefs and raiders. >> it's traditional. >> black uniforms. >> look at the last game, coming out today with the ratings, the highest rated game. it's a statement to the value of the nfl and value -- >> i will say they hit -- at one point they had one job and that was to keep an eye on josh and they did not. it's like, there's no one around him! do you remember? did you call andy reid and say what the -- you know -- >> yeah. one of the things i learned

early on is these guys are elite players and -- >> but -- >> josh is as well. >> the legs on that man. >> he's a great player and playing great. we look forward to seeing them again. >> you do? >> yeah. >> is that a promise? >> it's not a promise it's a hope. we want to get in the playoffs. >> i think you will. it's great. mark, thank you. >> nice to see you. >> cnbc sport set to release its list of the most valuable nhl teams and commissioner gary bettman is going to join ulis ve in the 8:00 hour. "squawk box" is coming right back.

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welcome back to "squawk box." u.s. officials racing to delivers billions of dollars to chip makers to complete a significant portion of president biden's chip act before he leaves office. the commerce department awarded most of the $39 billion of that grant money which, of course, was allocated under the act to energize production. nearly $30 billion is tied up in government negotiations leaving those deals in limbo as the new administration prepares to take over. the big question whether that money will actually get spent. tinl given the largest award up to $8.5 billion in grants for

fast projects plus up to 3 billion for defense. it is counting on those funds to pay for massive facilities it's built in arizona, new mexico and ohio. the commerce department aiming to complete as many as possible in the next two months ahead of the incoming trump administration. so there's a little bit of a race on and it will be fascinating to hear whether president trump, president-elect trump wants these payments to go forward whether howard lutnick, now going to run commerce, would want $30 billion out the door. i would imagine that maybe they would say no. >> or wonder if the department of government efficiency. >> d.o.g.e. might -- >> would weigh in on this. >> we're going to have another conversation weighing in on us this morning. rich greenfield on the expected spinoff of nbc's cable networks including cnbc and a preview of nvidia results as we head to a break, a quick check on target after reporting results.

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welcome back to "squawk box." comcast the parent company of this network expected to announce today that it's spinning off its nbc universal cable networks including this one. joining us rich grainfield, partner and co-founder of light partners. this was a possibility in the offing a couple weeks ago and now seems like it is in the offing. i'm curious about your reaction? >> well, i mean two major reactions. one, this is sort of a very clear, direct statement by comcast, and its, you know, controlling shareholder and brian roberts, like they are exiting the cable network business. this is them saying we don't want to be in this business. this is no longer a growth business. it's going to be around for a long time. but it is just no longer a growth business. so i think it's interesting. everyone was looking at, disney is going to get rid of the tv

asset, david faber interview 18 months ago. we talked about you've had david zaslav and the question of wb spinning off, paramount what does skydance do. rupert murdoch sold a bunch to disney was the first mover but of the companies that exist today the one that's making the big move, i think this is a pretty big tatement from comcast that they're exiting the traditional basic cable network business. >> and you said you had two big thoughts. that's one. what's two? >> well, the other one really concerns you and everyone else at this network and msnbc and usa. can these noorgs stand on their own? is news, you think about the power of news and impact news has, every trading desk around the world watching this right now, can news and, obviously, usa with some sports, not a lot, they have, you know, they have smack down from wwe, they have

some golf, they have, you know -- there is stuff but not a lot of sports. can those networks stand on their own? and we're going to learn. i think there's probably a lot of skepticism among investors. they like the fact that comcast is getting out of this. first, they like it because at the end of the day, it's a very bright signal that comcast is not about to go buy wbd and then go buy more cable networks. this is them saying we don't want to be in the cable network business and showing investors what they don't want anymore. >> so let me ask you a value question. we're looking at the stock up about 2.5%. the question is, these assets, $7 billion of revenue, which is going to be moved into a new vehicle, are they -- what kind of valuation do you think they're getting today inside comcast? what kind of valuation do you think they get outside comcast? do you believe ultimately that comcast shareholders do better?

>> first of all, the multiple inside of comcast is probably single digits, mid single digits at best. whether they get that on standalone basis, i think sort of misses the point. first of all, comcast, walt covers comcast for us, this is going to be driven by what happens in broadband far hor than what happens to the value of this. this is a really small part of comcast. this is a small part of nbc universal, smaller part of comcast. i think the reason why the stock goes up or down -- i think in this case it's benefitting as you talked about, andrew, because of what it signals. it signals comcast is not going to consolidate in cable networks. they're not buying wbd. they're not looking to grow this part of the business. they know what they want. they like theme parks, they like studio. they like broadcast tv and how peacock ties into that. they're not going to buy a large portfolio of cable networks. it's more of a, hey, first,

comcast has not sold assets. when was the last time you and i were on tv on "squawk" talking about comcast shedding assets. >> right. >> that's a new thing. >> and on the new company, you know, part of the idea is that there's going to be additional capital that gets freed up that can get invested back into the business either by acquiring other businesses, investing in organic growth, buying licenses, or content elsewhere. what kinds of things would you want to see that kind of business do? >> look, scale is going be to important. we started the conversation talking about this is sort of a -- this is a science experiment. like can you spin these off? like will this work? you know, yes, you can functionally do it. does it create a stable company. the last group of cable networks that was spun off you look at diamond sports within a few years went into bankruptcy. this doesn't have the same cost

dynamics that that did in terms of sports. look, carriage is critical. can this maintain carriage. obviously, these are a lot lower than like regional sports networks. i think there's a much greater likelihood of the sustainability of this asset. but in terms of m&a, my guess is mark lazroz who will run the new company he will be on the hunt to roll up enough cable networks, i don't know if that's a&e, starz, amc networks, pieces of wbd or paramount, but he's going to be on the lookout to get more cable networks because at some point you're large enough where it's hard to imagine being dropped by distributors even if you don't have the must-have stuff. >> that doesn't get you to the growth place. >> and also they are intentionally spinning this out without a lot of debt. if that puts a lot of debt back on the balance sheet what does that mean? >> andrew mentioned it doesn't have a lot of growth.

i wish i could sit here and tell all of you that there's a growth strategy for linear cable networks but i don't have one. the reason they're being punted by comcast is that there isn't a growth story and that's the rationale for doing it. becky, in terms of like the debt side of it, it's a really good question and i think it's going to be important to maintain a strong balance sheet. using equity and taking dilution rthser than issuing cash and trying to do something. a merger of equals because you're stronger together with scale. if you amass -- like we've talked about at wbd. do they have enough cable networks where if you were going to drop them you couldn't be in the cable network business. like i think that same concept is probably what laz raz is going to be thinking about, can i get enough scale, maybe msnbc, cnbc, usa, maybe that's not enough, but if i add in four or five more, do i have enough scale where i'm -- i'm not a growth company, but i'm going to live for a long time and harvest

cash. >> you're a pain in my -- today. but the nly thing i would say, if there is an argument for anything linear anymore, cnbc, the market opens at 9:30, earnings every three months. this is the content itself whether it's streaming, cable, no matter what it is, it's the value is there. i just don't know how you -- you put it with other things to start growing again. but, you know, look -- go ahead. >> maybe you don't put it with other things. >> sports and news. are still linear entities. >> maybe you spin it off and let it go a couple years and private equity consolidates and a larger private equity play. maybe somebody wants msnbc or maybe there's someone strategic that looks at cnbc, joe, to your point and goes, this is a really unique asset. it doesn't function like other cable networks. it's watched all day long. >> yeah. finally. >> somebody building a business. >> thank you.

thank you. like pulling teeth with you. >> look, maybe elon -- >> no. >> remember, diamond, they went bankrupt in two months. >> the other piece you have to complete the spin first unless you think that bidders start to emerge for the different pieces. it becomes complicated to buy the pieces individually because it actually creates a sort of dissynergy and devaluation of the other assets. if you pick one asset off or try to pick another asset off you basically have to sell each separately, correct? >> look, i think it's hard to separate these assets especially with the tax base and all the complexities. people were texting in last night saying the minute the press release how soon until elon says he's buying msnbc for the fun of it. who knows. >> rich, finally, "wicked" i think you saw it. what did you think? >> it was stunning. >> universal film by the way. >> between "wild robot" which was amazing, donna langley at

universal has become one of the most consistent and amazing producers of content. "wicked" is going to blow people away. >> thank you, sir. nice to see you. >> thank. all right. when we come back, we're going to talk target results including some comments from ceo brian cornell. plus, a preview of today's big numbers that we're expecting a little ler. nvidia reporting after the bell. we'll be right back. are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

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welcome back, everybody. retailer target reporting earnings this morning. they came in at $1.85 a share, that was well below the $2.30 that the street was expecting. that's the biggest earnings miss in two years. revenue of $25.6 billion missed expectations of $25.9 billion. same-store sales nchds up by 0.3% for the quarter, but that was lower than the street was

looking. it's down from the growth they saw last year. for the fourth quarter target is saying it expects flat same-store sales below the estimates of $1.3% growth. that stock off by 18%. joining us right now is an analyst who will be on the call at the top of the hour, michael lazar. michael, i spoke with brian cornell, the ceo, and he said while they did see some green chutes in areas like beauty and food and beverage where beauty was up 6%, look, this is a real miss in terms of what they were expecting from the consumer. they thought the consumer was going to be in buying discretionary, apparel and other items more than they showed up. it's a big hit. extra costs came in during the quarter too. what do you think? >> it's constructive to compare walmart and target in this situation. what we saw from walmart yesterday was that it's executing on all cylinders, and

one of the features of its models is these alternative revenue streams that create some insulation for other factors within its business in the event that there are challenges. in fact, one third of walmart's overall profitability growth this quarter came from advertising revenue and membership fees. those are two areas that target under indexes in. by virtue of not having those profit woes, target's model is more sensitive to lites and misses, especially when you consider that target generates one third of its sales from style categories, home and apparel, and those are going to be more sensitive to inventory obsolescence, different trends, and as a result, they may have to discount excess stroer clear out and that's going to act as a

hit to the margin and what i think we saw with both of these retailers this quarter. now one last point, there is an opportunity with both. walmart is on a multiyear journey where it's going to create shareholder value as it executes this model. target is a volatile model, but it's very inexpensive valuation. to put perspective around that i think there's still a very good case it can earn $10 of earnings next year and with the stock trading at 125, $130 in the premarket, it's 12.5 to 13 times earnings, for what is still a retailer that generated more than 2% growth in traffic, more than 11% growth in digital sales in the quarter. that's how we look at it right now. >> brian cornell says that when they look at the consumer they see a consumer that's on a budget right now, choiceful he keeps saying, but on a budget. they're hopeful that that will change in the fourth quarter, that people will be drawn in by the holiday offerings.

are you enthusiastic about that idea or not? >> i'm enthusiastic in general, becky. i don't know if i'm enthusiastic about that idea. what i do think is the consumer is steady right now, and i think it's reasonable to call it choiceful where it's making very specific selections about what it wants to buy for both itself and for others. this, as we've well talked about, is going to be a shortened holiday period which means that the retailers are going to have to do more with less. they're going to have to shrink more sales in a compressed time period. that is going to lend itself to an environment where there's going to be even more winners and losers. i do think that target and walmart will fit into the winner's bucket. they're just too convenient. they have too many choices. the other thing that's going to happen is gift cards are going to eat outsized winners in this

holiday season. it's too convenient when you don't have an opportunity to go to the store and target and walmart should be outsized beneficiaries of that as well. >> a lot of other retailers are down today. you like target when it's down 18% to $127 right now. do you like the other retailers that have sold off in part of what we've heard from target their concerns about the consumer? >> yes. i think you do need to be selective with other retail stocks in this environment. absolutely. while there's been a core holding of retailers that have outperformed, this includes walmart, costco, those stocks are trading at lofty multiples and so it makes sense to balance that with others trading at much lower multiples. one name i would highlight is ulta beauty. in fact, target highlighted that its beauty category was up 6%. we think this is going to be a holiday season where beauty really resonates. that is going to lead to better

trends for ulta beauty. it's already given a look at next year so there's very little overhang on what next year could bring. tariffs should be less of an issue. ulta beauty is a stock that we would take advantage of today on the heels of everything that's going to happen in retail. >> michael, thank you. >> thank you. coming up, republican policy committee chair shelley moore capito to talk about president-elect cabinet picks. futures, where things stand. we have green on the screen. dow up about 121 points, nasdaq up 125 pntois and the s&p 500 up 11. "squawk box" coming right back.

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it is 8:00 a.m. on the east coast and you're watching "squawk box" right here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin. among today's top stories, delta airlines affirming its fourth quarter guidance and issuing new full-year 2024 revenue guidance of mid-single digit it growth. that's about in line with the 6%

rise that wall street is expecting, the stock off 22 cents. mortgage demand inching up last week. the mortgage bankers association says total application volume rose 1.7% compared to the prior week despite higher mortgage rates in the market. we're going to talk about the state of housing later this hour with expert ivy zelman. prosecutors set to lay out ideas today for what they think google hould do to end its online search monopoly. options could end exclusive agreements which google pays companies to be the default search engines on tablets and smartphones or divesting the chrome internet browser. google planning to appeal once the judge makes a final ruling and that should come next year. all right. comcast, announcing it's going to spin off its cable networks and david faber the other member of hair force one, we still got

it, baby. >> of course. those were the glory days. we saw the early days and glory days glue still got it. and i don't know about you, i'm not convinced. i do not dye. >> i don't dye. i don't dye. >> okay. >> you know i don't. you've. close. >> i know. i'm kidding. i'm kidding. i'm trying to start something again. what do you know? do you know anything? >> it's out now, joe. our future is sealed. just kidding. the news out in a press release and a note from a memo from mike cavanaugh who runs nbc universal. you have been discussing it all morning. i listened to you talking about it with rich greenfield a short time ago. comcast going to spin off the cable networks of nbc universal, not including bravo which will stay given how closely it's connected to peacock, into a new company. it doesn't have a name. there is what it's comprised of. it includes us and msnbc, syfy,

goch channel, usa and oxygen. the broadcast network peacock, the studio, theme parks, they all stay behind. that's about $40 billion in revenue that will comprise nbc or what nbc universal will now be once the spinoff is complete. and we along with these other cable networks go out into the world. it will take about a year to complete. a couple i've been able to piece together through reporting. you know, ebitda, this entity may be around $2 billion. they keep talking about it being well capitalized. i would assume that's low leverage as i've been hearing from people who have worked on the transaction as well and investigating it. maybe one to one. maybe $2 billion in debt, but unclear at this point. they haven't fully decided. a dividend as well. you've got something that's well capitalized, has some sort of a

dividend yield producing a lot of free cash flow albeit we know how that's going, right. and the question becomes on its own, can this entity use the capital it's generating in a way that will benefit its future as opposed to the situation right now where frankly there are a lot of shackles on what these cable networks can do given the other needs of nbc universal whether it's paying for the nba, whether it's paying for the losses at peacock and things of that nature. so it's a move that is the first move by so many of these media companies, really, and they hope to have a first mover advantage i think in the sense of getting out there into the public markets, being free to use their own cash flow to potentially create growth, and maybe there s also the opportunity to create more scale by taking in more cable networks over time. that's kind of the plan. and as i said it will take a year. it is a pinoff.

just so comcast shareholders understand you're going to get a ratio that's going to be a name at some point and then you will be free to sell it or keep it depending on your desires. it may take a while to sort of find a shareholder base for this entity. where will it trade? amc trades 4.5 times ebitda. maybe better than that. fox trades at six times. probably not as good as that. take a guess. around five times. $2 billion. maybe if you're lucky a $10 billion market cap. that's what we know from the release and other things, obviously, i've been hearing. >> you said out into the world. all you left out, going out into the world. the cold cruel world. did you leave that out? >> marching off on a new adventure. >> new adventure. >> there you go. >> new adventure. >> how is our -- our sea legs? are we -- can we stand? do you know? are we -- >> i don't know. >> i think we can. >> i've been trying to come up with a proper analogy.

i've been going with we've been on a life raft that's kind of been sinking. we're all going to be able to swim for ourselves. it's up to us. >> maybe -- >> we need a new analogy. >> latch on to a bunch of other people drowning and -- >> come up with a new analogy. >> david -- >> swimming for obvious reasons. >> you did. you're a swimmer and you wear a speedo no one needs to think about. in terms of comps, publicly traded comps for the new business in terms of you talked about evaluation and said upwards of $10 billion, you know -- >> yeah. >> on the high-end look at fox maybe, though -- >> i said fox trades at 6 times ebitda, news and sports. it is, you know, obviously, you got to believe it's a better entity, frankly, is point. people may argue with that. but in the marketplace certainly it's well known. amc, 4.5 times. i think the bankers advising

this are looking around 5 times. it seems to be potentially a hopeful fair multiple for the entity which with produce -- as you know, the ebitda is coming down, right. that's one of the reasons why it is -- this spinoff is taking place. the question is -- >> i was going to ask you, can you ameliorate that decline for this entity to fight for itself in a way -- >> i was going to ask about the debt and dividend piece. >> yep. >> the truth is if the plan is basically you have to build an arc, you know, faster than the water comes at you, hang on a dividend and having any debt is a cost to the business and your ability to go use that money for operational or acquisitions that can get you that growth what do you think that looks like? one to one on the debt piece. you know, how big would that

dividend be? >> i don't know. i was told decent. that would attract investors. what kind of investor base can you imagine here for this thing? you know, is it really going to attract people who actually think that there's an opportunity here with declining cash flows potentially, so a dividend is something that may be attractive and yes, you're right, it will use up some capital, but this thing will generate a lot of free cash flow and i think the expectation is that it's there, then okay, what are we going to do? that's after capex, but what can we do over time? it's going to have its own currency. a possibility there as well. as i heard greenfield say, maybe two years out, if it's not going as well, maybe private equity does come in. maybe mr. brian roberts they own 33% of the voting shares, can get paid a control premium for that over time. you couldn't sell it now anyway. it would generate a huge capital gain. this is the plan. >> the idea of potentially the other thing we talked about greenfield about and maybe tom

rodgers too, i can't remember, the idea of wanting to get more bulk by, you know, picking up pieces of other places, doing a deal with somebody else and even if that's not paying cash, teaming up and making sure that you get there with scale to control things a little bit longer. >> right. right. i think that's certainly becomes a possibility. i don't know -- when you think about a warner brothers discovery, though, becky, the cable networks there are so intrinsic to the business given the debt load they contribute so much cash flow, very hard to imagine a scenario unless you were to transfer an awful lot of debt with that, which is not what you want to be doing here. but there are other opportunities that will come up. by the first mover you perhaps have an advantage and/or at least things that will -- opportunities that will arise that wouldn't have if you weren't making this plan. so i think that is at least part of it. sports is going to be a component of it. you're not going to see the nba or nfl, but you guys were talking about it earlier, the

premier league, golf, big ten on usa, maybe there will be other opportunities to add some sports as well. but listen, there's also dissynergies. you have been talking about it. how you separate msnbc from nbc news, cost structures there, even separating to a certain extent from peacock, you can recreate things from commercial agreements, licensing agreements, but it's not without its challenges. >> yeah. some of those things are positive. i think msnbc being separate from nbc is probably a positive. i don't see why it's any more complex, david, than we're moving to a streaming world or whatever, so you got this valuable content heretofore was distributed through cable, so now it's going to make a transition somehow, i don't know how it all plays out, to streaming, but the valuable content for cable becomes valuable content for streaming down the road. it has to be worked out. why is it any more complex than that? you need money to do that and you don't know.

there's, you know, musical chairs. you don't know where everything ends up. the valuable content finds a home somewhere. it happens to be on streaming. >> paid in the same way, as you know, joe, the key to the success of so many cable networks has been the fact that people pay for them and don't watch them because they're part of a bundle. if that breaks apart, 70 million people pay, but how many really watch us? >> i know. but if you're part of the entity it i people are paying for, for the bundle it makes a difference what content is important. stragglers can fall by the wayside. >> yes. >> i'm talking my own book here maybe. >> i get it and i think that's true, but there's definitely -- >> help me out, will you. >> come up with a new strategy sfwroo work with me. >> first of all, at some point, you know, the decline will start to ease, although it hasn't yet in terms of the linear networks. youtube tv is -- we get paid there as well. that's putting together the same

bundle and that's been successful. and the question will be, does this group of cable networks have any leverage with the distributors, with the charter of the world, as part of some sort of a skinny bundle? i don't know the answer. i think that the expectation is yes. and i think to the extent there's been an investigation of that perhaps come back as a positive from the likes of the charter of the world. your point is a good one. we have to wait and see. but these are the pressures that all these networks have been under for some time as the model blows apart and how you figure out a way to come up with that same number in terms of revenues and earnings. >> the comps can be valuable, but unfortunately the economics of that. >> digital nickels instead of analog dollars. >> one of the great success has been "the new york times." i saw it took -- it took 15 years or more, by the way, there was only one or two that actually succeeded in the marketplace. every other player didn't succeed in the marketplace. and so it took 15 years, it

really did take 15 years, from the height all the way down to back to actually get there. that's going to be -- that's the execution risk. >> the one thing i will say mike cavanaugh, reading his note on this that's out, points out that, you know, this is going to be led by mark lazarus and annan kenny the cfo and coo from nbc universal, says they both raised their hands to lead this initiative and that says something too. people who are excited about jumping in and take that operational risk and run something with it too. >> faber, this -- >> the opportunity to potentially invest in the business and examine come up wi things to do. >> building brands. >> is not an insignificant one. that is going to be part of the keys in stemming that decline in cash flow this thing will start out with. >> it might be more believable, david, if like right here, see how i let a little gray, i don't touch it there, but with you, i don't know.

it's just less believable to get a shot -- it's lessble because you have no -- >> i have it. >> i do. i have a lot. you just can't see it as well. >> yeah. >> see. >> all right. >> it's better, david. doing better. we got to roll. >> we have west virginia republican senator shelley moore capito on deck. >> all right. >> we'll see you in a little bit. she's going to join us about the incoming trump administration's cabinet picks and all the jockeying going on for that position when it comes to the potential treasury secretary choices. we'll talk about that and break it down after this.

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dad: hey boss. you okay? son: i said i'm fine. ♪ dad: you can talk to me. son: it's been really, really hard for me. among president-elect trump's picks for his administration, cantor fitzgerald ceo howard lutnick is going to head the commerce department. former wrestling executive and sba small business administration leader linda mcmahon secretary of education, dr. mehmet oz is going to lead the centers for medicare and

medicaid services. trump's pick for the secretary of the treasury appears to be fluid and up in the air, though the "financial times" is reporting private equity billionaire marc rowan has emerged as a top contender. joining us now to talk about how the incoming administration is taking shape, west virginia senator shelley moore capito. she's the incoming republican policy committee chair and, i don't know, i guess there's about 15 different names we can go wherever you want with this. do you have any insight into treasury at this point, senator, or do you know what we know? >> i sort of know what you know. it's going to be an exceedingly important appointment because of what the president ran on. he ran on economic growth and world dominance in terms of our own energy and also our own economics, so i think he's looking probably at each of these candidates carefully to

see how they will fit in and what their past has shown they can move forward. i look forward to it. i think it's an important pick, and i think he feels that way too, which is why it's one of the moving down the line in terms of one of the latter ones. >> the -- it's different this time around, it just seems to like so many things are being considered, and i wonder how this works in terms of recess appointments. is that -- if the former leader or to be former leader mcconnell saying now that there won't be any of those, can he dictate that? do you expect there will be somewhat -- what do you -- knowing senator thune, the incoming majority leader, what's going to happen on january 21st? >> well, you mentioned at the very beginning of that comment that it's different this time, and it is different. the president had a team led by linda mcmahon and howard lutnick

that have been vetting individuals, looking at individuals way previous to the actual election and you see these folks rolling out rather rapidly so you know they were in the pipeline and actually being considered much earlier than the election. that is much different than the first trump administration, and so i think because that is existing, that gives us the lead time when we get sworn in on january 30th we can begin to have hearings, even though the president can't make formal appointments until january 20th when he's sworn in, but we can be ready. i think many of these, that's what you're going to see. you're going to see us have completed the prework so that we can get these quickly, efficiently and that will lead to, i think, sort of calming down this whole question of recess appointments. the way i understand the constitution, we, as a body, the house and senate, have to put ourselves into recess. the president can't just unilaterally declare the congress is in recess. there are provisions if we're

divided on a question. we had a big discussion on this last night and i think -- i think what we need to do is consider these efficiently, get them up for votes, stay here all the time and make sure the votes go through and i think the issue of recess appointments will probably go away, and it won't be an integral part of how the president is going to get his cabinet through. we'll do our work. >> also it's different this time for other reasons. we have a president coming back to be president again, but after -- when he wasn't president for four years. there's been -- that's rare. it's happened before, but it's rare. and i can remember many appointments that were controversial to start and resulted in very contentious hearings. i can never remember where you got like -- i mean you know the names. i don't have to go over them. maybe -- you got five that are fairly controversial and you've

got a couple that make the other ones not even look controversial. i don't know how -- you know what i'm saying? how does that play out, where -- i could see some of the less controversial ones, maybe that was the method -- i'm not going to call it madness but maybe there was thinking that ent into that. we're going to throw a lot up here against the wall and most of it is going to stick. do you think it all sticks? >> well, i think there on capitol hill today, i understand the vice president to be jd vance has been here. i think that is a decided advantage this time for the president and that he has a seated senator who knows everybody and at least in the republican conference and probably the entire senate, and so that will be a benefit. i think there is some method to what you're saying in terms of, for instance, lee zeldin was one of the first appointees as epa administrator. maybe that raised eyebrows. he doesn't really have that environmental background he needs to have. he's going to a go through my

committee and i think well and quickly and that's a key position. so i think as you see these roll out, some of them, obviously, also rubio was an early one. he's going to -- we have a great high opinion of marco and his abilities to be able to lead us on the international stage. you get to more raising questions. we'll go through the information that's available to us. they're going to make the rounds and meet everybody. if they haven't met already. and answer some of the questions in private and then we'll have probably some gad tv watching for some of the nomination hearings. that i can promise you. probably as we move into january. >> okay. can i ask you about thumb's up or thumb's down your prediction on specific names. do you want to do that? i don't know if i want to do that. can we do that? >> i'm probably not going to give you a good answer on that. i haven't met many of the ones you're going to ask me. >> thumb's up or thumb's down. binary. matt gaetz. >> that's not fair. i haven't had --

>> okay. rfk jr. >> i haven't had the privilege of -- of considering these. >> the elephant in the room. a few elephants in the room be very crowded room in terms of elephants. >> speak for yourself. >> speak for yourself. exactly. >> here's another thing that's different is, you know, used to be you'd find these things out in the morning and then have time to, you know, vet them through the news cycle. we're finding out about linda mcmahon at 6:00 in the evening, so we know president trump doesn't sleep very much. >> yeah. after three others. >> you have no perspective on gaetz? i mean -- >> rfk jr.? >> pete hegseth? you're an example of what i'm saying. those last couple you don't care about because -- >> because things have become unusually -- >> that's what i said. >> normalized of sorts. >> you know there's a process here. we're at the process. let's let the information examine forward. senator grassley runs the

judiciary committee. he's stated in his public statements everything should be transparent and ape vailable toe committee members. we're six to eight weeks off from this. things can change. and they can either get better or worse and we'll have to see as they're making the rounds through the congress. >> all right. senator, thank you. i -- i mean, that's what all of us want is to live interesting lives, isn't it? where you are right now with the bird's eye view of everything happening, i'm a little -- i'm not envious, but it should be interesting for the entire country >> it's fast moving. >> it's fast moving. senator, thanks. >> thank you. when we come back we're going to talk the business of sports, the reveal of cnbc's official nhl team valuations list is on the way. we're going to see who is number one. then we will speak with nhl commsierarbemaison gy ttn. don't go away. "squawk box" will be right back. etfs designed to outperform the index.

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>> welcome back to "squawk box." the futures this morning have been steadily climbing all morning long. you see the dow futures up by more than 120 points. s&p futures are up toopy about 11.5 points and the nasdaq up by 45. let's take a look, i think at treasuries. let's check out bitcoin actually it's back above 94,000, a gain of $1200. 94, 221 and watching treasury yields. these have moved higher after dropping down yesterday on concerns of those headlines coming out of ukraine and russia. this morning the 10-year at 4.43, ii at 4.41. jeffrey schmidt says it is uncertain how far interest rates can fall. he said the initial decision to lower rates is an acknowledgement of the growing confidence inflation is on a path to reach the 2% goal and

does not say whether he favors a cut at the december meeting. schmidt will have a vote coming up next year. when we come back much more on our parent company comcast deciding to spin off some of its cable assets. julia boorstin will join us coming to us from the west coast this morning after a break. then, we got a deep dive night state of the housing market with ivy zelman. another note, don't miss an interview with goldman sachs ceo david solomon on "money movers." stay tuned. we're coming back after this.

all right. everybody, welcome back to "squawk box." right here on cnbc. check out shares of target this morning under quite a bit of pressure and stock down about 16% right now after missing on both the top and bottom lines. same-store sales also missed expectations and for the fourth quarter target is expecting flat same-store sales. that's below the estimates of 1.3% growth. we spoke with brian cornell who talked a little bit about this. look, this was a very difficult quarter. they expected consumers to show up and buy a lot more discretionary goods than they did. that's going to cost them and they have to move that inventory

and hoping the consumers will show up in force for the holidays. we'll see what happens. they are giving more moderate guidance, more conservative guidance, as a result of all of this. they did face higher costs in previous quarter taking a look at trying to make maneuverings for the port strike that was there and additional costs with that. that stock, again, down about 15% this morning. we're going to continue our conversation about the breaking news of this hour about our parent company comcast announcing to spinoff cable networks including cnbc and msnbc, usa networks, e! and others. bravo will remain part of comcast nbc universal which will include the broadcast network, nbc sports, olympic, and other properties that help populate the peacock streaming service. the spinoff business led by current group chairman mark lazarus, the separation expected to take about a year to take place. want to get out to l.a. to get the perspective from hollywood julia boorstin is here to talk about all of the developments.

how do you think this changes the landscape and what kinds of transactions, all of a sudden everybody is talking about m&a do you think get borne out of this? >> i think that's really the key piece here. one of my sources close to the situation said, this isn't the end. this is the beginning. indicating here that in spinning off these cable networks what comcast is doing with the new co, they're putting it in a situation to make meaningful acquisitions of other channels. i'm told by sources that we should expect there to be a lot of conversations about warner brothers discovery looking to sell off some of its assets. the idea that some of those channels would fit well with this spin co. after that, maybe look at starz separating from lionsgate could be paired in here and amc networks as well. plenty of cable networks that could be combined here. paramount, which is going through its own management transition, sell some of those assets. what else is this company

acquire? how do they try to squeeze out as much revenue as possible from these linear networks? what do they do with them from a digital perspective in terms of streaming? what do they do in terms of non-television revenues or tv or streaming revenues, like events, things like communities. you have a network like scy-fy can they build out that horror community around sci-fi. it's interesting bravo is hosting bravocon events part of peacock, but we'll see more of those types of businesses out of the new spin co. >> when you think, though, about growth businesses, we're all talking about similar kinds of businesses, linear cable channels that by default on a year on year business is it's hard to see them growing in this moment given the unbundle that's taking place, do you imagine there's other kinds of acquisitions of companies that have a true growth profile, if

you will? >> well, i don't have anything in particular in mind. i think the initial move is consolidating and creating some scale around these cable channels. i think, though, then the question is whether they can create businesses that have growth profiles within that company. i mean, for instance, here at cnbc, which is, of course, part of that spin co we have an events business. we have communities. i think there's going to be a sense of the idea of these being brands that have value beyond the tv ecosystem and how do you generate as much value from those brands as possible. >> flip side to all of this, on the hollywood end, you know, historically a lot of the -- i mean, a big piece of this is comcast wants to be a growing machine, obviously. >> yeah. >> "wicked" getting some great reviews across the board including from rich greenfield this morning who saw it last night. when you think about sort of the long-term prospects for comcast,

how do you think this changes the dynamic? obviously, it's not going to have this revenue that's going to go down every year that may change their profile a little bit. do you think there's an extra multiple tick or two that comes from it or not? we were looking at the stock. it's up about 98 cents this morning. but, obviously, down from where it was even a week ago. it's a little hard to judge how the market is reacting to all of this. >> i think the question here is what happens with peacock. if you look at the assets that are staying part of comcast this is intentional about building up the potential for peacock and to make it a real player in the streaming space. right now, it is much smaller. you have the giants, netflix, disney plus, amazon prime video and peacock is one of the smaller players. what they're doing in keeping bravo which has reality tv, and keeping nbc, nbc has sports and what they can do is they are going to have the nba, which is a new deal, they have nfl, and to have the addition of the nba which is a new deal, hasn't started yet, they're going to

create a critical mass of sports for peacock. so i think that's really important here. i would not be surprised if, especially in this m&a environment with the new regulatory environment here, we see more assets added to the core of comcast and nbc universal business as they really build up their interest in becoming an entertainment powerhouse. what they're doing is having these brands like "wicked" they'll be able to exploit across their other platforms peacock or now at the theme parks as well, and as they invest in the theme parks, a true sense of diversification from the more traditional media business, i think they're thinking about what's going to work on these platforms at the same time. >> thank you so very much. we'll see where this goes. all exciting. thanks. let's talk housing as 30-year mortgage rates are hovering around 7%. what that could mean for buyers and sellers, ivy zelman.

sounds like it's bad news for everybody all involved as mortgage rates push higher again. >> well, certainly not good news, but it's been interesting with rates now actually about 6.8% on the 30-year fixed rate. we've seen surprising resiliency in terms of volume. however, we're seeing it pick up in listings having to reduce prices and incentives builders are continuing to offer, mortgage rate buy downs. the area of weakness we're seeing would be more of the entry level where the move up market has been very strong and remains i think surprisingly resilient despite rates moving higher. >> i mean, the reality is, we're still dealing with a ways where there's just not enough supply that's particularly difficult for first-time home buyers, as you mentioned at the entry level price point for these things keeping people from being able to buy homes. huge backlog there. what's the solution to that problem and how does it get

fixed? >> well, i think the way that we think about the solution is that we need to see, you know, the local municipalities, cities, partner with developer builders to utilize land that's not out so far out in the rural areas that you can't have trades willingly driving out there to build homes. it has to be providing more affordable houses closer to the employment centers that comes at the local government level. it's not go going to be at the federal level. trump is talking about utilizing federal land but most of that land out west is really call it third, fourth ring, further out, and trades and perspective buyers are not going to want to drive -- they'll spend more on gas than they would on their mortgage payment. maybe not, but it's too -- >> time factor too having to commute somewhere to a job. so if the federal government can't make progress on this, how -- how optimistic are you about local and municipal levels being able to do something about

this? how long does it take to get us back to what we would consider a more normal situation? >> you know, i guess i'm somewhat skeptical they can come to fruition because not in my neighborhood continues to be a big impediment, and i think that that will continue to really curtail any likely significant improvement in building affordable housing. i know that there's some opportunities that have come to fruition in different markets in seattle and denver, but it's very small. it really is not enough. >>, and i mean we've all been a little surprised i think by the 30-year and the move higher for the yields there, the move higher for mortgage rates as the fed has been cutting interest rates. has that created a panic in the industry or how do people plan and accommodate for that? we're not seeing lower rates like we anticipated? at least in the long end? >> to the builders or the realtors or what? >> builders to realtors to anybody involved with this? this is a problem to try to tackle.

we see it playing out to a company like a home depot or lowe's. it's not developing the way they had anticipated and that means everybody has to have a longer term plan for this. >> i think they adjust. i mean what we're seeing for the builders they continue to use mortgage rate buy downs, averaging 5%, some markets lower than that and that's still creating volume for them. they're still selling homes, but they are providing that value incentive. i think in the existing market inventories are up 20, 25% nationally, but that's allowing for more pending activity to come to fruition. so we do have buyers back in the market remember. we have a very strong economy and we're still seeing that result and more demand. i think that everyone's adjusting. affordability is still stretched for the existing home market we're about 20% above trend line. and in the new home market we're about 10% above trend line. i think the builders and realtors and buyers are adjusting. when interest rates were approaching 8% not long ago, we

did have continued demand. so i wouldn't be surprised to see the volume, you know, for 2025, assuming rates stay where they are today, be in the mid to higher single digits for the new home market and we expect a pretty good rebound in volume for the existing home market given it's at recessionary lows. price will be the factor that needs to be adjusted downward. we are seeing markets where pricing is not only moving lower but we're actually seeing pretty big reductions in list prices. that's definitely going to be the lower. >> thanks. a lot of good information. appreciate it. >> thanks for having me. still to come cnbc set to reveal the valuations of the nhl's most valuable hockey teams. those numbers coming right after the break followed by an interview with nhl commissioner gary bettman on the state ofhe memedia rights and much more. stay tuned. you're watching "squawk box" on cnbc.

cnbc sport is out with its official list of the most valuable nhl teams. you can find it right now on cnbc.com. like every other major sports league, hockey is in -- of a big bull market. our senior sports reporter michael joins us now with more. hey, michael. >> good morning. the business of hockey is booming, and nhl team values are hitting record highs. the average nhl team is now worth $1.9 billion. it's all because the business of hockey is booming. last season, the nhl hit record sponsorship revenue and record

ticket revenue. in addition, its u.s. tv deal is more than three times its previous deal, and its next canadian national tv deal which should start in two years is expected to see a similar increase in value. now let's take a look at the top five most valuable teams. at top of the maple leafs, the leaves are approaching $100 million in annual sponsorship revenue. by far the most in the nhl. they're followed by the new york rangers, the blue shirts led the team in ticket revenue last year at $170 million. the montreal canadiens ranked third valued at $3.1 billion. they raked in the most local tv revenue in the league last year. $65 million. and with the l.a. kings fourth at $2.85 billion and the bruins right on the kings' tail at $2.75 billion, both of those

teams own their arenas, too, which gives them a huge advantage in sponsorship revenue and tens of millions in revenue from non-nhl events like concerts. all of this robust economic news in the nhl is coming right through in team transactions. just recently, the tampa bay lightening, not exactly a big market team, changed hands for a record $1.8 billion. $600 million more than the previous record for an nhl team. joe, back to you. >> we had just football for a second, we had the chiefs owner on and winning three super bowls is good. the florida panthers won their first stanley cup last year. did that -- can you see the financial impact already on that team? >> absolutely, joe, because hockey teams keep all their gate receipt revenue from the playoffs, except for a small portion they put towards revenue

sharing, but as every hockey fan knows, every round your ticket prices go up. so the typical team, depending on the round, can bring in anywhere from $3 million per game up to 5, $6 million per playoff game. >> yeah. i would say we're going to say that no canadian team has won the stanley cup in a long time, since 1993. why are they still in the top five for most -- because it's in canada! they like hockey! in canada. i got it. i can't believe they wanted in to ask that question. anyway, thanks, mike. make sure you head to cnbc.com/sport for the official nhl team valuations. joining us for more on the valuations of the team and his league, as well as the state of sports media, and a lot more, nhl commissioner gary bettman. i mean, just looking at the results you must be like a genius, i mean the way you've

run this thing, couldn't have been better, blockbuster. you're amazing. there may be some overall had things about sports on tv. >> between what michael said and you've said, i think i've had enough and i can -- >> exactly. how valuable is sports in the current environment. >> content. >> the news with comcast today, everything having to do with content and distribution shows great content is increasingly valuable and we think there's nothing more valuable than sports content and you're seeing that over and over again including the most recent nba deals. from our standpoint, the league has never been healthier. it's not just me. >> no. >> we've got great owners. >> don't downplay it. >> we've got great people at the club level. >> you can't binge watch sports or hockey. you have to watch it when it's on. >> our competitive balance, how good the game is. >> that too. >> fueling ratings, attendance, partnership growth in terms of

sponsorship. the whole package is working together, but again, starts with our players in the game. >> gary, one of the things referenced there is the deal in canada. >> yes. >> and the media deal that's going to come up with rodgers. and a lot of speculation about what that deal will look like in the future whether that will be with rodgers, whether there will be a streamer, amazon, kind of deal. what does that look like in your mind what the nba did, for example. >> we have a negotiating period which starts for 60 days. with our consent rodgers has sublicensed for this season and next amazon prime to carry monday night hockey. thinking about our television presence and role in canada, television media, think we're the nfl equivalent in canada. 41 of the top 50 programs

throughout the year. during our playoffs every night. we think there are great opportunities although cable in particular, media in general, other than the streamers are heavily regulated in canada and that presents some challenges. i think the outlook is very strong for us. >> are there more opportunities to package different sort of schedules of games with more providers than there used to be. >> well there -- >> is that a good or bad idea? used to be you'd focus and do a deal with one network. >> yeah. there seems to be less for exclusivity. everybody wants a piece. again, we're open-minded and rodgers has been a great partner. and we're going to wait and see what they say. just like espn, disney has been a great partner as warner brothers discovery has in the states. but what -- what's clear to me is that sports content, our content, our fans, our game is increasingly valuable which is

also being reflected by what michael's valuations have been. >> any concern about streamers and streaming live games. i ask, amazon is doing a great job with the nhl. they're doing a great job with the nfl. they stumbled a little bit early on, and i raise the question because this weekend, obviously, netflix stumbled and stumbled big with this big fight and now there's questions about what's going to happen christmas day with football. >> we're in an evolutionary period for media distribution and with the comcast announcement how cnbc is going to evolve over time. whatever the bugs are with the increasing use of technology, they're going to be worked out. but i think we're at a point in time where distribution is going to be maximized and really good content, which we include ourselves in, is going to be increasingly valuable and we're going to reach more fans than ever before. i think the key is, consumers, particularly millennials, gen-z, gen a, they want content on

their terms and technology is going to help deliver that. >> how do you see that? is it simply a money game or are you looking to experiment, too, in how you go using whether it's direct to consumer, whether it's some of the streaming stuff, cable networks and broadcast? >> it's important that games maintain their authenticity and you don't adapt the game to the technology but use technology to deliver it in more ways than before. puck and player tracking, we call nhl edge, enhanced boards, we brought technology to the game to enhance the fan experience. what we need to do is make sure we're giving our fans maximum opportunity to connect with the game on their terms. >> have you had conversations? i mean this is an announcement today with comcast, but what that would mean to you all at a broadcast? how you would look at these two entities being separate or tied together? >> it's interesting because the split has a lot of cable entities on one hand, but nbc

and peacock on the other hand. >> correct. >> i think they'll probably be some integration of the two. >> sharing. >> i would imagine. i mean i'm not privileged to -- >> are you concerned about what may feel people talk about a sports bubble, people have always been talking about a sports bubble in valuation, but sports now outside of the nba, the nhl, the nfl, and baseball. we're talking about, you know, pickleball and we're talking about -- >> i would like -- >> volleyball. >> and sailing and -- >> talking about pickleball i would like to be garret. >> and the emergence of women's sports in ways than ever before. >> i wonder whether the fight for the attention of the fan changes? >> that's a great question. two things, one, i've been in sports now for almost 45 years. i've been doing this for 32. and i've been hearing that it's a bubble for that entire time. clearly, particularly now with the evolution of the delivery

systems, good content is never been more coveted and valuable. i think there's going to be more and more fragmentation and there will be opportunities for more sports to get distributed, but in the final analysis the four major sports have the largest fan base and the best content and i think that's going to continue to be the case as long as we all take care of our games and make sure the competition is good. >> how do you think about the regional nets? >> that's the point in time where things are evolving. i think you're going to see less focus on territory and regionalization and ultimately over ime there will be more national distribution. >> you ought to be able to watch whatever you want. major on sundays. the jet and giants always have to be on. nobody else. >> i hear you. the question is can the economics where you got to get a lot of extra pieces of bites of basically the same apple before,

right. and that becomes a little bit more challenging. >> if you remember, if you go back 30, 35 years to the emergence of cable and the penetration it got, it was all based on sports locally. >> yeah. >> that's how cable and satellite entities penetrate. i think you're going to see more of the same with streamers, that sports is going to drive distribution. >> i saw a new thing i had never seen before. the window cleaning world cup is a thing. >> is it really? >> yeah. >> no idea. the level of sports getting back to -- >> where are they doing that? >> last one was in london. >> let me ask you -- >> i would be scared -- >> when you do these tv licensing deals and you've done the math on this, do you believe ultimately that the advertising revenues the networks are going to capture pay for the licensing number or is it a loss leader to use for the networks to promote their products, amazon,

obviously, is an unusual company now given what it's doing compared to what a classic tv company would have been. >> the answer is yes, in a funny sort of way. >> okay. >> the business will evolve and the advertising with will be more and more targeted. we have teams that are distributing free streaming, but doing it with targeted advertising and they think they can make as much money. the model is changing. for example, the panthers, florida panthers, stanley cup champion as you pointed out, have gone over the air, kind of like back to the future for local sports. and they're going to make as much money as they did with the cable regional sports and their viewership is up 170% because they're more widely distributed. this is all evolutionary, but it's all good. >> gary, thank you for coming in this morning. >> thanks for having me. >> congratulations on your success. >> thank you. >> a quick final check on the markets before we hand it over to our friends on "squawk on the

street." where things stand right now. we have green on the screen. dow up about 74 points, nasdaq 22, s&p 500 up about 5. take a quick look at treasuries. 10-year at 4.34, 2-year at 4.3. more news coming to you tomorrow. make sure you join us then. "squawk on the street" begins right now.to you tomorrow. join us tom. "squawk on the street" begins right now. >> good wednesday morning. i'm carl quintanilla with jim cramer, david faber at post 9 of the new york stock exchange. futures steady on a big day for retail earnings, media and tech. nvidia reports tonight. one of the last a.i. catalysts of the year. target with the biggest earnings miss in two years. set to fall from 16%. plus, our parent