thiis "nightly business report" with bill griffith and sue herera. amazon, intel and microsoft trounce earnings expectation and some say this critical sector is a good investment for your money. stocks surge. the major averages get a big lift even as a number of companies say inflation pressures are >mounting. >>eenage hacker. the incredible story of a young man who hacked russian hackers and is now makg millions helping companies defend themselves against people like him. those stores and more tonighss on "nightly busine report" for thursday, ri april 26th. we do bid you a good evening, everybody. stocks r highe at the open this morning and this time the change. ld for a earnings reports from some of the biggest u.s. companies at a

decl te in the year treasury yield combined to send a major averages sharplyer hi the dow was up more than 300 points at its peak today, closed up 238 to 24,322. the nasdaq was up 114, the s&p rows by 27. and the technology sector led the marketay higher t after the closing bell, microsoft, amazon and intel all easily topped earning estimates. we start with amazon's the company's results were driven by a surge in online shopping and strg demand for its cloud services. it earned $3.27 a share. analysts wer expecting a $1.26. revenue climb 33% to come in at $51 billion. investors seered. tht the stock to a record in initial after-hours trading. >> thest take away from amazon is firing on all

cylinders and says it will continue to deliver profits to investors. not only are its core businesses ecommerce but newer businesses like brick and mortar and subscription services are growing at a faster click than wall street expected. amazon, a company that used to sacrifice profit for growth is now exercising more fiscal discipline ando telling vefrsz t expect operating income of 1.1 and $1.9 biion in the current quarter. amazon is spending big on new businesses fromriginal content to hardware to groceries and to gaining market share in regions like india. for "nightly business report," i'm deidre bowsa, san francisco. >> now to dow component intel which reported better than expected earnings and revenue driven by higher demand for mi-conductors for datacenters. intel earned 87 cents a share. revenue came in at 16 billion. that was up 8% from last yea and about 1 billion more than expected. the stock rows sharply in

initial after-hours trading and aditi roy has more on intel's report for us. >> reporter: a big day forel i earnings today as the company handledly beat analyst's expectations on a number of key metrics, one of those critical metrics the data centerroup revenue number which came in at $5.2 bilon versus analyst's expectations of 4.84 billion. that numbereferring to chips use and servers to support computer systems. ar it's pt of the business analysts are watching ver closely and the company is also investing in since cloud is a or growing categy and more and more industries are shifting towards the cloud. the company also beating on revenue coming from their client computing grou that referring to the pc and mobile chips. two headwinds inhis category for the company, competition from companies like amd and the decline of pc sales. forre "nightly businessrt," i'm aditi roy, san francisco. and fellow d component microsoft also topped wall street forecast on strong demand

for its cloud computing services. it's flagship cloud product called azure which competes with amazon, azure holds the num two position in the cloud computing market. the result sent the shares down and then back up infter-hours trading. let's dig deeper into these tech rnings. joining us right now sharing his thoughts, dan morguing and vice eresident at see nova trust. the world heard in all three reports, cloud. wi the g influence of that in the technology world for companies that are not known for. you got retail for amazon operating systems for microsoft and chips for intel but they all are seeing more of a force in the cloud right now, an't they? >> yeah, that was the real picture in terms of the companies, you know, amazon with

aws. that was up -- talked about 5.5 billion in revenue. that was a huge number. microsoft is an old legacy compan like an ibm who's made this conversion over off the sktop in thecloud, commercial cloud did over 6 billion and intel with their data center group up 23%. so all of these companies, intel, microsoft, old legacy companies that are making a good transition into cloud and like eou say have a big retailer l amazon you don't think of when you buy something off the internet they're a huge player. they're the number one player in infrastructure as a service. really cloud is a huge force now >> technology. nd you make the point as i look at my notes that for amazon, any way, they're aws unit is somewhat under appreciated or not basically valued correctly by the street. why? interesting, it's because we do think when we talk about amazon we talk about the

whole foods acquisition or we etting intothem health care, we talk about, you know, 100 million prime users. we hit that target recently. we forget about the fact thatey re a huge player in this enterprise area in the cloud space. they are the numbe one leader in that. you mentioned are which is microsoft's product in that space also, google cloud is in th space too. they're the clear leader in terms of total projected revenue and growth. it is ieresting that a lot of people don't think of amazon as an enterprise cloud play. they think o it as an online marketer. so interesting. >> the stock prices in the clouds that's for sure. >> yeah, yeah. >> thanks, dan. preciate it. >> thanks bill and sue. th one o big themes emerging from this earnings season so far is inflation. a number of companies are talking about how they're facing rising costs. bob pisani has more. >> reporter: we just about at the halfway point for earnings and they've been excellent but

one common theme that's been raising a red flag is buyer it's being a hot topic on the conference calls. they're mainly talking about ca mod thank you inflation around metalrices like aluminum and steel and oil pric, but some are also mentioning hher wages. so caterpillar this week expects steel and other cmodity costs to be a headwind all year. derived from crude oil, kimberly-clark said margins were impacted by significantmm ity inflation. whirlpool said profits took a hit about raw merial inflation. proctor & gamble, they also highlighted rising commodity cost andve denson, they saw price increases for paper as well. several companies like chipotle separately brought up higher wages as well. how's everybody coping? a few said they were just going to raise prices in response. ao smith which makes wat

urificationsair prices is raising the price tag on its products by 12% and rising freight costs but not everybody cse afford to r prices. auto, apparel, tech hardware and househol a personal product f their seeing some profits under pressure. all of these sectors are impacted by higher commodity cost. fo "nightly business report," i'm bob pisani at the new york stock exchange. and higher commodity cost could ripple through the stock market and the economy t over next week and a half or so. we'll learn a lot more about el both with these of more earnings guidance, economic data, a fed meeting and the employment reports. joining us to talk about all of that is ryan sweet. he's direct oflt re economics. also joining us tonight is michael far. good to see you gentlemen, welcome. >> thank you. ng lots to talk about. ryan, i'm g to start with you. of those things that i

highlighted which one of the economic reports are are you going to be watching the most closely? >> over the next week or s ere are two key ones. first comes tomorrow and it's not gdp, it's the employment cost index which is a very good measure of wage and benefit cost in the united states. rate in theme u.s. trending lower and having nowhere to go but even lower. wage pressures will begin to build and that's going to put upper pressure o company's cost and generate some inflation. i think the feds more sensitive to wage pressures now than they are going to be paying close attention to gdp and next is the core pc deflator which the the feds preferred measure of cor deflation. they'll be some favorable base effect and we'll get a year over year number in march that's very close to the 2% target and how markets interprete it it's going to be key in how markets do next week. >> michael, we heard from some companies reporting this week

they're already seeing raw material cost creep into their business right now. though investing as you're anticipating higher inflation down the road? bill, i'm investing looking for companies that can continue to ow. i think you have to price in a lertain amount -- i don't know whether we'll c it inflation but certainly we'll have higher rates, right? the fed has changed direction that's clear. they'll continue to increase those short-term rates. cost of money is going up. that's inflationary and we saw in -- when we looked at earnings yesterday we heard from them that they were seeing higher costsf goods. i think, you know, you have to listen to ryan sweet, too, who saysou've got to look at the employment cost because these are going to serner or l be passed on in end costs to the consumer. yes. all in there, margin pressures is what we'll see. >> ryan, if indeed we get song readings in the pce and other indexes does it change your

assessment of what the fed is going to do or do you think the fed will reassess? >> i think the feds prett much on course to raise rates a total of three to four times this year. they signaled three in their summary of economic projections. in the so-called dot which shows all the participants expectations -- end of this year and next year, if you take out th lowest two we get four rate hikes this year. we have core inflation moving closer to the feds target with the unemployment heading below 4% fairly soon. the feds is going to feel very comfortable in where the economy's headed, where inflation is headed so actions today effect by raising interest rates will effect the economy down the road. the feds got to be very forward looking and the fed is trying to pull off the miracle in trying to land this plane perfectly on the tarmac. they're worried that the rate

will fall too low and the economy willoverheat. >> ryan, isn't there a question that the fed could?overst they it in 1937, they could throw us back intoio rece ryan is a graduate of the university of delaware, fabulous program, david lyons put on the economic summit every year there and the economic and entrepreneurialship forum. this is a great school.i got to hear you tell me do you think the fed an overstep here and send us to recession? >> i do. i don't think it's an immediate threat not in e next year or two. usually the risk of a really increase substantially when the fed raises the fed funds rate, the real fed funds rate 50 basis points above the terminal fed funds rate. nominal of 2.5%. that's about 50 basis points. time. e i feel like if the feds

projections were going to oversht just a little bit. as inflationary pressures begin to develop, the fed justra nay -- they've done it in the past, they may panic, raise rates aittle bit and that may be the one that -- that'll trigger the next recession. >> gentlemen, we've got to go. thanks so much. still ahead, chipotle entering a new era with a new ceo at the helm. wells fargo is reportedly

the target of yet another probe ing to the "the wall street journal." the labor department is now looking into whether the bank has been pushing 401(k) participants into more expensive iras. regutors also want to know if wells fargo pressed account holders to buy f in-houseds which generated more revenue for the company. chipotle investors have something to cheer about, yep, you heard me correctly. the chain appears to be winning back customers following a string of ecoli outbreaks more than two years ago. chipotle reported blowout quarterly results tha sents the stock 24rgs higher one of its biggest move sinceha the went back in 2006. kay rodgers talked to the new ceo to bring new life in the embattled restaurant chain. >> the food looks great. >> reporter: with the new chief executive officer i ace, chipotle mexican grill is hoping to usher in a new era.

brian in this case ol former ceo of taco bell took the helm last month. nichol known for his innovative style of marketing and bringing unique items to the menu has analysts optimistic. they have nearly 2,500 locations and 70,000 employees. nichols top priority in the new le remindi people why they love chipotle. >> we need to focus on leveraging the platform that, w ha the food is cravable and there's opportunities to use what we hat and present in new forms, new varieties to get people just reengaged with what they love about chipotle. >> reporter: this comes after a string of foodorne outbreaks hitting the company's stock and tarnishing its image. they plan to focus on marketing. their slogan is foodith integrity. they're going to rely on these fresh ingredients tt customers

have come to love here at chipotle. >> there's always an opportu uty fo to be even more cognizant of the financial commitmts we make as well as the innovation commitments we make executing a guest experien, giving eve customer the experience they want and expect from chipotle. >> reporter: they're also planning to test out new items on the menu. >> breakfast will not be coming any time soon, but one thing i can tell you is, our food tastes great. i think we'll beim expting with can weli open earer and adding hours on the front d. >> reporter: so far, investors showing they have a strong appetite for the change in leadership at the brand as the stock continues to climb me than 50% since nichol was announced ceo in february. fory "nighsiness report," i'm kate rogers in denver. starbucks profit margin shrinks and that's where we begintonight's market focus. after the bell tonight the coffee chain said that restructuring costs and an ngcrease in employees benefits caused opera margins to

decline. andall, total sales rose topped expectations. the company rterated its 201 forecast. shares initially fell in the after-hours but finished the regular sessi up nearly 3% to 59.38. also right after the bell tonight, mattel said thatse higr s for a couple of old stalwarts barby and hot wheels helped sales rise above expectations. the toyer mid report a loss but said it's working on nd profitabilityorking through challenges caused by that toys 'r' us liquidation. sh pes initialped in the extended session after ending the regular day up more than 3% at 13.98. and southwest airlines said that bookings haved weake following last week's engine explosion that left one passenger dead. the airline said that that softness was expected but added that its probably going to mean a measure of revenue turns negative for the quarter eperall. southwest didt stronger earnings for the last quarter

and said it's in a position to weather rising fuel costs. >> if prices con higher from here, we have very solid protection in place since december w firmed up 80 options for firm delivery on the max. the max aircraft is 13 to 14% more fuel efficient, so we'll just continue to look for ways to be more fuel efficient, continue to look for ways to mitigate priceri -- sharp increases with our hedging program. >> shares of southwest fell near 1% to 53.30. >> sue? strong demand in pepsi helped revenue beat estimaten salese company's north america beverage division continue to fall but pepsi sai it is confident that greater investments in marketing will reverse that trend. >> gator aide went through a bit of a down trend. mountain dew has comeback quite nicely. we're down to getting the pepsi business back on track. we ramped up our advertising in

the firquarter. we were up double digits and as you see us increase advertising further, i think you'll see the market share performance of the coal of business specifically improve as well. >> pepsi shares climbed 2% to 103.26. general motors made fewer high margin pickup trucks in the latest quarter but still delivered an earnings beat. caused uction lows were by assembly plant changes that gm made to shift its focus from sedans to more profitable larger vehicles. during that period gm said its china market performed wed,. >> we ou know, an outstanding quarter in china record equity income of 600 million. we continue to perform very, very well. we're excite bd our product launch portfolio there. we expect to see another strong year of equity income in china. >> gm shares rose just a fracti to 38.25. and higher oil prices and cost cuts helpedonoco phillips top expectations. th company also reaffirmed its

capital budget for the year and it raised its production outlook. the shares rose nearly 3% to 66.97. the heads oforth and south korea are meeting tomorrow for the first time during that historic inter-korean summit and the meeting will takelace in the heart of the emilitarized zone, an area you might be surprised to learn is home to me very big companies. eunice yoon is there for us. >> reporter: we're in demilitarized zone. this is the world's biggest he panel ring hub for that's go into your tv. four fifths of lg's large displays are produced right here n d15 the company announced plans to invest an additional $9 billionil to a new plant right here on the ground. the thinghi is that place is about as close as you can get to

north korean border. how close? let's go for a drive. well, we can't drive any drther. theilitarized zone, the heavily fortified border between north andouth korea is just a few miles past the river and we are clocking in at 17 minutes to go nine miles from those lg facilities. i think it really goes to show just how vulnerable some of kouth rea's electronic factories are if a war were to break out. any w conflictl ripple from the global economy from here. cing , he shut down twitter and says he even hacked russian hackers when he was a teenager of the now he's telling his story.

after all the news and revelations we've been hearing in the past year, you might think the russian hackers are unstoppable but one american 15-year-old actually hacked the notorious cyber criminals in an exclusive interview right now, this young hacker known a cosmo the god, reveals how he went from being wanted by the government as teen to raking in millions by helping companies defend against cyber criminals. andrea day has our story for us. >> reporter: you went by cosmo the god, dideeou fl like a god? >> yes. >> reporter: but cosmo the g was really just a 15-year-old taylor. amed eric he's revealing his story exclusively to cnbc for the first time. he showedp for the interview with his new business partner

marshal webb. they're working on a -ubersecurity sta called path one of the ways taylor says he's turning his lifeat around. your message to american teenagers who want to become hacker e> join the good side and don't go to dark side of the internet. >> reporter: he fell hard for the dark side when he was 12, then he grew a group of hackers. they shut down twitter for about an hour. they a major corporations sometimes gaining access to customer's rsonal information while company's did not acknowledge this access, companies likeaz did they will cnbc that the security of amazon customer accounts is one ofigurst priorities. then the group moved on to bigger fish, high profile targets like kim kardashian, michelle obama and donald trump: yo exposed sensitive information for dozens of celebrities and politicians what were you thinking? >> i was thinking t nothing to lose and i wanted to

make it in. >> reporter: cosmo the god was on fire, postingo the i on a website for the world to see. social security number home addresses even full credit reports. >> i would publish a new celebrity every day. >> reporter: how did he get the secret info? he says he hacked into a russian stolen that had already the data and had it up for sale. taylor said he convinced him to hand it over free of charge by promising not to take their site down. so you hacked the russian hackers? >> yes. >> reporter: how did that fe i? as 15, it felt amazing because i don't like russia, but i had to talk to them to get in with them and it worked. reporter: and listen t what he did after he posted the info? >> i made the site seem like it came back to russia and the media published it as russian hackers as -- i knew the bi was going to. catch up with >> reporter: he was sitting in his bedroom when fbi busted down

the door and took him down in s. cu do you regret publishing that information? >> yes, r100%. orter: he's now watching from a distance as hackers cash in on crypto. >> it's only getting bigger. the easiest way is to hijack at cryptocurrency wallet and there's no trace. >> reporter: what's your biggest fear? >> having my crypto wallet hijacked. reporter: is there any bit of you that wants to go back and grab a bit of that action >> of course, and i think there always will be but i can never go back to the dark se of hacking. >> reporter: his latest project, the cyb security start-up path. it uses block chain to help companies figure out if they're website is loading correctly on devices around the world. they plan to recruit computer users all over to make it work. offering them tokens in exchange for letting pass access their computer. after taylor was busted, he pleaded guilty to a string of

high profile computer crimes and walked away with probation. thath as his fourest and hopefully the last time he says he'll go down for cyber crimes. for "nightly business report," i'm andrea day. well, before we go, here's anotr look at the rally on wall street. the dow advanced 238 pnts, the nasdaq was up 114 and the s&p 500 rose ue27. >> i'ming he did well in math. >> i would thi, so yes, or statistics or something like that. that does it for us tonight. i'm sue herera. thanks for joining us. >> i'm bill griffith, thanks we'll see you tomorrow.

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