this is "nightly business report" with sue herera and bill griffith. alexa, h was amazon's quarter? the e-commerce company trounced earnings estimates, grew itsin cloud bs and solidified its retail dominance. about face. facebook makes stock market history, but not the kind investors liko see, losing more than $100 billion in lue, e biggest one-day loss ever. head start, why savings f retirement is not just for adult, but also for kids, too. those stories and much more tonight on "nightly business report" for this ththsday, july good evening, everyone. welcome on this very busy earnings day.

we begin tonight with results from the retail juggernaut amazon. earnings per share doubled what analysts were expting resulting in a profit of more than at$2 billion, a record quarter. so let's get right to the numbers.ar amazond $5.07 a share. estimates weil for $2.50. profit was strong revenue was a bit soft. the company saw revenue of nearly $53 billion which was upl sharply frot year and not quite as much as expected and ed, but k initially po then pulled back in a volatile after-hours session. courtney reagan has amazon's quarterly highlights. so it's not a complete sleep for amazon's second quarter. as e earnings were twice strong as expected, other metrics fell short. north america and intertional arvenues disappointed and its high mn cloud computing business, amazon web services generated more revenue than nalysts forecast. during thequarter, amazon extended prime membership benefits to whole fds shoppers and the company neglected to

reveal any further details and amazon's annual prime day e shoppingnt is not part of this quarter, but part of the next quarter to be repored. whil amazon had said it was its best day ever, its revenue forecast for the thirdrter that includes prime day is well below wall street esthtates. for "n business report" i'm courtney reagan. they'll join us to talk about amazon's soliduarter and he's senior equity analyst, and alwayseood to you. thanks for joining us. >> thank you. >> big beat on the bottomdiine. you see any weakness at all on these numbers tonight? >> ihe think overall results, frankly, i think, had a lot of positivetakeaways, and if you covered amazon for a while, i think you would know thatll essent this is a marathon as opposed to a sprint. there's a lot of concerns in terms of the rally that the shares have enjoyed over the last few weers. so you can understand why investors are overall this quarter, obviously,

blew awayto the b line numbers and there are some concerns with the revenue target, but all in all, i think for a company that's still growg revenues, 39 to 40% and y higher i look at the amazon web services, there's a lot to be optimistic about especially oving turned the corner in terms sustainable profitability guidance that we saw for the q3 quarter. >> it sounds like you do not share some of the concerns that created the volatility in the stock aft hrs even with the run-up that wooe seen in the stock? >> that's correct. i do have some near-term concerns especially on the international busins where they had another loss this quarter. we know that they're investing heavily in india, and we also note that, y know, the sales of hardware devices of edco and alexa, and we're looking for that to drive the secular growth, and the smart

speaker category >> and back to school season coming you have by having a sense that this guidance provided to be quiteco ervative. if you throw in the prime day event last week,mazon is a company that tends to somewhat conservative in their outlook and the one concern and we have thee target pr $2,000 and we're still hopeful that, you know, there's still some upside. >> very quickly, would you buy v at theses here, then? >> we are still bullish on the share. that's why we reaffirmed the buy recommendation today with the target price of $2,000. thanks for your thoughts tonight. >> thank you. and we are watchinghat race to a trillion dollar market cap. at today's clo apple was still in the lead with a valuation of reeper ever closer to on's value alphabet, given the stock's move in late-day trading.

>> meanwhile, on wall street, the market's majra as were mixed after the dow climbed after shares of travelers and disney. the nasdaq pulled lower by that historic drop in facebook ares. so the industrial average gained another 112 points today to 25,527. the nasdaq was down 80 and the s&p was down eight points today. >> as we reported last night, facebook sai it expects its revenue growth rate to slow from last year. that warning resulted in facebook suffering its worst day in history as a public company and the biggest one-day stock value loss in stock market history. so what happens now for fa book? look.boorstin takes a >> facebookaising red flags and after revenue growth flowed more than expected it would continue to decline merningfully ov the next two quarter, and the lowest growth rate ever and in europe, user numbers declined in the quarter and some are

timistec over the social platform's future. we think prospects look good, lo term, short term and obviously tnre will be questio mashes around the deceleration. also raising concernsbo face warned that ads in the stories atured on facebook and instagram are profitable as ldcebook's news feed and bulls say that c change. what happens to the revenue per user and connects keepoing up d with stories being such a breakout hit for them which they obviously stole 100% from snap chat. that they can figure out how to raise money this could be a revenue-printing juggernaut. >> another factor weighing on facebook's stock, margins will decline meaningfully i several years as the company ramps up its investments in safety and security. facebook is hiring thousands of employees and investing to improve artificial intelligence. the socl giant is working on a number of new initiatives to prevent other scandals like cambridge analytica as well as to comply with european privacy

regulation gdpr, giving up profits in the near-termo protect the platform's users because the stakes are high. >> if they don't get theth security o platform right it's all over and they have a lot of issues about this earr.er this y so they need to get this right. i think that they will. if they can, this is the opportunity to buy t stock here. >> a key measure of facebook's success with these investments is how well it protects the security of the platform aroed upcoming midterm elections. consumers and investors alike will be watching closely for any si of election manipulation. for "nightly business report" i'm julia boorstin in los angeles. it would not surprise you to know that facebook is a popular holding among fund managers. if you don't own the stock upright you are probably still invested in it in some way. facebook is % ownedy institutional investors, meaning investment adviseut,l funds and pension funds. vanguard, fidelity, black rock,o state streetl advisers are

all top holders of this stock and if you own etfs, facebook is 6% of the qqq which racks the nasdaq 100 index. the technology etf called the xlk had an 8% weighting in facebook shares and vanguard's communication etf and the vox has about a 13% weightingfaf book. so now that the faang names which is the acrym for amazon,en netflix and gond let's take a look at what they're investing in and what's not. john najarian founder of the najarian family office. >> welcome >> good to be here, guys. >> especially on a day like today. ce>> let's start with ok and a terrible day for investors y. how do you look at the stock and what would you do with this? >> last night the told us too much, sue. when the cfo warner got out and said basically that the margins ting and ascontr

you said, operating margins down from 60% two years ago and nearly 60% to 44% now will drop into the 30s and he sai that over the next two years. that's a lot faster and a lot bigger than anybody thought that face book would dip to that kind of operating margin. that's why people were modelin that into their price targets and they took them down anywhere from 20% to 30% today.ou >> soe leaving it? >> yes, this is one i'd leave. wouldn't take it. i think there's still more pain to come, unfortunately, bill. does it retest the 50 level? perhaps. >> amazon, you had less time to analyze because it just came out this evening because the numbers look pretty good. eb>> amazon services, they were doing maybe 40% better than some of the numbers year over year. icey bly dominate virtually every business they go into. they don't kill it, though. people think they're a category

killer. i don't really think they're a killer, but they're certainly someone to be reckoned with and the fact they're getting into drugs now will be bigor them and it was bad for walgreens when they announced that and a number of other drug stocks, but they're not going to take overe ything, but they're going to take a bite out of everything. >> it's just a matter of time before they do the same thing for banks. so this is one that i'd take. >> you're taking it? >> taking amazon at these levels. >> you're not worried about the vaation at all >> i always worry about that valuation, sue. as long as they eep putting up these kind of numbers and the third parties selling thrgh them, that growth is dramatic. .o i still like amazon even at $1800-plus a sha google. you like it, basically. >> i like google. they were able to overcome a $5 billion speed bump like that. so i like that and also,gr thei th in asia and europe is accelerating again, and i think that a positive for them.

? are you felling fang fagna? >> i skipped over. >> speaking of net valuations, people worryut too much a valuation on how much they're spending on content relative to what the stock pri is doing right now? >> just like amazon, i worry about valuations if you're someone based on that, then you'll leave ind i'm a taker, because it's corrected 15% and it didn't give us the samean gu that facebook did so if netflix would have said we're goin to drop and it will continue to contract at least for the next two years, i wouldn't take it, buty since t didn't say that, i think 15% off is a nice sale on netflix. >> very good. the fagna. >> very good. >> thank you guys. >> thank you as always. >> john najarian we appreciate it bill. >> elsewhere, there were more earnings. intel reported strong results beating both earnings and

revenue estimates and the datus centeress came in weaker than expected and that's what investors were focusing on and theyent the shares lower in the initial after-hours trading tonight. >> it is time to take a look at some of today's upgrades and downgrades. norfolk souther was upgraded to hold to sell. that firm cites theottial for operational improvements either by current management or an the price target is $173. the stock rose a fraction to $169.57. 3d systems was downgraded to underweight from neutral at piper jaffray. the analyst there cites intensifying competition. the price target is 10 and the stock fell 6% to $13.17. elf beauty was downgraded t. perf the analyst there cited challenging trends and increasef ta uncertainty. the firm says the small cap stock has become moreuncertain as a result. the stock, though, did rise a

fraction today to $14.17. freeport mcmorran was upgraded to hold from sell at deutsche bank. the analyst cited the stock's valuation right now and the stock's price target now at $15.50 and the shares closed at $15.97. still ahead, airline stocks take off, but will a renewed focus fuel prtues bring some ulence? ♪ ♪ here's something we haven't seen in a while. a rally in the airline stocks. shares of american, southwest and alaska air all moved higher on better-than-expected second-quarter earnings. phil lebeau explains why from american airlines' operation center in rt worth, texas. ♪ ♪ for all of the hand wringing

by investors worried about airlines flying into lower profit, the feality is different. alaska airlines, southwest and american airlines a posted better than expected earnings in the second qrter. >> demand is strong and the supply of seats is up a lotr the consume seems really quite rong. >> the airline continues to see demand and thanks in large part to the strong economy and that means there are few empty seats even as the industry adds more flies. still, this haseen a turbulent year for airline stocks. why? investors worry the additional flights will make it tough for the indtry to raise fares which would limit revenue grow the, but the biggest concern is the risin cost of jet fuel, up more than 40% in the lastd year an while that has cut intoe airl profit, industry leaders are making adjustments in fuel contracts and are prepared to fly with higher prices. >> in the end, we don't know. we just try to be ass prepared we can for catastrophic increases and we certainly got

that kind ofte pion in place. >> the focus on higher fuel prices is nothing new in the in airline stry, but for now, the impact of those higher costs are bng offset byol ticket sales and planes that have few empty seats. phil lebeau, nightly business report, fort worth, texas. >> mcdonald's reports sales growth in the u.s. and that's where we begin tonight's market focus mestic same-store sales grew at their slowest pace in more th a year, as a matter of fact, missing analyst expectations and foreign markets ad a strong performance and those results helped to offset the weakness in the u.s. overal the fast food giant's earnings and revenue came in a targets and shares were off 2% at $156.14. a starbucks sai increase in new customers who spent more helped earnings ris above expectations. the coffee chain also said it added nearly 2 millionembers to its loyalty program.ti

shares ily fell after hours and did rise in the end of the session down at $51.45. dunkin brand earnings rose at a faster than expected with higher prices and franchise fees and royalty incom and the incoming ceo said its earlier decision to come back oner a numbf products on its menu has proved to be the right move er growth. >>ntroduced the national value platform in the second quarter and that was a big part of our results in q2, but we also had some of the highest beverage sales onecord in q2, as well. we get the combination with the beverages played well and for us, we continue to modurnize and keeprand relevant for years to come and the growth is all about thatnd >> dunkin b shares were up a aiaction to 71.19. comcast that increased marketing for its internet services paid off as the company signed up more customers, from

fits rose and top d expectations, but revenue, while higher did come in a little light. shares fished up 4% to $34.75 and remember, comcast is the parent cpany ofcnbc which produc this program. > underarmour said increased investments in direct to consumer andnternational business caused its loss to widen, but it appears as though invest may be paying off. sales in foreign markets took off this quarter, helping the athletic apparel company beat expectations. the shares rose more than 4.5% to $22.04. hersheys topped expectations, but rising shipping andgr ient costs pressured its margins. the makers of reese's peanut buttercups and kit kats is responding by hiking prices on a number of its products. the company is raising its % dividend and launching a $500 million share buheack. he shares climbed more than 7% to $99.66. and after the bell, amgen

said strong sales of the new rug helped earnings beat estimates and the company is raising its full-year guidance. reuters reported that amgen is facing roadblocks as it tries to ort its $575 migraine treatment on the market b the competition ramps up. shares were initially higher in the extended session and they ended the regular day up a fraction to $194.05. >> treasury secretary steve mnuchin said today that the trade deal being discussed between the u.s and the european union will come in stages. during a i cnbcerview he said yesterday's talks with the european commission president is the staing point for resolving a lot of trade issues with the goal of eventually eliminating all tariffs. >> the first issue that will immeately begin negotiating is to resolve the issue on the retaliatory tariffs and phase one is to immediately resosve issues so there will be no

tariffs in either direction. president trump has said that as ng as we're negotiating the overall agreement that there will be no newarfs in either direction. t> secretary mnuchin was tight-lipped abode relations with china, but he did say that the treasury is closely monitoring the recent t weakeni chinese currency. >> on capitol hill, the u.s. trade representive told lawmakers that he's hopeful a new nafta deal can be reached soon. >> hopefully, we are in the finishing stages of achieving an agrencent in ple that will benefit america's workers, farmers, ranchersnd businesses. >> separately, mexico's economy er who was scheduled to meet with the u.s. trade representative today said hisgo is to speed up talks with both the u.s. and canada. on the economy, orders for durable goods ros for the first time in three months driven by a pickup in business investment. that's the good news. the bad news is the rise was well belowxpectations in part because of a sharp decline in

defense oers which posted its biggest decline since march. >> tomorrow, the commerce department will release its first official estimatese of nd quarter gross domestic product which is a broad measure of goods and services produced across the country and as steve liesman reports, expectations are high. >> it's the one economic number that everyone is talking about. second-quarter growth which could be as strong as 4% or 5%. >> think most people understand what president trump is doing and what we're doing is good for thehi economy. i as you know, we're looking forward to a very strong gdp number and we have real growt earlier this week the president tweeted out in perhaps a veiled reference to the coming gdp report and we have the best financial numbers on the planet, end quote. >> the median of 12 economists surveyed byo cnbc see gross domestic product for the second quarter coming up at 4.1% which would be the strongest quarterly number since 2014.

for the administration, it's nothing less than proof for the deregulatory economic policies are working and the economists also say there are temporarys factn the numbers including a surge in government spending. >> the quarterly numbers are pretolatile and we juiced the economy with fiscal policy and the underlying been moderate and built in some fiscal oomph on o top that and you've got some real momentum here. >> there could be some addition trade and inventory building in the number as businesses bought and stocked goods ahead of coming tariff, but that won't explain all of the trends and consumer spending could also be stronger likely driven by tax cuts. >> it is not all driven by exports and there could be solid,lying growth here that can't be explained by one-off factors like exports o inventories and some of this is the tax cut. some of this ithe increasen discretionary spending and some

of this is an underlying economy that's quite healthy at this point. >> only the actual data over time would continue to believe whether the high growth is permanent or just a temporary talking point. for "nightly business report," i'm steve liesman. >> coming up, kids and money, why it's nevar too to start saving for retirement. here's a look at what to watch for tomorrow. the oil exgiants, annmobil and chevron are out with their earnings and we'll also hear from the blue chip company merck. 21st century fox and disney hped aal shareholders meeting to vote on the merger between disney and the fox assets, a as we just mentioned, we'll get

the first readn second quarter onomic growth. that's what's to watch for on friday. >> that's good.we hould do that more often. >> some kids are getting a head start on saving for retirement by contributing to an account designed just f them. fidelity says the growth of its roth ira program is up ang whoppi 475% since the product was announced in 2016. laura cassidy is the vice president of retirement of fiddlity and joins us to talk about that. thank you for joining us tonight. >> thank you for having me. >> i am 21 and i am opening it for a person und the age of 18 and they have to provide their own earned incwhe. a roth ira? i'm curious. >> well, one of the great benefits of a roth is that you can withdraw the contributions at any tim s tax-frce they went in after tax. so for a lot of people,ou know, putting money away in a roth seems at age 15, it seems

like retirement is so far away they can u it for, you know, qualified educational expenses or their first-time p hochase and you know, in later years, but it's a great way to gethat habit going of saving for retirement and putting some of your ened income away. >> you say it's really a teachi moment and tha the parent can contribute, certainly, but it's the time that you should takeour child and teach them about compounding and really a life lesson in money. >> right. exactly. it's a great opportunity, say, you know, talk about how much should you earn this week. how much should you putway for savings and how it can grow. that's exactly right. >> it occurred to me when i heard about this. you started this two y ars. what took so long? i know you did it because of the demand you were getting from some of your customers, but iras ha been around for a long time. >> right. it is something that our

customers had been asking for. we hadn't had an account for retirement for people under age 18, and so we had to get over a cof hurdles and once we launched over those hurdles we saw the pent-up groh that we've experienced over these two years and it's been great. >> yeah. what kind ofncases have you seen? >> well, leak you said, triple digits. over 400%. it's amazing. this year alone, we've seen over 30% in new accounts opened just in this year, january through june. so you know, that's great growth, and we're going into the time of year in the summer where maybe a lot of kids have a summer job and we expect a little bump from that. >> that's a lot of lemonade stands that they'll be opening there. >> laura cassidy. thanks for joining us tight. >> appreciate it. >> thank you for having me. before we go, let's take a look at the final day on wall street. the dow rose 1 points to

25,527 and the nasdaq dropped 80 dragged down by the historic drop in facebook, and also the ip, andwas down about eight. facebook shares, as we ne ment had their worst day ever after reporting that disappointing quarter and guidance. that does it for us tonight. i'm sue herera. thanks for joining us. >> i'm bill griffith. have a great evening. see you tomorrow.

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