on the other side, some are announcing capex reductions. we're going to look at undrum, >> this election, kamala harris is dominating the social media front. we'll discuss further ahead. >>> first, a check on the markets overall, the dow sliding more than 300 points at this stage. they're bracing for jay powell's speech. >> peleton takes ahold of 36% to around 450 a share. advance auto parts down 15%, snowflake down 13% as well after their results. we'll trade those stories shortly. >>> and how pfizer and moderna are doing. the fda is approved an update for covid vaccines as the virus surges. right now shares down 4.5%. >>> now worries around the consumer that are controlling to surge. we saw the sales struggles. williams sonoma following suit. clothing retailer holding up slightly better. signs of softening are stim there, but market signals are still relatively bullish. more than 90% of the stocks and s&p broke their ten-day moving averages this week, so shorter term, things are looking okay. joining is our guest along with mike santoli.

you have the capex players, you have names like service now and others. as the godfather of ai speaks tonight, this is the final piece that shows that this ai party we've talked about, it's 9:00 p.m. and it goes until 4:00 a.m. >> speaking of ai, kate rooney has some news for us regarding openai. >> a source telling me that openai is raising another round of funding. this is going to be led by thrive capital. it puts the ai startup's valuation at roughly $100 billion, according to the source, openai and thrive did decline to comment. a source close to the matter telling me that tri-valley is go -- thrive is putting in $1 billion. they're saying that microsoft is also expected to put in some additional funding. this would be the biggest round, scott, since openai and microsoft and that deal back in january of 2023. microsoft invested around $10 billion. there's been an arms race in terms of spending. it's expensive to run one of these models. they are building a war chest. $100 billion is a massive number, puts it near the likes of stripe, spacex, some of

you have seen capex go up at google. you have seen capex go up at microsoft.ou are seeing capex go up at meta. all of the company seem to be implying that there is no end in sight, at least through 2025, and that should be good for nvidia. if we actually look at the other data points in the industry, amd just reported, and the numbers were fine. but it is really just a really small fraction of the amount of the ai related chips that nvidia is selling, and nvidia is embarking on its most significant ever with blackwell. ed: if i ask you about that specific point, i have discussed the annual cadence of new product refresh. the bit that is concerning or hard to understand is, what about all those companies, hyper scaler but also others, that invested in the h 100 generation and may have just got past the yellow line. suddenly, they have the option of whether they buy the next cutting edge generation of ship upgrade. i think we have talked about the ability to swap out the generational gpu quite easily. it is hard to fathom, really. denny: what is really interesti

ai and capex a lot of oxygen on the earnings call after spending $30.5 billion when it comes to capexigher in the second half of the year. the majority of that spending to support the growth needed for aws infrastructure and then ai. which executives say reflects strong demand. guys, back to you. >> it would be interesting to see the quarter and response if it hadn't been for the re-acceleration in aws. kate rooney. >> after the break, "squawk on the street" heads live to the olympics in paris. andrew ross sorkin with what's ahead. >> hey, carl. according to andy jassy, the olympics such a distraction impacting their business. when we come back we're going to talk about a different business ahead. that is the nba. we talked to adam silver about the big media deal in part with amazon. our parent company as well. and espn owned by disney, we'll show you some of that right after this. (office chatter) is it me...or is work not working? at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work? can ai help your people wo

capex is going to be, what, 37 to $40 billion. mean, operating expense is obviously going to go up as well. >> now -- >> revenues are just going to keep accelerating? >> if i were -- now i know why alphabet's afraid. he's outspending alphabet. he's outspending everybody. obviously, that meeting -- >> he's not outspending microsoft. >> we don't know because microsoft has a lot of different moving parts, but for this specific notion of advertising, he is coming up with a solution that i think is going to drive a lot of traffic. and david, one of the things that's happened, i know you're going to love this because you're just going to laugh at me. this is the carrie situation with john travolta again. ray-ban meta glasses continue to be a bigger hit sooner than what we expected. what'd i tell you? >> you did. you're still losing, what, $4.5 billion on reality labs? is that right? >> $4.5 billion in reality lab losses, and those are going to extend, according to last night's call. >> yeah, but -- >> at the same time, jim, operating ma

the other one is the capex numbers keep rising.three companies, amazon, google, and meta, i think we raised our capex number something like 15% for next year or $20 billion, like the three of them are spending $160 billion in capex. are we really going to see an roai, return on that a.i. capex? i think the best example of that is meta. meta turned around its business the last two years, in part, and in significant part, because of a.i. deployments, and especially if you're a content company. i think the market's completely missed this point. content companies can be dramatic beneficiaries of a.i. if they deploy it well, and meta's deployed it fantastically, and i think google is doing that now too. so, i know that's a debate in the market. i'm going to take the other side on this. i think a year from now, we're going to look back on this and say, wow, they really did get a great return on that a.i. capex spend and until the market realizes that, it makes longs out of these stocks. >> there will be a bit of a vacuum in terms of that

, google, amazon, and meta, we all saw them raise their capex. the question is, whether they confirm this next iteration of these gpus, this blackwell chip, if it is going to be delayed and for how long? and then they can talk about the customer migration to these -- you know, so, to me, that's really the risk. like, the guy didance and what people are expecting in the back half of this year. because year over year, you're seeing massive deceleration in earnings. it's still up a lot year over year, but it's the decel -- >> couldn't the decel in capex in a.i. be positive for them, though? and negative for nvidia? in other words, at some point, we were starting to push around meta, we were starting to push around google when we started to hear the capex numbers. they're a bigger part of the waiting. i wonder. and i wonder if an nvidia failure, the other side of that, back to a lot of those stocks that are in the dow, but is rotation a good thing or a bad thing? nvidia's failure, does that lead to rotation and is that positive? was that happening an

spending and capex. first on a.i. spending, telling me, quote, what we've done is we've redeployed a lot of people onto a.i. that were working on other things. so, basically, shifting some talent around. you might remember earlier this year, apple canceled its car project and moved a lot of that talent over to artificial intelligence, among other things. and then on capital expenditures, cook saying, this is an increase year on year on the amount we're spending for a.i. and apple intelligence, and also kind of playing into this a.i. narrative is what the rollout looks like. so, apple intelligence is launching this fall, but it's only going to be in u.s. english at first. apple has already said it's not going to launch in the european union any time soon because of regulatory concerns. but more important market is china, and china has even stricter regulations around art official intelligence. cook said, we're working on exactly what we will do there, and there are definitely regulatory questions there that we have to

i think people are wondering about intel's capex cut and what that may mean. i think everybody who reported so far already incorporated it i actually had to take my intel capex numbers up this year rather than down they were apparently targeting a capex this year that was quite a bit higher than i was expecting them to target those are the things that people will be watching for but in general, everybody else has reported, the general environment in semi cap or at least in the near to medium term seems fine. >> i don't think sentiment around intel could necessarily be any worse than it seems to be now. since you mentioned that name. i mean, you, somewhat reluctantly, upgraded it, i don't know, a year ago or something like that. >> it was a year, year and a half ago, something like that. >> and i say reluctantly because i think you admitted as much. >> oh, yeah. >> it was less awful in your mind what about now, though you still have that same rating on it, market perform with 25 buck target. how do you see it here >> to be fair, i don't know what the heck to do

spend big on capex, and that tends to be a win for nvidia. ai is booming on the capex side, investment and infrastructure aside, but the bears are saying how is that turning into practical use on the market? that has created a big golf. carolyn: is it, if you are going to buy the volatility we have seen as of late, buying into the lower price points, you do it with what has already won, the nvidias, not those working on software. daniel: i like to talk about this ingestion period happening with ai. it will not happen over the next quarter or two where ai will be implemented into every enterprise. we saw palantir it had a great quarter. service now had some resilient results against some of the people betting against the software. we are also waiting to see strength from companies like sap, oracle. ibm looked ok. these are the company doing the implementations of ai. if you are looking at this predictable big spend going on, all the mega tech companies are saying we don't want to be the blackberry of the ai era. we are going to spend in advanc

you're able to play offense, but you're also playing defense because of the balance sheet, the capex, the buybacks, in some cases even talking dividends like we were not before? >> big picture, i do think it's elements of sword and shield. 18% will feel relatively anticlimactic, but well above the 499. the biggest and best balance sheets in the world, like i said, they're generating an immense amount of capital. they're returning that in the form of buybacks and dividends and reinvesting that on a level no other company can touch. >> do you believe in the broadening story more substantially that it has sustainability, and does that maybe hinge more than anything on what powell says later this week? >> in a way, i think it's already taken shape. i looked at this before we came on. there's 11 headline sectors of the market. all 11 are positive year to date. the laggard is real estate, that's still up 5%. the market has been brioader thn sometimes people give it credit for. is it top heavy? of course it is, because mega tech has earned that top heaviness, but it's been decently brought.

these companies have more cash to deploy on the capex so he takes that is assigned the companies will spend even more on ai and that will benefit nvidia. whether or not we see that in the results next week is the big question but like you said the stakes are very high especially after tsmc earnings were good paid everyone's watching for nvidia to see if they can keep up with that. >> we've seen how basically bullish the market was and a few concerns within the market beginning of august we saw significant selloff and we've seen that since july. what do flows tell you in terms of people's appetite to get into a company with such a high market cap. emily: people are buying the dip. is it finally time to pivot out of big tech but we are seeing people the rotation to small caps that's really not a theme anymore. investors have this appetite to hide out in big tech amid concerns the economy is slowing. qld, this is an etf that goes to ask -- 2x qqq taking inflows nearly every day for the last two weeks and in the last session it took about $250 million in which is the biggest flow since ap

from a capex standpoint -- >> before we go to capex, are you going to be raising your guidance as a resulte going through the plan process now so all the organizations that we build the bottom up corporate plan and review that with the board in october. and early december we're going to review the corporate plan with the street and we're going to have a spotlight in the up stream. we'll update both the synergy outlook for that transaction and more broadly what we plan to do with the corporation to continue this growth trajectory that we have been on. that will be early in december. >> okay. >> back to capex, we put out a range, we expected at the back end of last year for the exxon side of the equation to be between 23 and $25 billion. with pioneer coming in for what is left in the year, we expect to be another $3 billion. so we'll be at the top end of the exxon -- of our forecasted range last year, $25 billion with 3 on top of that. expect to get through the year with about $28 billion of capital expenditures. >> i guess my question would be is if the synergies are working better than ant

we talked about this a ceo survey s showed a third of ceos are either cutting back or cancellation capexup to election, just awaiting the outcome to determine remember whether they want to pursue capex or not, that is number one, number two is, obviously, the, wild markets view that as enormous positive history suggests exactly the opposite as we all know usually where fed starts to cut, that you sell off, and while narrative has been this time better shape economy fine not having a recession all indicators right now actually look worse than when fed was about to cut rates in september of 2007, credit card delinquencies chapter 11 filings, core consumer sending et cetera, that is another issue that fed marketsing grapple with, finally, no one is talking about this brics meeting in pb russia, the end of october, but widely expected they will announces real progress, in developing a currency for trading amongst themselves that avoid the u.s. dollar, that process has been underway for years but they accelerating recently ramping up purchases of gold ramping down purchases u.s. treasurys so

but when we start to see those capex guidances trail off, suspend from the actual customer guide start to come in a little bit, that's how ow you know that the pricing is going on. so given the fact that all capex increases were significant last quarter and that's the main theme from big tech earnings, we don't think that's a big discourse event, but wher it is, we're talking down 20% or more for the stock, and i don't think that it's too many quarters away. we don't think it's this quarter, but i wouldn't be surprised to see it happen within the next maybe two or three-quarters. >> josh, just before we let you go, you spoke about the competition land skaup. which of these businesses stands to benefit the most if we continue to see nvidia perhaps stumble on this blackwell chip rollout or if we see earnings kiss appoint today or money moving within the sector? >> for sure. it's amd hands down. when you think about it, arm is more of a play. it's kind of still a relic of that meteoric rise that it had earlier in the year and hasn't really come down from. you know, micron is kind of more

because financing that capex suddenly becomes cheaper? >> yeah.s&p hit its peak. the s&p is down about 1% from there. the magnificent seven are down 8%. but the equal weighted s&p is up, too. so we've been saying this for a while. in terms what we're looking at, to invest, it's the areas that benefit from rate cuts. so it's areas like consumer staples, utilities, telecom services. other sectors of the market, because it's that other 493 stocks, our belief, that drives this market to new all-time record highs, and we still, don't get me wrong. we like apple, we like meta. we see revenues there doing well. they had before revenue estimates go up, but you have to look outside of just seven stocks through the rest of this year, because rates going down will benefit a lot of other sectors in this market, just like you brought up. >> working with about 70% of the s&p market cap, i guess. talking about the 493. trying to drive the index to new highs. i guess, dan, for that to happen you must assume the economy's going to hang together pretty well and the

to me the capex investment hasn't stopped, and it's going to to accelerate into next year. >> forgive me. i've got to leave it there. i do have breaking news i need to get to. we'll talk to you soon. >>> to alex sherman as we're getting some news out of the nfl regarding the imminent vote on private equity investing here. this is a juicy detail you've reported on. can you tell us what you know? >> part of the vote, i'm told -- remember, the nfl has never allowed private equity ownership before. they're really setting the rules. one of the terms would be to take a percentage of the so-called carry, that's the profits that a private equity firm makes when they have a transaction and sell an ownership stake for its own return. the nfl wants a piece of that. we don't know exactly the percentage of the carry that the nfl would like, but no other league does this as an across-the-board rule as you'll remember the major league baseball, nba, nhl, all allow up to a 30% ownership stake. the nfl for the first time now considering up to a 10% ownership stake in addition to the smaller ownership

>> actually capex goes down. i think they curtail the growth. that's where most of capex is. even if they do spend on tech, incr incrementally on technology, i think they're going to curtail unit growth for the next year to try to essentially lower cannibalization and bump up that sales growth. >> all right. nick, thank you for joining us. appreciate it. >> thanks for having me. >> nick setyan. easy comps. that's a good point, because the ceo was there for a year or so. >> listen, you makes very good points. i admire him for not sort of being with the rest of the crowd. >> herd. >> the herd. i think the headwins -- they are not abated at all. it's still challenged. he will figure it out. it will take time. and, you know, if you do see, you know, if the market has another downturn, starbucks is not going to be insulated from that, so, i think this is a level where if you've enjoyed this ride, like try yan did. >> we thought it would be an interesting exercise to see which other companies could benefit from some activist pressure. maybe a ceo change. dan, what is your pick? >>

. >> they showed flexibility on capex. >> they've -- they never listen to anybody. >> elliott, as youight imagine, given their $2.5 billion stake we told you about a couple months ago now, is certainly saying, hey, see, maybe we did have an impact. >> they should be saying that, because texas instruments is insular. they take nobody -- nobody's advice, and then suddenly, that's what -- >> they have a history of doing that. >> this was very much what elliott wanted. >> so, yes, i think that from elliott's point of view and some an a analysts as well, the fact that they have this call and reduced their capex intensity forecasts, offered free cash flow guidance, guardrails in terms of what ththey really are aiming for is seen as a diversion for them from their previous practices to a certain extent, so perhaps in some way at least establishing kumbaya with their large shareholder. >> leslie picker is doing a piece on elliott, and i think the big issue here is, where are they effective? where have -- it doesn't matter. for instance, the travel trust, if you want to pick on me, constellati

scott: capex will be up and likely higher than expectations.hat's going to be a theme that really stays around for some time. has been an investor what you want to see his health in the core businesses and this mapping of how each individual company is going to address the ai opportunity. in the case of amazon what you will see is strength in the retail business, strengthen the advertising business and improvement in aws with increased spending. how that is received my expectation is will be positively received because amazon is finally clicking on all cylinders after transition post-pandemic. jonathan: operational efficiency was a phrase used by mark zuckerberg at a time with all this money on investment. can you speak to how much wiggle room they have on cost? how efficient and disciplined that company is. scott: they cut a lot in that post-pandemic year of 2022 everyone became more efficient. on the digestion of the building from the pandemic. i think meta has more to cut. ai itself brings the ability to manage costs more efficient because t

the penalty that alphabet received for capex spending and somewhat weaker margins in the next quarterit is often what happens when valuations get a little bit lofty. and then every bit of news, every bit of headline news drives the market because algorithms are reading the headlines, the hedge funds are trading off the headlines, so you get these big outsized moves. if you put it in the perspective of the 40 plus years i have been, doing it historically this has been a time -- i have been doing it, historically this is a time where you want to build a list of names you own and as the markets settle in, vix comes down a little bit, this is an opportunity. the last thing i will say about this is the one economic number that has been little discussed and gone unnoticed was the improvement in productivity in q2. came in much harder than expected, up 2.3%. the previous quarter was revised up also. and i think productivity is going to be the keym the magic bulle -- key, the magic bullet, whatever you want to call it for economic growth in a lower inflationary environment. ed: take what you

in the first half of 2024 the capex was $30.5 billion. they are guiding even higher for the second half of the year. just to put it in comparison there for last year was only $40.8 billion, so that is a significant increase. like all of the other big tech companies they are selling their story of strong ai growth. they would like to have more capacity than they already have today, and they are claiming that they are seeing strong signals of high future demand. i guess also if you are in the ai race it is impossible for you to stop investing, because you would be obsolete with no means to catch up. but to investors it is really required, a lot of impatience. everyone is telling the same story, so it is hard to say whether in the short term whose investment will play off -- pay off in the long run. ed: just focused on a ws, we have hardly espoused the retail business or advertising. you see anything in those segments that interested you? helena: pray ws, it has been selling nicely, so what we especially like about aws is their high operatin

the issue, it's always trying to think about 2025, even 2026, as you say, the biggest driver is the capex the cloud producers. and that looks like it's an on upward trajectory. one thing i would always caution, you start, you always see periods of digestion by the big cloud providers. we haven't seen that yet. that may be in the cards for 2026. that's something that people worry about, i also think energy constraints is something that people look for. and supply chain looks to be ramping well. those are things to watch for. fundamentally, what jensen was talking about last night was the strong for the hopper product and the blackwell product. so both continues to be strong. but as you say, this company is priced for strong growth and maybe we're getting to good growth, not great growth. >> ben, that's what i wanted to ask you about, you say nvidia is priced for strong growth. talk to me about current valuations. how sustained is this? we're seeing investors selling the stock on positive news near. at the same time, nvidia makes up about 7% of the s&p 500. so, does it deserve this type of

spend, capex spend, concerns about that. you're seeing a massive rotation into more speculative from a credit quality standpoint in the market. perhaps you would argue that was a trade down. you had to think the economy was still chugging along at a decent clip if you were willing to take the inherent risk that comes from investing in those type of companies. the reversal to me suggests that narrative is now being called into question. >> you know, we always hear, don't fight the fed. since wednesday, i guess it's only 48 hours ago, don't fight the fed. boy, they're really fighting the fed. i would think that -- i think monday we probably sell off again and i would look to be buying things on tuesday. i understand the a.i. story and is that overhyped. okay, i get that. then you have a lot of other companies that the valuations are come in a lot. they have great balance sheets. so, to me, i think the back drop of fed cutting is not bad. could things go down more? yes, of course. i also think that this -- the magnitude of this

but the capex cycle continues to be incredibly strong.obody cut their numbers whatsoever or even spoke in any way towards the idea that they weren't going to spend whatever was necessary. >> i know you pay fierce attention to the capex guidance that we've got in recent weeks. >> i do. i'm trying to just understand the entire ecosystem at this point, and from what i can tell, nothing is giving, so to speak. >> joining us this morning here onset, we have torsen slok and michael. good to see you guys, happy friday. t, you have been so constructive on the economy at large. you put out notes every week, arguing the economy, in your words, is just fine. >> well, as david was just saying, the guidance in terms of capex is still quite strong. the magnificent seven, their investment in capex has been very strong so on the firm side, businesses are still spending. the a.i. tailwind is very strong. on the consumer side, there are issues where it comes to consumers that are highly indebted and impacted by high interest rates but across the board, the

this is a start of a massive -- we have a trillion dollars of capex over the coming years, and i'm notoing to be -- there's going to be some speed bumps on the way in tech, but i believe this tech bull market is well under way despite, obviously, some of the macro worries we've seen over the last week and that's how we're handling investors through it. >> all right. continue those checks, but make sure to get sleep. it's getting late over there. >> thank you. >> the yen at 148, by is stronger but still pretty waek. >> doing some shopping if you will. >> because they can't adjust the prices fast enough for the designer goodsp tourists are flooding. the weakest was 161. it's down to 148. if you went in the past few years, you're used to more like 100 or less than that. still ahead, wells fargo's head of equity strategy with his volatility playbook arguing it's time to buy stocks but not the market. we'll find out what that means next. do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. call coventry di

that meant no company did capex in the face of that.ntory and raised a lot of cash. i think businesses prevented us from having a recession because they got cautious. i think that's why when the fed starts to cut, there is going to be a positive impulse because, one, there's pent up capital spending. companies aren't over leveraged. there are going to be ipos. you talked about the dearth of it, that should come back. as you cut rates that's going to stimulate the consumer. >> tom, real quick, you mentioned the market multiple the s&p i should say at 17. are you expecting $330 of s&p earnings? because that's what that implies >> well, that's the median p/e, david. so when i look at median, i'm taking the 250th stock in the s&p and that's at 17 times. i think in aggregate the multiple is higher because the mag seven have a higher p/e. the median is a better way to look at market composition. i'm comparing that to the russell 2000 median, you know, the 1,000 stock in the russell. >> i see. wanted to make sure i understood that. where are y

how much capex do you need? know, the capex actually makes a lot of sense to me because the demand that they are seeing and the pull that they are seeing is significant. if you look at individual kind of ideas of how and how productivity will improve because of ai, there are so many different examples. we just talked to a pharma company who saved $70 million because they started to use chatgpt to help them formulate kind of the packaging that plastics were in. that's an almost infinite roi for them. we think they're very early on and we have to remember chatgpt kind of exploded on to the scene less than two years ago. and it's already on pace to make significant changes to productivity. >> right. >> i don't know. i think there's like a much worry about nothing. in part because i don't think people believe the productivity increases, but we do. >> it may be time to see that. these stocks had an enormous run until recently and the p/e ratios now differ somewhat. i note you have them all in your portfolio, so are y

i was talking to an energy provider who said his capex is up 40% over the last five years and what doest's -- so the hyper scalers is the one that's actually buying this technology and doing liquid cooling, but the liquid cooling companies tend to work with account chip muchers. it is a higher up front capex cost but does reduce your costs over the longer term because it does lower your energy consumption and if you don't keep your chips cool enough some have monitoring devices and if they get too hot the warranty is voided. with your equipment you don't want it to be malfunctioning. >> and direct to chip cooling seems to be pulling ahead these days. thank you. >>> sticking with the ai theme news on openai, and its efforts to attract investment. kate rooney is in san francisco. >> this is the latest in openai's funding round. the "financial times" reporting openai is in talks to change its corporate structure to become what they're describing as more investor friendly. it comes as the company is in the middle of this multibillion dollar fund raise. a source telling me openai's valuation

but there is also the point that our expansions, more than 30,000 in denmark, huge capex investment,e are fueling the gdp growth and we take that quite seriously, so the jobs we create i don't think will disappear again. and now we talk about expanding in the u.s. it doesn't, as the same as moving. it's the same in the u.s. we would be careful and respectful in how we grow, so we could do that in a sustainable way. francine: that's increasing supply with new factories. lars: we have made huge investment decisions and these are the billion dollar commitments per year and it takes four or five years to build some of these facilities and we started already years back so we have more and more lines kicking in on a ongoing basis, but some are -- francine: are you also looking for acquisitions? lars: yes, most products came from our in-house which is a bit unusual. we expect to carry on with that but we can see we can complement that. typically it would be early-stage where they have great signs. we have -- so we can express the sign in a better way than they could do on their own. so it m

and given like i said the capex cuts and on-equities, -- op-ex. they're burning cash. margins are horrible. the revenue lower. it's not a good situation. >> so go more into that, stacy. when you say it's not good, how bad is their business? >> it's bad. so look i mean the quarter itself, the revenue you could argue was okay. the margins were awful. right. they're ramping up their chips for ai pcs and the cost structure is bad. margins are bad. that gets worse as we go forward. next year margins don't look great. back half revenues are worse. some of that is inventory drain. there's too much inventory on pc chips in the channel. we've been highlighting that. i monitor that fairly religiously. we publish on it every quarter and convinced we're swimming in cpu inventory. they overship in q4 and q1. data center side losing share to amd, doesn't look so good. their other markets, mobileeye reported, we don't cover mobileeye, but they cut their guidance massively and that goes to their revenue. it's just not good in the context of the broader macro and the share situations.

what are his expectations in terms of that hyper scaler capex continuing?re's a bet on sovereign. i want to understand the customer base that nvidia has and how sustainable growth is across their customer base. jonathan: this was awesome as always. mandeep singh of bloomberg intelligence. the earnings day moves had a move last time. 16% move the quarter before that. lisa: especially when you consider market caps. it's always been swing up. he would how much that is a market driver versus a market crusher when it comes to the idea that there could be a broadening out when you have the behemoths driving the train. jonathan: the stock is up .4% in the premarket. stories elsewhere. yahaira: the two richest people in china sought more than $16 billion wiped out after record-breaking stock selloffs. the founder of beverage company lost 3 billion companies -- $3 billion as shares fellow record 10% yesterday. colin wang's wealth tumbled by $14 billion as a shares fell the most in company history. pdd is the owner of the popular shopping app timu. it signaledconvinc

adding we've already targeted $200 million of capex reductions in fiscal 2025.evenues in line. you can see the stock higher by 10% on those headlines, less bee. >> thank you, kate. meantime, american express falling over 2.5%. analysts moving the stock to neutral, citing commentary from retailers and travel companies that suggest a, quote, challenging spending backdrop for even the high end consumer. guy, this was on your radar on our call this afternoon. >> i think it should be on everybody's radar. they don't report until, i want to say, middle of october-ish, okay? so, this seemingly came out of nowhere. however, i think it came out of all the earnings calls that we've been talking about. i think they're starting to connect the dots. price target from the b of a analyst is still higher than the price now. with that said, people are concerned about american express, with some of the credit potential risk out there, some of thehearing from the consumers and these retailers. this is one that we'll come back, remember that day in august, there was a downgrade of

could be an environment you want to buy traditional capex rather than just a.i. capex.th side wonky. think about it. fed is about to cut rates at the short end, we think. and that means cash yields drop. where has all of this retiring money gone over the last couple of years into cash and short duration bonds, and retirees are looking for investments to live off of. they need a real rate of return that is healthy. i think dividend yielding stocks offer that real rate of return that is much more attractive than even ten-year bonds at this point. >> curriculums that pay dividends. >> match up, a nice intersection of dividend growth, industrials, financials, energy. these are some of the spots we're finding these companies, but i think a lot to look at in the s&p. maybe not the darlings that worked so far this year but other areas that start to outperform. >> thank you. great to see you. andrew? >> thank you. >> thanks. >>> coming up, interviews on two of the magnificent seven companies set to report earnings after the bell tonight. apple and amazon. speak with analysts of

, there's also the point that with our expansions, our more than 30,000 employees in denmark, huge capexnvestment, we are fueling the gdp growth. and, you know, we take that quite seriously. so, the jobs we create i don't think will disappear again. and, now we talk about expanding in the u.s. it does not come in the shape or form of moving activities from denmark to the u.s. it is growth in the u.s., so we will be careful and respectful in how we grow, so we can do that in a sustainable way. francine: and that's also increasing supply with new factories? lars: yeah. we have made huge investment decisions, and these are, you know, billion-dollar commitments per year. and it takes four or five years to build some of these facilities. and we luckily started already, years back. so, we have more and more lines kicking in on an ongoing basis, but some of them will also be kicking in in the future. francine: are you also looking for acquisitions? lars: yes, we are. we are in the unique situation that most of the products we have came from our in-house r&d efforts, which is a bit unusual compa

you saw what the capex numbers were, remarkable, year on year for all of these companies. in large part it was justified even though the market took issue with certain reports and the amount of money they're spending. >> listen, unlike ron, warren buffet did e-mail, and he enjoyed the movie this weekend. besides that did not tell me anything about apple. to broaden that part of the conversation, we don't know what he's holding and why et cetera. we know to steph's point the stocks have had a terrific run over the last couple months, they're all up at not nose bleed valuations but fairly expensive and there are broader concerns and maybe he just wanted to lighten up because they've had a terrific run. for the average investor watching the show if anything it's corroboration and we don't know why, but corroboration that the stocks haven't had a terrific run and the single best investor of all time has chosen to lighten his load. >> what happened to the great rotation trade, money supposed to come out of the mega cap names and go into the eatons and all of these other stocks

are they going to a that capex spending? is it kind of a war of sorts?hat are they going to do to stay ahead of that competition with the lead that they already had? >> indicated nvidia it is about a product architecture and maintaining that lead. they already compressed the two-year cycle time to one year and they have been really under shipping demand, that is what we've can see in the data. but from a hyper scaler perspective, they have to show it in their cloud revenue, and for everyone else was investing in these chips, they want the are alive. there have been questions about when the roi will come, but the use are becoming stronger and figure by the day. i think it is just a matter of maintaining medicaid's where you continue to show a recurring revenue stream like the hyper scalars have done, but from a chip perspective, the only thing they need is the next chip to be bigger and better and to command a higher price than they were commending before. >> it's interesting the implied moves, and you can find this by going to the nvidia ticker on the te

percentage of overall hardware capex spend nvidia is consuming in this segment.peak of mainframes and cisco at peak of the networking booming. at some point you wonder if the whole market fills out and diversifies? >> i remember covering apple 15, 20 years ago. more like 15, maybe, on the way up. thinking, how many -- how many ipods would they have to sell to justify -- it's like, an impossible number of ipods. it wasn't an impossible number. didn't see the iphone coming. you have to look at what this enables people to do. speaking of -- it's late august, which means were she a birthday. >> thought it was your birthday. it's not. >> it is not my birthday. well, you know, back in 2020, joe kernen was, i'm sure, hoping for for more years and we got it. fourth birthday of "on the other hand." >> congratulations. >> thank you. yeah. it's not the fourth birthday yet. still new. the "on the other hand" newsletter. just over a year old. give you the qr code on the screen. there it is. or type in cnbc.com/otoh for the full text of both of these arguments. >> it's like a

monetization, and if the economy is slowing, these companies are going to have to slow down their capex pretty soon. >> back to the economy slowing, though, that narrative is fueled by that jobs report, right? these are all -- >> isn't that what the fed wanted? isn't that -- >> sure, yeah. >> when we think of the long and variable lags, i think just like the fed was too slow to recognize inflation in 2021, i think they probably should have been -- i know some of you guys disagree, probably cutting a little bit, because as soon as that started to put pressure on the consumer, to steve's point, the savings right started going down, and really consumer credit started going up, that was probably the point in which they should have been worried about a 50-year low in unemployment rising very quickly over the last -- >> so, i hear what you're saying on that, and i think what you're saying is, you don't necessarily think friday's payroll number was a disaster. part of the thing the market is digesting means that this -- they could be very far behind the curve. this move, friday's payroll numbe