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tv   Closing Bell  CNBC  October 26, 2017 3:00pm-5:00pm EDT

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it is in your office. >> if you know somebody who's gotten back surgery or knee surgery, i think that's most of us at this point, they have probably been prescribed opioids and so they have that potential. so it's everywhere >> yeah. and let's hope we can do something about it to be continued. >> thanks for watching "power lunch. >> "closing bell" starts right this second. and welcome to "the closing bell" i'm michelle caruso-cabrera in for kelly evans. >> i'll take that. i'm bill griffeth. brace yourselves this is the busiest day of the earnings season. plenty of other things going on right now. in one hour we're going to get an onslaugt of reports again this write this down, everybody, amazon, alphabet, intel, gilead. that's only for the start. we're going to tell you what to
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expect how does this happen who planned this >> easiest -- busiest day of the earnings season. sometimes less is more listen to this dunkin' donuts looking to boost sales by offering fewer types of doughnuts in some stores we'll talk to the ceo on a first on cnbc about that move and this morning's earnings report. >> apparently they identified 18 what they call core doughnuts. >> those pour doughnuts. >> wonder what the poor doughnut is see if nigel can name all 19 of them coming up. president trump is going to crack godown against bad actorsn the opioid epidemic. number of drug distributors and pharmacy benefit managers have been getting hit hard on those comments among other things in just the last few minutes. some down more than 4%, 5% we have the attorney general of new mexico suing both farm suit c pharmaceutical companies and opioid distributors. he's now suddenly finding himself wanting to do exactly the same thing the president's been talking about here.
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>> let's get right to president trump, speaking about the opioid epidemic in america. labeling it a national health emergency everyoand the presideo said this. >> i'll be looking at the potential of the federal government bringing major lawsuits against bad actors, what they have and what they're doing to our people is unheard of we'll be bringing very major lawsuits against people and against companies that are hurting our people that will be taking place very soon. >> we just showed you some of the stocks are getting hammered as a result. meg tirrell has more on the stock reaction >> look at the companies involved here across pharmacies, pharmacy benefit managers and drug distributors, you did see a big leg lower during president trump's speak when they mentioned that a number of investigations going on from states and counties, 41 state attorneys general have sent information requests for
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subpoenas to manufacturers of opioids. we are wondering if these stocks are down based on trump's comments see here the pharmacies, walgreens, cvs and rite aid taking legs lower. there's an article that came ou from the st. louis post dispatch talki ining about amazon gaining licenses in several states these are stocks affected by fears of amazon coming into the drug supply chain as well. potentially both of these things coming together weighing on stocks in this sector. see the distributors down there significantly. of course, they're also implicated in all these opioid investigations as well, guys >> when you add in amazon, you have a competitive attack, a regulatory attack and judicial attack happening in all the last half hour. >> i think it's in that order. not to discount what the president said, there are others, we're going to talk about that with the new mexico attorney general wanting to go after the bad actors as he put it. i think the amazon effect is a huge part of this right now,
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don't you? what do you think, meg >> amazon is a huge fear in this industry it's unclear exactly how they're going to get in, what they're planning on doing. as we've been reporting on this, they are really thinking about getting involved here. so that's been weighing on stocks in terms of distributors, they're also under pressure because generic drug prices have been going down in the united states that's been really horrible for them over the last few quarters. of course, you'd argue that would be good for consumers but it's been bad for those stocks, guys. >> all right >> i was going to say when amazon enters a market, what happens to prices there? they go down. >> this year, that has been the case it's just amazing to watch here. all right. we're still in the middle of earnings season and you're watching celgene today which has been clobbered around reporting, yes 12. >> historically bad day. it isn't so much the quarter results as the company's longer term forecast weighing on the stock today. celgene cut its 2020 sales guidance by as much as $2
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billion. in 2014, forecast product sales to drop $21 billion in 2020. sees $29 trillion to $20 billion for that year. brings adjusted earnings guidance down by 50 cents a share for 2020 coming after the failure last week of the company's experimental drug for crohn's disease. all that causing the stock to lose a third of its value in the last month celgene ceo saying on the call today the company will aggressively pursue stock buybacks and wouldn't affect the company's ability to do business development and m&a. analysts say the results put more pressure on celgene's biggest product. celgene maintained its forecast this year of more than $8 billion. the company took its third price hike of the year of 9% bringing its total price increases on the medicine year to date to almost 20%. celgene's, quote, reliance on price will damage public perception of the company, guys.
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not a good day for biotech and have gilead after the bell that we'll be watching closely as with el. >> yeah, we'll have that for that thanks for the rundown, meg. twitter having its best day in more than a year. bob pisani with a closer look there. >> oh, boy, do we have action here twitter up almost 20%. the specialist for twitter here. 20%. that's not a typo. listen, these companies, a company like twitter, is all about cash flow. they report ed way above expectations and more importantly the guidance was better than expected had good metrics daily active user growth up 14% year over year that's good news 330 million active users, monthly active users now more people being engaged with the service. what people are looking for. you want the bad news, be old school like we, they haven't had a positive earnings growth quarter for four quarters, down 23% compared to a year ago revenues having grown for three quarters or so
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nonetheless, you want to see how impressed people are look at this 100 million shares exchange hands. they normally trade 12 million shares a day they're going to do ten times the normal volume. that's a sign that people are starting to get back in on the growth we're seeing. don't get too impressed overall. remember $20 when they went public, 2013, price was $26 at that time. so still haven't gotten close to getting above the initial offering guys, back to you. >> yeah, hit highest 74 if memory serves. before tanking at that point thank you, bob. >> okay. all right. now, we're not finished yet. let's turn to events in washington today new developments in the republican tax reform plan ylan mui has been trying to put it together for us what's the latest, ylan? >> reporter: the state and local tax deduction has become a major sticking point in this whole debate republican leadership has yet to reach a deal with its members who come from high tax states over how and if they should tackle this very popular
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provision. now, house ways & means committee chairman kevin brady says he wants to stay at the table and get this problem solved but there are 11 republican members from new york and new jersey who voted against the house budget today as a protest against eliminating or possibly limiting the state and local tax deduction. i talked to one of them, representative peter king of new york, and what he told me was that he's not sure that anything short of just keeping this provision entirely will be enough to win him over another congressman, tom macarthur of new jersey switched from a yes to a no on this house budget because of this provision. however, he did say that he wants to work constructively to come to a solution even though there has not been a concrete deal hammered out yet. there's not much time for republicans to figure a path forward. the house ways & means committee wants to roll out their tax bill on november 1st, they want to
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startde ba debating this in come on november 6th. just today senator john cornyn told reporters he wants the sth senate to pass their version of a tax bill before thanksgiving guys, buckle up, going to be a couple few weeks. >> definitely. laid out the calendar which looks tough under any circumstances. are they talking, though, about raising the standard deduction a lot? >> if they do that, it kind of eliminates a lot of issues for people who then wouldn't bother to itemize, et cetera, then wouldn't care so much about whether or not they're offsetting the state and local, right? >> reporter: they're talking about doubling the standard deduction from $12,000 to $24,000 for a couple but for people in high tax states especially with high property taxes like new york and new jersey, may not be enough. when i talked to peter king, he said raising the limit on state and local tax deductions, the income lirkocome limit to $400, least he would consider. so there's still a lot of dials for republicans to try to turn here to come to a deal
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>> and floating the idea of a -- raising the national sales tax on gasoline as well. >> off set. >> something that hasn't happened since 1993. >> perhaps to pay for infrastructure. >> that's for the infrastructure plan as well, but, yeah, but, i mean, they're throwing everything out there at this point. ylan, thank you. we'll see you later. joining our "closing bell" exchange today, victoria hernandez from crossmark global investments, steve grasso from stuart frankel own rick santelli at the cme steve grasso, let me start with you. we talked about a selloff yesterday then sudden. ly all is forgotten. what's driving this? the vote on the budget today in the house? which gets everybody excited about the possibility of tax reform, is it the earnings that have come out? >> i thing it's both those things, the fact the ecb is seen as being slightly dovish i think yesterday you hit it right on the head, mcc when you have everyone selling this market off based on no tax reform getting done and basically 12 hours later, them
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saying we're positive that we're going to get something done, we're going to try to move the ball downfield, i think people are saying, you know what, thank thanks giving, it's okay, we can get something done as long as we see some type of pro-growth policies, bears cannot get in the way of this market it's a momentum trade. and it continues with momentum large cap tech, health care, and things of such >> is and rick, speaking of the -- quote/unquote, dovish ecb, our ten year was the only one of the majors around the world where the yield actually went up today. everybody else went down today >> reporter: absolutely, bill. that is a huge point the spread now between r 10s, 202 basis points, most since around mid-april this is very significant lp we're living in a world where everything correlates. stock markets, interest rates. not all calibrated the same but generally correlate. we're starting to break some of those. it doesn't surprise me that the
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sovereign market is going to be the first to start to recalibrate to different levels and i really think it is significant. as a matter of fact, we haven't moved much, but at 245 where we're sitting, that would actually be higher than the 244 and change we settle i think that's technically significant. we've talked about that 94 area a lot with regard to the dollar index. and how the timing of that pattern coincided with today wow, the dollar index is up almost a penny, matter of fact, it is up a penny now and sliced through the level like hot knife through butter my feeling is, one of these markets tomorrow is going to go the other way. either the dollar index is too aggressive, or interest rates are going to catch up. i personally think it's the latter it's not only that, you know, tomorrow we have our first look at third quarter gdp i think that's going to be very important. and i agree with steve grasso, i said yesterday, i think that much of the nervousness in the market had to do with the ecb. we might get to do a little bit
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that over again, not twquite as big for the bank of japan on 391st. >> victoria, as highlighted with the yield on the tenure, for months if not a full year now, could have bought the ten year when it yielded 2.4% and sold when it yielded 2.2% and done that over and over again for months and months. made a lot of money. rick is suggesting maybe this time is different. how nervous are you that long-term yields are rising and are going to stay elevated and what does that do to the stock market >> i think there's definitely some cues here that we're actually on a trend higher that's going to be more sustaining than what we've seen in the past. similar to what rick said, on that 244, 245 level on the ten-year treasury, that's a definite ceiling we've been bumping up against the fact we keep closing around here and can actually push through this, i think we're definitely going to have trends go higher. and to go along with that, you got really strong ism manufacturing and
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nonmanufacturing numbers you've got consumer sentiment at multi-year highs so you've got some good ammunition to help the yields move higher. and for investors, that just really means especially like on the fixed income side, you really need to look and have that short duration portfolio to reduce your sensitivity to interest rate movement and have some income component there to help you ride through this, and be ready to reposition your portfolio when treasury settles into a more stable trading range. >> before we go, steve, you and i and michelle were talking before the show, you were pointing out the level of the s&p, the last time the ten year was around 245. >> yeah, just as a historic reference, we were at 22350 in the s&p cash to keep things in perspective, i think yields are actually coming in when you look at who he's going to replace for fed head, they're going be a lot more dovish than they are today no matter who he
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picks. one last note on the market, mutual fund, the -- fiscal year end, most popular month is october. single stock selling only has tomorrow left so that the trades can settle by the end of october so there's a lot of people legging into the equity market, feeling the mutual fund selling has abated for the moment. >> okay. got it. >> good to know. >> thanks, guys. lady >> thank you. >> victoria hernandez, steve grasso b, rick santelli. all right. 45 minutes before the bell dow jones industrial average higher by 82 point the. >> we were up 130 at the peak today. >> we're off the highs and off the lows as well, though we're less than an hour away from a barrage of key technology earnings announcements we're going to hear from amazon, alphabet, intel, microsoft and more a full lineup of reporters and analysts ready to break them all down the big after-hours movers. but when we come back, though, dunkin brands. sales down at baskin-robbins but
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up at its doughnut locations we're going to talk to ceo nigel travis about the quarter, outlook for the rest of the year and see how many of the 18 core doughnut fvolars he can name. >> you told him the quiz in advance. >> that's okay
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boy, look at shares of buffalo wild wings today up 20%. soaring after reporting those earnings that beat the analyst estimates last night restaurant chain says the quarter was held by a promotional shift from traditional to boneless wings. boneless -- it's all about the boneless wings here, michelle. that improved their cost and also raised its forecast for the year the stock mike santoli pointing out this is a highly shorted stock so there may have been some cover in there as well. >> lot of pain today for those people. >> still, that's impressiimprese their half price wings on tuesday nights, they added the boneless to the -- the boneless wings to the menu and took off from there. >> oh, it's not that the bones are really expensive and boneless wings are cheaper and -- >> well, that's kparexactly -- i don't know why they didn't do
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that before, right >> speaking within the food category, dunkin brands reporting mixed earnings this morning, company seeing impact from hurricanes irma and harvey at its stores. dunkin announcing a 650 million share purchase program joining us now on a first on cnbc interview, dunkin ceo nigel travis >> welcome back. >> michelle, bill, good afternoon, delighted to be back. >> we want to talk earnings are very interesting but we're actually much more interested in h this concept of less is more where you're talking about reducing the number -- the types of doughnuts that are available in some of the stores. as an experiment why are you thinking about doing that >> okay. so we've been working on that for nearly a year now. we have a thousand stores but i want to make a point very clear, it's not just doughnuts. a lot of people have got that message. that's incorrect we're actually streamlining our menu to make our stores less complicated to offer -- to operate. it's easier to train people, better for our employees,
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obviously our franchisees' employees, reduce labor turnover and boost guest satisfaction the other point i want to make is that by taking down the number of skews we have at store level, wie can bring in more products innovation is an important part of the equation. >> we've been doing our interviews here for a while, you know where i'm coming from i'm not the type to be, you know, confrontational and cynical and all those things give on hearing you talk about more and more and more additions to the menu with new items coming in at breakfast time and everything else. now you seem to be saying it's maybe gotten too complicated and trying to rein it in on the menu even though you are still going to do renovations and innovations. so did you overdo the additions to the menu, now you want to pull that back, is that what's going on here? >> well, basically over time, you're right, bill, we've added
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things to the menu, decided to simplify it. one of those things we heard from our franchisees is our menu is too complicated we bought in a new president of dunkin doughnuts about ten months ago, dave hoffman, dave's doing a great job. we developedtogether a new blueprint for growth the franchisees are right behind it but a major part of this is we've got to tackle the biggest issue the franchisees have we've talked about it on this program before the biggest issue they have is the lack of labor. a major way of tackling that is to make the stores easier to operate, and the same time, create the room so we can focus on the high-profile products like on the doughnut side, our halloween doughnuts. hopefully can see that >> props >> can you hold it up? we didn't see it you got to hold it higher. >> can you name the 18 -- can you name the 18 core flavors of doughnuts? you're going to have 18 -- you're going to keep the core 18
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doughnuts. what are they? >> okay. so, bill, it's not just doughnuts. it's bagels, it's the bread carriers and we're going to reduce some of the complexity on our beverages as well. i'm not going to name the "a" team because the 18 will vary b region, vary by franchisee and may not be 18. may be higher than 18. someone somewhere's got this idea of 18 it's not 18. what we're doing is trying to streamline our menu. and some products will go in and some will come out >> just so they keep my maple bars. >> i wanted to ask, i think obvious ones that will stay will be chocolate frosted. >> yep. >> give me an example of something that's likely to go. >> is well, michelle, i'm not going to try and do that because as i say, it varies everywhere and what we will probably do, i recognize this is a test, over time we will agree with our
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franchisees based on data, based on what the consumers say. that here's some core items. we're nowhere near finish this test and locally you can have some extra flexibility because there are local tastes and a big country like the u.s >> and the -- you know, you're also -- speaking of flexibility, in some stores, i guess in pasadena, you're even taking out the name, doughnut, from the franchise store. it's just dunkin >> okay. >> how long before that's going to go nationwide do you think and what kind of flexibility does that give you >> okay. so, again, a test. we're testing it in two stores one in pasadena. going to be one in quincy, massachusetts. >> okay. >> no decision is made we are looking at the effect of doing that a lot of people love dunkin' donuts some people think it's more moddmo modern to have money name,
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dunkin it will be a long time before we make a decision. the key, bill, we got a new store design, we got next-generation stores franchisees are very excited about what we communicated to them and, again, right behind the blueprint for growth >> but it's -- bill's last question speaks to the overall take that you've tried to make this more of a coffee company. haven't you? >> well, there's no doubt over time we've moved to beverages. one of the things we announced on our earnings today for the first time with our store sales, our store openings, and our cpg sales like rtd, we've actually sold in the last 12 months over 5 billion in the u.s., over 5 billion cups of beverages, something like -- from 2011 when we went public we're moving down the beverage route. let me tell you one thing, back on the doughnuts, michelle, we had a record quarter for doughnut dollar sales.
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the doughnut mojo is back. going to keep focused on doughnuts. on doughnuts and bill would always accuse me of being optimistic. >> thank you. >> all right yeah, yeah, i know, i know you got the point in very good. i see it coming. someday it will just be called dunkin and you can just call yourself nigel no need for the last name. we'll know what we're talking about. thank you, mr. travis. >> thanks, bill. see ya. >> nigel travis. coming up, we told you earlier about president trump's steps to curb the nation's drug epidemic by declaring opioids a public health emergency. when we come back, we'll talk to the attorney general of the state of new mexico a state which is accused drug manufacturers and distributors of compounding its drug problem. and we're counting down to a slew of big name earnings coming out after the bell including amazon, alphabet, microsoft and intel. going to bring you the big reports with in-depth analysis coming up at the top of the hour stay with me, mr. parker.
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of insys therapeutics, news that executives from the pharmaceutical company have been arrested on racketeering charges. doj released claiming that former executives bribed doctors and pharmacists to prescribe an opioid pain medication to large numbers of patients. medications intended to treat cancer patients. the doj says in exchange for bribes and kickbacks, doctors wrote large numbers of prescriptions, many to patients without captioner. elsewhere, as you heard,
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president trump today declared the opioid addiction crisis a public health emergency. and he wants the federal government to go after what he called bad actors which could potentially include opioid drug manufacturers. listen >> i will be looking at the potential of the federal government bringing major lawsuits against bad actors, what they have and what they're doing to our people is unheard of we'll be bringing major lawsuits against people and against companies that are hurting our poem that will start taking place pretty soon. >> as it happens, the state of new mexico has already filed suit against both manufacturers and distributors >> joining us now is hector, the attorney general for the state of new mexico. good to have you here, sir >> thank you for having me >> it i don't know if you heard the president today, i'm assuming you must be happy about what he's talking about because he's talking about taking the
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same tact that you have. >> i'm very pleased with the president today. the truth of the matter is that my counties and my state have been in a state of emergency for many decades so i'm 34r50please the presidens joined the fight i'm also pessimistic until i see real action at the federal level, my today to truly target the pipeline and the flooding of our respective states. >> so who are you going after? can you name names who are you saying >> sure, our litigation is targeted at the distributors and manufacturers. they've been very reckless for many decades in flooding our market and also misrepresenting the dangers and the true risk to patients and communities all across this country. the truth of the matter as well is that i have certain counties today that have addicted babies at ten times the national level. i have counties where 80% of my population has an opiate prescription so this has been reckless
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behavior for many years and we're trying to hold these accountable -- these companies accountable. >> is meaning what what are you trying to achieve with these lawsuits? what are you after >> well, i want to change the way business is done so if you're going to distribute prescription drugs at my state, there needs to be set aside funding for law enforcement, for treatment, and more importantly, for prevention and so we have achieved record profits with these companies yet we have also achieved record deaths and there has been a very little investment in terms of the safety net it left these states devastated across the country >> but the core of your lawsuit alleges they did things that led to the pervasive issuance of prescriptions when they shouldn't have been. what did they do that is illegal in your opinion? >> there were laws in place that were ignored and subverted they absolutely misrepresent ed
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how dangerous these drugs were we never would have put levels of draino or chemicals in public schools without warning. in effect, they flooded the school with dangerous products and misrepresented the dangers to consumers secondly, they've been flooding the market at unhealthy levels well beyond any type of medical necessity. so they have known this for many years. we have evidence and we're willing to hold them accountable for violations of law and want these individuals is to come to our courthouses in new mexico to account for these actions. >> wait a minute i get my drugs from my doctor. not from the distributors and the manufacturers. aren't doctors to be held accountable in some -- to some degree we all know that they can have financial arrangements with these distributors, you know, that there's an incentive for them to want to prescribe
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certain drugs. why don't you go after the doctors at well? >> absolutely. we are we have active criminal investigations we are not taking anyone off this pipeline of destruction we want accountability at every level. doctors are being looked at in terms of investigations. more importantly, the flooding of the market where the risks really began, where the overprescribing and overdistribution and over dangerous marketing to these companies. i believe this is where the threshold between reasonable pain management and gouging communities really occurred in these boardrooms >> all right attorney general, thanks so much for joining us. >> thank you, sir. >> thank you time now for a cnbc news update with sue herera >> hi, michelle, hi, bill, here's what's happening at this hour, everyone new security screenings for all passengers on u.s.-bound flights begins today h they were drawn up by the trump administration air france abiding by the new
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rules by requiring passengers to fill out special questionnaires. mexican authorities reporting they have arrested one of the top heroin traffickers. victor manuel felix is allegedly linked to the sinola drug cartel he was tracked down at an upscale mexican city apartment complex. england is testing a new supersonic car for the first time today the jet powered car is designed to eventually reach 1,000 miles per hour the first goal is to break the world land speed record which now sits at 763 miles per hour and after a decade with the yankees, manager joe girardi is out. the team announcing the decision today five days after the bronx bombers were eliminated from the playoffsgirardi's leadership, the yankees won the 2009 world series. lots of changes in the postseason that's the cnbc news update. i will send it back downtown to you, bill. >> all right, sue, thank you very much.
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we're headed to the close. 25 minutes left in this trading session before the flood of earnings come our way. the dow is up 83 points right now. kenny from o'neal securities with me on the floor of the new york stock exchange. what is going to happen here at the top f tof the hour? this is crazy. >> yesterday down 100, today up 100. we keep going back and forth during the earnings season depending oncented to not only weaker earnings but the negative macro data today they're excited about earnings once again. they were much better. tonight they're looking forward to all the numbers after the bell, right? is. >> huge. >> big technology companies after the bell everyone is preparing for that they're assuming these numbers are going to be great. we're going to be off to the races once again tomorrow but we'll see. in the meantime, it's a relatively quiet day once again. the vol jum the market is in this range. goes back and forth until you get a real macro event a catalyst that's going cause the market to break out or break down i think actually the next move is lower versus higher
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>> you're on record now. see you later. thanks, kenny. michelle >> thanks, bill. coming up next, new report indicates weaker sales for apple's new iphone 8 than its predecessors but are consumers just waiting for the iphone x? that goes on sale tomorrow or has demand for apple products simply cooled off? we're going to dig into that report when "closing bell" returns. a in real assets. like agriculture to feed the world. and energy to fuel its growth. real estate such as e-commerce warehouses. and private debt to finance transportation and infrastructure. building blocks of strategies to pursue consistent returns over time from over $120 billion dollars in real assets. partner with pgim. the global investment management businesses of prudential.
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the word out is the iphone 8 and 8 plus are reportedly posting the weakest sales of any of apple's recent smartphones. listen to this accounted for 16% of all iphone sales in the september quarter that compares to last year's i iphone 7 and 7 plus which made up 43% of all iphone sales in that quarter one market research firm says the slow sales could be from confusion over the trio of iphones that apple's releasing the x, the x, that will be available for preorder tomorrow. and i think people just may be waiting. >> right i think you can officially buy it 3:00 a.m. and the analysis i've read is how soon are you going to get that phone when you first order it
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if they tell you it's two weeks, maybe there's not that much demand right? look at the calendar for how long it takes them to fulfill the orders. >> there's the issue of how much they've been able to produce. >> exactly, also >> so it's -- >> a little bit of a mystery. >> worst of all worlds right mow. slow demand for the iphone 8 and 8 plus as people wait for the x. they can't make enough xs until we wait to see what kind of demand they have. >> the stock slowed down a little bit, not acting all that poorly at this point. >> still had a pretty good year. >> yeah, exactly. >> lots of stocks would take that kind of year. >> busiest day of earnings mi une wreoi t congp xte' gngo get a preview of amazon, microsoft, what key metrics you should be watching for all those stocks stay with us his advisor ran the numbers and showed that he wouldn't be able to retire until he was 68. the client realized, "i need to get back into the markets- i need to get back on track with my plan." the financial advisor was able to work with this client. he's now on track to retire when he's 65.
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>>does he do that all the time? oh yeah, sometimes he pops out of the couch. help from real traders. only with td ameritrade. today is the busiest day of earnings season. >> i had no idea. >> said it several times. >> have we okay. >> our reporters are standing by with a preview of the key tech companies that are about to report results jackie deangelis on amazon, josh lipton has alphabet, jon fortt has microsoft. jackie, let's start with you. >> good afternoon, michelle. several factors in focus this quarter when it comes to amazon. first, the whole foods acquisition. how's it doing and how's it going to be reported will it be lumped in with another segment? next, fourth quarter guidance also key that's the holiday season and
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analysts are going to want to know how amazon is going to spend getting ready for that shopping boom. finally, margin growth update on aws. that's amazon web services and who will take over as amazon's studio chief. these will goiare going to be af interest back to you. >> so many areas to wait for on that one thank you. josh, cabot the company formerly known as google, what are we expecting? >> here's what we're going to be looking for when alphabet reports. revenue of 20.2 billion. would imply a jump of 21% on the top line year over year. alphabet stock up more than 25% so far this year also watch for growth from google properties. so meaning search and youtube, raymond james looking for growth there up 22% guys, back to you. >> got it. thank you so smumuch, josh jon fortt, what should we be watching for when it comes to microsoft? >> the division, michelle, that
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matters the most is productivity and business process includes office 365. expected to provide $8 billion in revenue, watch the growth rate for commercial in there which was up 45% last quarter in currency and the number of consumer subscribers which was 27 million at last count second thing, revenue in the intelligent cloud unit that's the infrastructure side of microsoft's cloud business. azure and servers. analysts want $6.7 billion in revenue which would be double-digit growth, bill, those double digits. >> aren't they, they all about the cloud. somebody said, somebody else's computer thank you, guys. we'll see you later. that's just the tip of the iceberg. there are a lot more reports coming your way as well. >> yeah, we're 14 minutes before the closing bell right now the dow jones industrial average is higher by about 92 points. and the s&p is higher by about -- where did you find it >> it's up almost five points right now. >> going to -- >> i'll show you later. when we come back, it's david darst day a day early.
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we'll tell you wt hahis market theme of the week is coming up let's begin. yes or no? do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online.
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ten minutes left in the trading session with the dow up 94 points. joining us, it's thursday, so don't recalibrate your
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calendars. david darst, our friend, the independent investment consultant joins us today with your acronym i find very intriguing what's that all about? >> we want to say farewell for domino passing on, we know he's entertaining everybody in heaven >> already. >> swell, a noun, a verb, an adverb okay and it is an adjective and things are swell right now meaning they're good how are you? i'm feeling swell. i'm feeling excellently. to swell is to expand and blow up which the markets have been expanding. and finally, a swell can be a wave moving through the water or in the 1930s an elegantly f. fitzgerald type person swell. >> i always say this will be on the midterm, i hope you're taking notes he's saying this because goldilocks is too long a word. >> we're showing people this graphic right here >> correct swell, swell is the strength all
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over the world, you have china, you have europe, you have emerging markets you have u.s i can come back to that. the "w," it was a win this week for xi jinping 64 years old he's untethered and untrammelled now for the next five years "e," is earnings the hurricane hurt the insurance companies. it was expected to be lower than last year. it will be about 2%. 3% but then we have three in a row up 10% the "l" is lifting yields. and the "l" is the labor market's okay. so if you come back to just the "s," okay, the strength, you have the chicago purchasing managers index you got the fed. you got the new york -- the empire state manufacturing construction spending was strong this week. >> right. >> it's not only in the united states, eurozone, china, the exports, the imports
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the fixed asset investment the lifting yields the highest this year, michelle -- >> hold on, we got breaking news. >> we do hang on one second here. bertha coombs, something on aetna. >> yes, big news today a lot of people looking at drugsto drugstores dow jones reporting that cvs, according to sources, cvs hoe v srs health, pbm and drugstore chain in talks to acquire aetna, the insurer. aetna shares are halted at this point. they surged ahead of that news we are reaching out to the parties to see what they have to say. this would certainly be a blockbuster very interesting kind of transaction. aetna as you know, of course, tried to acquire humana, that deal was blocked aetna looking to move its headquarters here to new york in the next year to try to become more of a new kind of health care company with more technology, more looking toward
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the future not just traditional health care so we are following this story, but certainly a very interesting headline, indeed, guys, these days, this month, has been all about m&a, very different kind of deals than we have been used to from those blockbuster deals announced a couple years ago. >> they just made their deal to sell their property and life insurance portfolio. aetna did. that's what's that's all about >> makes it easier for cvs to buy them >> exactly right. it's all about health care very interesting thank you very much, bertha. >> very quickly. we got a trifecta this week. the odds are that we'll get a fed chairman that wants to raise yields secondly, european central bank is starting to withdraw its tapering activity. its quantitative easing. its money printing thirdly, the -- japan looks like they might start to raise their yields you've got this trifecta working
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on -- that's the lowest of the year was september was 2.06. and the highest was march 13th, 261. here it is at 240. >> yep. >> the market is okay with it rising gradually >> fascinating stuff david, thank you so much. >> thank you so much. >> appreciate it have a good week. >> happy halloween, everybody. >> yes, nice costume, by the way. aetna has opened for trading now. i can't see the monitor that closely but it does look like it has popped so this is a story we're going to be following over the next hour as well. >> 10% or 11% move at this point. >> no surprise that we're seeing that move there on word that bertha coombs just told us that cvs health perhaps is in talks to acquire aetna blockbuster deal there obviously. we'll come back with the closing countdown in just a moment here. >> thanks, david. >> michelle, nice to see you
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duncan just protected his family with a $500,000 life insurance policy. how much do you think it cost him? $100 a month? $75? $50?
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$1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online. all right. as if it we didn't have enough news to report to you today with all the earnings coming out next hour, now we have this late report today, moments ago, dow jones reporting that apparently cvs health is in talks to buy aetna, would be a huge deal. bob pisani here with me. we're standing in front of the post where they trade aetna. and you can see shares are up 9% right now.
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at $174.70 i'm hearing, bob, the offer may be for as much as $200 a share right now, the market's not anywhere near that at the moment. >> that's right. and this is a big deal i mean -- >> huge. >> aetna would be, what, $50 billion, $60 billion, between -- >> they're in the process of selling their property and their life insurance portfolios to simply city thiy things so they offering up -- >> regardless at $50 billion to $60 billion -- >> that's a lot to absorb. i don't know what cvs -- >> go hi aahead. >> i don't have it in front of me already up 9%. aet aet aetna will normally trade 4 million, 4.5 million shares. it was way down in the low 3s a short while ago. so the volume is really churning now very, very rapidly so 331 million -- so, yeah, do the math here, you can see it, $175
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dealing $55 billion market cap >> cvs has a market cap itself of $76 billion. >> they're going to have to go -- >> borrow a lot of money, folks. >> that's chewing off a lot -- >> a lot of money for them to eventually deal with that. >> again, the landscape is changing in this industry. now you the president today talking about we have an opioid crisis in this country may be going after the companies that manufacture these drugs the distributors had the attorney general of new mexico on doing just that right now. a lot of those companies were going south as a result of all of that. now you got this deal as they still are trying to figure out what they're going to do with obamacare for next year. >> we have also the report of amazon potentially getting in the prescription -- st. louis post dispatch reporting that and that was an additional factor in seeing some of those drug companies -- >> and the ceo of aetna has been very vocal in his opposition to, you know, he's been leaving a lot of markets in around the
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country in obamacare because they couldn't make money in that this looks like they're selling out and moving on. >> this is their way to figure out an exit strategy. >> exactly all right, bob, thanks very much we're going out with a going of about 80 points on the dow here we go the busiest hour of earnings this season. coming up on the second hour of "the closing bell. buckle up, everybody welcome to "the closing bell." i'm michelle caruso-cabrera in today for kelly evans. the dow jones industrial average finishing higher at 23,399 the s&p higher slightly. the nasdaq moving lower but not by much. the russing 20000 is higher by a quarter percent. on the busiest day of earnings season, we got big names reporting results after the bell jackie deeangelis covering amazon josh lipton will bring us
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earnings from alphabet jon fortt is monitoring microsoft. meg tirrell covering gilead and seema mody will bring us results from the likes of expedia, mattel and first solar look at this lineup. we got all these reporters ready to go. joining us on the panel today, we have cnbc senior markets commentator mike santoli, stephanie link, managing director and equity portfolio manager at tiaa investments. nancy tangler, chief investment officer at heartland financial guys, ladies, good to have you here mike santoli, you want to weigh on the news with cvs, aetna? one is an insurance company, another a -- >> seem like a remaking of the whole kind of medical food chain going on today between the news of this potential bid. keep in mind, anthem taking on a pbm. right? of kind of do it itself. maybe there's now seen as value having an insurer and pharmacy benefits manager one point cvs also has the retail business. >> stephanie link, this news, we are showing the -- what was
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happening toward the close cvs came well off the lows got hammered by president trump when he talked about lawsuits. this news seems to have brought it way off the lows as if people like the possibility of this deal >> oh, absolutely. because cvs is having a hard time growing on its own. they have to do something. they've been quiztiacquisitive r the last several years growth has been drying up. actually acquiring a pbm or hmo gives them better pricing power. gives them better margin upside. gives them a lot of options and the diversification i think could be very accretive to earnings depends on the price they pay and also this is a big step outside the box for them i think investors overall would be happy because they're trying to find other ways to grow. >> of course, investors are obsessed with the threat, potential threat of amazon getting into the pharmacy business the wholesale pharmacy business. in theory if cvs were to do something like that, slightly blu blunts the threat.
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it could dilute that part of their business. >> speaking of amazon, jackie deangelis, how do the numbers look >> good afternoon to you, bill the amazon numbers look pretty good the stock is trading up about 3% in terms of revenue, higher than expectations and higher than 30% revenue growth year on year. that is significant. in terms of the eps, we have 52 cents, that's gap accounting see that the stock is trading on good volume here as i mentioned, we're looking at shares up at this point a little bit closer to 6% at this point. back to you. >> mike santoli, what do you think about a huge beat on the bottom line for amazon do we believe that >> that's not supposed to happen a function of a huge upside i think in revenue momentum. usually it's just kind of a residual, right? they couldn't invest fast enough against the money coming in the door so it falls to the bottom line not obviously a managed beat, but a real one so it looks like, i think,
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after, you know, a couple of months reallywhen the stock ha been kind of back on its heels definitely a relief i think on the top-line momentum especially. >> there it is back above $1,000, up 67 now or 7% gain nancy tangler, do you like amazon where do you stand on this one >> yeah, this one's a little rich for our blood, but i wonder how much of the beat or any was attributed to whole foods. we had, i think, six weeks of bad acquisition. yeah, we'll stand back and let this one run we're playing our anti-amazon play through walmart >> josh, let's get to josh lipton, standing by, he's got alphabet numbers josh >> michelle, alphabet reporting eps here of $9.57. the street was looking for $8 preside .33. revenue $27.77 billion analysts modeled $27.20 billion. looking through the segments here, michelle, google advertising revenue comes in at
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about $24.1 billion. google other revenue, remember that's play hardware, cloud, $3.4 billion google's segment revenue, search, youtube, $27.5 billion tack as a percentage it looks like of google ad revenues, 23%. aggregate paid clicks, year over year up 47%. cost per click down 18%. michelle, back 230 you. >> that's a trend we've been seeing. >> not to be outdone, this one also now is back above $1,000 a share. just as amazon has done. >> yeah. >> nancy tangler, you're a big holder of this stock, right? >> yep, we like this one i was a little concerned about the tak numbers but that not awfully bad. we'll probably use some of the strength to trend back a little bit because we have concerns about the regulatory environment going forward. >> being told acquisition costs. >> right >> traffic acquisition costs. >> it investing a lot, spending
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a lot in mobile, spending a lot trying to grow in other areas. i think it's encouraging they saw operating leverage that's one of the stories, themes for this company that they have been able to put up the growth clearly they just did 22% total revenue growth bringing it to the bottom line is a good thing. the tac number to me is a little high i want to get a little more information on that. so i, by the way, think the amazon numbers are awesome i mean, they truly are. >> you're in agreement with the market there, too, by the way. >> i happen to own it, i'm happy about it the stock has been down 6% since last quarter so the expectations, believe it or not, even though it's up almost 30% on the year, it has lagged so i think people are a little more concerned about it we'll get more detail about it i feel pretty good. >> nancy raises a good point about google, also true about amazon much more unknowable as opposed to when you get data out today on the earnings, cost per click, et cetera, et cetera the regulatory environment for these guys the cover of barons, seems like
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every region of the world has some issue with data gathering or something, mike. >> it's been unquantifiable kind of overhang on the stocks. i definitely think that's true also there's been a preference among investors for sick sickle val blank blank si cyclical value stocks. they've been the net losers on that the earnings fate this afternoon, it's going to be pretty significant to see if that growth investor muscle memory kicks in when we get reminded these are money-printing machines. >> agreed. best positioned sector in the s&p going forward and in h the previous 12 months greatest overweight. i agree with you, mike i think there's a lot of opportunity for momentum to return to this group. >> were you concerned at all as mike highlighted, they kind of slowed down. they wrpt really participating lately there have been concerns they're reacting to rising interest rates, people have been suddenly rotating into cyclicals. did you get worried there? what do you think right now?
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>> well, yeah, we weren't worried. from a valuation standpoint we had plenty of room with holdings in facebook, apple, cisco, intel. we had a lot of old tech and new tech but i do think we -- this has been a market of rotations so we were heavy holders in industrials, so we let those run and now we're, you know, looking for opportunities to add in certain places. >> okay. >> as we did with oracle but also to let these things run and then trim them back. >> all right the third of the holy trinity is here now microsoft, jon fortt, sorry about that >> i don't know which one this would translate to but here are microsoft's numbers. it's a beat. revenue came in at $24.5 billion. it's about a billion above expectations eps, 84 cents versus 72 expected the beat came from a surprising place, though. productivity and business processes, a little higher than inline at $8.2 billion intelligent cloud slightly
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higher at $6.9 billion more personal computing. that's the pc business outperforms above $9 billion about $9.5 billion where the street was i think expecting a little less than $9 billion. expecting a little bit of disappointment there microsoft did return nearly $5 billion to shareholders in buybacks and announcing 8% increase in the dividend the stock just a little bit higher after hours perhaps because the upside came from the area where we don't expect a lot of growth but still, strong numbers, double-digit growth as expected in the cloud businesses for microsoft, guys. >> you said personal computing, right? did i hear that? >> right >> more personal computing. >> laptops and stuff >> more personal they call it more personal not only oem laptops others building it with microsoft software also includes -- >> the stock just now has turned negative, by the way go ahead. >> john, do you know what the cloud business grew? >> yeah, let me look through
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some these numbers so if we look at office, office commercial, cloud services revenue, up 10%. constant currency consumer products the consumer business now has subscribers at 28 million. that's a million higher than last quarter intelligent cloud which includes azure was up 13% in constant currency and enterprise service revenue about flat products and cloud services up 17%. azure revenue growth up 90%. or 89% in constant currency. that's the infrastructure side, that competes a bit more directly with amazon web services showing some strong growth, not quite doubling, but 89%, close >> what does that do to your personal algorithm there, steph? >> just computing it all. >> yes. >> i would say the number was up to 90%, 95%. growing 89%, 90%, is pretty darn
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good love to see what amazon's growth did just to compare, that's what the consternation is over both names a ult time, right? >> here we go. intel. dom chu? >> what question hawe have, int showing signs of life, up a percent in the after-hours trade on 1.2 million shares worth of volume we have earnings coming in that beat analyst expectations. $1.01. beats the average analyst -- revenue coming in better $16.15 billion analysts on average were looking for $15.73 billion also looking for some of the estimates for their forecast, they see fourth-quarter earnings per share, 86 cents adjusted analysts saw 83 cents or slightly better than expectat n expectations there they also see 2017 full-year eps, $3.25 analysts were on average looking for $3.01 per share. so a pretty strong report overall on some of the client
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segments to give you an idea, going to go through the rest of this right now on the client computing side, they're showing $8.9 billion worth of revenue. that beats $8.7 billion in terms of their overall expectations according to fact set. also on the data center side of things, $4.9 billion worth of revenue, $4.8 billion the average expectation as well. those shares up marginally after hours. i should point out with intel's stock, we're talking about a decent performer so far this year 14% to the upside. matching the overall market. but certainly lagging the technology sector overall and very much lagging the semiconductor industry specifically so we're going to kind of comb through this and see what else is going on but for right now, a very healthy report, it looks like at first blush across the board, the stock reacting marginally to the upside for a stock that has been an underperformer in the industry overall, guys back over to you. >> dom, thank you. before we respond, don't miss a first on cnbc interview with intel's chief financial officer, bob swan
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that's tomorrow after 11:00 a.m. eastern time on "squawk alley. i'll watch for that. >> if it would have come to microsoft and intel, seeing a little bit how high the bar was, marginally up in terms of stock trading after hours. what looked like pretty co comprehensive beats. up 15% or so this year but 15% or so in the last few weeks. it's had this quick ride, pausing there on great numbers. earnings alert on expedia. seema mody has the results seema? >> look at expedia third-quarter earnings it's a miss on its bottom line the street was looking for 2.62. revenue also coming in below wall street expectations at $2.97 billion. street was looking at about $2.98 billion. what's also interesting is looking at gross bookings which it does include home away, the vacation rental site expedia bought worth $3.9 billion in 2015 gross bookings increasing $2.2 billion or 11% year over year to
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a$22.2 billion on the revenue side for the third quarter of 2017, revenue increasing 15% now. that includes a negative impact from the natural disasters and two percentage points of positive foreign exchange impact you can see the stock is down here more than 7%. a little bit light on home away bookings at 2.01 billion we'll continue to dig through the report the earnings call does begin at 4:30 p.m. eastern. guys, back to you. >> seema, thank you. anybody want to weigh in h i mean, that stock is down 7%. i know natural disasters are going to be part nancy, are you in this one at all? >> i'm sorry, bill, we're not. i can talk to you about intel and the others, but no, we're not in it. >> that's okay let me get on expedia, though. >> trivago just had a disaster. the hurricane certainly had an impact for sure. we all were bracing for a soft u.s. and a stronger europe i just wonder if maybe europe didn't pull through. and that's the result of the
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disappointment >> stephanie, we have the answer to your questions on aws from amazon first we have this earnings report on gilead meg tirrell has those numbers. >> that's a tease. >> a beat on both earnings and revenue. adjusted eed earnings per share coming in versus $2.13 revenue, $6.51 billion for the quarter. everybody's always looking at the number for their hepatitis "c" drug revenue, coming in basically in line. they now have four hepatitis "c" drugs on the market. analysts were looking for $3.23 billion in total revenue that coming in around $2 president$2.2 billion. you're seeing the shares coming off a little bit. they were really helped on the hepatitis "c contra" number versus consensus estimates of $30 million. people are parsing through this right now. company also raised the lower end of its product sales
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guidance for 2017 by $500 billion. now to $25.5 billion in 2017, total product sales guidance, guys call starts at 4:30 we're going to be listening for any more information on the new cancer drug they acquired from kite as well as what they might do with the rest of the $41 billion they have in cash. back over to you guys. >> and the stock down a fraction right now. meg, thank you very much michelle what are the -- >> aws, yes, amazon, aws, coming in at $4.6 billion $4.584 billion compared to a year ago >> that's a little more than expected some people were thinking $ inio 40%. we know there was pricing pressure i think both companies did pretty well in cloud that kind of confirms that this trend is continuing to be very strong and supports both stocks. >> it keeps getting away from nancy's price there. >> yes what'd you want to say on intel? >> oh, just, i mean, i think
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what we're seeing with intel, microsoft, is just a grind they've moved from microsoft, in particular, a great deal and so it's going to take a lot more, a little consolidation then we need to see a little more exponential growth going forward. and i think that's where the opportunity is for stocks like oracle and their cloud business that has lagged and now has the opportunity to catch up. and texas instruments and their chip business which is in a totally different space and level of profitability so that's where we're putting our focus as we move forward. that we own those stocks yep. >> this really is like election night with all the precincts reporting at the same time jackie deangelis, you got guidance now from amazon very important what are they saying >> that's right, bill. they're saying net sales are expected for the fourth quarter. remember, this is one that everyone was going to focus on because of the holiday spend period those net sales expected to be between $56 billion and $60.5 billion. that's a little bit of a wide range and a little more conservative than some analysts
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were expecting in terms of growth, it would be growth of 28% to 30% year on year but some are suggesting that, again, they could blow past that as well. on the operating income, it's expected to be between $300 million, the company says, and $1.65 billion. also, a very wide range there and in it line with what they've said previously. but you can see that because of that top line and bottom line beat for shares, now trading higher almost by 8% at this point back to you. >> see in there also, jackie, guidance includes approximately 1 is sthourks b 1,000 basis points of -- >> absolutely. we're going to hear more about that on the call, michelle that's something everybody is really focused on. obviously this was an acquisition that closed during the quarter. i think there's about five weeks of accretion that will add too what they were able to see what the whole foods acquisition. they're going to want more detail about how the company is
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including this in the report as well >> stephanie, have any thoughts on that, 1,000 basis points >> revenue is the acquired -- >> yeah, the more information the better we don't really have a lot of information on whole foods right? so it's just in a concept basis at this point. i think all of this sounds really good. again, i think the expectations were a little bit lower for these guys versus some of the other faang-like names because it has lagged because people are wondering about the cloud business, the margins and that sort of thing i kind of think this is -- it's obviously good enough right now. we'll hear more on the call. >> and there's more. let's get to winn resorts with leslie picker. >> reporter: hey, bill, that's right. we got a beat on the top and bottom line for wynn resorts in the third quarter. let's get through the numbers. adjusted eps of $1.52 per share. on the revenue side, posted revenue of $1.61 billion that was up 45% year over year and beat analyst estimates of
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$1.56 billion. the company said the increase in net income was due to reporting. the first full quarter of wynn palace and growth of las vegas. dig deeper into the numbers, one of the reasons you see weakness in the stock performance there, the average daily rate during the third quarter for wynn macau was down, and the revenue per available room for that property was 240, a 6.6% decrease from the third quarter of 2016. so we'll keep an eye on this one, conference call starts in about ten minutes, guys. back over to you. >> yeah, because we'll certainly want to know why that macau revenue was down, regulatory, say something about china, et cetera >> las vegas sands was strong yesterday. >> who knows if it's just a little bit of a market shift stephanie, you own this, right >> i do not own -- i own mgm >> you do. >> that's more las vegas exposure we certainly don't expect las vegas numbers to be very good. after what happened. but i do think that that story
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is more of a restructuring one wynn is a great company, it's run very well, too it's up huge this year absolutely huge. right? up 60-some percent big, big numbers trading at 23 times forward. i could actually get exposure to gamie ining for a lot cheaper in through mgm. i'd wait to add, because i expect guidance to come down -- >> i hear you're agreeing, nancy? >> yes, i agree. i do i think wynn is an exceptional operator but it is at this level a little pricier so we're out -- we were out a little while ago. >> okay. jon fortt has more on firewo microsoft's results. jon? >> mention the commercial cloud business again, an important number i didn't hit. annual recurring revenue hit $20 billion as of this quarter that's a year ahead of schedule. that was a target, a three-year target microsoft set gross margin, up 8 points to
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56%. that's profitability that's important also what exactly was better about the more personal computing business the pc market did better than expected that helped lift microsoft's -- also gaming software and services that's xbox live and some those titles at did better sfi finally, linkedin, $1.1 billion wo worth of revenue in the quarter. microsoft originally said of the acquisition it would be minimally dilutive in face cai 8 '18. now they're saying it's going to be slightly accretive. that acquisition which raised a lot of eyebrows doing better than what microsoft expected is what they're telling me, guys. >> a little na, na, na from microsoft. >> that's right. managed to come through better than e pebxpected. expectations for high enough for microsoft. valuation at a 13-year high in terms of a forward p/e the fact you're tackling on a little more than a percent on the news is probably a net positive. >> if i got the commercial cloud
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margin number right at 57%, that's a lot better. people were thinking 52. that's good. they're more profitable. >> you have all those number in your head. that's just amazing. >> she is remarkable >> nancy, what about microsoft >> yeah, we own it it's one of our largest holdings and it's appreciated dramatically as we all know. it is getting kind of price city for us and so we're looking for an opportunity to do some scaling back and trim out but we love the story, we love the management and we love the product diversification. those linkedin numbers are impressive given what the expkations are. >> if the "e" gets bigger, you can ride this stock higher what makes you decide you're going to trim a little bit >> i'm sorry -- >> you there >> sorry i am >> let's -- >> pardon me. >> we're going to take a break let me get you a class of water.
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>> choked up about that. all right. thanks, ladies -- >> we got to go. i think she's going be okay. you're going to be -- yeah all right. she's fine >> thank you. >> heck of a way to end this thing. stephanie. >> sorry. >> thank you so much nancy, good to see you as well have a drink of water. we'll see you later. we have much more still to come on this massive day for tech earnings. coming up, we'll get shareholders and analysts' reaction to those huge results for amazon and alphabet. >> we want to hear from you. contact the show on twitter, facebook or e-mail you're watching cnbc because we are first in business worldwide. excuse me, are you aware of what's happening right now? we're facing 20 billion security events every day. ddos campaigns, ransomware, malware attacks... actually, we just handled all the priority threats. you did that? we did that. really. we analyzed millions of articles and reports. we can identify threats 50% faster. you can do that? we can do that. then do that. can we do that?
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call, visit or go to mattel reporting earnings. >> oh, boy. >> not pretty. >> seema mody, she is pretty, has the results. >> very disappointing quarter for toy maker mattel earnings, 9 cents adjusted the estimate was 57 cents. revenue is amiss as well mattel suspending their dividend the company says dividend suspension expected to provide added liquidity of about $50 million per quarter. also cite that toys "r" us' bankruptcy impacted q3 results company also citing a tighter retail inventory management and certain underperforming brands i'm just looking to the release.
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american girl brand worldwide gross sales fell 30% the stock was halted it's resumed trading you can see it's falling here after hours. a big mover here down as much as 26%, guys. back to. you. >> american girl down 30%? i remember when that was just the hottest thing, the lines out the door on 5th avenue >> yeah, yeah. >> the toy business has been accelerated by the toys "r" us -- a dif devidend cut >> really need the cash. >> gone. >> girls don't play with dolls is this basically kids play with computers? >> not as much they play with screens for the most part. my 13-year-old was into american doll for a while, the 10-year-old didn't really take. >> my 26-year-old daughter was very much into american girls but that tells you, you know, that was a long time ago. >> before the ipad. >> sorry you want to go to this amazon shares surge ing after blowing out wall street's earnings expectations. back above $1,000 with a gain of
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8% let's get reaction now we're joined for the restof this half hour, ed lee from recode then also with us is trip miller from capital partners and ed from key bank capital markets. edward, a blowout quarter i guess for amazon. >> blowout jeff bezos' world, we just live in it pretty much, right i think the key to understand with their businesses moving forward, the lock thing that they announced yesterday, there was a report today about them getting to pharmaceutical wholesale possibly as a business, they sort of got some licenses for that. they basically want to be sort of the operating system for all kinds of e-commerce, all kinds of delivery, whether getting inside your door, selling you groceries, i know where they're getting the hardware as well again, that's purely the end game there is i want to sell you more stuff. >> two eds on this panel, eddie, what do you think? >> great results across the board, obviously only five weeks of whole foods expect to see more great things
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going o out of that going forward. amazon is the codominant dretair of this age. walmart, making inroads against amazon but clearly didn't impact them this quarter. >> ed lee -- trip miller, is amazon trying to do too much this year has been a watershed moment for sththem when most retailers are suffering mightily are they doing too much at this point. >> they're doing the right thing for shareholders i think they're focusing on their core businesses and growing those rapidly. new things they are getting into i think are both complementary to the prime customers you saw with amazon key yesterday and some of the other initiatives they may take on going forward while smaller, more complementary to their bigger story. i don't think they're trying to do too much. he sedaid earlier, we're livingn an amazon world and excited to be shareholders for the long term. >> to that point of trying to do
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too much, questioning it, during the president trump discussion about opioids, we saw a lot of the pharmacy management -- on top of that, st. louis post dispatch reports that amazon's now got licenses to do pharmaceutical distribution. >> hovering over the area, people thought they were going to -- every end mark, yesterday ww granger, like, building products, they were hit because amazon wants to get bigger in that area. essentially sort of all-purpose threat to everything that you buy. what's fascinating to me, we can drill in on their fourth-quarter guidance for sales we're a third of the way just about through the quarter and the range is $5 billion. right? so it's $56 billion to $60.5 billion. they don't know how much momentum they're going to have over the next couple months and i think the street interprets that in a positive way now like, hey, you don't have a handle on orders no this can be so big and so sfafa we can't keep up with it. >> whole foods acquisition, clear right away what it's going to add to in the fourth quarter. whole foods is operating at a 5%
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margin amazon tends to be 2% or less. there's a lot of room they can play with, lower prices, not have to negotiate supplier deals and do that and still make money. i think it's pretty -- >> that last point is why everybody gets so nervous, every time they talk about going into some other area because they -- investors will give them the privilege of having much lower margins than everybody else in the sector. >> which gets to something david einhorn -- yes, they can disrupt other streams but do you give them credit for earning it themselves >> a guarantee they take that profit. >> amazon is the most mentioned company on corporate earnings calls ahead of google now. in terms of what other companies are thinking about, what they're concerned about, you know, whether they want to imitate or be afraid of them. >> so ed, is this as good as it gets for amazon? >> we rate the stock sector weight, we think they had a fantastic year thus far. i think, look, again, this is much more competitive market i think they're obviously doing lots of things and lots of di t
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different sectors but taken c significant share. at this point it feel the to us it's going to be a much more kp competitive market. >> what happened to the hand wringing going on for years about the profitability and lack thereof? you know, plenty of people are not in this stock because analysts told them they're not making a profit so they shouldn't buy this stock and it keeps going up where'd that concern go, eddie >> i still think it's a concern, certainly longer term, we look at things like how much cash they're generating, what's the profitabili profitability? i'd add in north america they added $7 billion revenue and profitability fell ultimately people will pay attention to it. today, look, they're one of the great growth stories in the market and taking share from traditional retail. >> all right, guys, ed lee, we're going to see you again >> sure. >> going to say thanks to trip miller and also ed thanks for joining us. >> thanks, guys. a number of conference calls are just getting under way right now. we have gilead, wyn hn resorts x expedia kicking off calls.
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we'll be monitoring those and get you any news as we get that. time for a cnbc update with sue herera. >> hello, michelle, everyone, army sergeant beau beowe bergdal leaving court for day one of the sentencing phase of his trial. facing up to life in prison for endangering his colleagues he walked away from his post in afghanistan in 2009 and was captured by the taliban. bergdahl is due back in court on monday. the ukrainian government opening a terrorism investigation into explosions in kiev a security camera capturing last night's blast. it killed two people wounded five others including a member of parliament. a fire engulfing a home in a gated community near dallas. firefighters from six units are fighting the blaze the cause of that fire is unknown. so far, no reports of injuries at this hour. and burger king offering free whoppers to the first 500 customers dressed as clowns on halloween night. it released a video ad which you're taking a look at there which takes a dig at mcdonald's
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at the very end. burger king's video shows a ronald mcdonald-like clown demanding a whopper. free whoppers are being offered at only select restaurants in miami, l.a., austin, and salt lake city. you're up to date. that's the news update this hour michelle, back downtown to you. >> all right thanks very much, sue. let's get to seema mody for an earnings alert now on bidu. >> >> google of china reporting earnings that beat street expect tag expectations but revenue missing analyst estimates at 23.43 yuan. very weak revenue guidance for the fourth quarter that seems to be concerning investors here one of the reasons the stock is down over 11% here in extended trade. it's been a big winner in 2017, up as much as 40% so far this year as part of this chinese tech rally. so perhaps expectations were just too high coming into today's report back to you. >> what do you think, mike. >> i think seema hit it right
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there. there's no room for mixed when the stock is kind of up on a perch like that. >> yeah, no doubt about it. we have barely scratched the surface of this monster day of earnings next up we're going to dissect alphabet's earnings, stock getting a pop of strong profits and revenue. going to debate qwhether to buy the stock on this news in just a moment. plus this would have been our top story otherwise. aetna shares soaring o a report that cvs health is trying to acquire it that would be huge how that will shake up the health care business, coming up. that brings big ideas to life. and cutting-edge transportation development to connect those ideas to the world. along with urban redevelopment projects worthy of the world's top talent. all across new york state, we're building the new new york. to grow your business with us in new york state visit
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okay if you're just joining us, where have you been? here's what you missed so far. these companies are reported earnings so far. we're calling it a blowout for amazon alphabet, we're going to talk about. microsoft -- and microsoft also strong earnings. those are positive mattel just a horrible report. and in part, due to the bankruptcy of toys "r" us and their american girl dolls division saw sales plummet 30% in the quarter and they have suspended their dividend that shock is down 15% expedia, travel company hit by hurricanes in the quarter and the stock is down 7% zruas a result. >> bill mentioned alphabet is higher by 3% big beat on earnings slight beat when it comes to -- joining us for reaction, ali from morningstar, daniel from
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n newburger berman ed from recode is back with us your thoughts on this matter >> really nice move for them i was a little concerned by the cost per clicks. they've been going down, going down last quarter. means more of the advertising is moving to mobile, right? mobile advertising costs less or get less for it. it's part of the trend but at some point, the margins are going to sort of dip i think that's one thing to look out for. >> dan, what struck you on this report >> i think across the board the company has really demonstrated that the core platform remains healthy and when you think about things like youtube, which is a tremendous asset that alphabet has really built and nurtured then you also look at google's cloud platform which is something we think is somewhat underappreciated by the market overall, good set of results. >> ali, what did you think the whole shift from, you know, laptops to mobiles, everybody wants it and yet people pay less for that advertising even as it goes up how worried are you about that >> actually, not that worried in
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the short to medium term another figure you can look at is the aggregate paid clicks although the cost per click is going down, in terms of the interaction, engagement it creates which is an rli for the advertisers, themselves, that continues to increase. i think that's very positive another think, i think the youtube -- the youtube asset has certainly driven the ad growth that we've seen in the revenues. along with hopefully, you know, management will provide a little more color in terms of how much the cloud business, which is a very, very fast-growing market, contributed in q3. overall i think it was very positive especially margin expansion. i think they went up 400 bits year over year >> ali, you've got a -- i don't know -- this valuation i guess, not a price target of $1,030 we're $4 away from that. are you going to readjust that or are you going to feel this is fully valued, not too distant future here. >> well, i mean, can't really disclose that now.
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depending on what additional information the management provides on the call, how it goes, going to have to look more in-depth into the numbers. but overall, you know, it's one of our favorite companies. basically market leader in the ad business, digital ad business, behemoth out there we don't see it facing any serious competition. >> all right guys -- >> we got to go. believe it or not. >> crazy this afternoon. ali, daniel, ed lee. >> thanks, ed. always good to see you.mentione calls under way for expedia and wynn resorts we'll monitor those and bring you news from the calls coming up here. first, we'll discuss how a potential cvs/aetna merger, on any other day this would be the huge lead story. >> big-time. >> with all these earnings how could it impact the rest of the health care industry and whether or not a deal between e o enak sse thtwev mesen
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it's been an incredible earnings session post close and you can see, by the stock's reaction, what's doing well and what's not amazon had a big beat, higher by 7% after hours trading, alphabet, higher by more than
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3% microsoft ditto, higher by more than 4%. mattel is a disaster expedia not doing well either. see mattel after hours lower by 16%. >> they does sended their dividend that's a big number for them as well a big part of that we have more on alphabet's earnings josh lipton, what do you have? >> bill, i just had the opportunity to speak briefly with alphabet cfo ruth porat about these results. you know is now 31 straight quarters of at least 20% top-line growth, that's pretty unusual for obviously a company of this size telling me she was confident that growth could continue we also, though, did talk about a couple points that i know the street was really focused on, bill one was that increasing regulatory pressure, including what they're feeling in europe with that $2.7 billion record fine, for example. ruth porat, about that fine, telling me we do feel good about the steps we took but it's early under the remedy, comparison shopping services have a new opportunity to use shopping ads to advertise on in
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the rell varevant countries and google shopping in these countries will operate in the same manner busineidding alongse comparison shopping businesses the bigger issue the street is focused on is android case, remember, the risk there that eu regulators would force them to unbu unbundle android for other google apps and what that would mean for business and market leadership in that region. we also did talk about those other bets i asked ruth porat, listen, they continue to lose money what are the metrics she's watching to gauge the success? ruth porat telling me what we're looking to do here with other bets is create valuable businesses over the longer term. we established businesses, technical and financial milestones, give the pace of investment tied to achieving those milestone and it's a multi-year look at creating what we think are good opportunities. guys, back to you. >> all right, thanks for that rundown, josh. the other big story of the afternoon, cvs hoelt reportedly in talks to buy aetna.
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joining us, senior analyst at morningstar. this would be an extraordinary deal, right? we're talking about a pharmacy company, pharmacy benefits manager going now into health insurance. that seems like a remake of this sector >> yeah, it is it basically what it is is a vertical integration in several key critical players in the whole system take a look at what united health has done, with its own operations, own strategy this falls pretty much in line of what they've done look at united health, has its own pbm, own insurance company what's going to be unique about this deal, though, you have a major pharmacy, cvs, integrating along every -- almost every single point of the health care space. health care insurance space. not only as the pbm but also as a manage the care firm >> i'm just looking here, aetna's market cap is hovering right around $60 billion what kind of a premium would you assign -- would you expect on this deal? i mean, this is going to be big
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here especially when you consider cvs' market cap is $76 billion. >> we should highlight, reporting, dow jones has a beat, maybe 200 bucks a share. >> well above the 170 right now. >> yeah, definitely there's going to be a premium for it those assets are key or at least they're very positive assets within the insurance space if you remember back at the year ago or so, aetna was going to merge with another company, huma humana so, you know, it is, you know, it is a key premium asset and there will be a premium assigned to it. now is there going to. be be a fair value who knows. there could be some other offers out there. i'm not sure that's going to really dictate actual dwha the price is going to end up being. >> wow there's another offer out there. here we go gechb again in the we sector vishnu, thank you. crazy, crazy
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vishnu joining us on that story. alphabet's and intel's calls are beginning in a few minutes i'm val. the orange money retirement squirrel from voya. i represent the money you save for the future. who's he? he's the green money you can spend now. what's up? gonna pay some bills, maybe buy a new tennis racket. he's got a killer backhand. when it's time to get organized for retirement, it's time to get voya.
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we're not finished first solar earnings are out seema mody, once again >> reporter: hey, bill first solar, a strong beat for the company on its bottom line $1.95. the street was looking for .84
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the ceo of first solar saying results were highlighted by strong earnings resulting from the sale of the california flats project. that stock up 4% here. back to you. >> all right, thank you for that, seema. amazon popping after reporting earnings l arroits cfo on the results, next. the smart ones look to fidelity to find them. we give you research and data-visualization tools to help identify potential opportunities. so, you can do it this way... or get everything you need to help capture investment ideas and make smarter trading decisions with fidelity for just $4.95 per online u.s. equity trade. fidelity. open an account today. ♪ open an account today. we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future.
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it's not just amazon microsoft and alphabet conference calls starting in the next hour. we'll have the key numbers, next
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we're building the new new york. to grow your business with us in new york state, visit amazon's higher after reporting earnings this hour jackie deangelis just got off the call and joins us with the highlights >> reporter: the cfo gave us detail on business settings analysts were interested in. what stood out was talking prime day in the online sales category, saying prime memberships are increasing the highest sign-ups for prime
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memberships and trials on the prime video strategy, the company said it expects the content to increase next year as well and on content, it said there's a lot of data in terms of what the prime members like out there. they know what they like and they're going to continue to deliver it to them that's a key that a lot of people were honing in on back over to you >> jackie, thank you very much that stock up almost 8%. overall, michael, this earnings hour reminds me a lot of a certain world series game. lots of home runs this time around >> all late, all coming in bunkbunk bunches. this shows how good the earnings have to be to get a pop. amazon is there, it will challenge the highs in july, a high of 1083 we'll see if this enthusiasm carries through. into the holiday season, it seems like amazon has changed sentiment a little bit >> we've seen f.a.n.g. slow down in the last couple of months does this turn that around, do you think?
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>> i don't know if it turns it around in the sense that it grabs the attention from the other cyclicals. it definitely seems like it's reminding people that these are organic growers that have a lot of power to put up good numbers. >> and the retail continues to suffer mightily. thank you, that was fun. mike, we'll see you again tomorrow kelly is back with us as well at that time. "fast money" starts right now. see you tomorrow "fast money" starts right now on the biggest night of earnings for the quarter our traders on the desk, it is tech's big time to shine amazon, alphabet, microsoft, intel all higher jack jackie deangelis is gearing up for amazon in a few minutes. dom chu is here listening to


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