Chips made by their own engineers. Apple integrating hardware and software together is what makes our bankrupt so great. Having a world dallas silicon design team is a game changer. For apple, analysts say the transition should be a significant benefitbecause it gives the company that much more control over its hardware and it should translate to improved performance and performance. There is a broader insurgency because there are rivalries. Josh, that is a great set up today to bring in our next guest. Talking about apple, google ad revenue, good morning, dick, good to sue yee you how are you . Good, how are you good. Apple, it is amazing we didnt get any grand announcements, but the platform gets more vertical and stickier and i guess that is leading to the alltime highs. What do you think . Yeah, the hardware news was surprising to me i think it is worse news for intel than it is good news for apple. It was just surprising when people are trying to focus more on their Core Competencies i thought the best news was the continued improvements to the air pods i think we will look back and view them as the Great Innovation the surround sound and what some thought was a bug, but now it is there. That will feel like something we were surprised we were able to live without do you feel like they need to address china directly or updated metrics on apple tv plus or app store scrutiny . Things like that that we didnt really get yesterday yes i think that the Biggest Issue they are going to face is the Regulatory Environment going forward. They did approve hays but taking 30 on any app is crazy. It is a legacy from the days when they took 30 secents out of every 99 cents from a song on itunes and anyone that can take 30 of a transaction theyre not involved in starts to feel more like, you know, organized crime than someone providing utility theyre just going to need to be proactive about that or the regulators will come after them and come after them hard so we will see what happens there in the next couple years. I think was the most significant wwdc in a decade, at least, because of the chip transition announcement and the backdrop of the app store. I want to ask you about that specifically when i first met you i think it was in chicago you just joined google with feed burner you looked at it from that perspective and you had been the ceo of twitter, a major developer. Apple is trying to move to their own cpus at the same time they just bought the 5g chip business from intel, and it is trying to push the Services Strategy from the app store all at the same time how hard is that hard. Very hard. Now, you know, again, the reason im so surprised about their movement into dealing with their own chips is you know i get that it will improve margins a bit in the long run, but it is not a company that is starved for cash you would think they would use their significant stockpile to do more than one additional they announce one show coming in 2021 to apple plus they could be competing across the board for shows. So im just a little surprised at the focus of the rnd budget and that it is not, you know, spread out into areas where they face more competition like their streaming tv it seems to me that it follows apples legacy of betting on themselves. That will be an increasing margin benefit overtime. When it comes to the app store specifically my trouble with what theyre arguing here is that at first they wanted all of the developers on it they would come on for free, maybe they would take a cut of the purchase, but theyre saying youre using our Payment System so it is for your benefit. Now there are developers that dont want to use it, but theyre saying were providing you this dominant store. This was free, right yeah, youre exactly right. The antitrust argument about leverage is a strong one here. The fact that they can take 30 , and it feels like the days of the legacy of 30 sent cents on 9 cents for itunes i think it would behoove them to be proactive even just saying look, if you dont want to participate in this you dont have to participate and well take a very, very small cut, but were not going to feature you in the app store. At least it is an option they will need to do Something Like that or the regulators will make them do it. Good morning, i know we talked a lot about the developers and we heard good to see we have more west coast representation on the show now. Absolutely. We talked about the developer side of this, but we have not talked a lot about the consumer side of it it is extremely clean and friction less for the consumer developers, does it ultimately hurt the experience on our side if what youre saying, if they say okay were going to leave it, what does that mean for us i mean, no, it will not hurt the consumer experience. It is not because apple takes 30 from headspace that they can build the campus they have built. They have an extraordinary stash of cash. The User Experience will dont be smooth and elegant and as great as they want it to be irrespective of whether or not their taking 20 or 30 of tran action ises. We talk about the frothiness of the markets precovid. But we have see a lot oftivi activity in the private markets. We saw door dash, we saw a deal from master card, even bill akman is talking about going unicorn hunting. What is the state of the private markets right now . It is still exciting and i think youre still seeing high prices there are a number of early and exciting mid stage growth in telehealth, mental health, Machine Learning i think the ability to point Machine Learning capabilities and technology at Health Care Problems if you have an ai program that can scan 50 million chest xrays there is a company with one of the best Machine Learning experts, they can be in an e. R. Backing up the radiologist in the emergency room and the a. I. Has scanned 50 million xrays. How many has the person in the e. R. Scanned maybe 1,000. A process automation company, telehealth companies, theres an amazing number of companies and you continue to see investors out here excited about those i understand that were in an environment where the rest of the world feels like it is falling apart in many ways city structures are under pressure so it is a strange pox, but it is still a number of amazing opportunities and private companies. Speaking of that, do you think large cap tech at this point it feels expensive or maybe not given our reliance upon it in this pandemic and the innovation that youre talking about right now. What would you say it looks like it has value at this point boy, i will tell you what i love in the Public Markets i love the Enterprise Software Services Companies they feel like a bowling ball. Slack and on and on, they have a number of customers that love the software, and they just expand and grow the companies every year those are Great Company thats will grow and grow and grow. And you know i just dont see it coming to an end any time soon for those companies. And i mentioned three or four of them there are dozens of them those are the places where i feel like youre not going to see or value a road overnight there like you might in a market where Unit Economics are less based on software. The uberubers, the air bnb wher is more about how many rides did we offer, those things we see can change on a dime there is dozens of these that is a really good exma nation of what happens i love the beard, you look great, see you seen. Appreciate it thank you. And we still have more to get out of apples worldwide developer conference, next, including a rare sort of reversal from apple. Well talk about that. The developer and creator of the email a hey is going to join us after this he sort of won the battle with the app store. Round one. Apple shows up and says unless you pay us, were going to bust your kneecaps. Well, how about an encore following the koefcontroversy, e announced sweeping guidelines. Developers can now appeal any rulings of violations of apples policies and challenge the guidelines themselves without the threat of their app update approval being held up during the dispute. Fair to say our next guest was the catalyst behind that update. Lets bring in the developer of the email app hey including the creator of base camp and founder of ruby on rails i have been going back and forth with apple trying to understand what their policy change is, exactly. Your update was approved apple says they want to work with you, and you think you have a solution for hey that follows the letter of the new law for them what is that solution . Were offering two new parts. One is a new time limited email service that you can sign up for on free. You can try the app, it is not a closed door, and you can use it for a variety of things that those burner addresses are great for. Hey was always meant to be an Enterprise Software. That we were going to sell this to companies who would allow their employees to use the system those employees should not pay for the Company Email system. Now we have some customers on it thousands of interested customers, and were going off of what phil shielers latest antics were. We dont know yet if that was enough apple keeps changing the rules a bit and dictates them a bit more and i have two takes on that on the one hand i want to be my 20 year long apple evangelist romantic here and think that this is a real opening here. And we will see a kinder and better apple that is better for the developers the student of monopolists is more timid what they have actually given out so far is so small, they say you can appeal to apple if you want apple to investigation app investigate apple. Okay that doesnt help a service like hey very much. We now have bug fixes that we pushed out together with those Business Model improvements sitting there for awhile so i mope it doesnt mean you get one freebie and then you get put in purgatory apple tells me that microsoft 365, while you can pay for them off platform, they offer the option to subscribe in app and they pay apple a cut of that is that rule, if its okay for microsoft, which is a big if because they said to regulators you should look at this. But if it is okay for microsoft is it okay for you too if apple says you cant have a subscription based app without offering the option and if you do you have to pay us the fee . No, that was the original shake down that we refused g mail is another great application, this is who we thought we went up against they have a g suite product. If you download the g mail a today, there is a closed screen that says sign in and you have to sign in with an existing subscripti subscription google does not sell anything in the apple store. So the enforcement rules are completely up and down we thought we were doing what we were supposed to do. We thought we were showing up for a fight with g mail. For a toll say well, all of the actions that go through the app store, we have to take a 30 cut, it doesnt work we just got the latest numbers in for hey it has been in the market for a week and two days. 80 of the people on the system come from apple platforms. 80 . Apple is not some sort of small one of many players. For our kind of business, apple is dominant and they have that dominant market share and they cant run around charging what they call highway robbery prices we dont have another option if you go somewhere else and youre saying to 80 of your customer base, are we going to switch anyone to switch to windows or android no we dont have that power we want apple to give us the choice to sell our own subscriptions. We dont even need a listing in the app store. We would be happy if we could just pay for the credit card processing they dont have to list us you to find us through a direct link, its fine. We just need to get on to the iphone the dominant platform for these services and when apple denies us by charging or demanding a 30 cut, it is competitive and it needs to stop im wondering if you have talked to the ceos of any other companies or developers that are also unhappy there is a growing you remember. Epic games, match group, will Developers Work together to win the concessions they want . I know you managed to accomplish a lot on your own, but would you be stronger working with other developers we absolutely would pi it doesnt even matter if youre a billion Dollar Company if youre looking towards reporting earnings next quarter that are down 50 because apple retaliated against you and you were kicked off of the most dominant platform for your business, no one is going to do that is there a strategy david i mean there is conversations. There is definitely conversations here, but it is very difficult, first of all there is so many dircht shapes and sizes of business. Really the concerns need to be pushed forward by regulators if we say we have standing in one case you can use it as a company, we sell these subscriptions on our website, give us a path forward here, aeple, give us a choice to offer consumers the best way you were talking about them buying from apple, but what im hering is that it is not true, if you have a problem with your subscription to match or fortnite, going through apple to try to get a refund is virtually impossible it has gone so far that several of the ceos that i have talked the to, when they get a request for a refund they dont bother going through apple. They will write a paper check or send through papypaypay paypal because it is not worth the dance with the bear which is apple. Theyre planning to do this transition in the mac to their own chips at the same time theyre trying to build 5g chip capability in the same company, at the same time theyre focusing on growing revenue through the app store in a more aggressive way is there ever a period that you can think of where a major platform as taken on this much at once . No, this is unprecedented and i have been in tech for 25 years. I lived with micro soft at tsof height of their power. The fact that theyre producing d sh tv shows, making chips, running the app store, it is a Staggering Amount of ambition. And that comes from the fact that theyre now a 1. 55 trillion company. You cant just grow a ten Million Dollar business line here and there you to grow in leaps and bounds and this is why theyre devouring the vendor chain theyre be holden to no one and they have power every everyone else this is what regulators need to take a look at one player that has this much power. Paraphrasing kanye west a little bit there i hope to have you back soon because this is not going away apple is not going away. Some people are saying the same things about apple and google. Thank you david hanssen. As we go to break take a look at shares of spotify who are hitting a new alltime high. Dating back to its public debut in 2018. That was the direct listing coming a day after the Audio Streaming Service launched on their parent comcast they contie nuto benefit from that stay at home play stay with us coming up, investment unless door dash. Billionaire Venture Capital ice vinod khosla is going to join us after the break. Woman my reputation was trashed online. I felt completely helpless. My entire career and business were in jeopardy. I called reputation defender. Vo take control of your online reputation. Get your free reputation report card at reputationdefender. Com. Find out your online reputation today and let the experts help you repair it. Woman they were able to restore my good name. Vo visit reputationdefender. Com or call 18778668555. music anncr give customers access to precisely what they want, when they need it the most. With adyen, the payments platform that delivers convenience for all. Adyen. Business. Not boundaries. Here is your cnbc news update this is the First Time Since march 19th that throughput was higher than 600,000. Amazon is launching a climate pledge fund. It will include transportation, lo gist ticks, manufacturing, food, and culture among others they added the 2 billion is an initial commitment signaling that the fund could grow overtime and black americans enrolled in medicare were four times more likely than white counter parts to be hospitalized for covid19. Asians were hospitalized about 1. 5 times the rate of white americans. Carl, back over to you all right, frank, lets check in with bob and see what is happening. Hey, bob we had a wild overnight session on the novaro comments we moved 80 points and dropped down he walked them back there is that circle and now we have European Services and manufacturing numbers right in the murn that help moved bond yields up a little bit it is still basically megacap tech energy is okay banks were up early on and now have fallen back rates and utilities are lagging because higher yield tends to hurt them. Look at the banks. They were all up earlier most of the regional ones slipped into negative territory. You would hope to hold the earlier gains that you had and not really doing that for those. In the meantime it is still mega caps the new high list is basically mega caps. Facebook, netflix, paypal for example. Youre in the 200 billion club. Theyre the ones that are doing better lets remind everyone what is in the market important thing today, the reopening story. The coronavirus cases rising, most people feel were overvalued right now the trade war is a wildcard. We heard that from navaro last night. And the feds vigilant. I would say those two are positive one questionable on the trade war. Two kind of iffy right now two positive as you see the megacaps keep moving thank you. Coming up, Silicon Valley veteran Venture Capitalist coming up after a quick break. music anncr give customers access to precisely what they want, when they need it the most. With adyen, the payments platform that delivers convenience for all. Adyen. Business. Not boundaries. Welcome back to squawk alley our next guest is invested in very familiar names. Joining us now is the found er thank you for joining us today it is great to be here. First i want to get your take on the executive order here yesterd yesterday. Looking at some of the biggest names. The companies that rely on them the most what does this order mean not just for them, but the tech pipeline, the start up eco system they really hurt innovation in the country. They are well qualified and they go elsewhere but beyond just a label or talent pool, many start ups are started by immigrant founders, spg like 40 so that innovation doesnt happen in the u. S. And that is a real job creation engine it is a lard part of new tech employment creating from the innovation eco system immigrant founders and employees now who might this advantage then you say that founders might go somewhere else and we know that were in the middest of trade attention between the u. S. And china and china is leading the way in a lot of next generation technologies, perhaps 5 g and facial recognition china is very comparative when it comes to technology. Theyre well supported by government and u. S. Staff. So there are other centers of excellent in Technical Innovation coming up in india, bangalor, it doesnt just advantage the u. S i want to ask you about the state of the valleys laying off 715 employees, 700 of its workforce. We hear about start up layoffs as well. Are we continuing to see mass layoffs and things shutting down or are thing stabilizing down there . I dont think anybody knows where the covid pandemic goes in september or october most people are expecting a second surge what that does to the economy, people are not able to predict very accurately so that will change but here is the surprising fact. The more layoffs there are, the more entrepreneurs created people working on unfairly advanced products they may not have el advance in the next year or two, and those that do the best and most ambitious startups i do think the amount of start up activity will do well in the next year or so. I hear that is Silicon Valley experiencing a pull back or a devastating moment it was not just an opportunity, it was like fear and loothiathig people were depressed and leaving in mass. Is it heading there or is this just for the moment a pull back. I think if you look at fundamental new investing and in fact, and they believe the Larger Tech Companies and the start ups follow their streams i think that is likely to happen if i take a fiveyear perspective. I dont see the number of start ups declining in the next five years. What youre calling tech is a segment that really is not the start up, it is the tech part of the big company world. And there is, cut backs there, i think theyre pretty public, what the layoffs that have been announced. I do see the start up eco system flourishing through this, not suffering from it. Especially if you take a five year deal. I was just looking at an interview that you and i did ten years ago temperature years ago in april and we were talking about clean energy research. I said are we going to look back in 50 years and call this the golden age for clean energy. You said well look back in ten years and call it the golden age for clean energy is not driving for three months changing the way that people think about Legacy Energy sources . I do think we will see that change continue. Ly give you an example solid state batteries, quantum scape, the leader in solid state batteries, and surprisingly what people might think is very, very well funded. They have hundreds of millions of dollars for their pilot production factory now theyre doing very well. They just raised a significant amount of money to start producing renewable jet fuel they were based in chicago were starting to see this happen of course impossible foods are taking on a large area of sustainability maybe addressing the 30 or the 40 of the planets land area for Animal Husbandry and if it was forests we could focus on sequestration. So theyre doing well. Theyre not as flashy as the big tech and serious tech addressing a serious problem of climate so theyre doing just as well and i do think that the next ten years when we talk again we will see the same kind of esurgence and amazon just annoyanced their large sustainability fund. One of the Largest Investments that were pursuing since covid started is in Public Transit which seems like an odd area, but it is a major area for sustain ability. I dont think it will be as flashy, the time lines are much longer it takes ten years to do Serious Development in technology. For climate. You mentioned colara they have two different major efforts going now. First is to start 60 lower Carbon Emissions that is still going. And addressing the electrochemicals, pvc pipes and more with less footprint it is less visible and less reported on. That is encouraging while we have you i also want to get your thoughts on the ipo landscape right now. As youre an investor in some latestage Companies Like door dash and instacart, what would you tell them . Should they go pubic sooner rather than later. We have seen those statements from air bnb the founders are opportunistic in gathering resources each company is a little bit different. There are different stages of predictability off of their results. But almost all of the delivery companies, instacart or more are exploring, there are many areas doing very, very well under the pandemic regime. Telehealth is doing well manufacturing and supply chain robotics and inversion 3d printing technologies, theyre all doing extremely well they will cater to the longterm trend of local manufacturing so delivery, telehealth, manufacturing, i think were seeing a lot of positive activity that i think will continue for the next decade. Focusing mostly on longterm trends not what is happening this quarter. Vinod, thank you for being with us today and we hope to talk to you again soon great to be here, thank you apple to 400 a share only about 9 away and that is what cohen is saying as that stock hits another alltime high this morning one day after wwdc. The analyst behind that call joins us next. Stay with us deposit checks, check balances, pay bills, and more. Explore all you can do with our Digital Tools from almost anywhere. Pnc bank. From almost anywhere. You say that customers maklets talk data. S. Only Xfinity Mobile lets you switch up your wireless data whenever. I accept 5g everybodys talking about it. How do i get it . Everyone gets 5g with our new data options at no extra cost. Thats good. Next item corner offices for everyone. Just have to make more corners in this building. Chad . Your wireless your rules. Only with Xfinity Mobile. Now thats simple easy awesome. Switch and save up to 400 a year on your wireless bill. Plus get 200 off a new Samsung Galaxy s20 ultra. Will the shopping from home trend fade away as states begin to reopen or with the arrival of a vaccine. Ups, fedex and some of the largest investors in shipping dont think so Frank Holland explains frank, what indicators are they seeing that makes them think this trend can continue . U. P. S. And fedex continue to adjust their business to the covid19 pandemic. Residential delivery has become 90 of the growth in ecommerce but only 33 as profitable as businesstobusiness delivery according to estimates from deutsche bank. A high volume, low margin situation that both companies have responded to by adding surcharges to their biggest shippers companies we all know like amazon, best buy and target. Charge 30 cents for every package they send that exceeds weekly volume levels from february before the pandemic started. Also added a flat rate surcharge of roughly 30 for oversized packages items like office furniture. With the number of shipments sent out these surcharges generate 48 million of revenue for u. P. S. In june alone that is according to shipma matrics. Even as shelterinplace orders are lifted and the economy reopens, the current Online Shopping trends will continue. Companies have also put their money into an extended surge for example, fedex ceo fred smith says fedex is hiring 400 Truck Drivers per week and ramping up hiring since march and the job report Companies Added more than 20,000 jobs and since the pandemic started, Ecommerce Companies we all know like walmart and amazon adding more than a million jobs keep this in mind, q2 is forecast to be the alltime peak for ecommerce. Will Online Shopping remain at the same level when we all return to normal, whatever that looks like looks like some of the Biggest Companies out there believe it will back over to you interesting, frank. Reports now that amazon signed another big lease for a warehouse near new york city thanks well take a break here. Getting closer to session highs, which was up 290 on the dow. Nike, of course, with earnings in a couple days visa, merck and jpmorgan were back in a moment upbeat music we did it crowd cheering [narrator] wherever you start, snhu is where you can finish. crowd clapping crowd cheering here we go. [narrator] and its it. [group] yay [narrator] you did it, high five Southern New Hampshire university. [man] that gets a hug. laughing look at that masters degree, i did it i did this for my children. I am very proud of myself. [narrator] finish your degree at snhu. Edu. I opened a sofi money account and it was the first time that i realized i could be earning interest back on my money. I just discovered sofi, and im an investor with a diversified portfolio. Who am i . i refinanced my Student Loans with sofi because of their low interest rates. Thanks sofi for helping us get our money right. Apple hitting another alltime high a day after wwdc joining us to discuss Research Analyst who just raised his target to 400. Chris, good to see you, again. Welcome. Thanks for having me, carl. Walk us through what you heard yesterday given the fact that we really didnt get any updated metrics per se it was more incremental news about the operating systems. What struck you . Why 400 . Sure. So, we did raise the price target yesterday before the conference started id probably see in terms of the conference itself the key note and not comes to the hardware and the unknown secret for a while. Like you said, incremental on the ios and some of the apps and some of the products like the watch and the pencil wasnt material, probably not. At the same time it was incremental and kind of reinstates the fact that reinforces the fact that this is one of the reasons why people love being in the apple ecosystem. They keep giving you more and more addition aal benefits whic make it more difficult to leave. We just had a long discussion with the developer obviously, disgruntled at the terms that apple demands given their leverage i wonder how can developers as a group create their own leverage or is it going to be up to regulators how much risk do you see behind the app store . You know, its a question that comes up often and quite honestly, i think this has been going on for a while the customers like apple taking the cut and going on for a while. Largely investors seem to be not too worried about it if regulators step in and pie t the end of the day the reality is for Smaller Developers the eco system that apple provides and the broad swath of install base of users that it can dodge is pretty impressive the larger ones are ones that can have their own other options but i would say largely speaking most developers, you know, it does give them a good channel to tou catch up on install. Good morning, its john to my eye, the biggest risks that apple is taking on, the biggest risks are platform related. The transition to its own chips and the need to transition developers at the same time. The transition to more focus on a Services Model and transitioning developers and the app store to what, however it is going to clarify these rules how much do you factor those transitions and the risk associated with them into your model . Sure, john. Nice to hear from you. I would say that the Platform Risk is something that has always been there. What i mean by that. The platform help apple generate so many new subscribers and customers. So at the end of the day when you look at the hardware aside if youre needing to silicon which is using a processor instead of the intel processor at this point look like a huge threat or risk but the reality is if you look at the iphone eco system and the ipad eco system all being done on the architecture so, i think the moment from intel to the eco system at the end of the day is not a huge challenge. It just takes a while because it will move eventually to your point, see how the things shapes for the developers and ends up being like an apple takes a smaller cut or however that plays out the services side, i think, the existing install base of your loyal install base of iphone and hardware uses are the ones that who they are first targeting with the Services Opportunity and then getting intermittent new subscribers that have come to tv plus and et cetera who are not legacy iphone users. The story is here to say to your point, the development does come up every once in a while and take it as it comes. Well, the price actions just been stunning. Again, today, 368. Responsible for 12 of the dows gain since the march 23rd low. Thanks for the guidance and the insight. Well talk to you soon thank you meantime, guys, some headlines out of dr. Fauci testifying on the hill today couple things, john. He says the next two weeks are critical in addressing what he calls a disturbing spike in new cases and then adds that a vaccine will be ready by end of the year or early 2021 and in his words, its a question of when not if. Couple that with kudlow on the tape saying the china deal is fully intact and the gains are holding. Lets get to headquarters. The judge and the half carl, thank you welcome to the Halftime Report top story, techs milehigh club as amazon, microsoft and facebook all setting new records. A sign of too much in the key part of the market we debate that today with the Investment Committee joining me josh brown, jon najarian and Jenny Harrington and Richard Saperstein is back and treasury partner cio and one of barrons top 100 advisors ill take you straight to the boards lets check the major averages we are green and we are focuse