Transcripts For CNBC Squawk On The Street 20240712

Struggle just to keep up. Look. I think that all of these have one thing in common. They all believe that the future is a little bit better and a little bit faster to come than many of us believe it is rather remarkable to see a consensus overnight from companies that basically say, you know what . Darn covid full speed ahead that includes boeing boeing has what i regard as being a very bullish scenario involving good cash, involving the possibility of returning to much more flight in, lets say, the next year. And even after 1,600 flights of the 737 i dont think theyre going to call it maxx anymore i dont know i think were growing to have a hard time keeping us down today unless faang keep us us down because the hearings go badly. We have a couple of guidance. Ebay the other one that raised guidance. Starbucks had a lot of things to say analysts recommend stocks its an exciting time. In a lot of ways, youre with a tesla call it turns out tell la sla is goi be a big car company thats not going to get us anywhere there are a lot of things going on i say the analysts are takingen by surprise how strong things are. David, you know, the analysts are all optimistic. Theres a lot of optimism out there, theres no doubt. Viewers, after the series of ceos that join us in the next half hour or so are going to have a pretty good sense of the economy. And theres the amd that stands alone in its own way its probably the one whose Business Model you would most want to have right this moment. Yeah, because you have intels Business Model faltering. You had the top ten list you had people thinking, including me, how much better can it get a lot. It is as i occasionally do, i will compliment you theres a way you do create wealth if you can hang on there when a new ceo comes in with a new vision as lisa su did. You mentioned ebay this is the ceos first interview. He was forceful on the Earnings Call saying, hey, things have not gone as well as they could have guys, weve got a packed hour lets get to phil lebeau. Good morning. Lets bring in dave calhoun, ceo of boeing just after the Company Reported q2 results. Dave, thanks for joining us. Youve announced that youre cutting your production rates over the next couple of years, and at the same time people have the same question for you that i hear all the time. Whats the outlook when you look at airlines around the world over the next few years . Yeah. Following last quarters outlook when youll recall we believed the industry would return to roughly 50 of service by the end of the year, we didnt know then there would be a second wave of the virus or the cases, and the extent to which theyve traveled to leisure markets, certainly here in the United States in terms of a nearterm perspective, things have gotten quite difficult. Flights have not come back as quickly as we thought they would. With respect to the long term, we still feel like three years is the right time frame. Weve always believed that if anything has changed on that front, its that theres probably more optimism today about the vaccine and the notion that a vaccine would become whi widely distributed over the course of 2021 in my view, that should give people confidence. The last comment i would make, the experience of the airlines immediately following the first spike when we all believed it might be under control, there was a pretty robust demand coming back into the marketplace, and for me, that just speaks to the underlying demand that exists and that i believe will ultimately fuel the industry. In the near term as you mentioned, were seeing a weaker demand from around the world in the airlines as you assess, do we need as many planes or cancel or push out our orders youre out with an order saying, look, were in the midst of adjusting our staffing, and now youre going to further assess potential cuts in the future what can you tell us about that . Well, the rates are going to come down from what we announced a quarter ago. Theyre not going to come down in quite the dramatic fashion that they did the first time, but were going to delay sort of the reramp of our business, and as a result, we will have actions that we have to take over the course of this year into the middle of next year when we bring those rates down to more modest levels. We adjust these rates and consider the market pretty much every day because there is, just like you suggest, theres a customer calling us every day with a desire to want to defer and to deal with the difficult environmentals that theyre dealing with. You know jim cramer. Good to see you be a little more optimistic one thing i believe youve done right is cash, the second thing is cash, and the third thing is cash i believe youve taken some things off the table for investors and you have rightsized the company so when things come back, theres a possibility you may have an Inflection Point of earnings, which means you may have to buy the stock now. Could i be overoptimistic, or is the possibility vaccine, return to travel, including business travel, quarantines, and shortage of new planes because of so many planes needing to be replaced well, jim, thats that is my stump speech, and its not a stump speech i believe that to my core, and so does my team. I am optimistic. Ive always been optimistic about the recovery of the industry as i said, in light of all the circumstances youve just described, including the eventuality of a vaccine and more and more confidence about that, i believe there is a chance in those second and third years out from now where were going to be struggling to keep up with demand so i dont want to buy or sell stock at this moment on the basis of that. Im not going to recommend anybody else does, but it is worth saying that we remain very confident in that future and as i said, just that early recovery, just that early recovery, post the first spike and the fact that bookings came back and they came back fairly robustly for me says that the underlying demand equation still exists and that eventually we will solve this. All right lets go a little deeper on that one, i think people are starting to realize that an airplane is a far with masks is safer than a building or structure or elevator you dont hear of anyone getting sick on planes second, the masks. There was a time i think it was front and center look, youre never going to be able to take back the tragedy that happened, but 1,600 flights since the maxx i think a lot of people are saying, wait a minute. Its punitive at this point. Safest plane around. These two things, the fact that people recognize plane safety is right there both for actual safety of engines, but more importantly safety of covid, is really not top of mind anymore were accepting. I think thats happening yeah. I think that awareness warrants, one, a lot of concern on our regulators, business associat associaters, customers for sure on what really happens in an airplane it is not a trapped tube of air. Its processed every two or three minutes through a hepa filter there are a number of things that provide for a safe environment. In addition, all the procedures that the airlines and regulators have put in place to ensure that sick people dont get onboard an airplane, the requirement and strong recommendation that masks be worn. This layer of protection works for the public i believe its a safer environment than many of the communities in which people live, and we have to believe that the education is happening, and i believe the public is beginning to accept that that is a fact with respect to mr. Calhoun with respect to the 737. Go ahead. Im sorry the progression, the certification progression has been fantastic its been thorough been transparent as you said, the airplane flies every day. It has incredible Performance Associated with it and now we have to finish it we have to finish it the right way, this process, with all the global regulators, and im confident that we will my hats off to the faa. Theyre doing the work its diligent. And were just going to stay confident and follow their lead. Yeah. Mr. Calhoun, sorry to interrupt you there. Its david faber i wanted to get to the Balance Sheet. Certainly one of the moments in this pandemic concerning the financial aspect, it changed sort of a perception you have 32 billion roughly in marketable securities, 60 billion in debt. Will you need to access the Capital Markets or are you satisfied in terms of the cost cuts and dividends not being paid, in terms of extending buybacks that you will not need to go to the captain markets again . With respect to the forward look and capital rates, we think were at a good place to get us from here to the environment i just discussed with jim, a more optimistic environment, and, therefore, not having to go back to Capital Markets on the other hand, never say you never go back. We believe we have tested difficult circumstances, we have put every Sensitivity Analysis we think we know against what weve now described in our Earnings Announcement with respect to production rates, and we believe were in a good place and were going to get through this with what weve raised. That was always our intent were pleased with the way the Capital Markets responded. Were really pleased with the way the credit markets opened up as they did. And ultimately it played out for us. Dave, speak of being a little more optimistic, on may 12th, you went on the today show and said i dont want to be too productive, but, yes, a major u. S. Carrier would have to go out of business. Can we take that off the table let me put it in this perspective. Boeing serves the marketplace. Most orders come from outside the United States and all kinds of jurisdictions there are bankruptcies going on today and at the time of that interview there were bankruptcies that were apparent to us. If youre boeing and you produce airplanes, you always have to consider bankruptcies in that process. What i will say is that the governments support, c. A. R. E. S. Act in round 1, whatever ultimately gets played out in round 2, i believe has been incredibly effective with our u. S. Carriers. Its kept them alive, kept the footprint fresh, theyre warm, they can take delivery of new airplanes when it comes. With all that said, theyre in as good a place as they can be, and theyre an incredibly come pe stent group of o ceos its still pragmatic for bowing to look at that land scape because bankruptcies are happening as we speak. Thats the finest lens i can put on it. Dave, its phil again youve had 700 someodd negative planes iechlts shri planes its shrinking, not growing. You do write that off or do you think next year you start to see airlines say, yeah, were ready to order again i think its sort of the discussion weve been having all along here its that moment in time when the really healthy airlines and there are going to be a bunch that emerge in better shape and Better Health than others the minute they think they can gain an advantage by building out their fleet, refreshing their fleet, and that the virus, the worst of the virus is behind them, then thats when it will happen it will happen in different jurisdictions at different times. China, europe seem to have a little more control over their environments than the u. S. Does at the moment, but it will happen, and i believe somewhere in that depending on a vaccine and success and distribution of a vaccine. Somewhere in the second half of next year, im hopeful that this worm turns. Second half of next year. I think people are hopeful it will happen sooner than that one last question, dave. A lot of us, our first flight was on a 747 it was an iconic aircraft. Was it a tough decision to say its time to stop building it. Yeah. Its been a tough decision for quite a long time. You know, this is just facing reality with respect to the mark market, and the new airplanes that are available being part of the puzzle the customers want the new airplanes, new technologies. The 747 has been unbelievable. The only comment i would make with boeing and the 47 airplanes, were going to support them it started in the late 60s. So, yes, its emotional for everyone, but we believe that in 22, we will end production. Dave calhoun, ceo of boeing thank you for joining us on squawk on the street this morning. Carl, ill send it back to you i think everybody would agree. You hear a tone of optimism from dave that im not sure we heard when we talked with him after the first quarter. Certainly an evolution from just a couple of months ago. Phil, as always, our thanks to you for bringing it to us. Thats our phil lebeau in chicago. Were not nearly done wchl very the ceos of jetblue, ge, amd, and starbucks. Lisa su, raising guidance. Dont go anywhere. Look here, its your very own allinone Entertainment Experience xfinity x1. Its the easiest way to watch live tv and all your favorite streaming apps. Plus, x1 also includes peacock premium at no extra cost. This baby is the total package. It streams exclusive originals, the full peacock movie library, complete collections of iconic tv shows, and more. Yup, the best really did get better. Magnificent. Xfinity x1 just got even better, with peacock premium included at no additional cost. No strings attached. An army family who is always at the ready. So when they got a little surprise. Two . They didnt panic. They got a bigger car for their soontobebigger family. After shopping around for insurance, they called usaa who helped find the right coverage for them and even some muchneeded savings. That was the easy part. Usaa insurance is made the way liz and mike need it easy. Sometimes you have Success Stories so excited in the stockmarket that it take yours mind off covid, politics, anything that depresses you, and one of them is a amd and what lisa su has done guidance for the year, fantastic. A huge earnings beat left. s find out what happened and lets talk exclusively to ceo lisa su. Lisa, its truly fabulous to have you. Hey, jim. Good morning its great to be with you guys this morning. One thing i find so interesting, despite the fact you talk about a competitor, and i do this too, when they make a mistake, you have a roadmap. Could you sflan explain to people how youve taken the destiny of amd and put it in charge of you, not in charge of the customers . Well, jim, look what i would say is we are in very important markets. When you look at the thinks powering our data centers or infrastructure or work from home, school from home, pcs, these are really important things for the market. We have been focused on this for many years, and its all about delivering high hperformance computing, helping our customers, helping them do the essential things they need to do our roadmap has been consistent and has been strong over the past couple of years and its produced very good results were pleased with our Second Quarter results. A lot of things came together in our business, but its the result of a longterm journey of delivering great products to the market. That did not seem to be the case when you reported last. I felt that when you decided you shied away from guidance, you had gotten away from the notion you had a longterm plan. Obviously thats changed what occurred to make it so that you have a vision that i didnt feel you had last quarter . Well, i think what we have is, you know, there are a lot of uncertainties, right, when you look at the mackerel, the impact of covid19. We wanted to make sunday we understood all the puts and takes. What came to us in the Second Quarter are a couple of things first of all, our server business had its highest ever quarter. We had a number of the top cloud manufactures really ramp on our products for their most essential services we had our p. C. Business you know, the fact is, youcs arl we had our notebook business with a strong ramp across. And now as we look through the second half of the year, look, theres no question, theres a lot of uncertainty were watching like everybody is, what happens in the macro. But we feel good about the markets. We feel good that the pc market looks strong we have a great gaming cycle coming up with our new consoles. We look at that and say, hey, you know, despite the uncertainty, we have a very strong roadmap our customers want, you know, to partner more deeply, and we see revenue, you know, growing now at 32 year over year. Unbelievable revenue. Growth, and at the same time i dont want to be the guy who singles it out its possible you could have 20 server share up from Single Digits tore a lot of it has to be the competitor intel, a company that when i first met you, i was telling you i was an intel hawk and scoffing at what amd could do you schooled me, put me in my place. But is it possible you can get up to that share from singledigit share we had a very good Second Quarter in the sense that we met one of our key goals was meeting doubledigit market share in the server market, and, you know, based on our result, we met that milestone. Look i think this is a multiyear journey. I always talked about a multiyear journey were in the business of High Performance. It takes many, many years to develop these products were excited about our roadmap. We have a new set of products coming out in late 2020 for both of our serves as well as our p. C. S and games markets, so were excited about those products were going to keep focused. Its 2020, 2021, 2022. Its about being very consistent and ensuring that were working on delivering that High Performance to the market. Lisa, in terms of analyst commentary, it seems like the bear case centers around some kind of price war that would develop in the second half and put your second half guidance at risk whats behind that. You know, carl, i guess its safe to say its a competitive market always been a competitive market our focus is on playing our game about introducing new products it its about what our customers want to achieve. Its about delivering it to the marketplace. No doubt its a competitive market we feel really good about it we feel good that technology is becoming even more important in this covid and postcovid war that were in, and the way we look at it is, you know, we want to ensure that, you know, were playing the long game. And, you know, as important as this quarter is and next quarter is, its more important that we continue to get on to the most important workloads that our customers are trying to do you know, thats what were focused on. All right, lisa this is something ive got to ask. Youre teaming up with da vinci im sorry gem see roy, who you know really well i have to tell you, i thought that was epic with an i. Are you two working together well i always felt that you guys were ene enemies, not frenemies. You know, in the tech partnership, there are competitors and partners were pleased and happy to be within the next nvidia systems, i think. Theyre a very big company and they chose our processors because we were the best in the marketplace. I look at that as validation of some of the other large customers that were working with i think the key for us is, look, we want to push the envelope this is all about delivering more than you could do last year, you know, and the year before so, yes, there are lots of partnerships that are important to us, and, you know, were happy to be selected. I was hoping you would guide up margins with guiding up on revenue, and i actually thought you could one day be up to the holy grail of 1662, if youre not with that, youre not a real serious company. Any chance that can happen you know, we went through in march we went through our longterm financial model. Our longterm model says we get to greater than 60 . It depends a lot on our product execution, our mix of business our goals are to deliver on the top line, grow revenue at a compound annual growth rate of over 20 over the next couple of years, you know, grow the bottom line as well as grow margins i think, again, part of that multiyear story is steady progress each year. You said on a call with enterprise, we have specifically addressed our total aggressive market i thought that was one of the most bullish lines of the quarter. Please explain. The Enterprise Market takes a while. If you think about how fortune 1,000 companies are doing, theyre not just betting on this generation, but theyre betting that you have a longterm roadmap. You know, weve made Good Progress in the Enterprise Market weve also expanded our number of platforms we can address. This is all part of this notion of its a stepbystep journey the products are really good the products next year will be even better. And our goal is to make sure were partnered deeply with cloud customers, enterprise customers. Were very big into supercomputer. Supercomputing is very important these days in terms of medical research and the other Key Applications so our goal is to really, you know, specialize in this area of highperformance computing and deliver, you know, those improvemented to the marketplace. So increasing it is more about addressing more of the space. Lisa, your prowess is only exceeded by your humility. Congratulations on another great quarter, which i think you might have been able to do despite the fact there was a competitor that slipped up always great to see you. Thank you very much great being with you guys this morning. Back to you, carl. Jim, stay with us were going to get the opening bell and the s p heat map as it fills in there will be names that will probably slip through the cracks today. I want to make sure shopify is not one of them, though, as revenue, just a blowout, up 97 . You know, its funny. Jeff bezos is being drilled fwi House Committee really on the basis of monopoly, ill call it that i want to rewrite my speech if im jeff bezos and say, listen, shopify is beating the heck out of us. Hey, we have no monopoly you should be talking to those guys because shopify is just on fire, and whose business are they taking . Theyre eating amazons lunch, so i think the house ought to get a little more familiar with a small Canadian Company thats no longer small and if they were bought by an American Company that refused to do so, jeff bezos, yeah, he was really good and did a terrific job, im looking at shopify that stock may not even stop here. Its at an alltime high here, jim. Do you believe given that that bezos going into this hearing has the least liability . No, unfortunately because theres always this contingent of small businesspeople that have to be catered to by the constituency this is who elects them. He has to be skewered. Tim cook less skewered i have no idea if Mark Zuckerberg plays it right, he can talk about how his company has created more jobs and instagram has been the answer to the pandemic jeff bezos is on the hot seat. Tim cook is like in the jenkins hot seat like in the nfl he knows how do it well. Thats more like a trump navarro thing. Hell have to answer to people as he gets his head handed to him. Jim, you have to explain it to people. They dont operate in direct competition, shopify and amazon across the board, but you should explain where the competition is in terms of shopifys business for those who are not following the stock closely. I would want to work with shopify as a retailer because shopify is my friend theyll even advance me money. I always felt from an excellent documentary gee, david, youre probably familiar with it amazon competed against the people who shopify actually gives money to david, that doc told me amazon is patient and shopify is friendly if anyone in congress has heard of shopify, they should say, you know what . You should do some things that shopify does, which is helps these Companies Rather than hinders them i think jeff bezos could do that shopify is full of companies that are small who will one day go big theyre not going with amazon. Theyre going to stick with shopify. You are referring to thirdparty sellers on the amazon platform. Such an important component of overall revenue from retail. Lets not forget amazon is aws, advertising, very particular from a profit perspective. But the thirdparty sellers sure to get attention in terms of amazon competing against them, getting data, understanding what selling is, going into business, sourcing the same thing and selling at a cheaper level that said, these sellers are aware of it going into business with amazon originally they know this is a risk they take, but the platform itself is so ubiquitous, that they have to use it. Yeah. Well see if the same argument can be made with the app store they know the deal going in, but clearly the size of the app store is whats raising some eyebrows jim, the other one here, visa. Even though a lot of values working today and despite the beat, fiscal profit down 23. I see moffitt is at a top peak. Still conversion from cash to credit card and contact lists. Covid play and i think thats going to be what is the narrative going forward, which is why the stock could end up being up. Talk about being up, how about a stock that has spent a lot of time in the doghouse of late, and im talking about starbucks where a lot of people felt, you know what . I guess that was a Great Company at one time. Well, its back. Rallying this morning. Investors are shrugging off the coffee chains losses, which have been substantial, okay . And theyre thinking about the future why . Because Kevin Johnson actually laid out a course of the future that i thought was incredibly strong first on cnbc, star bucks ceo Kevin Johnson. Kevin, you did it. It worked. David, jim, carl, good morning. How are you guys it couldnt be better why . You have come up with a strategy, a covid strategy that will transcend even after covid, and whether it be curbside or what i think you should talk about, which is very exciting, the new im going to call them starbucks express. There are so many open storefronts in this country. Youve got Balance Sheet you can put stores where you dont have to worry about social distancing because the line moves. And i think you should talk about the new way retail can work in an era where crowds are an enigma. In march when we were closing our stores and providing economic certainty for our partners and taking care of frontline works, we put people over profit. Certainly we think that was a very, very important thing do. It built our mission and values and built trust. It strengthed what starbucks stands for certainly as weve reopened stores, we operate protocols the way we run the stores, the digital dashboard that helps around the world now were in a world where we can navigate anything this Global Pandemic will do around the world. What youre pointing to, is weve accelerated Strategic Initiatives that really have improved the company. When you look at disruptions i spent 32 years in the technology industry. Whenever theres a disruption, its those companies that recognize the disruption, invest in ways they different yat their brands thats what theyve done theyve figured out how to accelerate Strategic Initiatives weve had in our strategy. Were excacceleratexcea acceler only in the covid era but beyond were highlighting the stores. We see today that our drivethrough stores in the suburban markets are performing extremely well why . Customers want experiences that are safe, familiar, and convenient so you think about in urban core market how do we do that . We have traditional Starbucks Stores today in china we qaa them starbucks now. These are the equivalent of a walkthrough store. Its a much smaller footprint. Its all geared toward mobile ordering and a very convenient service. These starbucks Convenience Stores will be located within a three to fiveminute walk if you as a customer want to share your coffee and food and have a sitdown with a business colleague or Family Member or friend, you can walk to a regular starbucks store and sit in a cafe. If, though, youre on the go and want to pick up your coffee on the way to work or school, these Starbucks Pickup stores are going to be for you. Its blending those store formats that create a Network Effect thats where were going. I think a lot of people look at a number, particularly people that are not from either company. Sales declined 41 people say, its crazy stock is up 3. 70 theres a thing called cadence i think you have to tell people what happened in july. I think july is an ar bin jer a harbinger for what can happen for the recollect st of the yea we look at our two lead Growth Markets we saw our Comparable Store sales improve again from the month of june to july. In fact, we finished the month of june in the u. S. At a minus 19 comp, and in the month of july, we gained five more points in comp. We finished july at minus 14 comp the most important thing is, jim, i look at the leading indicators i look at three things i look at our Customer Connection scores. Theyre at an alltime high. Thats a signal that what weve done is resonated with our customers. And the digital reach we have is bringing our customers back into the store. That momentum is continuing. I look at the brand of infinity scores certainly those brand affinity scores have strengthened as we have come out of reopening stores in this period. And, finally, when i look at our market share numbers, certainly in the month of april when we had all of our Stores Closed i kind of ignored that month because when youre closed, youre not going to get a lot of share. In may, our market share was flat but when we hit june, the market share is taking off. Customer connection is strong, affinity is strong, market share gains in june. Look, we have now woven into our operating cadence how to navigate this Global Pandemic in every market around the world. The recovery is working, and were now accelerating initiatives to superproof the company. Kevin, speak of markets around the world, i want to focus on china where youre largely entirely open in fact, i think you open 1 hub new stores in the country during the course of the quarter. What have you learned from china in terms of dealing with the virus and obviously the rew e opening there that you can then transport back to the United States well, you know, david, as you point out, this virus started to spread in china long before it came to the United States and other markets around the world, so back in january as we began really focusing on supporting our team in china, we learned the store protocols that allowed us to open our stores in ways that were safe, safe for our starbucks partners and safe for our customers. Now, those store protocols that were created in china were imported to the u. S. And adapted for the u. S. And other markets so all the store protocols were using they were originated in china and have been adapted in other markets around the world in addition, the key thing we learned about from china, once youre open, you have to monitor the situation of the spread of covid in every city across the country, and if you see that theres a resurgence of cases, covid cases, youre able to in that city carefully turn the dial back, basically constrain some of the Customer Experiences to help support government and Health Officials as they work to contain it that learned translated into a digital dashboard that we now have in place that cruises some of the Artificial Intelligence software we have thats called a deep brew that informs our store managers whats happening with covid, what our customer preferences are in that particular market, and what were seeing with market incentive. A lot of what weve done in china, weve now operationalized in the United States and around the world. Kevin, youve got a lot of investors tracking highfrequency data that is not seasonally adjusted, very volatile, things like chase card spending, open table, and google mobility, which do suggest that weve at least stabilized, flattened, maybe come down a bit. Is that being reflected in anything youre seeing in july look. This the recovery process, the plans that we have in place, theyre working, you know, carl, and we continue to execute against those. Now, look. Until theres a vaccine and more therapeutics, were all going to live in this world of covid and we all have to be mindful of that the jury wont be linear, but as company, we have really operationalized how were going to deal with this and its working. Were continuing to monitor it its different in different parts of the world there was a resurgence in bay shirng and the government was cautious they tested everyone we dialed back in those stores and now china and beijing is back on the front foot you look at whats happening in florida, texas, being cautious there. So this is just the world we live in. But, you know, were able to now do that, and i believe were going to continue driving the recovery i have full confidence in addition, im pretty enthusiastic about the future. Im enthusiastic about the additions. Jim highlighted at the top of this call, were really embracing new ways to blend new store formats, ledge go digitald service the customers, and thats going to serve us well in the longterm. Kevin, i wanted to come back to china briefly it cant escape your attention the deterioration between the u. S. And china how worrisome is that for you from a business perspective, and is there a breaktheglass plan at starbucks should we embark on a new cold war with china. Well, you know, dana, weve been in china for over 20 years. And ever since weve entered china, weve had the mindset were building starbucks in china for china, and what that means is our team in china is completely selfsufficient we have people in china that run the real estate, that design the stores, that invent the food and beverage we hire local chinese craftsmen that build our stores, artisans that come and create these great stores and we continue to invests in china. And i think because we are in china and weve done this in a way thats respectful to the culture and we value the relationships that we have in china, you know, i feel like were going to navigate this just fine. Certainly, you know, we think about the range of alternatives. But right now i think our business is healthy. We just crossed 4,400 stores we said, look, this fiscal year alone, were building over 500 new stores in china, Net New Stores were going to continue to grow. We Just Announced a couple of months ago, a 130 Million Investment in a global roasting plant in china, and certainly thats there to serve, you know, asia, but also the world in terms of roasting coffee for starbucks. And so, you know, im bullish in terms of china for the long term, but i also recognize the geopolitical situation is a bit tense, and, you know, were going to stay focused on what we do and what we do well, and thats hand crafted beverages, taking care of our customers, being respectful, and creating that warm welcome into our stores, and that will serve us well. Kevin, i hate to truncate you. You said on july 15th, im a believer in mask, we believe i in it a lot you know, jim, when we reopened storrs, we required all starbucks partners to wear masks in reopening why . Because we know it works we know that Wearing Maskshelp reduce the spread of the virus we know that washing hands helps reduce the spread of the virus we know that social distancing helps reduce the spread of the virus. We built that into all of our safety protocols when we reopened, we respectfully requested that customers wear masks certainly many of them did but as we saw the importance of Wearing Masks and more and more states were mandating that, it made sense to do it across the country. It gives us confidence, not only our partners but the customers we serve its a same experience you can come to starbucks and enjoy your favorite hand crafted beverage or food item and feel safe i feel this is a positive step not only for starbucks but for the country and society. I think like you, i believe this is something we can all do as citizens its something we can do as citizens, so we have a responsibility to do, that care for ourselves and others in our country. Amen. Kevin johnson, stock up nicely congratulations. Ceo of starbucks. Thanks, jim. Carl, back to you. Jim, thanks for that. Were getting some headlines regarding tik tok and the ongoing discusses on the hill. The president and treasury secretary stopped to talk to reporters briefly at the white house on their departure, the president suggesting theyre still far apart in their negotiations with democrats on the Coronavirus Relief bill but seeming to signal hes willing to negotiate on the issue of eviction and also payments to americans, whether thats those direct payments or unemployment checks, the president signaling a little bit of wiggle room there. And on tik tok, the treasury secretary saying tik tok is under review by the federal government, the president saying he might make a decision at some point, no idea what the decision could be the government could block tik tok entirely they could require them to divest and sell to an american owner, or they could negotiate with tik tok and come up with some set of rules and regulations to satisfied the government that data is not being abused there no indication or hat tip in which direction theyre going in, but they do say theyre considering it, david. Yeah. Ive been following it closely, as you know. The chinese parent of tik tok is valued at 130 million can they sell a majority to a u. S. , to your point redomicile it thank you. Lets get back to interviews after this break ebays new ceo will join us for his first tv interview dolph lundgren, youve got a onesixty i. Q. , a masters in Chemical Engineering and youre technically a genius. And it appears youre quite the investor. I like to trade. Well, Td Ameritrade has pros ready if you need help, say talking through a new strategy. Just in case things, you know, get a little rocky . Im sorry on the upside i think thats waterproof. Maybe not. Shares of ebay are down after a Strong Performance for the stock price. Theres concern about deceleration at the company. Joining us now is the new president and ceo of ebay i want to start off on your first conference call. You said were not satisfied with where we currently stand and the reality is the past few years we have not executed to our full potential briefly, what are you going to do and focus onto change that so ebay does execute at its full potential . Thanks, david, and thanks for having me on this morning. Since ive been back, i think theres lots of areas of opportunity. Im not satisfied with where we are, and i see enormous up side potential in getting back and focussed on the Customer Experience im planning on leading what im calling the techled reimagination of ebay thats using our technology and compelling experiences in three different areas. First, building compelling experiences in key verticals that are really core to ebay. And also getting back to our consumer selling thats individual selling which is really important to the platform second is being the seller platform of choice especially around nonnew in season we have a 500 billion opportunity in the core of what ebay is great at in nonnew in season and being the seller of choice is a huge opportunity and third is building lifelong buyer relationship trusted buyer relationships. We have new buyers coming into the platform all the time. Turning them into enthusiasts. Thats the plan to really drive this techled reimagination of ebay. Yeah. You know, investors obviously have ben facilitied as the company has from the pandemic, from so many people shopping at home, revisiting ebay, perhaps, or using it for the first time but in speaking to some investors, a number say given what youre talking about in the second half of the year, they dont feel confident in the sustainability of your growth. How do you answer that this quarter weve seen more than the last six quarters combined and what weve seen is that while growth moderates as mobility opens up in countries, obviously were a Global Company with lots of countries around the world. Its sustaining at a higher level. We feel really good about the new buyers coming in all the things were going to keep them on the platform, getting them to down load the app, et cetera what were focussed on is building a longterm sustainable healthy business, delighting buyers and sellers in their experience on the site youre no longer attached to papal in the sense of having to use them what is that freedom going to allow ebay to do when it comes to an opportunity for you in payments weve announced were launching managed payments thats the ability to manage payments on the platform its great for buyers and sellers. For buys, its seamless. They command they dont have to create a separate account and can manage the transaction seamlessly on ebay. And sellers love managed payments because they can manage their business in one area on the site and the vast majority of cases theyre going to be paying lower fees on the platform and thus far all the sellers that have joined have been pleased with the experience of managed payments two weeks ago we expanded. We were live in the u. S. And in germany. We expanded to uk, canada and australia. Pay pal will continue to be an important partner. The manage payments experience makes it seamless. When i talk about a technologyled reimagination, manage payments is a good example of that. Weve committed that by 2022 that will bring 2 billion of revenue and 500 million of operating income to the bottom line also great for the overall business by doing manage payments on the platform all right im going to solve your problem because the stock is down. I go to the site, up to 60 off reeb reebok stock ex, for sale make a bid, get the mojo back. Could you do it by the end of the day . You know, i think what youre talking about is what is important to me coming back to lead this company. Ive been back 100 days and im focussed on vertical experiences. So experiences like in sneakers that youre talking about, experiences in our core categories where were great whether thats luxury items or collectibles or fashion or parts and accessories. How do we get back as e pay and make sure were building the best experience for buyers and sellers to transact on the categories i think what youre seeing with vertical and niche competitors is theres a lot of Untapped Potential for us theyre getting gmv which should be transaboutive on tct i on thm i want to make sure those types of transactions happen on ebay. We build the capabilities and trust in the platform so the gmv is showing up on our site. You can roll them up. You can rent the runway. The world is your oyster, but youve got to get away from ebay. Core ebay does not have the growth we want you got the capital. Why dont you become the one stop shop for everything that every Stock Exchange that is not for stocks can be yours. Yeah. You know, when i think about whats happened over the last couple weir years, i think we were chasing in new in season product and not focusing on the core our opportunity is in the core when you think about nonnew in season, thats a 500 billion opportunity. Were low single percentages of that t huge f bringing sellers tha that inventory and making sure buyers have a great experience is a key focus for it. Well always look at m a and find opportunities to bring capabilities now that were focussed on the marketplace business and accelerate that we think theres a lot of work to do in the overall experience, making it better for buyers and sellers and keeping buyers on the platform for a lifetime. Speaking of m a, you did a large deal in terms of divesting. It was the classifieds business. A 9. 2 billion deal. To the surprise of some you decided to keep a 44 interest in the combined company, with the buyer of it. Why not have sold classifieds for cash, use some of it to invest, others to buy back more stock as opposed to having a 44 stake in a Foreign Company we think this is a fantastic combination. When you look at the transfer of the assets of ebays classifieds group, it creates the Worlds Largest online classifieds group. In 20 markets its the number one leading market share its a fabulous company. For shareholders, the allows us to capture in the short term the third thing it does is now that weve divested stub hub and weve transferred assets for classifieds, it allows the whole Management Team to focus on the core marketplace business where theres a lot of Untapped Potential. We appreciate you joining us to fill us in and well continue to be focussed on that core marketplace business as well look forward to getting your updates along the way. Thank you. Thanks, david thanks, jim. Excellent the president and ceo of ebay. Carl, over to you. Still a lot more to come this morning. Welcome to squawk on the street. Im Carl Quintanilla with david faber and leslie picker. Jim is going to stick around big cap tech ceos on the hill today. The democrat gop talks progress appears slow on stimulus were going to talk to ge and follow earnings in a moment. Jim, the fed this afternoon as a tenyear real records at a record low today look, and i think obviously people feel maybe theres going to be a deal my sources indicate there will be a shortterm extension and were going to be out of this woods, and that people who are betting this is going to fall apart are going to be wrong. It was my principle concern. I think that theres a lot of good news coming and people should stop thinking there will be no deal shortterm. Were going to get something stop worrying. And it could turn the market what, david you mumbled something. Yeah. When you said stop worrying, i thought of strange love. You know i am more confident than i have been, that there will be a shortterm deal. Thats big news, jim. Thank you thank you, david i want to make sure people understand, does that mean the 600 benefit gets extended for some period of time until they figure this out . Not sure, but something is going to happen that is better than the way the papers read thats good. The goal of everybody is to not have a sudden drop off 600 to nothing rent not paid. Commerce slowed down covid hot spots coupled with that everything we said about boichg. What well say with ge is going to be wrong. So im not saying you can take anything to the bank, but a shortterm deal is in the offing all right well, it certainly would be very important for the overall economy. Lets get to ge this morning the company reporting earnings of course, and were happy as well mixed results, by the way. Just to sort of reference them a bit. Lets talk to larry culp, the companys chairman and ceo and he joins us now. Larry, always good to have you glad youre back for another quarter. Another tough quarter, of course, in terms of navigating the head winds particularly in aviation i guess the good news is you went through a lot less cash than you might have anticipated. Is that good news . David, jim, good morning. Good to be with you both no question some of the better news from ge is the fact that our negative Free Cash Flow in the Second Quarter, a time of unprecedented pressure on the business, particularly in aviation, was just over 2 billion. David still negative were not proud of that. We have to do better we have to put it into positive territory. That said, i think the team took the reality head on here during the course of the Second Quarter. Worked through a number of operational issues, and came out a little bit better than we had opera anticipated. I think were pleased with that outcome, but we have plenty more ahead of us as we work to transform ge in the second half and as we get ready for 2021 yeah. Well, larry, you were working to transform ge before the pandemic you seem to be on a strong road there in terms of doing it but as you point out, theres nothing i would assume in your Business Career youve dealt with thats like this. When it comes to aviation, how confident can you be at all, and therefore, do you have to just keep cutting costs to make sure youre in a position to withstand whatever head winds are coming . Well, david, i think we take a lot of confidence despite the nearterm pressures in the industry right . This is a vital integral piece of the global economy. And we will see it return. Were all somewhat uncertain as to when that will happen but it will happen and what we want to do is make sure we take all the shortterm actions to continue to serve our customers, keep our teams safe, and improve our overall performance while making sure we continue to perpetuate the investments that allowed ge aviation to be a key partner to not only airframers but airlines around the world for decades. And thats the balance thats the challenge that we have in front of us. We dont know when well get back to 2019 levels. I dont think any of us really do in the nearterm, were going to be aggressive with respect to cost and cash preservation actions. And thats part of what you see here in the Second Quarter results. More to come in the second half. And i have great confidence that ge aviation will continue to lead in the future, but it will be if you will, a bumpy ride for a little bit you say more to come in the second half. Can you give us any sense as to what youre referring to david, specifically i think as we look at the second half, were going to see the majority of that 2 billion Cost Reduction and the 3 billion of cash preservation take root and deliver impact for us in the second half. In addition, i dont think we see necessarily the overall Aviation Market changing materially were encouraged by the sequential progress that we see. We look at the daily departures for our engines by platform, by region, every morning. And weve seen some nice recovery off the early spring lows china today is down high Single Digits its a far cry from where we were in march. We think that will be the environment were going to work through in the second half, and into 21 but Getting Better larry, first, didnt you have black hair when you got this job . I was somewhere inbetween, jim. You got dealt a tough hand. Renewable energy was what i thought was a write off. I know down 19 is nothing to write home about, but when you have other doozys its not so bad. This is an esg company, and a Robin Hood Company i deal with a lot of youngen investors. They say i want renewable. Tesla. Is it possible or you can humor me is it possible that Renewable Energy may be the esg company of the future and people want to own it and they dont want this other stuff . So maybe we get it maybe you give it to us. Jim, were very proud of the work that our Renewable Energy team is doing. Just looking at the Second Quarter, the Growth Engine within that segment, on shore, our new turbine and repowering kit volume was up 16 and thats despite all the covidinduced pressures on the supply chain which were meaningful we worked our way through that we think Renewable Energy has a significant role to play in the energy transition. Were a leader in on shore wind. Were making significant investments with our offshore platform to participate there more actively. But we do have a couple businesses, our hydro lines that are going through tun arounds. If i look at the Second Quarter, i think i saw Real Progress with respect to the way the new makt teams are exkuding the day in, day out plans. We have a tremendous future ahead of us in renewables. We need to make sure the growth is coupled with better earnings and better cash. We recognize that, the team does thats work underway, i think work we can and will do. Are you surprised that given the prices of natural gas worldwide that youre not selling more gas turbines . Because its a Great American story, for instance, but i would have thought that you would have been able to crush it because you do have the best gas turbines i think we crushed it in a delivery perspective we had a very Strong Quarter in terms of shipments where we were late was on the inbound, the orders front i think gas certainly has i think a role to play in the energy transition. We like the way customers have responded to our rh platform and continue to see, i think opportunities to do better on the order book side of things in the second half. That was clearly a space really in a bit of a contrast in renewables where we saw financing slow a bit, customers taking a pause, but if we look longer term, we feel good about the potential to continue to deliver new units in that business clearly its more of a Services Play as you know and thats where we also have i think the opportunity to continue to take cost out. We had 200 basis points of operating margins of support as a result of the Cost Reductions that are underway. Now, we lost that benefit largely because of the volume pressure on services but by and large, i think we really like the improvements that team has made over the last couple years to improve our execution and we think we have more to go there larry, were kind of moving through the portfolio. Lets get to health care orders there 4. 3 billion down. Youre benefitting in some ways from covid19 related results and losing in others whats your outlook for health care at this point. Youre right. We were pleased with the first half given the Critical Role we play on the front lines with a lot of talk about ventilators and other products like ct scanners, patient monitors that have been critical the world over in battling the pandemic. We certainly got hit hard. You referenced the elective procedure referrals. Thats the highest margin part of our Health Care Business. But what we took the most comfort in through the course of the quarter and even into july, we look weekly at the utilization of our install base of our mri and ct scanners that really gave us a very good window on the slowdown in traffic in hospitals but that has had a sequential improvement thats been quite remarkable, and were back really on a global basis where we were on a precovid level now, that doesnt necessarily translate directly into new equipment order s but it does support the underlying parts of a higher margin part of the Health Care Business where orders are down Single Digits and we were down meaningful double digit number in the Second Quarter so that is all moving in the right direction. Weve seen good adoption of our Digital Projects to help them deal with pressure of patients from covid19 but we think we helped accelerate their Digital Transformation as well here in this moment. Any regrets about selling that business . Obviously you never could have known it potentially would find itself in a good position given whats happened, but it did bring in significant revenues, i should say significant cash at the same time, at the same time, it would probably be a vibrant business right now its a terrific business, and i think my friends that bought it are going to be excited with the team they just brought on board. But david, i think we have no regrets. We sit here today with 41 billion of liquidity that we would not have had had we not done that transaction. Were sitting here having reduced our debt load, down 22 billion from the beginning of last year on top of the maturities we pushed out relative to nearterm debts. I think what weve done to derisk the company at a time of uncertainty broadly, you do what you have to do im convinced that weve taken the right actions including the bio pharma transaction to set ge up to weather this additional storm. It delays the transformation of the company, but it doesnt prevent it and thats a part but not the only part of what were doing to make sure we realize our full potential. Larry, ive been critical of the accounting you had before you got there to the point where i wondered did a disservice to shareholders. Theres going to be a change kpmg has been your auditor since 1909 i want to know what it means and is there any way that kpmg can be held accountable for some of the lack of or ill advised candida accounting it doesnt seem fair to you that you should be saddled with this . Were focussed on the future. We have time here as we transition before theyre fully engaged. If you look at what i and the board as well as the Management Team, we have a number of new people on board. A new cfo, a new controller over the last several quarters. I think this is a team that has really gone through the accounting and the operational rigor required to run a company of our size and scope. And feel good that as we move forward with them were going to have not only better results but we intend to deliver that with greater candor and transparency. Finally, you are going to continue to sell over the next i think three years. The remaining stake in bikaker hughes beyond that capital, is there a need for ge to potentially raise new capital in the markets we dont think so this mornings announcement relative to the multiyear exit from baker hughes allows us to monetize that noncore asset, something that began in the fall of 18 well do that over the next three years and do that in an orderly way. I think were excited about that just to really get on with things in terms of what weve done this year with respect to accessing the debt market, we think were done with that work. Were pleased with the results pushing out over 10 billion of nearerterm maturities i think at this point we have to work those levers that are within our control to drive better growth, better earnings and better cash, and as we move forward, thats what this team is going to do well, we always appreciate you joining us to keep us updated. Larry, thank you thank you. Jim, whats on mad tonight we have very exciting stuff we have dexcom my favorite is aphria. Its about cannabis and every wants to talk about cannabis there we go. We pander to it. Everyone does want to talk about cannabis thats right, jim. Well look forward to that up next, the challenges facing jet blue as revenue plummets in the wake of the pandemic an exclusive with the ceo, robin hayes, straight ahead. And new polling out today from the Cnbc Change Research Poll of Battle Ground states with only 24 of likely voters nationwide saying its safe to fly. Well be right back. Dont go anywhere. Jet blue reported the Second Quarter results with revenue tumbling 90 in the quarter. Lets turn to phil with jet blues ceo with him. Thank you, leslie lets bring in robin hayes coming to us from new york city. Robin, lets start with your perspective. You heard from larry culp said from ge. Earlier today we heard from dave calhoun from boeing. They think eventually the industry comes back. Thats longterm what do you think six to nine months hi. Great to be back on the program. We agree well see recovery at some point. People want to travel. Theres a lot of pent up demand for travel lots of friends and family theyve put off seeing how do we bridge to that point what were focussed on at jet blue is first making sure people know were doing everything we can to keep flying safe, and make it as safe as anything youll do in your daily life and two, focusing on our cash burn we came into this with a really strong Balance Sheet and by conserving cash, it means that as we pivot out of this, as we come out of this, well be ready to do well and take advantage of the opportunities that will present themselves robin, theres growing chatter in d. C. Of a second cares act being passed another round of aid specifically for you and other u. S. Carriers. Whats your sense on the likelihood of that passing thats a hard call to make. I dont know the answer to that. I dont know if anyone really knows the answer to that i will say that a day of reckoning has to come. We were all so fortunate with the first cares act. It protected the industry. It protected hundreds of thousands of jobs in the industry but as you just showed before the segment started and as were seeing, were seeing in the u. S. Volumes at 25 to 30 of what we would expect. We are close to the end of july. So we are going to still as we get to the end of the first cares act period through to september, were still going to be at a fraction of our normal levels airlines are going to have to reset. It has the potential to cause a significant amount of job less losses in the industry an extension of the cares act would prevent that and protect a significant number of jobs having said that, you know and ive talked with people who have said youre one industry that was targeted in the first cares act and for a good reason. And people are saying wait a second should the airlines get a second round and there are a lot of other industries that were not specifically targeted . I appreciate and recognize that and as i said a minuting a, we were fortunate as an industry. But so much, the airlines are really the toll that will help us recover theres no tourism without airlines the whole travel industry is built on the back of the aviation system. The economy, so much of our gdp is directly or indirectly tied to aviation. The multiplier affect you get if you keep the Aviation Industry intact will help us bounce out of this more quickly the argument when cares one was put in place and thats the argument that holds for cares two. You and a lot of your peers are experiencing a shrinkage of your airline in the middle of this crisis. How quickly can you scale back up to meet demand in the event hopefully there is one, a solution to this pandemic . You have to be nimble and flexible things will improve quickly. In june we were looking at 20 to 30 improvement in bookings and then things turn the other way. This is a nonlinear recovery sometimes it feels like two steps forward and one step back. Sometimes it feels like one step forward and two steps back what were doing is making sure we can adjust our capacity upwards when we see demand but also reduce it and take it out of our system when we dont. Weve had fabulous support from our crew members over 60 of our crew members have taken some form of time off over the summer and its about kind of getting everything lined up so we can increase capacity when we see demand and reduce it when we dont. But all the time, our number one priority right now is to reduce our cash burn. Robin, youve been creative in finding work arounds. This code share and partnership with american, of course, got a lot of attention the last couple weeks. Can you talk about the progress within that, and what do you say to those who suspect that its a precursor to something larger between you two . Yeah. No, i think were excited about the potential partnership. I think there is a lot of evidence that when jet blue flies are out, not only do fares drop in many cases significantly, but Service Improves and everyone has to raise their game and were constrained in new york were a relatively young airline. We dont have portfolios other airlines have. The partnership with american allows us to have more flights in new york and bring more lower fares and also connect to their longhall destinations its going to allow between us to offer a better choice to customers and a third strong combination compared to the other area were excited. Were going to compete with american, too. Were going to compete with american over south florida and we announced flights were going to london next year. Were competing with them to london too its a partnership, but were going to stay hopefully competitive in other areas robin, you brought down your cash burn stashlubstantially when we were on the Earnings Call, you said you feel good about your liquidity right now do you foresee the need to raise more capital in the second half of this year, or unless something strange happens, should you be good through next spring we feel good about where we are so far we left the Second Quarter with about 3. 4 billion of cash we raised nearly a billion in the quarter prior to that. We still have over a billion dollars of unimcouple bered assets and we have the opportunity to take the government loan out. And we have transactions that we can do we will continue to be prudent and make sure that we have sufficient liquidity its been a priority for us over the last few years to improve our Balance Sheet. We came into this with the second strongest Balance Sheet of all in the u. S. Airlines. Its been very important that we continue to protect our liquidity to make sure we can come through this. Because it is going to take a significant period of time, i think, for us to see the recovery that we would all like to see one last question, robin, how do you feel about the Comfort Level of passengers, not just for you but for all airlines right now . Polls show it remains really low in terms of people saying theyre comfortable getting on a flight when i talk with executives, they feel the people they talked to in the airports are generally good with the flying experience. You know, i think what we can focus on is make sure people know that when they need to fly, when theyre ready to fly, that we are going to do everything we can to keep it safe. And theres been some really, really positive changes in terms of how we clean and sanitize airplanes that are going to stay forever. Only this morning we rolled out a new uv Lighting Technology to sanitize airplanes to compliment what we are already doing and our Customer Satisfaction surveys have never been higher its never been higher for customers flying, i think theyre appreciating what were doing and the industry we have to work on this together and over the course of time, you know, its our view that as more people fly, more people are going to get comfortable and seeing the numbers adjust. But things have to be open when you get there, and they have to be able to go and do something we have to get the case counts under control in states that are tourism markets so people have the confidence to go back there. I think everybody would love to see that. Robin hayes, ceo of jet blue thank you for joining us this morning. Guys, its been a busy morning a lot of exclusive interviews with executives, especially in the airline and Aviation Industry, and the one thing you can take away, almost all of them believe its going to turn at some point. The question is how far into the future before that turn actually takes place . Thats a nice way to sum it up so far, phil. A lot of interviews to you when we come back, obviously big tech ceos on the hill is a huge story today well talk about the various strategies they have going into house judiciary in a moment. As business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will. You can rely on the people and the network of at t. To help keep your business connected. Welcome back federal agents have left seattle after local officials complained their presence was escalating tensions at recent protests. Tactical forces arrived in seattle last week and were on sa stand by to protect federal facilities the Minnesota Twins honoring george floyd last night. They stopped play to take a moment of silence at 8 46 local time in richmond, virginia a hologram of floyd was unveiled next to the robert e lee strat chew and in mecca the first pilgrims arrived for this years sharply curtailed hajj you are up to date daats the news upte ill see you in an hour. Were back after a quick break or whats trending. Get realtime insights in your customized view of the market. Its smarter Trading Technology for smarter trading decisions. Fidelity. In a highly capable lexus suv. At the golden opportunity sales event. Get zero percent financing on all 2020 lexus models. Experience amazing at your lexus dealer. We use buildings we already known, it cut costs. In innovation we feel we can become competitive a park thats 1200 acres with its own power, waste recovery. The infrastructure is there. Im not paying for that. Those are key costs that come out of that entity that gives us a competitive advantage. That was the executive chair of kodak joining squawk box earlier this morning look at the stock. That is nothing short of extraordinary. We mentioned this stock yesterday when it was up significantly after mentioned by peter navarro. This loan that is coming from the u. S. Government under the defense production act of about 765 million to enable kodak to begin manufacturing the ingredients for generic drugs. Thats at the heart of whats happened here. The stock has been halted for volatility and its one weak performance is now well, 2,242 over the last two days. Its i dont know we see this occasionally it does remind me of some of the periods in the late 90s when wed see some names, you can name a lot of them, too. That just moved in ways you would never have anticipated he was speaking positively about the companys future in terms of its ability to deliver what has been promised or will be as a result of getting this money in, given kodak has dealt in chemicals for a long time. But unclear what this really means. I will tell you theres one director, George Garfunkel i think he owns 15 now. He bought shares at the end of the year last year do the paperprofits right ther for him who i believe has been a pretty big supporter of republican politics in the past. Over to you. Or anyone, david, who bought mondays low of 213 and at 5060 now. Youre looking at huge profits on paper the bulls will argue theyre heralding a new era on pharma. Well have to see an an amazing run in the meantime, were watching big ftechs hearing later this afternoon with tim cook, jeff bezos and others. Walter joining us to talk about whats been called the biggest concentration of personal and corporate wealth to ever appear before congress, and similarities some say to big tobacco hearings decades ago you think its that big a deal oh, man, were going to have to process this, you and i over a drink five or ten years ago when you have this concentration, and its being done on a virtual platform where because of coronavirus everybody is appearing in little boxes, its such a weird period because it helps us understand how technology has enabled us to do things including survive this coronavirus, but also technology is something that sometimes runs outside of our control the pushback, walter, from those who say this is nothing like the big tobacco hearings of ye yesteryear these are pillars of the american economy, and they share broad popularity among american consumers. Is that fair absolutely, and we have to make a distinct. These people are not being caused with causing intentional or unintentional or reckless deaths of human beings i think this hearing, i hope it will focus very specifically on antitrust its a Sub Committee of the house on antitrust. And the question that we have to face with these companies is they have become so success frl, so bilg and theyve earned confidence by creating great products the question is whether you can leverage the dominance in one field in order to crush competition in adjacent field. That seems specific, but thats at the core of what we need in our economy. Our antitrust laws often focus mainly on one of the prongs, does it harm consumers youll see each of these tech execs say no, were helping consumers but theres another prong of antitrust law that says you also judge whats happening based on whether it suppresses competition thats bad for the economy and is bad for all of us in the long run. I do think thats an important question these tech executives are going to have to answer. Its not like the tobacco exec questions they had to answer, but it is very real for our economy. Walter, what are the chances that Congress Passes meaningful regulation as a result of the hearings today can we expect to see anything change as a result of this, or is it more just getting these four executives, i would say in a room, but into a zoomlike format in order to hear their perspective on the state of things right now i would not look for legislation. Im not one of these people who believes that washington is all that functional when it comes to complex tech issues, but what you will see, and it hasnt become totally partisan yet. In the field of antitrust, youre going to see states attorney general and the department of justice which is now looking at google and preparing some antitrust measures, especially in the field of advertising where google is using its dominance in the market of search and its other products to gain dominance in advertising youre also seeing the ftc look at the aunt trust issues on facebook what will come out of this is more gift or should, grist for serious antitrust investigations, not wild legislation that tries to control the tech industry. Walter, its david. I have at least three of your books, probably more behind me right now. You havent heard anything yet about bezos. Youve written about innovators, and a great deal about steve jobs bezos to me is the most interesting because hes never appeared in this way before. What are your expectations from him this morning or this afternoon . What well, what are your expectations, i guess, is my question first, let me say that in involve theres a book coming out of jeff bezos writings and letters. Ive been studying and writing about him. That book will be out in the Harvard Business review, and what i expect from bezos is hes going to say we have made the most consumerfocussed company ever thats one of the themes of his life, of his career at amazon from the very beginning. He focuses like a laser on what can be good for consumers. And it does. I mean, i look at the shorts and trousers i put on. Theyre amazon essentials. They come from amazon. The question is it helps consumers and weve learned that in the pandemic just to be able to have things delivered when its harder to go shopping, but the question is how much is that suppressing small, independent businesses entrepreneurs . How much are they using that data so i no longer go to a lands end or to buy a shirt, but i go to amazon so i think youll see from bezos a stress on what hes done for the consumer and a deflection, perhaps, on has that hurt competition in the marketplace of america finally, walter, theres zuckerberg who according to some of the advanced testimonies will sort of frame his appearance through the lens of china, and wed be remiss in not mentioning the statement out of tiktok that accuses their attempt to steal ideas as a lack of patriotism. I think zuckerberg needs to worry the most both about antitrust because its simple hes not only bought whatsapp and instagram, but i think 80 Companies Recently after a while when you keep keeping competitors or doing things that leverage your dominance in the social network, and you start trying to suppress other competition, so then you have tiktok coming along, the only big competitor coming down the pike, and i think Mark Zuckerberg will play the patriotism card there. We dont want a china product coming in and theyll talk about stealing intellectual property but the antitrust regulators have to focus on whether or not what facebook has done has been anticompetitive in a whole variety of fields. Just a few an hour and a half away, essentially i cant wait for it its going to be an amazing show yeah. Hopefully we learn something and something constructive comes out of it. Walter, thanks talk to you soon thank you still to come its the busiest day of earnings with boeing, amd and others on the move today well dive into it deeper when squawk on the street returns could the stock market offer insight into who could take the white house in november. What history tells us on trading nation more squawk on the street coming up. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. Schwab stock slices an easy way to start investing or to give the gift of stock ownership. Schwab. Own your tomorrow. My schedule are not come back as quick. Theyve already made and announced most of the adjustments. Longterm, we feel like three years is the right time frame. Dave calhoun, boeings ceo joining us earlier on squawk on the street. Saying many of the same things he said the last time that he joined us. But somehow seeming more positive at the same time. Indeed. And our question about whether he thought a major would go out of business, softened on that one, i thought although not definitively but said Government Support has had some effect on that front. Boeing shares not helping out today. Were about an hour today from todays historic tech hearing on the hill well discuss that with early and facebook investor later on in the meantime, dow super tight range. Up 70. Were back in a minute keeping our eyes on shares of moderna with the fda the company is aiming to prize his Covid Vaccine 50 to 60 per dose that stock down almost 5 today. This as were getting new results from the Cnbc Change Research Poll of likely voters nationwide with just 39 of the participants saying they would definitely get the vaccine while 19 saying they would definitely not get the Covid Vaccine. Were going to take a quick break. Stay with us experience the adventure of a bigger world in a highly capable lexus suv at the golden opportunity sales event. Lease the 2020 nx 300 for 339 a month for 36 months. Experience amazing at your lexus dealer. Shares of Virgin Galactic a little lower this morning. The stock as you might know has doubled so far this year you might have seen those images of the shape two cabin interiors yesterday. Our Morgan Brennan sat down with the companys newlyappointed ceo as well as now chief space officer George Whitesides to talk about the unveil and the companys leadership transition. I think this Inflection Point that the company is in right now is really exciting george and the team have brought the technology to the point that were on the last path towards finishing our testing and moving forward. But the company is very young. And so as we do get into commercial operations there will be time to scale and thats something that i have great experience and familiarity with in scaling amazing ideas into Large Businesses that look for amazing experiences for consumers. At a personal level, both disney and Virgin Galactic are incredibly purposedriven companies. The purpose of Virgin Galactic to open up space and allow people to see this planet from a greater perspective i think amazing good is going to come of that i had to be a part of it. Yeah. Theres been some, i guess, talk on wall street among analysts and investors the fact that you are essentially an outsider coming into this company right now. What do investors need to know about you and about how you lead well, you know, disney and Virgin Galactic obviously different businesses but they have a couple things at their core that are very similar both are grounded in a bedrock of safety. Consumers trust us, need to trust us and we are embedded at the engineering level, process level and at the culture level safetyfirst organization. Thats something that i will bring and amplify its embedded in Virgin Galactic already the second thing obviously is both these companies at the essence they deliver lifechanging, amazing, magical experiences. And i tell you, i had the chance to be in the simulator with our chief pilot and came out of there knowing this is going to be a lifechanging moment. And i look to bring my experience from disney to help amplify the efforts that have gone in here and will start well before the flight. It will culminate in the flight and continue far afterwards. Yeah. And george, i know you mentioned on a call with investors and analysts that you were thrilled about this transition and that youve actually been its been in the works or youve been talking with Virgin Galactic chairman for quite some time i wonder if you can give us some more details about how this process came to be, how it happened and also the fact that you are staying on with the company, what this will now mean in terms of your new role as chief space officer. I think morgan, as you know, part of the excitement of this company is not just the present, which is space flight from here in Southern New Mexico but also the future of high speed point to point travel. Thats a huge effort and so im going to be able to focus in on that as well as some orbital space flight stuff that i think youll be hearing about very soon. Im going to ask you a question that i asked george before, but im curious to get your take on it. Virgin galactic stock is up more than 100 this year. Commercial service hasnt even launched yet how closely do you watch that stock move do you feel like the market could potentially be getting ahead of itself and getting ahead of the company and setting the bar very high . So honestly i have been focussed on listening and learning in my new job and you know, i think at this stage thats right where i need to be. I spent the first two days with the Spaceship Company meeting the engineers and technicians that are putting together the next vehicles that will be added to our fleet as i said im out here in space port america, new mexico, this is the most important thing for me right now as the incoming ceo. We note that morgan is not here today, guys thats because she and her husband, matt, just added a new member to their family nicco matteo was born on monday 27th weighing in at 7 pounds and 14 ounces. Man, david, we wish them nothing but the best congratulations to those guys. Absolutely. Wonderful news im sure who knows, could be the first baby in space if morgan has her way well see. Only morgan could juggle a ceo interview with Virgin Galactic while delivering a baby we wish them nothing but the best she would be a mom in space with her child doing an interview with the ceo, thats something morgan could pull off. Guys, well see you later. Thanks for the help this morning, leslie. Good wednesday morning, everybody. Welcome to squawk alley. The markets obviously got a lot on deck. The fed decision big tech ceos on the hill, the earnings continue to pile in, not the busiest day, thats tomorrow but, jon, this is the story of the morning is were going to spend this hour dissecting how each of these executives is going to approach this important hearing at the house. Yeah, carl. The question for me is how much of this is theater and how much is substance thats going to come down to the type of questions that get put to these executives not only in an Election Year but less than 100 days away from election day. How much will politics creep into this versus will the questions get to a crossexamining sense of defining what markets are and