Cisco, longtime ceo John Chambers is stepping down after 20 years in the top job. Cisco veteran Chuck Robbins is in bringing to an end one of Silicon Valleys lo. Mcdonalds investors werent impressed. They sent shares lower today. Cisco managed to rise fractionally. We have two reports. Josh lipton on cisco but first Courtney Reagan looks for the new strategy for the worlds es the golden arches have been a little tarnished in recent quarters. It will take a lot to turn around the Worlds Largest restaurant chain, but today Ceo Steve Easterbrook is detailing at least the initial strategy two months after taking o the reality is our recent performance has been poor. The numbers dont lie, which is why, as we celebrate 60 years at mcdonalds, ill not shy away from the urgent need to reset this business. Mcdonalds will sell 3500 restaurants to franchisees taking global franchisee ownership to 90 from 81 . Which easterbrook says will generate more stable and predictable revenue and c the fastfood chain will cut layers and bureaucracy finding 300 million in annual cost savings by the end of 2017. Mcdonalds will reorganize its Business Units into four segments based more on Growth Opportunities than geography. It will return 8 to 9 billion to shareholders this year. Lets define but still state admissions include improving food quali Brand Perception bringing the customer voice back into the business and being bolder and fastno easterbrook says the company is amping up Consumer Choices from how you order to what you order. Mcdonalds is testing new menu items like tastecrafted sandwiches where customers can choose beef or chicken. Choosing between three roll types and four dif from here wed expect to see sales improve gently through the year. Second half recovery in sales. Perhaps not a powerful one, but we see this story being an improvement story in the second half and that continuing into 17 as they get some of this restructuring done over the next couple of years. Competition in the fast food and fast casual dining space has been as intense as its ever been. Winning the consumer will come down to the perfect combination of tas. For nightly business report, im Courtney Reagan. We talk about changing the world back in 1993 changing the way the world works, lives, earns and plays. Its now happening on steroids. It the end of an era in Silicon Valley. Cisco announced that John Chambers will be stepping down from his role as ceo. Chambers has held that position since 1995. Analysts who cover the company praise him for the passion that he brought to the tech bellwether which makes equipment that connects data traffic across the internet. Chambers will assume the role of executive chairman in late july. Am i doing what i would imagine im doing at this stage of my life . Absolutely not. His replacement is Chuck Robbins. Hes worked in several management roles a to the company. Most recently he was the Senior Vice President of worldwide operations. In a Conference Call robbins said he was humbled and honored by the appointment. Robbins does have a challenging task ahead of him, though. Rbc says that cisco is facing a range of competitive threats on a number of fronts juniper in networking arista in switching and Palo Alto Networks in securi a few. They say cisco needed an insider like robbins who understands t companys culture and can steer them through this challenging period with a steady hand. Analysts mention another hope with this change in the c sweet, greater capital return. The company does about a billion and a quarter in buybacks and another in dividends. Investors think that can go to 3 to 4 in cash returns. Cisco stock is up 20 in the past few months. Can robbins keep the momentum going . Only time will tell but investors could have a better sense when the Silicon ValleyCompany Reports earnings next week. For nightly business report, im josh lipton in Silicon Valley. With John Chambers staying on as executive chairman that could present a unique set of challenges to ciscos new ceo. Well have that story for you a little later in the broadcast. On wall street today the s p 500 closed just shy of a new record. Helping sentiments factory orders rose 2 in march, the largest increase in eight months. The Dow Jones Industrial average was up 46 points to close at 18070. The nasdaq rose 11 points and the s p 500 was higher by 6. Warren buffetts Shareholder Meeting this past weekend set a new attendance record. And while the event was full of the usual fun and games, the billionaire investor also fielded more serious questions about the markets. And about some of his most recognizable investments. Becky quick spoke to the worlds most famous investor and has more from omaha. The most frequently asked question of Warren Buffett, where is the stock m it headed from here. Something that hes called occasionally over the last 60 years in his career but right now he says thats much more difficult to do and thats beca it all depends what happens to Interest Rates. The market amidst normal Interest Rates is on the high side of valuation. Not dangerously high but on the high side. On the other hand if these Interest Rates were to continue tore ten years stocks would be extremely cheap now and one thing you can say is that stocks are cheaper than bonds. One of the companies that you told me youve been buying more stock in is ibm. You told me that on saturday. In the First Quarter you bought more shares. Well see that coming out in s. E. C. Filings soon. Ten years from now, theyll be earning a fair amount more money than they are now and i think theyll have a fair amount fewer shares so our percentage ownership will be up and i think well make considerable money. I can always be wrong on any stock. But thats my best estimate. I felt that way when we started buying it a few years ago. Again, a they ve 590 million shares out now so our interest has gone up 15 without us laying out a dime in that respect. The other issue that seemed to come up a lot was concerns about changing tastes consumer tastes in the Food Industries that berkshire owns major stakes in. Companies like kraft, cocacola. People concerned about whether this food is good for them. And thats something that millennials in particular have been thing about. Theres 1. 9 billion 8ounce servings of cocacola products served around the world today. And there will be more than 1. 9 billion a year from now and more than that five years from now and more than that ten years from now. Thats been true. And some people like other things and if they like broccoli and brussels sprouts, god bless them but dont invite me for dinner. In all seriousness, buffett says consumers tastes can change over time but theyre doing their best to stay ahead of the changing times and he has their full confidence in their ability to do just that. Becky quick from omaha, nebraska. Buffett also said he would short the 30year bond if he could and has no regrets over picking ibm over apple. Joe tanney joins us to discuss what mr. Buffett had to say on stocks bonds and the market. Lets start with what he said about the bond market. He said hed short the 30year if he could. Do you agree with that play . You know i understand his positioning. What hes essentially saying is that Interest Rates right now are incredibly low and odds are for a longterm investor theyre probably going to go up rather than go down. Of course one of the ways that you want to take advantage of that is just having a short position in the bond market. So i agree with taking an underweight position there. He also said as you probably heard there that if Interest Rates were normalized stocks would be highly overvalued or overvalued at todays prices. If rates stay low, they look like a bargain to him. How do you see stocks . I think buffett, again, is thinking about it the right way. You have to consider valuations within the context of where Interest Rates are and, of course when Interest Rates stay incredibly low, it just becomes a more profitable environment for companies. Think about borrowing costs, think about inflation, think about rates in general. And broadly speaking when Interest Rates are very low its a good thing for companies and of course if Interest Rates are much higher it becomes more of a problem. So his perspective in saying that stocks today are not as expe because Interest Rates are low is dead on. In the past youve said that you dont think the fed will move on rates until the latter part of the year. Do you still agree with that . I do. I do. I think the feds they have a dual mandate and are focused on two things. One being the labor market and the other being inflation. Weve seen a lot of signs that the labor market is healing. Things are clearly moving in the right direction. And inflation, in our view is firming. I suspect that as the u. S. Economy continues to heal the fed no longer needs to keep giving it medicine. I suspect that some point later this year probably in the back half of this year youre going to see the Federal Reserve putting the u. S. Economy back on a path towards normal which means raising Interest Rates. As you look at the u. S. Market most particularly, what if any, sector feels like the one that offers the best opportunity today for the next year to two . You know as i look at the u. S. Economy cle of a rough patch, if y in the First Quarter year, a lot of it du weather, i think your see a lot of pentup d coming into the seco on the back half of the consumer finally and starts to spend money that they were holding on to. Also, you had this t you will, from lower which we havent rea materialize into spe weve seen it turn i i suspect in the bac this year were going spending pick up, an be focused on sector that stand to benefit from increased spending on the consumer side. Think of cyclicals, think of consumer discretionaries, even Consumer Staples to an extent. Thanks still ahead, sue what the countrys producer is doing to beverage relevant ag pimcos flagship total return fund lost its title as the largest Bond Mutual Fund to the vanguard group. According to april data released by both companies and as reported in the wall street jo vanguards total Bond Market Index Fund had 117 billion in assets as of the end of last month. Pimcos total return fund 110 billion. As we reported a bit earlier in the broadcast ciscos John Chambers is stepping aside as ceo, but hes not going away. Hell remain as chairman of the firm he ran for 20 years. His continued presence may soothe some investors, but as our Mary Thompson reports, it will also pose challenges for chambers successor, Chuck Robbins. For two years John Chambers served as chief evangelist and architect of a firm whose stock climbed 1400 under his waf. By stepping down as ceo and staying on as chairman he can now provide important cover and counsel to his successor Chuck Robbins. There are all sorts of aspects of the job that hes going to have to learn. And the advantage is having a great teacher around. Still, chambers continued presence at the firm could create problems according to professor joe bauer. When the stays on, it always makes it harder for the new ceo to make changes, particularly if the new ceo has in mind dramatic changes. Cisco as executive chairman chambers will likely be in the office every day. And unless he checks his ego at the door experts say he may resist changes robbins needs to make at the Company Chambers built. His presence might also be seen as a constant threat to robbins. Professor catherine her igen saying the board could easily turn to chambers if robbins stumbles. There will be nonexecutive meetings of the board where the chairman will stay and theyll talk about the ceo, and if he feels like he wants to get back in he could easily have the rest of the board, who is probably in awe of him anyhow rubber stamp the idea that the current ceo should be shunted aside. Former ceos cast long shadows. Remember starbucks chairman Howard Schultz returned to ceo following the disappointing run for the coffee chain. And while hes no longer ceo, oracle chairman Larry Ellison remains the face of the Software Firm he founded. Executive coach mark nadher say best practices dic a former ceo should stay on as chairman for a year or less than leave. Citing Steve Ballmers resignation as being exemplary. This gave the new ceo to plot a clear course for t softw firm. Chambers future is less clear. Cisco says his firm as chairman is indefinite something that could definitely create problems for robbins. For nightly business report, i Mary Thompson. Comcast earnings and revenue top estimates and thats where we begin tonights market focus. The companys Broadband Division logged its strongest Revenue Growth in more than four years. Comcast also announced it will spend another 2. 5 billion buying back shares this year. Shares were up a fraction to 58. 78. And come cast is the apparent of cnbc which produces this program. Cablevision said its video subscriber losses in the First Quarter doubled from a year ago. Still the cable operator managed to beat on the top and bottom lines, shares up a nickel. Cognizant technologies saw its profits rise as revenue increased in its Financial Services and its healthcare segments after beating analysts speck takings, the firm upped its earnings for the year. Shares popped 6 . Strong ad sails helped amc network. Earnings were up almost 70 on the success of the tv networks original programming. Shares moved higher by almost 5 to 80. 02. Mcdonalds and we talked about a few moments ago isnt the only company food business trying to plot a turnaround. So the dean foods. Thats the largest milk producer in the country. After a sharp drop in consumption, the company has a plan to get people drinking it again. Jane wells has more from city of industry california. Remember this stuff . Its called milk. Whens the last time you had a glass . This is a category that really needs innovation and news. Milk consumption has been falling for decades. At least cows milk. Sales of plantbased milk especially almond are rising. Now the nations largest milk producer is trying to move the trend back. Okay class. Dean foods has launched the First National milk brand called dairy pure. By combining milk from its more than 30 regional dairies under one brand, dairy pure automatically becomes a 2. 5 billion brand. One of the Largest ConsumerPackage Goods lines in the country. This is running about 100 jugs a minute. Chief commercial officer is helping to lead the change. Inside the altadena dairy the company owns in california he says in a unique twist, the company does not want to lose Regional Brand equity. So dairy pure labels will be cobranded with the local brands. A similar strategy the company did with true moo chocolate milk which is number one. That brand is a 700 million business for us on its way to a billion. Thats really our goal for it. This saul happening as milk prices fall due to a glut. So dean foods is spending heavily to promote milk as a good source of protein without antibiotics and from cow with no artificial growth hormones. This is probably the most thats been spent against fresh white milk in many years if not ever. I take it its a sevenfigure ad spend . Yes, yes. Thanks for asking. He says creating one National Brand makes it easier for Grocery Stores by providing one bar code and the opportunity to partner with other National Brands. Cookies and milk is so natural its unbelievable. Pick your favorite brand. The reaching out has gone back and forth. More to come. It will be exciting. The hope is to make milk something more you pour on your cereal or incoffee. To make milk cool. Thats a big gamble. Dairy pure. Like moo. For nightly business re jane wells, city of industry california. Earlier in the program we heard from Warren Buffett hims at the annual gathering of shareholders where he was peoplo wanted to hear him give advice which he did. But the questioning got more serious. Special correspondent at Fortune M