hello and welcome to Market domination I'm Julie Hyman alongside Josh Lipton live from our New York City headquarters we are giving you the ultimate investing Playbook to help tune out the noise and make the Right Moves for your money and here's your headline Blitz getting you up to speed 1 hour before the closing.

Bell rings on wal stre yes I do think we're going to get a rate cut actually I think we might end up with two possibly first in September and then the second in December um and no September is not too close to the election so there is still the possibility that the FED will try to let us know that they are apolitical and do.

What they think is right for the economy for independent shareholders based on all the Press reports I think it's it's pretty clear that the uh Sony and Apollo bid is the best possible outcome but of course uh there's still lots of uncertainty here and there's still a controlling shareholder um in terms of uh what which direction that.

She's going to choose to go kicking off our coverage of milk and institute's Global conference today with discussions on everything from AI to geopolitics I think we've had a soft Landing um when rates have gone up 400 basis points and the wheels haven't come off the bus as they say uh I think that's the definition of a soft land.

Will it continue I think so we've got 1 hour to go until the market close and let's take a look at the major averages sponsored by tasty trade we've had a little bit of volatility today within a relatively narrow range right now the Dow up about 94 points or so about a quarter of 1% the S&P 500 up about seven uh three4 of.

1% and the NASDAQ uh gaining the most today about 9/10 of 1% what's called my eye today is that a lot of investors seem to be looking forward and that's evident from the Yahoo finance training ticker page because the top training ticker pretty consistently throughout the day has been paler which reports its earnings after the close of trading of.

Course we'll be all over those numbers but right now the shares are up 7% ahead of that um another in that category is Disney which reports uh tomorrow before the open those shares were up about 2% so it just shows again that folks are looking forward one more trending ticker that I do want to mention here is Robin Hood that's after the company revealed.

It got a so-called Wells notice from the SEC the Securities and Exchange Commission that could be a Prelude to some kind of action against the company we are going to dig much more into that later on with an analyst the shares been bouncing around all day right now down 1.4% getting back to the broad averages though do want to touch on what we're.

Seeing sector-wise here with this rally going on uh the weakest groups today consumer discretionary and real estate the strongest we've got cons communication Services stocks doing well today financials higher and energy also gaining some steam we are going to dig more uh deeply into the energy trade or the oil trade what's going on today a.

Little bit later in the show but quick survey of the NASDAQ 100 as well today since that communication Services Group is up strongly meta a big part of that it's up 2.7% and I also want to highlight what's happening with Nvidia today another one on our trending ticker list this one isn't even reporting this week it's not reporting until the 22nd.

Of the month but the shares are up 3.6% today it'll be the last of the mag 7 to report its numbers Josh all right jwy the latest jobs report showing the labor market Cooling in April hiring and wage growth slowed more than economists we're expecting our next guest thinks the FED may end up cutting rates not because of inflation but because of a.

Weakening labor market for more we're bringing in now Brian Nick Chief investment strategist at the macro Institute Brian it's good to see you you too thanks for having me maybe just to start Brian you know you look around right now these markets and you know decent economy decent earnings it sounds like you know JP basically just took a.

At least a a hike off the table it sounds pretty constructive doesn't it the question is we are we sort of decelerating toward that soft Landing or are we going to pass through the soft Landing onto our way to something worse and I think it's too soon for us to say for sure what's going to happen interest rates are still very high we're still.

Seeing that bite a lot the slle survey just came out showing that more Banks were continuing to tight lending standards a little bit surprised that we didn't see a continued tick down in the number of banks that are reporting tightening lending standards for businesses uh for consumers more consumers feel distressed there's more.

Delinquencies happening we'll get an update on that report from the FED next week that tends to be a time where you mentioned consumer discretionary underperforming that tends to be a moment where consumer discretionary tends to underperform as we start to see cracks in the labor market some cracks in the housing market potentially and.

That both leading sort of Downstream towards a weaker consumer so that's our concern as we move forward into the second half of the year you know we been talking for so long about Landings um refresh our like refresh our definitions what is a hard Landing what is a soft Landing because and I don't think the definitions are sort of hard and fast.

Right so I guess in your view what would constitute a soft versus a hard Landing versus a no Landing or whatever else we're calling it hard Landing for us would just mean we end this in recession um whether the FED Cuts rates in June July or doesn't go until November December if we end up in a recession that's a hard Landing means we're going.

To get probably another percent to 2% % increase in the unemployment rate that would be sort of your classic definition soft Landing again little bit of a slippery definition but I would say if you're looking at the potential for the FED to start cutting interest rates without a material increase in the unemployment rate the only time we've.

Really seen that is in 1994 1995 so it's been a while most investors have not seen one in their sort of investing lifetime at this point so uh it's been Elusive and one of the reasons is because interest rates tend to have this long and not so variable effect on the economy so the the tightening of the the Fed was doing two years ago is still.

With us today and the Titan the FED continues to do over the summer of 22 into last year is still coming online and there just this this morning I think president Barkin uh from the FED said he still thinks that we are yet to see the full impact of higher rates on the economy are you are you still Brian though are is your house view still.

You're counting on Cuts this year we are because we think that the unemployment rate is going to move up uncomfortably High when would you are you September December when do you think you'd see the first cut so if you look at some of the leading indicators for unemployment nfib surveys things that tell us that the probably the unemployment picture is.

Going to start to get worse in July August September so if the FED doesn't cut in Late July which is that that that last meeting of the summer you'd be looking into September but I think by that time we could be seeing not only fed cutting rates but also cutting rates potentially by more than 25 basis points at a time if they're if they're cutting.

Because of the unemployment situation getting worse not just because they're satisfied with inflation what's uncomfortably High their forecast at the end of the year is 4% we're at 3.9 right now so it doesn't have to much higher I see so in their view uncomfortably High even if it's not much worse he said he would tolerate a few TS higher than was.

3.8 when he did his press conference so I'm thinking by the time we get to four and a quarter certainly anything approaching four and a half the fed's going to be in sort of five alarm fire mode this scenario that you're painting is has become sort of out of consensus I think it's safe to say what is the rest of the your cohort missing that you are.

Seeing that that you think indicates this path I think the first is that there's this sense that we've already seen the effect of higher interest rates which talked about a little bit earlier but I think also if you look at some of the leading indicators for say the housing market thing we we thought was going to be meaningfully additive to.

Growth and it was in the first quarter that's going to go away in the second quarter and third quarter because interest rates have stayed high so restrictive policy is still biting U if people perceive the value of their homes is going down they're going to behave more cautiously if we don't see the equity Market continue to make new highs.

That's going to make people behave more cautiously the wealth effect has a lot to do with this as does people's comfort with the labor market that consumer confidence survey we got last week the net percentage of people who feel like it's easy to get a job is continuing to tick down what determines how much people are going to save versus spend.

How confident do they feel about their jobs and how wealthy do they feel that's been powering us through 22 23 in 24 that's looking like a lot Shake gear case so it's really the consumer and and the downstream effect on the consumer from both the labor market getting a bit weaker and the housing market not being as strong as it was so given this view.

Then Brian in the stock market where do you want to be positioned what what sectors look attractive well we like the defensive sectors but nobody ever wants to hear that right utilities Consumer Staples they're going to be your traditional sort of bond substitute you want to Target high quality companies high profitability high dividend yield.

If you're looking within sectors we're actually writing a report on consumer discretionary right now consumer services believe it or not that includes a lot of the cruise lines the hotels but that actually tends to perform relatively defensively within consumer discretionary didn't work in 2020 that was a very specific case where the.

Economy shut down and people were not taking vacations but for the most part if you look at consumer confidence when that's falling service is out performing sort of a low beta defensive part of that sector so if you want to get down into the details consumer discretionary tends to do better when interest rates and and inflation are falling but not.

When the economy is falling apart um so it's it's hard to find those those obvious targets when other than looking at the bond market when things are getting worse um uh lastly you know you mentioned utilities and this is a little bit of a a left turn but I'm curious you know there's all this talk about new AI power demand linked to that industry and.

What's happening and so I wonder the effect that that's going to have the utilities but does it also in a way make them less defensive if they are so tied yes you could argue it's a long-term secular secular growth story but it's also presumably going to be somewhat cyclical as well sure I just was reading this morning that there that was a lot.

There's there's less demand for sort of a lot of the residential multif family real estate getting built up but a lot of that real estate could potentially be taken up and construction workers time be taken up building data centers so exactly to your point using more power and more land just physically taken up by servers that are needed to power the.

AI Revolution if when it it it gets here um that is potentially the case the way that cash flows tend to work if you're collecting rent uh and that rent is relatively you know locked in over time same thing as like own like Farmland also tends to be a very defensive asset probably not quite the same with utilities especially if they're tied.

More into the cyclical parts of the economy but we know Cycles evolve over time discretionary used to be very cyclical and now it's very growth oriented because of the changing makeup and the same thing is true with technology those those now act more like defensive sectors than they did in the past utilities could be going.

Potentially the other way last question Brian for fixed income investors listening right now what's your guidance what's your advice uh we like extending duration we like being defensive here again that's not the the most popular call uh but if you look at spreads on corporate fonds that have tighten quite a bit the expectation that interest.

Rates are going to fall has powered some of that longer they stay higher the weaker the economy looks you could see those spreads widen out so if you want to be really defensive you could be holding very short duration cash like instruments with the yield curve still inverted but we think you get more bang for your buck if our call on the.

Recession is right by owning longer duration secures good to see you Brian thanks for coming in thanks for having me well Yahoo finance is bringing you coverage of milin institute's global conference today geopolitics AI the US election they're among the topics on the dock and for the weeklong event Yahoo finances executive editor Brian sazy and.

Our Aiko Veta are in Los Angeles Aiko let's start with you what are you hearing so far yeah Julie uh as you tell tell we got a lot of people out here hard to hear what we're talking about right now but look a lot of the conversation that I've been having is about geopolitics but specifically about what is happening.

Between us and China we heard from chrisina goreva earlier today talking about industrial policy the additional tariffs that could potentially come what that means for the US economy overall and then we just had a conversation with the former prime minister of Australia Kevin rud um talking about how this is likely to only increase further because.

Of what's been playing out between the US and China as well certainly Focus given all the conversation around AI especially in the competition that's playing out that's why I love being here with you Aiko you have that Global Focus I'm going back to stocks I mean I just it's something that still excites me we talked to polio Mark Rowan of course.

Apollo the parent company of Yahoo finance talking about how it may not be such a great idea that investors are so allocated to Nvidia Apple Amazon all those Magnificent Seven stocks heard the same moments ago from former Milwaukee Bucks owner mark lazri saying it's probably not a good idea I'm going to put up an article soon on that actually.

Want to make that our morning brief newsletter for tomorrow little some more details about uh not investing in Max 7 stocks so Julie of course all things stocks business Global you name it little bit of everything here at the milfi conference and obviously judging from the backdrop lots of people to talk to thanks so much guys appreciate it.

Looking forward to much more from the conference and coming up speaking of which we're bringing you plenty of coverage from the milkin conference we'll hear from the heads of on mobile IBM and Pinterest plus Robin Hood shares lower after a new legal threat emerges from the SEC how concerns should investors be we've got more coming up.

And we're kicking off Small Business Week with a panel of business owners we'll have the latest from Main Street in the 400 p.m. hour he.

m is.

now welcome back to yaho finance's coverage of the milin conference at the Beverly Hills Hilton California and a big moment in the history of Exxon having closed its Pioneer deal let's bring in Exon.

Chair and Co Darren Woods Darren good to see you again appreciate it thanks to having me so just close that Pioneer deal what should investors expect from an earnings power standpoint over the next couple years well you know when we were looking at an acquisition what we talked about was every opportunity has to be deliver more.

Value than what either company could do on its own and what we found with Pioneers an opportunity to take the technology development techniques that we've uh come up with in uh unconventional space take Pioneers uh understanding of the resource the Bas and their acres and together put that uh those two companies together produce.

More oil at a lower cost which is good for consumers good for the economy and do it in a more envir environmentally responsible way we're we're taking their 2050 Net Zero pledge and converting it into a 2035 Net Zero plan and so good for the US economy good for us uh consumers good for us energy security and good for the environment so a real.

Opportunity to create unique value we said at the time of the announcement that we would create on an annual $2 billion of of synergies once we got got up and running my expectations is we'll do more than that you think this is the type of acquisition that causes a reating in xon stock I think it it adds to uh what we believe is the unique.

Value contribution that we can bring to this industry we have been uh trying to help people understand that as a company that uh has an expertise and Technology uh capabilities in transforming hydrogen and carbon molecules can certainly continue to play an important role in our existing Industries we've got huge opportunities in developing other.

Materials that Society needs that leverages the hydrogen and carbon molecule that doesn't involve combustion doesn't involve emissions and we see a huge opportunity in that space for us the perum basin's obviously been the big opportunity for Exxon for decades but you've really been touting the opportunity you see in Guyana can you.

Help me understand when you look at the overall P how significant that's going to be as a revenue driver so I you know the way people often forget that our industry the oil and gas production business is one that continually declines because you've got every barrel you produce is a barrel that's not available tomorrow and so the challenge.

In our industry is to continue to go out and find new resources to bring those online in production and today's challenge is to do that in a lowc cost way so you have low cost of Supply but also do it with low carbon intensity and so our developments have been very focused on finding those unique resources bringing our unique.

Capabilities to bear so that we create a uh the best in Industry Supply Source from a cost standpoint and from an ad Mission standpoint Guyana is absolutely critical and that's critical not only for our company but I would say it's critical for the people of Guyana the value that we're bringing to Guyana his government and its people with the jobs.

Uh the economic activity I mean there GDP is growing the fastest in the world right now and this and part due to this resource that we're developing um I've heard heard you talk about low carbon a lot low carbon Solutions certainly sort of the the big push ahead for Exxon Mobile um specifically on carbon removal direct air capture you've heard that.

Holy Grail number $100 a TB is where you need to get at to make this an impactful solution what's the timeline for Exon on that right now well I think it's really it's very difficult to put a Time on on a technology breakthrough what we recognize is we have a suite of technologies that historically have been used for different applications we're.

Now trying to repurpose those Technologies to a much harder much more important application recognizing that today the carbon capture technology only works for the highest concentration steering of CO2 so we got a FR a way to bring that cost down the good news is uh there's a lot of Technology progress made in technology that haven't been.

Applied to this space and so we're with our technology organization looking at new materials new opportunities to try to bring bring that cost down uh and there are many other companies trying to do the same thing and so our view is we every company should be leaning into its areas of expertise trying to crack that nut uh once that's solved whoever solves.

That we believe our company's going to play a critical role in deployment because there are very few companies that have the ability to to build large scale um facilities that convert molecules and and and can do that around the world we have that capability as well as the technology so some combination of those things will come.

Together and we'll keep moving down the path of decarbonizing the world how would you create the the regulatory environment under the B Administration how would I grade it grade it in terms of getting done what you need to get done so I think the the Biden Administration has come in and with a very clear objective of reducing.

Emissions and trying to decarbonize society which is a good thing I think they've also been very cognizant of the balance that has to be struck between doing that and at the same time continuing to to meet the needs of the people providing reliable and affordable energy I think the legislation the IRA legislation uh that the Biden.

Administration Champion is important because it focuses on the objective which is carbon intensity and reducing carbon intensity what it's left open is how best to do that and the value or the importance of that is it allows every company every sector uh all the technology organizations to focus in on how best to achieve that based on their.

Capabilities their skills and their set of uh circumstances and so it doesn't try to prescribe how to do something instead it focuses on what must be achieved I think that makes for good policy that certainly opened the door for us to take the capabilities that we've have that we've developed over the last 140 years and apply that to this.

Challenge of reducing emissions and we think we have a really good opportunity to make a very large um uh reduction in emissions with a very large investment one that will move the needle you've been very vocal a lot more about the efforts that Exon Mobile is making to reduce emissions um it it strikes me as a very cautious approach and you've.

Talked about being more disciplined playing into your strengths returning shareholder value I wonder where climate science plays into all of it you you were just on a panel with John podesta the climate adviser who said look we don't have the time to be moving slowly and cautiously how do you think about that piece.

Because at the end of the day it is to address what scientists have called the climate crisis well I think there's a you know I would separate the role from a of a company from a government and if you want to a dramatically reduce the amount of emissions happening today you're going to have to abandon the systems the energy systems.

That are in place today they're delivering that that means people around the world are going to have to do without and the people who are lower on their on the economic Prosperity scale developing countries people who are still trying to make their way up the economic ladder if they don't have affordable reliable energy they'll be.

Penalized that in my definition is not a just transition and so balance is important I don't think anybody's arguing about the need to reduce the question is how can we best achieve that reduction and frankly if you go back in time we've been too narrowly focused on a very small segment of solutions what we got to do is open the apperture and.

And find every company's and industry's ability to reduce emissions and do it in a constructive way and so I think the good news is that that aperture is starting to open we do see policy makers around the world recognizing that we're going to need more solutions not fewer and allowing those solutions to come in and play a role I think that's the way.

We make progress the fastest where is Exxon in 2050 well we're going to still I I suspect be producing oil and gas uh depending on how quickly the world transitions that may be a smaller part of the portfolio that it is today but if you look at our core capabilities the technology capabilities that we have we.

Can make a lot of other products that meet the needs of society I'll just give you two very quick examples we've tasked our technology organization to take the molecules that we're we're using today in existing applications and make something new that the world needs so gasoline molecules molecules that go into the gasoline Transportation fuel.

We've got a technology today can take those same molecules make a resin out of them and replace rebar for construction it's lighter lower emissions uh and more cost effective and doesn't corrode so a brand new product to the world made out of gasoline molecules likewise likewise carbon dents streams in our refineries to use that to make carbon materials and.

Use them in batteries for electrifying um cars uh or using to make to make a new process to making carbon fiber so ways to take these molecules and make new products that Society needs enlarge and growing market so my view is we'll continue to leverage those core capabilities of transforming molecules but the products that we make in 2050.

May be very different than the products that we make today but they'll still be relying on those key core capabilities that frankly this business has been built on our company's been built on well thank you I was going to say so oil and gas still part of the portfolio in 2015 I think people there's oil and N oil and gas that goes into uh combustion.

And Emissions associated with that and then there's oil and gas in the hydrocarbon molecules that go into products that people use every day in their lives and my only point is uh we've got to deal with the combustion and more uh specifically the emissions associated with combustion but there's huge utility for the hydrogen carbon.

Molecule and the products the society needs so my view is you're going to continue to see those products oil and gas use as if nothing else a feed stock to make products the society needs for modern living thank you for always making time for y find we appreciate it Exon cherio Darren Woods enjoy the rest of the conference thank you thank you.

Juliean Josh back to you thank you so much guys really interesting stuff there from the Exxon CEO and let's stick with oil right now because prices are edging higher as Saudi Arabia hikes June crude prices for most most regions Traders are also digesting the confusion regarding reports over a potential ceasefire in Gaza here with the details Yahoo.

Finances inz F hi inz how you doing hi Julie yeah and we did see some confusion in the markets early today as you saw conflicting headlines one that Hamas had agree to a ceasefire uh and that being told to Al jazer the other one then Israel saying that it did not agree to a ceasefire uh through Reuters so this is where you saw that uh that confusion and.

The markets briefly turned negative um around uh this early this afternoon right there now you are still seeing though WTI up for the day up more than half of a percent Brent crude also higher part of this has to do with the expectations of perhaps a ceasefire not coming as soon as the market had anticipated also Saudi Arabia Saudi.

Aramco increasing its crude prices for customers across Asia for the third consecutive month so that is signaling a tightness in Supply and that sent Brent the international Benchmark price higher um OPEC plus will be meeting at the beginning of June and the expectation is that uh the oil Alliance will be continuing with its production Cuts you.

Do have some analysts that are saying well perhaps they will increase capacity because the alliance doesn't want the Us and other uh countries to increase their market share but nonetheless you are see seeing that oil last week retreated back more than 6% you really saw that unwinding of the geopolitical RIS risk if you see that geopolitical risk.

Winding back up again then you are likely to see oil prices higher but you have analysts that are calling for oil in the second half of the Year Brent to be averaging around $85 per barrel right now you're looking at Brent that's around the $83 Mark guys all right Nez thank you so much appreciate it time now for some of the.

Days trending ticker shares of Tyson dropping after reporting second quarter earnings the company's sales falling short of analyst expectations and Executives saying that the third quarter could be weaker than the fourth for Tyson we're bringing in Yahoo finances Brook to Palama Brook good afternoon Josh good afternoon Julie I.

Mean certainly what investors were Weighing on was a weaker Q3 guidance here shares dropping as much as 9% during today's uh trading session as the company did point to that weaker Q3 guidance now one of the influences on that uh weaker than expected guidance was basically because of the state of the consumer and what Tyson is seeing.

Right now and Tyson CEO Donnie King did tell yahooo finance that the consumer is experiencing inflation for housing or utilities for virtually everything in the economy and one that is really concerning is around Consumer Debt this consumer is a little bit under pressure he said now that consumer being under pressure is just one of the factors that.

Led them to weaker guidance for Q3 ultimate leading to what they said is a consumer bifurcation with consumer is moving from fine dining to casual dining to qsr but then others in the lower income uh cohort then turning to Food Services or ultimately then deciding that they're going to cook at home other factors leading to that weaker Q3.

Guidance include limited cattle availabil ability higher commodity cost and pork and prepared food seasonality here those are just some of the uncertainties that Donnie had laid out to us in a call but ultimately he did say that weaker is just a little bit weak he said that we maybe have overcooked what exactly that weaker.

Guidance could look like and they do expect Q4 and the fiscal year to shape up to be pretty good overall but Wall Street being quite critical of this I did speak to cfra analyst run sundram and he said that typically Q3 should be a strong quarter because of the grilling season and the demand that the company typically sees there and so Wall Street.

Definitely responding to that comment on the call today yeah for sure thank you Brooke moving on shares of Spirit Airlines sliping after announcing q1 earnings the company missed second quarter Revenue guidance expectations and the CEO saying the competitive environment remains challenging so this one Julie the stock actually hit an.

Intraday record low uh in today's trade the issue here the revenue guidance missed um looks like the adjusted operating margin guidance also kind of missed consensus as well team at City saying and they they rate this one a sale but they tell their clients about the results these kind of or didn't really bring many surprises um but the.

Guide was weak and the carrier with the carrier saying they said that it would need to see more improvements in off peak demand in order to meet its forecast they also point out the carrier highly overc capacity in some markets Florida and Latin America among them yeah average Fair per passenger down 16% in the first quarter compared with a.

Year earlier and I didn't realize this because of everything that's been going on with Boeing which by the way we'll speak about in a moment but Spirit actually had some issues with some Ron or RTX Pratt and Whitney geared turbo fan Eng which had grounded some of its aircraft so that was an issue for it remember they fured some pilots in.

September um they're trying to cut cost but the street is not satisfied here something else to keep in mind here is the company's debt position it's having some discussions with its Bond holders to try to resolve you know whether it's going to be able to I guess repay some of its debt so that's something else that analysts are paying a close.

Attention to right now um and those discussions I think are supposed to resolve by the summer all right and speaking of Boeing which I mentioned here uh we are watching those shares as well Federal air safety Regulators are reportedly open opening a new investigation now which is aimed at looking into the company's inspections.

Of its 787 um Dreamliners here again this is the latest um that we've got here and a new investigation apparently the FAA said that the Boeing notified it in April that it might not have done required inspections related to some of the safeguards of where Wings join the fuselage of certain aircraft this is.

According to the Wall Street Journal also we should mention our Alexis Keenan reached out to the company and Boeing said once it realized this issue it promptly notified the FAA and this is not an immediate safety of flight issue for the planes that are uh in the sky today that are yeah that was what you immedately think of is does it mean the.

787 Dreamliners need to be pull out of service the journal who broke the story saying it's not clear right now they do though cite this Boeing program Chief I guess an internal message Julie last month had said you know the company had found no immediate problems for Dreamliners currently flying but you know as you kind of highlighted there.

It's another headline and another quality issue here that Boeing doesn't need right the sh and the shares are down some but it's not as you know it's not as though the market is having a huge reaction to this latest we'll keep watching coming up robinet has received a warning from the SEC regarding its crypto business going to speak to an.

Analyst on the outs side about what this means for the trading platform.

Robin Hood has said it's received an SEC warning that the trading platform could.

Face an enforcement action related to its us crypto business Shares are lower right now although they've been bouncing around but there are some concerns one analyst though says the news may be a little overblown that analyst is Dan Dov mizuo America's senior Financial technology analyst Dan it's good to see you as I mentioned the shares have been.

Bouncing around here now typically news comes out about what's called a Wells notice from the Securities and Exchange commit and a stock goes down because it's usually seen as bad news now the stock was higher earlier now it's lower but why should people not be alarmed in your view hey thanks for having me you know.

Typically yes not in crypto in crypto everything is different they're used to it we're used to it exactly good news is bad news no but to be to be um you know the reason the stock is actually not going down and the reason we say there's no reason to be worried is because this is not new news as far back as two years ago if you go.

Back to their 10K the annual report they've said that they've been subpoena by the SEC for some of these issues so basically the SEC has decided to take action on something that they've been calling out like two years ago so this is been in the making if you look at the exposure of Robin Hood to crypto it's only like 7% of Revenue uh and like 15%.

Of assets under custody and you know those tokens I mean X Bitcoin XE ether X Dogecoin I mean that the exposure is very minimal and last you know the reaction on coinbase I mean coinbase tripled since uh the wells notice last year so you know the market clearly you know is shrugging it off so to say so we're saying there's no real reason to.

Be worried and Dan do you have a sense of a sort of timeline here what happens next look I'm not obviously I'm not a you know a legal expert um but I from looking at some of the others stuff around there like Kraken and some of the other exchanges I I think that at worst case scenario it's probably again this is just speaking of the Layman I it's.

Because because it looks like it's not new news and I'm looking at some prior cases there could be like some sort of like you know a settlement or or something I I I I don't see this as being and the Market's clearly agreeing with that so timeline you know this could take a little while but I think it's it the the results the fundamentals.

Of Robin Hood are so good that I think this is going to remain is a little bug bite not more than that um when you look at a situation like that with coinbase which has a much more combative or sort of at least publicly combative relationship with the SEC and with Regulators do you think Robin Hood has sort of had the advantage of sort of.

Almost drafting behind coinbase to some extent right let coinbase fight the fight and we'll kind of do our own thing here so in that sense also is the Wells notice more of a sort of unexpected it's actually a great a great point that you're making because they've been the good guy Robin Hood has been the good guy and I think they you know.

Voluntarily since day one agreed to you know not uh play in those let's say riskier tokens right that could be considered Securities and said we're staying in the you know things that are considered Commodities like you know Bitcoin or Dogecoin whatever SEC does not think is is like a big risk so I actually think that not fighting the SEC.

And being the good guy is going to help Robin Hood in the long term and not fighting it like coinbase does and Dan for Robin Hood uh earnings are on Deck here Wednesday what what do you expect to hear so we think it's going to be a stellar quarter we just published our our preview today just coincidence like.

We didn't know this was coming obviously uh but I think consensus is you know grossly understating revenues uh there's going to be a you know massive you know massive significant beat to revenues and and margin the best news you're going to hear again in my view is you're going to hear a lot more Mouse monthly average users coming out of Europe because this.

Is kind of the surprise element uh the traction they're getting in Europe and all the success they're having in this uh Robin Hood gold which is deposits coming in gaining share from the likes of Schwab in terms of assets coming in from people because they're offering 3% match on your IRA so a lot of these good things they're going to start gaining.

Scale this quarter and it's going to be a phenomenal quarter with great guidance for the year Dan good to see you thanks so much thank you coming up our milk and Conference coverage continues we'll hear from IBM CEO on the other side of the break stay tuned.

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Talking IBM Let's uh welcome in IBM CEO Arvin Krishna here at the uh milen conference good to see you again it's great to be here talking with Yahoo finance and water energy and Buzz here on AI here at the milk and Conference all right well let's stay on that buzz Arvin how is IBM Reinventing itself for this AI era look AI is a fundamental.

Techn Tech ological shift We Believe it'll cause $4 trillion of total value to the industry not all of that to the tech industry but to the industri at lodge all our clients want to tap into that it's going to cause productivity it's going to cause Revenue gains it's going to allow them to have more nibble Enterprises so what we are doing is.

Building the AI That's good for the Enterprise efficient open source in a way that our clients can control the IP and deploy it where they want that's really what we're about You' talked a lot about that increase in productivity that's like L to come out of AI can you talk specifically in these early stages at least how your clients are deploying.

Gen absolutely I think there's three use cases that really I think bring this to life for us so if you think of contact centers you know typically where people are doing customer experience can you help that person become way more productive so they might have to navigate amongst three or four screens if you ever called a bank you might.

Notice the person in the other is hesitating they ask you can you hold on for 30 seconds well that's because they're looking something up could a generative AI step in and instantly get the information by querying the underlying mariat systems can it make that person way more productive by the way productive means they get your query.

As a end user answered quicker you're happier you're more likely to get a correct answer the AI never gets tired or angry or snippy or anything like that I think that's a great use case I think that's going to be endemic everybody will use it second coding making coders more productive everybody has Tech debt can it help you get rid of the tech de.

Faster means that every Enterprise is going to have more capabilities to offer their end users and their employees I think these two without a doubt the third one where we are seeing a lot we call it digital labor in these days of tight job markets demographics that point to less and less people of working age can I get a digital worker to aug.

And the human worker I think these are three great use cases all our clients are interested in them we ourselves use them as the first client and it's and it's giving us all of those benefits Warren Buffett uh at his annual meeting talked about how the AI Genie is out of the bottle and he sounded concerned I I love all those things please tell me my.

Big bank balance without getting snippy with me I I get it are you concerned that AI will have too much power and what are the risks from AI I actually have no such fear so I'm putting it black and white I think there's a lot of people who hypothesize and as you have seen in many Technologies thinking that the rate of.

Progress which has been 100 times over the last 3 4 years is going to be another 100 to, times but just for the current AI if we need this much infrastructure and power for it to be 100 to a, times how much more infrastructure and power I think it's a little I use the term Fantastical to keep predicting that it carries on on an.

Exponential curve I think it'll get widely deployed I think billions of people will use it across hundreds of processes that will happen but to imagine it's going to reach this point of super intelligence I'm a bit of a skeptic on that topic one of the big big debates that's happening within the big players and AI is open source versus.

Closed Source I know you're shaking your head because you're leading an alliance pushing for open source for those who are not necessarily following close Source we're talking about those like open AI um uh as well as Microsoft gole what is the risk of a close Source AI yeah so I think on any technology for it to get that escape velocity for it to.

Really become ubiquitous you got to balance between three things competition you need competition because as we all know wall Gardens tend to generally have very little Innovation so you need competition Innovation but you do need some safety as you think about those three I think open source is a great way to achieve a.

Balance on all three points so open source is visible everybody can look at it you can red team it if you want to by yourself you don't have to trust the vendor to do all of the red teaming by the way as we all know AI is built on data so in effect the IP your capturing is the data you're bringing open source means that somebody can take a model.

That we might provide if they add their own data to it they can keep it we don't ask for it back if it's proprietary you in effect you get it back so I think it allows for a much faster proliferation while giving transparency back to those who want to get scrutiny on that issue of transparency there is a conversation about AI regulation the US has executive.

Orders in place but not necessarily A framework for a Federal Regulation you've got Europe leading the way you just had Japan's leader coming in set up their own framework are you concerned about the us falling behind in that conversation I'm not concerned about the us falling behind what I'm concerned about is that regulators.

Should not regulate the technology what Regulators should regulate is the risk or the use cases can you imagine sitting back in 1995 let's regulate the internet so let's regulate dial up modems how useful would that have been in until today I may not have learned how to use the computer so I think that it's really to.

The point of Warren Buffett saying the gd's out of the bottle don't regulate a technology because all you'll do is it'll go offshore these are digital Technologies but regulate the use case so be ass sure it's being used responsibly one that I also talk about is make people who develop models accountable for what those models can do.

I think those are tools that are classic policy tools and that can be wonderfully applied opening up the black box if you will open up the box let people innovate as fast as they can look at the last 18 months how much innovation has come there was open AI then there was mistol now there's IBM an 8 billion parameter model can do what our 200 billion.

Parameter model can do Let The Innovation go it'll make the technology cheaper and ubiquitous Marvin it sounds like just listening to you here IBM is working on some really cool and packable stuff on AI why do you think the the valuation on IBM may not reflect or be on par with some other AI place so I'm going to go cup hop full.

And then address your question directly first I think we've had a pretty good run over the last four years um if I look at the last four years I think we might have added 60 to 80 Million worth of uh uh total Enterprise Value so I'd say that's good now that does not meet our own aspiration so let me acknowledge that point but I think that ASB begin to.

Make progress we've got to be more consistent in our overall revenue and cash flow performance I think our cash flow performance has been pretty consistent but we probably got to be a bit more consistent on Revenue performance and as that happens I think we'll get both the multiple reating but also the growth that comes with the.

Underlying cash flow and earnings growth so I think those are the two pieces I'm very very confident our strategies in the right place we're building we're staying in the places that we have credibility we work for the Enterprise hybrid Cloud Ai and Quantum down the road and by the way I don't think Quantum or AI is really fully priced in.

Into where we are but I'll acknowledge Quantum is still 3 to 5 years out and AI is kind of in the early Innings I use a baseball analogy AI is kind of in the first Innings of a game don't quite know how it'll go cloud is more like the fifth or sixth inning so you have a pretty good idea not over yet but pretty good idea yeah we like sports analogies.

Here right um let's finally talk about sort of bigger picture you've got a good pulse on where the economy is given just the scale of your client base um on your recent earnings call um you talked about sort of a pullback and discretionary spending how um is that a pause is that a dry up how would you characterize where that is what does that tell you.

About the Investments companies are willing to make particularly in technology right now so I'm not an economist I'm a businessman and a engineer let me acknowledge that but I see where my clients are spending and not spending so I think that what is happening is really down to one reason and I'm actually quite optimistic about.

Both the US and the global economy and I'll come back to that however interest rates are higher for longer than most people supposed in the middle of last year so as you take that into account if interest rates are 2 3% higher for the 5 and 10 year then people have thought that means that all of the debt is going to carry an extra price so I think CFOs.

Are B tight in against that now that's not systemic that's not really secular but it is a trend that's going to be there for a year or two if that makes any sense I think that's the Bel tightening if I look at anybody who carries tens of billions of debt an extra two to three points is going to cost you an extra few hundred million.

Per year okay let's look after what discretionary he spent let's not do anything catastrophic let's not make long-term decisions but you go B Titan against distrust your projects that's going on now if I then look at demographic Trends I look at inflation Trends supply chain cyber all of that leads to well.

Let's spend more on technology so that's why you kind of see I want more software I want more infrastructure I want more AI I want more Cloud but if I can I'll kind of tighten on labor Based Services I think that's the two speeds we are seeing and we see that in the software grew well over 6% in the first quarter and Consulting was down two at constant.

Currency flat at actuals so we see that in our own business and I think it's a reflection of this macroeconomic brand I wish we had some more time with you but we don't you're a busy guy like you're very in demand at this conference IBM Co Arvin chrisan thank you for making time for yo Finance we really appreciate it pleasure to be here with you guys.

there is the closing bell on Wall Street and now it's Market domination overtime we're joined by Jared blicky to get you up to speed on the action from today sponsored by tasty trade first I'm going to start with where the major averages.

Ended up here we saw the Dow gaining about 176 points here after kind of bouncing around during the session ending closer to the highs than to the lows the S&P 500 moving up by a percent here and also moving if you look at a little bit of a longer chart we don't have the 50-day moving average on here but I can tell you we moved above the.

50-day moving average which is a technical indicator that I'm sure Jared knows a lot more about than I do and then we had the NASDAQ leaving the gains on the day up by about 1.2% quick check as well while we're looking uh sort of broadly here at what happened with the 10year a little bit of a pullback today but essentially flat at right around 4.

And a half% Jared now has a closer look at today's action spot on with that 50-day moving average we are now above it in all the major indices plus the Russell 2000 you'll just have to take our word for it now in terms of sectors communication Services number one that's xlc houses alphabet and meta as well as Verizon and some other interesting.

Companies Netflix but then financials Tech and consumer discretionary round out the top four so it is a mega cap sectors plus financials and let's take a look inside the NASDAQ 100 where we can see only Apple uh kind of taking things down a little bit of a notch that's down 9/10 of of a percent but Nvidia up almost 4% meta up 3% alphabet half a.

Percent and not a lot of losers here it looks like Amin down 3.79% down here that is The Biggest Loser uh we covered sectors but I do want to take a look at some of our leaders and Arc is the biggest uh winner here up over 2% and if we take a look inside the disruption field unprofitable Tech we can see besides Tesla a lot of.

Strength there Shopify up almost 4% Square block up 5% DraftKings up 5% now if we're taking a look inside Tech we also got to take a look at software versus versus semies here's software a lot of green but not too much dark green here's semis we're seeing some more dark green so semiconductors actually outperforming software within the Tex.

Sphere and here you can see arm up about 5% AMD up 3% Nvidia up almost four think we've been there I also want to show you one more thing here this is meme stocks and in a day where we're not seeing some of the fringer asset say uh like Bitcoin rise we are seeing mem stock so that in addition to unprofitable Tech those would that would be the AR components.

Just showing you that there is some interest in the fringer parts of the market Palante here is going to be an earning story this week that is up 8% American Airlines also up over 5% Julie thanks so much appreciate it Jared stocks closing out today in the Green Building on Friday's upward momentum after a Goldilocks jobs support.

Bolstered rate cut op optimism joining us with today's top Market takeaways Josh safer as we're on a little bit of a streak here yeah it's the best three-day streak for the S&P 500 that we've had in 2024 and I think perhaps just the broadest takeaway from that would be we had a bit of a gck check over the last month we talked a lot in April about how.

We had our first down month since last fall all of these headwinds seem to be mounting all at once like they always do we have these inflation concerns coming maybe we aren't going to get rate cuts at all this year what if pal talks about great hike and then last year or last week sorry kind of seemed to be the the moment where a lot of those concerns got.

Cooled at least for now Powell said no to considering a rate hike as the most likely scenario next we get that jobs report wages actually come in softer than people expected that cools a little bit of your inflation concerns and it really sets us up for what I put down as our second takeaway here which is a quiet week of economic data and I think.

A quiet week of economic data is just a welcome thing for this market right now when we've spent so much time over the last month talking about a rise in the tenure yields we're often talking about Eco data releases at 8:30 that are driving that move in the tenure we're talking about fedspeak and what Powell is saying and what he's going to say at.

The upcoming meeting and that was not something that we have that we're going to have this week so it seems like generally just a little bit of a quieter week as far as Eco macro drivers and maybe that's a good thing when earnings are actually coming in quite good maybe it is a little bit of a pause for people to yeah a little bit of a pause and well.

And normally stocks do better in weeks where we don't have Eco data releases so Bank of America I didn't know that Bank of America had an interesting chart on this this morning saying that the S&P 500 in a week where there is zero major economic data releases so you can see there when we say major economic data releases we're talking GDP CPI a Fed.

Meeting jobs report when there's none of those the S&P is up by median of 0.6% and then you can see going across your screen there the more events we have usually the tougher it is for markets so perhaps a quiet week means we can just drift a little bit higher for a little bit because when you think about things that sort of test this rally if I.

Had to circle them on a calendar right now for this week I couldn't name them right that doesn't mean they're not going to come they always come out of nowhere right and can come out of nowhere but right now on the calendar it's not like we're waiting for a jobs report on Friday and inflation print but we will be next week so for now.

Quiet on the economic data front for now yeah and I mean even the earnings front we have some earnings but none of them are hugely me you know sort of macro Market moving yeah they'll be interesting on their individual sides right like paler is interesting for the AI story but does it.

Really tell you anything about the overall AI trade I don't know we could debate that but probably not right I'm excited to hear from Disney it's going to be a very interesting report but really a Disney story story so I don't really I agree I think at this point we're through 80% of S&P 500 earnings and you have 5% earnings that is a j.

Like is it well if you think okay decent economy decent earnings yeah J pal just told you a Hikes basically off the table is that a catalyst is that enough to move the market IEM it feels like it is maybe Josh for this week but I would argue you're sort of just running up to this inflation print next week right if we think about what the CPI prints over.

The last couple months have done to any sniff of a rally moving higher it's been okay oh that's not a good print that's not a good and we've sort of gutten that consistently over the last couple months so to me that's the big thing I have circled it's not coming tomorrow and it's not coming in two days but I think that inflation print seems like one of.

The next big drivers yeah all right thanks Josh um speaking of paler reporting first quarter results and shares are rising after the company raised its forecast although not Rising by that much interestingly full year revenue from the company now seen at 2.68 to 2.69 9 billion so it didn't raise it by much the estimate is for $.

2.68 billion so I should say it's not as though the forecast is way above estimates here let's run through the first quarter numbers as well adjusted earnings per share at 8 cents pretty much in line with estimates first quarter Revenue $634 million which is just above the $65. million that analysts have been anticipating and.

Adjusted iida in the first quarter $34.97 above the $24.7 million that analysts were anticipating the shares are now taking a little bit of a hit initially went up after that raised sales forecast now a little bit lower so we'll keep on tracking it um but looking into the statement here Josh um there was nothing that sort of stood out the.

Company you know commercial has been a big initially this company saw a lot of its Revenue coming from government contracts and then was trying to really beef up the commercial side of its business it does point out here in the statement commercial Revenue was up 40% year-over-year to $150 million the customer count among commercial.

Customers was up 69% um so that's something that it is touting here government revenue on the other hand was up 16% it's still much bigger $335 million yeah I think the government side is interesting because kind of the Tailwinds for the business ahead there they did announce that kind of contract with the Army called Titan.

Commercials also really interesting Julie just because of the competitive Dynamics there and how that plays out but then obviously a big part of the story we're just talking to schaer about this is is AI AIP that's their artificial intelligence platform and you can expect a lot of questions at the call about just what customer demand and.

Of course monetization looks like there yeah it it is interesting again that we are not seeing a better reaction the shares we going to keep on digging in and speaking of digging in we have an analyst that we're speaking to a little bit later on R galoria about these numbers so maybe he can shed some light on the perception here well D remember.

The ramp into this print it was up about 40% this year 200% in the last 12 months so no rich is great so we're lucky to have him moving on as earnings season winds down there is one Magnificent Seven stock left to deliver uh their quarterly earnings Nvidia of course is on Deck to report first quar results that's going to be later this month.

Investors waiting to hear from the AI darling after collecting Insight from several companies on their AI efforts for more on the key trends this earning season let's get to innovator Capital Management head of research and investment strategy Tim or benowitz Tim it is good to see you so we can start there Tim you know earning season just.

Interest to get your take Tim what have you learned what have been the kind of kind of key trends themes takeaways for you well Josh it's been a very strong season overall we've seen very good growth uh at the at the index level and and a few key trends that we have been paying attention to Here recently number one uh we've seen very strong margin.

Growth uh across the board really across most uh sectors particular we've seen it very strong within the technology space communication Services where companies are expanding their margins they're growing the bottom line which I think is very encouraging and if you look at what we saw throughout the quarter we had a quarter where growth remained firm and.

Inflation really accelerated and what we tend to see is that as inflation accelerates you tend to see margins grow and that's exactly what we're seeing right now we do have to be careful moving forward everybody wants this inflation narrative to get under control but that also might mean that you know moving forward you could see those.

Margins come down a little bit that's not our view that we're going to be in that environment but if we are yeah you need to look out for that um Tim what's also interesting you know we were just talking about paler as one example of the AI trade and companies that are giving more and more information about Ai and how it's affecting their earnings.

How were you what do we learn in the earning season with regard to the AI Trend well J when we're talking with investors right now one of the key themes that we are continuing to reinforce is that this is not a trend that you want to fight companies are looking to integrate they're looking to scale and right now we think it's really.

All about the infrastructure buildout so thinking about things like semiconductors data center reads Cloud companies uh that's really they're going to be critical for that integration and even if we see a downturn I'm not so sure that you're going to see that pullback in spending just because it is so critical for productivity longer term.

So we think that theme is really important it's been a key driver of the market uh throughout the first several months we think it's going to continue to be the key driver over the next several months specifically with that focus on AI infrastructure and building that out and Tim I'm not sure what you think just broadly what the next.

Catalyst for the market is um Tim you know we did get some you know recently those good data points right so um Eon you saw that jobs report okay cooling but not crashing and earnings coming in better than expected Apple reports and pops and and j po just told you unlikely the next move is is a hike for sure is that enough for a catalyst to move the.

Market higher well it's going to be interesting Josh and I think we're going to continue to be in this environment where investors continue to ere extrapolate information from Little data points like we saw last week no doubt that was encouraging seeing the softening in the labor market wage growth started to cool a little bit that.

Ultimately is going to hold the keys but we need to remember that this is just one data point we need to see that continued Trend um to really get this this battle under control so what we are talking about to advisers right now that we think is probably the most critical thing in their portfolios is you have to find ways to decouple risk management.

Needs from the Reliance on interest rates coming down you're going to continue to see big volatility in rates uh as we were just talking about earlier uh and that means really decoupling separating those risk management needs from the Reliance on interest rates we're seeing a lot of clients uh in our world gravitate toward options based.

Strategies buffer ETFs is is one example that we're seeing a big move in and we think that makes a lot of sense just given that you have the built-in risk management you don't need to rely on long duration bonds you're not relying on low volatility stocks defensive sectors like utilities which at the end of the day Josh are all beholding to.

Interest rates having to come down it's not what we want you got to separate those two and so in other words it sounds like not necessarily a more risk off environment but maybe a little bit more risk cushion or risk averse environment than we've been seeing over the past year or so yeah we're what we're saying right now Julie is we want.

To be risk aware right we want to be aware to the risks out there no doubt we're Towing the line right between getting inflation down and the recession right we got to walk that that straight and narrow path but our base case view is that you're going to continue to see a world where uh economic growth remains firm and inflation remains firm uh and.

That is a world that I think you can continue to see equities do very well in overall talked about on the front end inflation goes up you tend to see margins go up uh growth remains firm that tends to drive the Topline and at the end of the day you can look at all the economic data you want but earnings are what Drive stock prices over the.

Long run so we think that's actually pretty favorable uh for equities here moving forward Tim I'm I'm just curious too uh Switching gears a bit here how you think about geopolitics I asked because we we are seeing these headlines drop Israel did begin hitting Targets in the southern godsen city of Rafa Tim I'm just as a strategist uh you're talking.

To clients how do you just think through these kind of geopolitical Dynamics yeah well we think about how we manage that risk and obviously at the at the index level buffer ETS we continue to see as a very viable solution to help manage that risk I also see we're talking to clients a lot about integrating energy into their portfolios.

Energy is one of those sectors right now Josh that's trading at about a 40% discount to the broad Market it's very cheap and it also offers a very nice hedge to a lot of those geopolitical tensions and by the way a lot of those macro tensions that we were talking about earlier if you continue to see that re acceleration in inflation it's.

Obviously something that no one can predict so it's important to have that built-in risk management in in place and also look to those pockets of the market that that are under appreciated but but all for uh nice defense Tim thanks a lot good to see you great to see you as well Julie all right let us get a little bit of a recap of today's action sponsored.

By tasty trade um as we've been mentioning that best three days for the S&P 500 going back to the beginning of the year here the Dow and the Russell 2000 are actually up for four straight days and we've got the da Dow with its highest close since April 5th the NASDAQ 100 and the S&P 500 at their highest CL since April 11th so we have not seen.

This sort of upward momentum in a little while here which is interesting also some of the other streaks that Jared blicker shared with us here Amazon alphabet meta and Microsoft up for four days in a row which is interesting also and catches my eye Josh and coming up more coverage from the milkin conference we're going to hear from Pinter coo Bill.

Ready on the other side of this brick I.

now Pinterest is on well a little bit of a a hot streak that I don't think the market really has caught on just yet let's talk to Pinterest coo Bill ready Bill good to.

See you at the milkin conference I've seen you all around the world good to see California yeah yeah good to see you again seven straight quarters of what Mau acceleration grow yeah as we uh well it's you know so is a fantastic quarter but it's really the culmination of initiatives that we've been putting in place over the course of the last nearly.

Two years and you know we hit an all-time high in users 518 million monthly active users and we've accelerated seven quarters in a row on users across every generation and across every geography but where we're really winning is with Gen Z genz is now 40% of the users on our platform and our fastest growing demographic that's.

People in their late 20s yeah it's what are they doing on pitures it spans you know sort of uh teenagers through you know college graduates and sort of folks early in their career but they're coming for two primary reasons one we've really improved the action ability on the platform uh Pinterest is where Jin Z goes to shop and so Pinterest had.

Previously been great at window shopping but you couldn't really get to the things that you found over the last two years we've really been opening the storees making it really easy for users to connect to the things that they find on Pinterest and you know led to us more than doubling the number of clicks we set to advertisers year on year in Q4.

And in q1 um so that that action ability and shopability is really reson resonating but then positivity is really resonating as well we've really invested in making Pinterest a more positive alternative to traditional social media and when you ask gen Z they will tell you that they see Pinterest as an oasis away from the toxicity that they see on.

Much of the rest of social media and that's cutting through uh and it's a great example of doing well by doing good I want to get back to that cuz I know that that's something you've been very focused on literally since you started at Pinterest that's right when you talk about shopability though is that the power of your AI any new AI.

You're releasing behind the scenes to help people shop on the platform yeah absolutely so AI has been a massive Tailwind for us and so you know we've done a few things one we really lean heavily into large language models uh nextg AI like uh GPU serving things like that we now use models that are 100 times larger than the models that we.

Were using a couple years ago that led to more roughly a 10 percentage Point Improvement and relevancy of the recommendations we make to our users but we've also been doing things to design our product to create great signal for that AI so for example we've really leaned into human curation at scale so it's not just that users come to.

Pinterest to shop they come to Pinterest and curate and put together outfits put together room designs and so when those users say oh I'd put this handbag with this dress and this pair of shoes or to put together a room in this aesthetic I choose this lamp and this sofa and this rug that gives us really great signal to make better and better recommendations.

To our users by training the AI on that really unique signal and importantly it's helping users to do things that help them take action in their real life not just keep them glued to a screen but actually make their life in the real world better as well I'll put this question to you so Warren Buffett's annual shareholder meeting he sounded.

Concerned turned on an AI after someone I guess made a video of him talking now I asked IBM CEO does he share those concerns he says no they're fantastic what's your views I I think like any technology you know the AI is neither good nor bad but it can be used for good or bad and so I think you know it's a totally appropriate conversation to be.

Talking about what could the harms be and how do you avoid those harms and on our side of it we're trying to prove that you can use the AI for good so we've done things like inclusive AI uh We've launched features uh you know like inclusive AI that we're doing that creates diversity by default in our feeds uh we're tuning.

The AI for positivity so uh roughly a year ago when we saw each other last at the can Festival uh we launched the inspired internet pledge where we committed to measuring emotional well-being outcomes on our platform and so we're tuning the AI to serve more things to help users come away feeling better about themselves uh and so body.

Positivity is an example of that where we we've launched body type AI so that people see people are able to see a more representative Set uh they can choose the body type that represents the best see a more representative set um of not just what the average fashion model looks like but what they look like and what real people look like uh we've done.

The same thing with like uh skin tone filters and hair pattern filters and so these are examples where you can use the AI for good and that's what we've been focused on is like how to use AI for good and you can also use AI to avoid some of the bad things as well we've used AI a lot to get Bad actors off the platform and build safety uh features.

Through AI so again AI is neither good nor bad like any technology can be used for either so we're focused on how do we use it for good and how do we also use it to avoid the harms that that could be possible you and I in the past have talked about Tik Tok What a band might be it is what it is but is the best possible thing that could happen to the.

Internet is something like this gets banned and doesn't exist in the US so we can go back to focusing on other things and getting life done um you know what I would say you know uh rather than common on any one platform you know we're not sitting back hoping for the demise of other platforms you know we have accelerated with Gen Z because we're.

Doing something really unique in the world of social media and you know it's it's on two fronts users come to Pinterest with intent we're not an entertainment based platform most of social media is entertainment based they us in a lean back entertainment consumption mode users come to Pinterest with intent and purpose whether it's to.

Shop or to make or to do or to buy they're coming with some intent and purpose and we're helping them fulfill that intent and purpose so that action ability is very different than much of the rest of social media and the positivity that we're investing in around you know making sure that we tune the AI for positivity tuning for.

Emotional well-being outcomes and more positive emotional well-being outcomes you hear it from jiny users they will tell you they come to Pinterest because they see it as as an oasis away from the toxicity of the rest of social media so again you know is it understandable that Regulators are going to you know pay attention governments Regulators will.

Look and pay attention if they think there are potential harms that totally make sense but we're not sitting around waiting for government action we're focused on avoiding those harms on our platform tuning for positivity and giving Jin Z something that's really great is different from the rest of social media Before I Let You Go tell me.

If I have this somewhat right so you have a part a deal with or a partnership with Amazon and Google do investors are they underappreciate how those two Partnerships will change your cash flow and your earnings over the next few years well what I would say is you know I I think you are seeing you know the.

Acceleration in our ad business uh really cutting through with advertisers first and foremost do we perform for advertisers we more than doubled the number of clicks we sent to advertisers in Q4 and we did it again in q1 and actually accelerated even further than is that because of Amazon it is really because the action ability that we're.

Bringing to the platform form and that's through a combination of efforts a lot of it is retailers coming to us directly but then we've also as you noted augmented that first party Demand on our platform with third party demand coming from Amazon uh who we've been working with for coming upon a year Google be added more recently for international.

Markets and so that is helping to bring more shoppable actionable inventory on to the platform but it really is a composite effect and what I would say is that when you step back back from it all Pinterest is firing on all cylinders if you look at the initiatives I laid out when I came in nearly 2 years ago that we went through our investor day last.

September you know our strength uh has been broad-based you know we we roughly doubled our Revenue growth rate from Q4 to q1 uh we doubled it from H1 to H2 last year we doubled again from Q4 to q1 and we've accelerated user growth in every geography with every generation and so it is really all the initiatives we've laid out around action ability and.

Positivity better performance for advertisers all those initiatives are hitting and Performing well uh and so the strength is broad-based well turnar around continues at Pinterest uh Pinterest Bill ready good to see you we'll see we'll see it can hopefully no uh sunburn for both of us this year absolutely guys back to.

You time now for what to watch Tuesday May 7th starting off on the earnings front companies reporting tomorrow include Disney BP and UBS Disney announcing its second quarter results before the bail it's first report since CEO Bob Iger defeated activist investor Nelson pelts in a contentious proxy battle analist expecting parks to be a.

Bright spot for house and mouse and streaming is also expected to get a boost from Price hikes as earning season rolls on we'll see more earnings from toast rivan and Lyft the ride share service reporting its first quarter results after the Bell active Rider growth is something analysts will keep their eye on during the earnings call.

Topline gains expected to Trail the company's ride share competitor Uber which is reporting on Wednesday and finally taking a look at the FED Minneapolis fed president Neil kashari scheduled to speak tomorrow is coming after today's commentary from fed president Tom Barkin saying that he's optimistic that today's restrictive.

Rates can bring inflation down that'll do it for today's market domination overtime be sure to come back tomorrow at 3 p.m. Eastern for all of your coverage leading up to and after the closing bell stay tuned we've got more Yahoo Finance on the other side.

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shares of Palante sliding after hours after reporting first quarter earnings despite the company beating on the top line and raising its full year guidance for more we're bringing in now rishy Jura software Equity Analyst at RBC Capital markets rishy it is always great to have you on the show so let's walk.

Through this Richie so paler reports they beat sales estimates it looks like for q1 Richie they raised their forecast for annual revenue initial pop but now we're down here about 9% in the after hours what is going on here richy give me give me your take yeah absolutely and Josh thanks so much for having me always a pleasure to speak to you um I I would.

Say it's a combination of a couple things right it's it's high expectations because this is become a a hyped or in my opinion overhyped uh generative AI you know beneficiary company we can get into that in a second you know you saw the stock was up uh uh 8% on the day today heading into earnings and then you know they put up results at already been.

Raised but I think that was priced into the stock and then at the same time you see uh us commercial decelerating uh pretty pretty big um you know last quarter they put up 70% us commercial growth now they're growing us commercial 40% I think it's a combination of those as well as some some other things that's leading the stock down about 9% in the.

Aftermarket well Richie truie here why is that commercial growth slowing is it just a matter of that they couldn't keep up that same Pace or is there some issue with execution or is it and market demand what's going on yeah um I think it's a couple things right number one is the compare itself just gets a little tougher I think that.

70% uh commercial number that they posted last quarter was maybe boosted by just a very very easy compare and some one-time uh impacts and so that's piece number one I think piece number two and and we'll see how this plays out over the coming quarters but when we talk to actual technologists who are deep into AI deep into ml who know more about this.

Topic than I could ever HED to over my life they are expressing skepticism around paler and and especially around AIP and whether they are what they say they are from you know an AI perspective and maybe there's a little bit of that showing up in in the US commercial numbers and and why we're seeing that slow down as well what about richy this.

Company's uh boot camps where they get customers you know kind of up and running fast with their AI software smart strategy in your opinion I think it is but uh look I would I would again put a little bit of skepticism around that boot camp strategy I think number one remember paler is very heavy customized software.

Right I estimated more than 30% of their businesses actually uh Professional Services and Outsource data science rather than actual true software so I don't know that is even the right fit for something like a boot camp and even then if we really think about uh boot camp customers these are people who say okay you know come and and figure out.

Some of my problems and give me a use case but it doesn't go from there to a customer becoming a multi-million dollar pent to your customer overnight which is how they make it sound on earnings calls but but in reality a lot of times those boot camp customers might do multiple boot camps or they might turn into a pilot customer over time it's not nearly.

The gamechanging to Game Changer to go to market that that I think they claim it to be um Rishi so obviously you you're not a fan um you've got an underperform on the shares here um we see it coming back to Earth today but you know the market has not been on your side thus far this year there has been the stock has rallied there um.

Definitely are a lot of paler buyers out there where do you think this sort of Disconnect lies between that perception of paler as an AI winner and what you're saying which is that in truth it might not be yeah I I think it comes down to that perception around exactly what is paler and exactly what is AIP because there is.

No way the valuation of paler stock at you know 25 times 4 revenue is supported by 20% growth and and and the margins that they're putting up that that's just not possible if you compare it to what other things in software or trading um what I think it comes down to is volunteer messages that they are this cutting against generative AI company.

They message a lot around AIP and boot camps and I think very deliberately Target retail investors um and and look everyone wants to play the AI game and and don't get me wrong I'm a huge believer in Ai and especially G of AI technology I think it is going to change society as we know it I just don't think paler is that cutting against generative.

AI company that they claim it to be I think it is a good data pipeline it is a good data ontology company I'm not saying it's not a useful company but it is not what they claim it is and I would say to any investor that really wants to play this AI Trend go buy Microsoft um you know they are doing a lot more when it comes to generative AI plus they.

Have that very deep partnership with open AI which to me is one of the most important companies in the world today um I I think Microsoft is a much better way to play the AI wave uh than paler and paler wish you know we're talking AI their commercial business but of course the you know the company's roots are in government sales I'm just interested for.

That business segment richy looking ahead what do you see puts and takes any Tailwinds that you see ahead you know I think there's uh really some put interesting puts and takes here right because what we've picked up in our checks and our conversations is that government agencies are actually looking to reduce their dependency on paler and.

Maybe multis sourcing use multiple vendors which is you know what we saw in the UK with the NHS deal where they actually end up using a number of different vendors in set of paler and the deal ended up being much a lot smaller for paler uh than expected and so I think there actually could be a little bit of mixed results in the.

Government business over the next couple years a result of this um you know I will also say you know the the government business is probably the stickier better quality business for paler but it's not a high growth business and I think that's why they don't emphasize it nearly as much as they do the US Commercial Business richy.

We'll get you chat here on this another another name in your coverage Universe I know was Salesforce CRM reporting in a few weeks I think rishy obviously a lot of headlines there about m&a maybe it was happening then it wasn't what what do you expecting to hear from Mark Benny off rishie yeah look I I I don't expect that.

They're going to comment on the informatic uh buy out rumors I will say I'm actually breathing a sigh of relief as a Salesforce bull uh that the Informatica deal isn't going through because I think there are better things they can do with that money uh including buying back their own stock or or juicing up the.

Dividend um you know what I expect out of uh Mark Benny off and and out of sales Force's results is I think they're going to talk a lot about data cloud and some of the success they're having at the data layer which is a new muscle for Salesforce uh but you know we've been really impressed with the numbers and momentum that we' seen out data cloud.

And and look for kind of more color around that more color around how their efforts to integrate their multiple clouds including marketing cloud and commerce Cloud onto the same core platform are going uh as well as just how we can see the future margin trajectory go going from here we've seen some very impressive margin expansion.

Coming from Salesforce over the past year year and a half I think there's still a long way to go uh on margins to get them in line with best-in-class software companies like Microsoft and and and Adobe and so I think there's a lot that investors can be excited about um with Salesforce and looking forward to hearing a lot of that color on that.

Earnings call well richy maybe we'll have the chance to catch up again uh when they report the numbers thanks so much for your perspective here really helpful thank you so much well Eevee startup Lucid results are out and the stock is sinking we're going to dive deeper into those numbers on the other side of the break.

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Now Lucid shares dropping after delivering first core results Yu finances prize submaranian is here with the very latest prize yeah stock not doing well right now and the had of Revenue beat here nice one actually but wider than.

Expected loss profit loss adjusted evid loss wider than expected to so some concern there about profitability um we already saw they had a pretty decent quarter in terms of deliveries and they're still standing by their 9,000 ,000 production guidance for the year and then also their gravity SUVs on track so some good news that they raise.

Some money in the quarter to but big question is you know what's the status for um the next the next uh product and also can they keep kind of going to the well The Well of the the P the piff the uh private um public investment fund to keep getting money for the company it's keeping it's still losing um enough money that only has enough Runway to but.

Q2 2025 as at the moment and what do we know about sort of deliveries or projections or how things are going to go for them the rest of the year in terms of what demand looks like I mean they they claim that they're going to get 9,000 delivered this year and then they they didn't they didn't shift that press yeah they didn't shift that and.

They had about 1,900 in in q1 so uh you can do the math and it's going to be over 25 200ish per per quarter um you know less than 10,000 a year for a car that cost that starts at $69,000 I mean that's it's a high price High premium product there uh and then the question is can they will the scale effects make a difference and can they actually start.

Making money on these cars and I think it's that's the problem I think that investors are seeing is where's the where does it turn where the cars make money for for the company and that seems to be kind of the issue for any EV maker right even the even or not even just pure EV makers even the big automakers making money on EVS right is just.

Something that it seems like mostly Tesla has cracked yeah and the rest have not they're all waiting for their second generation EVS that have supposedly be cheaper to make and and things like that but I I think right now here and now for for Lucid they're still ramping up their first generation EVS I think the the whole the whole uh invest in thesis is.

That gravity SUV when that comes out is that going to sell like hotcakes for them uh and then their their their next midsize car is 2026 but the question is how do you get 2026 uh we're still two years away yeah and the shares falling as we mentioned after our recession it's not as though they were rallying into the report they've been rallying in.

Recent days but they're down about 28% this year so far so expectations maybe were creeping up a little the stock Rose 9 and a half% today yeah crazy options activity so I want to see what CEO Peter Rollins has to say today in the call we see he addresses those concerns that you're talking about uh I want I mean potentially there was there was thought.

That they might push up some of these releases but that wasn't the case so far we'll see what it says thanks so much pross another company out with numbers him and hers and those Shares are up some 11% following an earnings beat for the first quarter Revenue up 46% year over year to $278.00 million and $297 million the.

Estimate there was for 288 for the full year the estim the forecast here 1.2 to$ 1.23 billion the Company CFO said quotee we've updated our full year outlook to reflect the ongoing business momentum and efficiency improvements we are experiencing coming up we're heading to Main Street with a panel of business owners as part of our Small Business.

Week on Yahoo finance stay tuned.

A now small business optimis optimism is at.

Its lowest level since 2012 according to National Federation of Independent Business the optimism decrease in March comes as inflation remains a top concern it's part of Yahoo finances small business big opportunities week we're speaking with small businesses from across different Industries here in the US and joining us now to discuss is sper.

Brewing CEO sherad chat the tiny tassel founder Mimi strippin and Carl's Fresh Market founder Ariel Alo welcome to you all um the reason I'm excited to talk to you all is because you know listen we we talk to a lot of smart economists on this show and strategists and we we crunch a lot of economic data and if you just looked at the data you would look.

At an American economy right now that seems decent that does seem sturdy but you all have a unique perspective because you got boots on the ground um so actually I maybe I'll start there shod with you and we can go around the hor I'm interested shrod just what does business look like right now what does demand look like now shro your.

Business Josh thank thank you so much and thanks for having me we are a a Craft brewery we're the oldest Craft brewery in Wisconsin prer brewery since prohibition we've got about 150 employees now so we are boots on the ground supply chain is still disrupted inflation is still giving us a lot of pain but we are growing we have in the.

Last three to four years since we took over about tripled the size of the company from 50 to 150 employees but it's been very challenging inflation especially has hurt us a lot the cost of packaging glass um honey sugar um all our ingredients is up more than 50% gas is up and that's hurting us we have full health insurance and benefits for our.

Employees that's gone up a lot finding people is still not easy interest rates have gone up to 8 and a half% from three and a half so for a small business it's a big struggle we're grinding it out though we're hustling and we're trying to do it and grow within that and fortunately you know the demand is still there we're pushing hard we've gone from.

A few States now to all 50 States we just exported to Canada and Australia and hope to keep that going but it's not been easy MIM I I I want to bring you in here next so shro I think is saying listen um there are some some pain points there but they're growing the demand is there is that what you're seeing in in your business MIM and maybe.

Also describe to us what you all do yes hi Josh we are a boutique here in Charleston South Carolina and we're actually the only black and asian-owned women's Boutique on the peninsula of Charleston South Carolina and we design and make jewelry clothing accessories and really accessible fun joyful Styles and we've seen a decline in the last.

Year in sales online and at our brick-and-mortar store and we've also seen the struggle of finding great team members of being able to compete with wages and benefits and pay them well and we have just really struggled to engage with our customers again without throwing lots of money at ad dollars and different marketing techniques that.

Haven't really shown a great benefit in the past so we're trying to work smarter and really really allocate our funds where we can see Roi immediately because this is the first year that we have had to really crunch the numbers and really really worry about cash flow and we don't want to have to continue laying off team members we want to continue.

Building this brand and empowering our team and creating a great workspace not just sell great products but we're hoping to start seeing a increase sales in person and online as the summer season kicks off here in Charleston Ariel let's get you in the conversation too mim's talking about kind of working smarter there in Charleston what are the.

Demand Trends you're seeing for your business hi there thanks for having me um Carlos Fresh Market is a very new business we've been open for five months um so we've opened up on the other side of the pandemic on the other side of the supply chain issue so all we really know is the landscape of today um we're full service coffee uh produce driven.

Environment we have a natural wine body sh uh Bottle Shop um grab and go items and uh we I'm really focused on just customer acquisition right now and providing a warm and inviting um environment and um really responding to the customers needs you know the day I opened was the day I released the dream and I'm really focused on bringing in.

Items that the customers want to purchase sherro back to you I'm interested in this question of of inflation which you kind of called out as a real headwind how Shad as a small business are you sort of navigating that challenge Shad what levers are you pulling are you able to raise prices for example yeah Josh that's a great.

Question the challenge is for a small business it's not easy although we are the oldest Craft brewery we make the number one root beer in America for New York Times and like you know uh blind taste tests by others it's still hard when you go or Costco or Manar push uh it and through to our consumers you know we're not Coke and Pepsi so it's not so.

Easy for us to raise our prices so we have to absorb a lot of those costs and we have that squeezes our margin and our cast position as one of your guests said and that's a very very precarious uh difficult situations we got to do payroll every two weeks we have to make uh line time and uh have the supply chain ready with warehousing and sales.

And it's been a very challenging you know pushing a boulder uphill for a small business and it's not been easy MIM I'm interested too and there in char Char which I'm jealous one of my favorite cities in the country um you know we got that big jobs report last week Mimi kind of you know showed cooling not crashing but cooling I'm.

Just assure what you all are seeing are you guys hiring right now in your business we're not able to hire at this point we're starting to see a demand and a need for more team members in our retail shop but the cash flow is just not there to make a data driven decision to bring on more team members and of course there's always that fine line of.

If you bring on another team member will that help to create more revenue and have more hands on deck and right now we're really facing tough decisions of do we make our current payroll or buy our supplies and inventory or do we invest in a new team member and Ariel I'm also curious how you how how you on your business how do you reach new.

Potential um customers right now Ariel are you having to spend more on marketing advertising how you going about it I'm definitely riding the Tailwind of being a new business and just having a compelling story so I had a fa amount of press in the beginning when this Store launched um and I just was deeply rooted in several communities.

Here in La which has sort of propelled the business I ran farmers markets for 5 years so def definitely rooted in a foodie Community I'm a I'm a native La person um and so I'm just riding those Tailwinds and and because it's early days they seem to be getting folks in the door I of course need to double that um to keep going and that's why we're.

Again like focusing on the customer experience but to Echo what sherad said I I I feel what he's saying completely um you know I I think consumers are so used to paying a certain price for food and now the veil is being lifted on like the true cost of a lot of things from Uber to Door Dash to food and it's you know we're in an education process with.

Customers and letting them know that like this chicken is not all chicken isn't created equal and you know there's been some push back on that um and so there's a lot of deep deep education and and with our customers about you know what what this orange Means versus another orange shirad MIM Ariel thank you all for joining the show today you.

Know running a a small business no no easy thing takes a lot of guts and a lot of grit thanks so much for joining us thank you thank you Josh thanks everyone thank you that'll do it for today's Yahoo finance live be sure to come back tomorrow at 3 p.m. Eastern for all of your coverage leading up to and after the closing BT.

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