tv Squawk on the Street CNBC November 11, 2021 9:00am-11:00am EST
side on the dow this morning s&p 500 up about 18 points a lot of folks will be focused, of course, on they ev makers we have to make sure you join us tomorrow we want for wish all the vet advance in america today, we salute you and thank you for your involves. mosq service. "squawk on the street" begins right now. good thursday morning, welcome to "squawk on the street." happy veterans day, where we salute and thank the men and women who have served in the u.s. armed forces. stocks are trying to stabilize, we're watching the curve flatten. shares of disney are slumping on an earnings miss. >> plus we are keeping an eye on all those ev-related stocks.
and ease been supply change bottl bottlenecks we'll kick off, though, with disney. a well covered story last night. >> there is a conversation where benjamin win berg from morgan stanley. of how many people would sign up for disney plus, said it was the low end. i don't know why people the not focussed on two things the theme
parks which are doing quite well and will do much better. i was eviscerated on twitter this morning for being stupid to buy disney, even though of course i bought it at 109, and i come back and say, david, the reports of disney's death are exaggerated. >> i think there's one key things here, when it comes the direct-to-consumer businesses that have become the heart and soul of so many content companies, the key things we measure them on, whether or not you want to talk about in the case of disney box office, or even more importantly theme parks, they're really expensive, really cost -- they cost an awful lot of money
games. i think it was a "squid games. look, i think that disney plus is going to be very good a fresh content. actually starts tomorrow with the "legend of ten rings" which, by the way has a chinese vi villain, so the chinese won't show it. >> a very important point, "squid games" will not be on disney they won't have that kind of show does that limit the tam? barclays take a victory lap, because they downgraded last month. they argue they've had plenty of content all year long. i think every one of the some of
these things -- i love that conference i used to go to it >> think haven't had it in. >> you can go to the office, but can't go to the. >>'ve working with the research director for the club, and take a little longer view i've lots of things that make me -- even though i do wish they had something like it it's not going to be something that violent, clearly >> take a listen to this
>> we reaffirmed our guides of 230 to 260 million households. we believe there are two primary drivers of that growth first one is going to be the expansion into new markets we're going to in international territories by fiscal year 2023. the second component is obviously going to be new, fresh content across all of our wonderful disney franchises. >> one interesting point that was mentioned was about the disney metaverse, rogers emphasizing this morning why emphasize that theme park revenue 2x. >> theme parks opening up in a more significant way as you hear the applause build here, i believe we'll have some celebration for obviously the holiday today.
it was interesting to watch the blen blending and i generally think that the metaverse and disney are made for each other. i wonder if the metaverse had not stolen the thunder 1234. >> should we take a listen -- >> why don't we do that? >> take a listen. >> my vision is to use disney plus in the platform i think it a three dimensional
canvas, if you will, so that we can create experiences that otherwise have been defined as it's a park experience or it's a movie experience or a book experience i think those all come together without boundaries, without borders, without constraints our creatives are just biting at the bit to get into the metaverse. >> he's clearly giving a lot of those to this already. >> roblox has it already i don't know, a combination with snap would makes sense to me i feel like i do want to -- let's say you were part of the b bambi's csi -- wait. >> that's a cbs viacom. >> yoho, yoho, the pirate's life for jim cramer >> your words are colliding.
i have no idea what you're talking about, but that's all right. we're eight minutes into the show. >> no? you wouldn't go see that >> what am i going to see? >> yoho, yoho, the pirate's life for jim cramer. >> we had sort of a bit of a stumble on the comment about capital returns a few weeks ago. obviously the scarlett johansson lawsuit? >> big shoes big shoes. it was a very smooth bob iger. i want to go back to the initial calls. let's not forget the unbelievable christine mccarthy stayed on, strong, strong person at the helm. makes mess feel much more confident about the financials basically that it isn't the man.
if i wantsh who are these people i don't know i think the theme parks have been lost any narrative. we used to be involved with espn remember when it was all we cared about whether it went from -- the theme parks are where the money is >> that's true they're very profitable, and now back to levels of capacity they haven't seen in a long time. >> do they still have the turkey leg? >> i think people still chomp on it. >> in frontierland >> yeah. i went back there when i was 28 with my parents. we stayed at the -- >> the comet -- the modern it wasn't modern. >> with the monorail running through it >> how much do i love it i love it enough to tell my
producer to take her kids down they're there today. they are waiting in line for the magic kingdom. i think it's big, but it doesn't matter. >> no, it matters. >> no, it doesn't. >> it's awesome. >> the short-timers who didn't listen to the number cut, do do they even know there's a theme park >> i do. that's where chapek came from. that's what he was running they do have sort plans with apps, weighing to player your entire visit >> how about the salesforce -- >> better pricing and galactic star cruiser, march -- >> a new hotel. >> i'm urging people to sell it. >> what? >> get out get out. you don't deserve to be in the next leg up. >> i got it. >> i'm calling them out. i'm saying they're short-time thinkers. >> like the people who sold sofi
at 17, affirm at 67. max came on and said, do you still believe in me? >> yeah, we will get to affirm that's been quite something. >> arrive arivian is now on toph gm and ford. the fifth biggest u.s. ipo of all time jim, bebind baba, facebook, uber and at&t wireless. >> exciting. i think the story is the untold number of the sustainability officers at amazon who basically -- who's ever thought of this before can you imagine a company that's produced 156 vehicles and they have orders for as many as they can make for amazon? as many as they can make you're looking at a market cap of 93.
as much as i like ford, and i do i'm a jim farley fan. >> i think fan understates what you are. >> i would be a season ticket holder. >> without a doubt. >> people refuse to understand there are internal connmbustion engine companies, and rivian is 100% future. the companies that are cloud native, remember like when salesforce was cloud native? that is a dow stock with a valuation that's incredible. this is the equivalentened, that's how important they not be internal combustion engine >> they're rooted in --
>> they get a huge discount. >> a dilemma -- >> that's why farley, by having a great selling f-150 and then making it electric is so brilliant. he has to move fast. why do i point it out? he just got $10 billion out of ri rivian. >> well, they haven't sold it yet. >> they have the ability to sell it this is supply begetting demand. people would buy it at 120. >> it will be a large gain for them i think the average cost was around $7. >> kind of like what musk did. >> 6.24 for some of the options he's exercising. tesla is up today. you made this point on your tease with becky, that whole thing with the twitter poll, which we knew, and thank you, robert frank, for the reporting,
we knew it was all nonsense. >> it's called the twitter fiasco >> i voted and i think i've been had. >> you didn't take it seriously, did you? >> i got in at the last minute it was like the hays tillman election, a corrupt bargain. >> people talk about it, i'm glad you brought it up. >> it was a robbery. >> we have a great line this morning about people who preordered, got in allocation and made a couple million collectively this was a wealth creator. we'll realize that one of the things we happened is billionaires were made a trickle-down analysis for you. >> the private markets have been the place over the last couple
years where fortunes have been made we're seeing it in the equity markets, too, but i talk about it all the time. it's where hedge funds have been making any outperformance has been from the privates and/or be a part of this even when you look at some hedge funds, upstart not so good the other day, but still. >> one last question do you think the money that's been raised has a big enough impact that wall street has made the country richer, as opposed to just made the rich richer >> that's a big question you're asking, jim. i don't know that i have time to answer it right now. >> lennen and mao debated this -- >> take a okt tus.lo afure we're back in a moment
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birthday of the marine corps. >> when i got in the business, the market was closed. it was in observance for the great people who served. now it's open? what do we have to make that much money? >> we are thinking of all our veterans, thanking for their service throughout the country's history. here is the moment of silence. [ bell ]
again, when will this happen okay it's happened. he's raised $53 million for himself. >> this was basically this is one of those things where i think it's a false construct the man has created tremendous wealth he's offered things like, i know you'll laugh, but popcorn -- amc popcorn. he's a showman in the showman's business. >> there's no doubt that's true. he also says he still owns a lot. >> sure. >> but i have been waiting for him to monetize some of this it's been a long time. there was an expectation this would become this pretty quickly. >> he's been playing offense, and remember the box office was
as good as feb 20. you scoffed at me when i said we had a worldwide pandemic coming. >> yes, that is true as well you chided me. >> soon enough it will be almost two years. when did it finally run out? >> the statute of limitations runs out soon. >> thank you. i want to point out the reinnocence of debt should be celebrated, because you have often taught us, look at the other side. >> particularly for a company like this, that was teetering on the end -- >> do you think he's a modern-day jack warner >> no. he's just showing movies he's not making movies he's just showing them. >> remember they used to -- >> don't forget the amc popcorn. is it special? i went to the movies, i went to an amc for the first time. >> were you allowed to have dinner there, and pouring at the
in the coming days we're going to get a wave of retail earnings on the october end earnings season. with that dillard's up 6% this morning, crushes tapestry has new management, i think these are ashing arbingero come how many years did they say they will good sales -- >> high inventories leads to markdowns. you know what no retail has now? no inventory so, yeah, part of the problem is
some retailer don't have enough inventory to sell. >> yes that's a very good point i went to my rite aid yesterday. they didn't have -- the truck hadn't come in i said, where is all the stuff it reminded me of what a russian drugstore must have liked like under brezhnev >> there's the opening bell. some moderate gains. i think it was goldman last month and the to as the mix gets better, it's a fung of what -- >> it was a tactical sell. i don't know tactical sell ahead of a company whose stock has underperformed people say when you have an
underperformer, it stays an underperformer i can't help seeing disney down the same amount that rivian is up don't you think "the mandalorian" could be part of the metaverse? it's kind of dark. i watched that entire show i enjoyed it. >> disney is breaking down now as if the park is closed enough >> well, jim, listen, they didn't meet the subscriber targets, they're going to be spending more money than some had anticipated. >> so what do people want? >> direct to consumer is the reason the stock had an incredible move a year ago. >> and we're peeling back from that >> well, anyway, i reiterate you're short-sighted if you sell i totally understand why you would. the same way you would sell
>> do you think. >> there you can look at netflix. it's always nice -- >> down it's an -- it's like affirm versus pickup >> listen, netflix did not have a great run. >> this -- you bring up affirm give me your those, it's a thing, isn't it? >> the excellent ceo of mastercard, i was pointing out that, are you a responsible borrower or not? this could make it easier for you if you're not responsible, to take down, buy things, almost encouraging it, but of course he's got it. what i thought was most important and my travel trust owns pay pap, why didn't it get the same deal. instead they have the ven
mo/amazon deal maybe because you had to sell a lot of your company to amazon if you were going to get the deal david, i think you notice that they gave warrants that were a significant amount of affirm was given to amazon. now, you have to start saying, is this going to be like plug power? remember plug power gave a lot of stock to amazon. >> amazon is doing quite well in their venture investing or equity between rivian and affirm alone, they have many billions now, for amazon it's child's play they found in the couch, about you for any other company. >> you know, we had not even mentioned singles day. >> no, we haven't. >> i think they're doing fairly well j.d. had a strong showing, but it's a muted singles day supply chain constraints in china as well.
not to mention everything else a absolute of headlines, one is xi getting the backing from the party to have a landmark done trip which would essentially set him up for infinite rule >> going back and forth, the 7th fleet, is over taiwan or over the 7th fleet, which is there? and are they testing us? testing biden's resolve? >> i think president xi is testing biden's resolve. >> sources say he's going to invite them to the olympics. they have a virtual summit on monday, we think >> that would be important. >> good commentary out of ust reform, maybe progress on phase one. >> and there was a climate deal -- i mean, i don't know
whether we should -- is this -- if we're -- a cold war, then what is this like? i mean, david, is it like a cruise ship going to disneyland? or is it like when we'll-- >> i'm trying to fit out where we are with china and whether or not it equates to the cold war you're referencing in the '70s, the u.s. versus the ussr. >> have you -- >> the ussr, we didn't have starbucks, like, loaded into moscow >> so you want to sell burgers and pizza? >> no, i'm saying -- starbucks
has 7,000 -- >> well, how about apple how about nike which is all the way back, they have the deal with the ministry of sports? how about "1984" a quick re-read. >> i read it not that long ago >> and the only thing you're safe with is thoughts in your head >> i thought tim cook's comments and their doctrine is to engage, right? not to separate -- >> and to have privacy >> privacy is important. >> one things privacy as a single source in principle is
>> it's called the hemlock estates. >> a money maker i'm not so sure whether that's the proper. >> name me another folio that was a money maker and then wasn't >> it's a quiz >> i'm not going to get it >> by the way, this was one of the largest spac deals >> yes. >> both bought or at least took in businesses from blackstone. they held on, though they did use it as an opportunity to monetize i don't know maybe black sstone has owned it for a while this is, by the way -- >> leading specialized payment platform, core business to connect and transact seamlessly through leading capabilities and payment processing, digital wallet and online cash solutions. they lowered their guidance, and
it's getting crushed >> what, does he have waterloo 10 and 2 what are those -- >> yeah, it's a mix. he's got two that haven't announced deals and another one that's still above ten. >> if they don't show it, my joke about waterloo doesn't work >> i like that joke. to use a term you like to use. that's suboptimal there. we're taking them off the money maker list. >> on the wall of shame? >> no, but off my list of money makers >> we haven't talked aboutb yond meat, down 16 with a miss, weak guidance, bernstein cuts to market perform. >> that was just a disaster. there wasn't anything. maybe some people just say it's over. >> that's going to take you back
to may of last year. >> before they started caramelizing it. what's the matter? >> what? >> caramelizing it. >> the matter or -- it's not actually meat. >> anyone have the impossible burger like at thegiants stadium in san francisco? i think it tastes better, but that could be because it has gmo. i'm not against gmo. sorry. >> still there was a $220 name, too. >> it was a short squeeze, and ethan brown is a great pros le advertiser i had a vegan and vegetarian daughter, and i said this could be the way, and then one is still vegan, the other will have a steak. what did you see what happened yesterday to hertz rivian handled that ipo very
well, i think. hertz got greedy, i think. >> good read there. >> that's the week that does give you a sense, but, yeah, it doesn't go particularly well >> you know engaged capital, they sold a big stake, and haim didn't go particularly well. some of these deals, i don't know why they're pricing them where they are, but -- >> yaeah, hain is down. >> gm says they're seeing better flow in chips. they have no north american plans that are not having normal production schedules, by the way, a headline last night out of south korea that chip exports
in the first ten days of the month are up 45. >> let's be jay powell for a second the number one cause in the cpi, fuel oil that's coming down this ecdo the spr. natural gas has come down below $5, and next is auto, and perhaps this is the beginning of a thaw of -- avnet told me that's not the case. farley has not weighed in with me yet today maybe jay powell is getting the break so he's not the go to the game maybe he eat be the goat as in greatest of all time. >> people are still worries about rent, meat, fish, poultry. we're moving on from the chip. >> i'm going beyond meat. >> that's a big number. >> could be the peak numbers
you ever thought about that? >> i'm going peak. >> peak inflation? >> yeah, i'm going peak. >> these supply chain issues are not going away. >> what, are you a port expert >> no, but i listen to the ceos we have a, and speak to many others not on television it's getting worse rather than better. >> i'm trying to speak with the san francisco mayor today. i don't think -- >> trying to talk to the mayor of francis he's going to fill you in on there? >> she president xi and she [ laughter ] >> there's a difference. >> president xi became mayor of san francisco? [ laughter ] >> for life! >> already they have taken it? or did we just give it to them >> no, they have taken it. it was that really weird edelweiss? remember that?
>> i'm saying it could be transitory, but there may be a auto, what you just said, and i think people should notice that oil has stopped going up the problem with natural a goods in our country is where it's -- they have this henry hub, but the fact is if we were allowed to build pipelines everywhere, we would notice we would have to import oil. >> that's a good point there's a lot of commentary that the white house is trying to jawbone on spr or a ban on exports, but they're not good at jawboning on inflation. >> they ought to pack ferc with people who are in favor of pipelines. this is a shortage of our own making they won't drill on federal lands in new mexico. there's a lot of oil in new mexico anytime you come out with pro-carbon statements like i just did, your career is pretty finished
i just finished my career. i actually endorsed the idea we should have more domestic drilling. >> what we have is capable of producing plenty. >> we can produce 12 million a day when we produce 9. >> got to refine it. >> got to refine it. we need carbon capture, we need mike wirth on the show now help me out here, mike i'm all alone. >> there's a lot to watch this morning. let's get to bob pisani. >> disney is down $14. that's 100 do w points take a look at the sectors a nice bounce back for some of the major groups here. semis all back up. consumer discretionary back up amazon is bouncing back. the car companies are doing well that's disney right there. that's why it's flattish
materials are doing better freeport is bouncing back. still no impact about these inflation concerns i want to get to that in a minute, but my head is spinning from all these ipos. i counted 17 several companies, one of these are weave communications one of the rare companies pricing below the range, which hasn't happened very often recently, people have been getting the -- but my heavens, there's a wine company, wink going company, lou's fashion company, it's a record rear. 372 ipos, that's not the record. the old record is about 500 in 2000, but we're already in record territory that includes -- we're not even done yet normally it starts slowing down,
but it's not it keeps going and going a lot of the ipo people are having trouble keeping up with the research meantime, jim brought up the main debate, as always, which is edge is this peak inflate right now? and how much inflation is there? it's very well studied on the stock market generally a little inflation the stock market is fine with that stocks outperform 90% of the time, an old jeffries studies. where you have problems is when it starts going suddenly very fast above that 3% range and then stays there for a while sectors that do well, you know, it's pretty often. energy does well, because they did raise oil prices reits do well, because they can rate the rents
banks, but none of this is happening, nobody is selling or buying based on inflation expectations, because there's still a debate about the transitory nature. finally, guys, different topic this is a decision gale for the bitcoin etf. this is they have to say yes or not to the van eck application gensler has made it very clear that he is concerned about all of this. about a spot bitcoin etf, because he doesn't believe he has adequate regulatory authority over the crypto-universe. the proshares, bitcoin strategy etf has been trading for a while, but, carl the etf community, which is more
pragmatic than the bitcoin community, is more pessimistic carl >> bob, thank you. still to come, the future for rivian a former ford bob pisani. >> the future for rivian, and its rivals a one-time board member will offer his perspective. as bob said some of the dow weakness is attributable to disney an 11-month low at 159.50. don't go away. to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go! dad, we got this. we got this.
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let's go! tonight the administrator on commercial space exploration and sending humans back to the moon. digging into thanksgiving din are inflation. you can get in on the new cnbc investing club with jim cramer find out more at cnbc.com investing club or use the handy qr code on the screen and it will take you there. the dow down 50, nasdaq up 0.8 we're back in a moment.
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entertainment, a spac that iswork jim taiclet, air force pilot, navy, at lockheed martin both stocks are great. salute the troops as we should. >> even though we have to work, as you said. >> you just think that we ought to go back there's so many veterans, wouldn't it be great to have a full day so that people can go visit world war i museum, world war ii museum in new orleans i looked up my dad there you can see where he fought. it's really incredible. >> see you tonight, "mad money," 6:00 p.m. stn.eaer when we come back the rivian rally, the market cap near 95 billion. don't go anywhere. so, you want evs, you have come to the right place. is that tom brady? yeah.
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good thursday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with morgan brennan and david faber live at post nine of the new york stock exchange s&p trying to get back some of what it lost yesterday, worst drop in a month. dow tougher sledding as disney is taking steam out of the blue chips. >> here are three movers that we are watching this morning.
we're going to start with buy now pay later affirm rallying after announcing an expansion with amazon and delivering a revenue beat for the quarter the shares up 13.5%. the ceo will join techcheck in the next hour. beyond that, beyond meat getting crushed. reporting current quarter revenue guidance for -- that was far below expectation. the stock is down 40% now almost for the year it's down 18% right now. finally carl mentioned it, blue chip disney dipping after missing estimates. subs for disney falling, bob chapek spoke about it last night on fast money. >> we reaffirmed our guidance of 260 million households and there are two drivers of that growth first one is going to be the expansion into new markets we're going to double the number of markets that disney plus is in, in international
territories, by fiscal year 2023, and the second component is obviously going to be new, fresh content across all of our wonderful disney franchises. >> so we're going to have a lot more on the quarter for disney later this hour. david? >> yeah. those losses starting to increase there shares of rivian going the other way. that stock moving higher for a second day, after more than tripling its last private valuation. investors continue to pile into what was 2021 largest ipo, the ev make is now the second most valuable automaker it got about $900 billion or so to make up to reach tesla. rj scaringe, the ceo doesn't own nearly as much of rivian as elon musk owns of tesla but as of today he is a billionaire. robert frank is with us taking a look at the rivian rich along with musk holding true to his promise and unloading milz
millions of tesla shares like you told us he would have to, robert. >> exactly david, lots of comparison this morning between elon musk and rivian founder rj scaringe but elon cashing out this week and rj cashing in. as you mentioned rj owns 1.7% of rivian that compares with the more than 20% of tesla that is owned by musk, but at last night's closing, rj is now official lay billionaire and owns 9% of the voting shares and like musk has what you might call a moonshot compensation package because in january, the board granted him options that couldall be value at over $10 billion if the company hit certain targets. to get all of them the share price has to hit $295, and he has to stick around until 2030 if he gets there, he will likely face a big tax bill, just like elon musk. musk cashing out about $5 billion in stock on monday, tuesday, and wednesday
this, of course, likely to pay a tax bill of what could be between $10 billion and $15 billion. connected with exercising options that he received in 2012 the plan to sell the shares, at least for monday, known as a 10-b-5-1 was adopted on september 14th, long before that twitter poll just this past weekend asking whether he should sell a 10% stake in tesla. it appears that the monday sales were part of that plan and included an exercise of options on about 2 million shares. the tuesday and wednesday sales appear to be separate and did not include any options akts we're still trying to sort a lot of that out. elon will likely have to sell another $5 billion before the end of the year to avoid potential tax hikes starting in january. david? >> right but robert, again to go back to sort of the overall story, he's got these options. they will expire i think, what,
maybe next summer? $6.24. >> august. >> hasn't -- >> august. sorry. he has not exercised all of them at this point. he's still kind of going to do it, we assume, piecemeal over a period of time the tax bill will be as much as $15 billion should the stock stay roughly where it is >> that's right. he exercised options this week on monday. about 2 million options were xersds he's got about 23 million options that he will almost certainly exercise before next august and almost certainly this year to avoid any potential tax hikes next year. so only about 10% of his options were exercised on monday he's got a lot more to go, maybe up to 20 million to exercise and exactly right, he will have to pay those taxes. what he might have been doing tuesday and wednesday is selling shares that have zero or next to zero basis to possibly give to charity that would help offset any tax bill he has on the
options. something that he's talked about. >> we're talking about it today but, of course, robert told you about it first robert, good to see you. robert frank. for more on rivian's big debut in the ev space let's bring in analyst michael good morning to you. i know you wrote last month you have seen some names in the space that are breaking to the front of the pack as we close out 2021 is rivian one of them? >> actually, yes, it is. i said that we are -- that we think that rivian, that there are certain companies in front of the pack. those that are in production or very close to production and rivian, small but is one of those names. >> what would it take to put them into that club? >> well, i think the next -- this quarter ending end of quarter production would be important if they can get 200 or 1,000 or more vehicles on the road beyond just employee shipments, that would be huge very few companies are actually there. there are a lot of great power
points out there with the evs and now companies that have evs on the road today. >> right data trek, one of our favorite sources here at this desk said this morning that rivian is the first legitimate competition tesla has ever had in terms of institutional investor interest. and that that might siphon out some capital from tesla. i wonder if you would go that far? >> it actually is quite possible because tesla has run so much just trying to find the next best thing of all the large ev cap names out there, there aren't that many, rivian is the new shiny object out there. >> so michael, it's morgan rivian's the new shiny object out there. what does it mean for all the other ev players, the suppliers, component manufacturers, some of the companies like reed, for example, that are making key parts of ev platforms that will sell to oems we don't talk about this piece of the market very much, but does it give lift to that?
>> i certainly think that it does if investors are kind of willing to give this kind of valuation to a rivian, which hasn't done much ebitda any time soon, the other guys should see lifting of all boats, especially those that move towards that finish line of being in the market, producing vehicles and having vehicles on the road today, absolutely, morgan. >> how do you go about trying to value rivian at this point i mean, do you have a model at all and how far out do you have to go to look at cash flows you can discount back in some way? >> this is a very tough one. this is really -- this and the group are not auto investments, these are tech investments and they're tech hardware. what you can do, one, sort of to look at 2023 sales, saying 8 billion, if you say 8 billion, it's only trading at 12 times sales, that's quite a bit, but not unheard of in the ev space
right now. the best you can do i think, carl. >> 12 times '23 sales. >> exactly >> yeah. >> got it. >> so then -- >> you know you have general motors yesterday, mary barra coming out and saying they believes her company is under valued the fact that, for example, thele valuation of tesla and all of the enthusiasm around the start-ups in the space has helped to give lift to rivian. why hasn't it helped some of these traditional names like gm and ford more, given the fact that they are pouring billions of dollars into this [ inaudible ] formidable competitor >> well, they are definitely launching their own ev if i could, i think the winner of the non-ev space is amazon. based on the gains they just got from their stock the last day and a half they pride themselves
[ inaudible ] with the gains alone after taxes, probably pay their drivers a full year's salary based on that gain alone. any company not in the ev space amazon is the one to watch right now as far as valuation. >> yeah. but as far as the legacy oems go, a discussion whether or not their historic reliance on combustion engine, weight around their ankle, as they try to move into a new market. does ford's interest in rivian help them out in that regard and give them a leg up over gm >> i think it definitely does, and if you recall, ford also owns a big chunk of a company called solid power, one of the spac mergers that are currently pending. with investment in that and probably the powered batteries that help with rivian as well, just adds more volume hopefully to solid power model and to make costs lower for both of them.
>> as we look at the market cap of the big players, one not like the other. interesting. michael, thanks so much. what a fascinating week. thanks for the time. >> thanks so much, guys. appreciate it. >> as we go to break take a look at the road map for the hour including a lot more on disney's quarter with the mouse house saying it's ready for its own metaverse. >> live to beijing with china's singles day ending at the top of the hour jd.com and alibaba shares are up on what is the unofficial holiday. >> spacex launching its fifth human space flight last night. the company also inking a new deal with its famous processing company. the ceo and fellow astronaut jared isaacman will join us later this hour to talk about that more "squawk on the street" straight ahead don't go anywhere. that's the one with the amazing camera? yep! every business deserves it... like one's that re-opened! hi, we have an appointment. and every new business that just opened!
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let's turn back to disney, the biggest laggard on the dow julia boorstin caught up with bob chapek last night and joins us with highlights good morning. >> good morning to you, carl disney's eevgs and revenue missed expectations and investors are particularly focused on the lower than anticipated streaming subscriber numbers. disney added 2 million subs for disney plus. that was in line with the slowdown that ceo bob chapek warned of but lower than the 9 million. disney plus is on track for the 2024 subscriber targets which he said they will hit in part by
investing in local and regional content. he also said he sees the potential to build the streaming platform into a metaverse. >> well, my vision is to use disney plus as the platform for the metaverse. i think it really blends our physical beings and our digital beings and creates a three dimensional canvas for our creative storytellers to paint so that we can create experiences that otherwise would have been defined as it's a park experience or it's a movie experience or it's a book experience i think those all come together without boundaries, without borders, without constraints and our creatives are biting at the bit to get into the disney metaverse. >> metaverse is the hot topics this season. three quarters of analysts have a buy rating on the stock but a couple of cautious notes were out this morning moffett with the neutral rating writing, quote, we wonder if disney plus is too narrow a product and requires much
greater investment in non-disney content to widen outs the product's appeal ubs lowering its price target but did maintain the buy rating on the stock saying, quote, while slower sub growth could weigh on sentiment near term, we still see ample runway for long-term direct to consumer chapek says they are thrilled with the demand they're seeing at the theme parks guys, back over to you >> really quick, julia, his line about day and date perhaps, staying in the mix, how do we evaluate his ability to please both the streaming community and the exhibiters >> well, look, so what he said is that he wants to make sure they have total flexibility going forward. some films will be in theaters for an exclusive window. that window will be shorter than the roughly 90 days that it was pre-pandemic a lot of times now it will be 30 or 45 days but it sounds like he wants flexibility. i mean before the pandemic, there was a very set way of how
you release movies and i think that going forward, they will probably be more careful about how they prenegotiate terms with talent after that whole scarlet johansson lawsuit which they ultimately settled they're glad that they haves the flexibility now to have each film decided in a one off manner rather than having to have a set way of doing things for theatrical releases. >> julia, thank you. for more let's bring in morgan stanley's ben swinberg and neal macker. let me start with you, i read your note this morning on the cost side here, i thought it was interesting that you did raise what you estimate in terms at least will be disney's need to ramp up content and therefore the content spend. how does that figure into your overall view of the company, and its prospects? >> look, i think at the end of the day if you own disney stock and today with the pullback we think it's gotten more compelling you believe they can
build a big and profitable streaming business and so the prize, as we highlighted in the note, is that as we move out of 2024 and beyond that is a big business with real scale and profitability. the cost to sort of scale to that point if it's $10 billion instead of $8 billion in the grand scheme of thing i don't think is a thesis changer. i think the keys they deliver on the top line to make the stock work rather than the cost to get there. >> right you called your note the cost of doing business you still have it as an overweight, why? >> i think if you go back, david, a year ago, between november and the end of the year we had the vaccine news, we had the investor day where they raised guidance. disney added $100 billion of value in basically two months. that's the market pulling forward and pricing in a lot of success. i think you fast forward to today as you can tell from the stock and what you read and research, there's a lot of skepticism in terms of what's priced in, i think now if they can deliver on their outlook, you can make real
money in the stock and the risk/reward has gotten compelling compare disney to netflix, netflix trading nearly 30 times 2024 earnings. disney as of today has cracked below 20 times we believe that disney has the brands and the ip and the track record, having gotten to 120 million subscribers already in just two years, to execute on their vision. >> yeah. neal, you seem to be one of the skeptics and have a hold rating on disney. what did you think of the results and is there anything that would change your mind on that. >> yeah. i think from my point of view i agree that disney has a great set of ipo and things like that. the results largely in line with expectations weaker on the sum number here. as i said in my note look at the number of subs that disney has put up over the last year versus netflix, tremendously outgained them in that area and they're still adding names there one of the reasons we're hold is what ben talked about here we think there's been a large
pull forward of the value here, and while we look at our fair value 170, we think we would look for more clarity on, you know, how quickly they're going to ramp out some of the other names and how quickly the content will be spread over a number of countries. remember, disney has been making a ton of local language content in india is it all going to be mostly in india or more things in korean, mandarin, japanese, and spanish, where does this local language go we think that's going to be a big point of focus for the company in terms of how they're going to build out with netflix and amazon around the world. >> so let's dig into that more it does seem like, we've certainly been talking about this really ever since the rollout of disney plus, that that is the narrative, the dominant narrative, for the stock. neal, the other businesses are showing signs of recovery because disney, after all, is a media conglomerate you're seeing the recovery taking root in the theme parks,
with advertising around sports programming coming back as well, you're seeing it with theatrical releases is that being overshadowed by the disney plus narrative and the fact that we have seen this pull forward and slowdown in subs >> yeah. but i think if you look back at disney over the last five years, there's been sort of an overwhelming narrative that takes over the media piece back five years ago it was how are linear subs doing in the united states? worrying about cord cutting and things like that now it's streaming that seems to be what's pulling forward. we think that the parks business is on the way to recovery. we are still a little worried about the linear business, not as worried as five years ago, but we are still seeing declines in subs and that's a large part of their business on the sports spipds how will they make the transition to espn plus and get 7, 8, $15, you know, from the total disney package from the cable distributors, how you get that to consumers. >> ben, it suspect that long ago
we focused on espn subs an the loss of those subs is that still a concern to you where do we come down on sort of where they stand right now in terms of the linear networks which continue to generate an important part of the cash flow for the company? >> yeah. they paid the bills, david, and i think particularly as they're burning cash in streaming, owning those assets is a positive and i would rather have those than not given where they are in the cycle, particularly with sports. again, as we think about the streaming landscape, our view globally is that we have a billion paid tv households moving to streaming over the next decade plus sports is a huge part of that market, and it's actually an area, again, just to compare to netflix, and netflix is not in and disney is, i would much rather be making the pivot into sports streaming overnighting espn than not. it's a cash cow. there's no growth there. that's not a big shock to anybody. >> neal, finally some of the
downgrades argued disney was going to suffer over the long term due to a relative paucity of titles versus netflix, they would have to ramana ramp up tht les over time. given their family oriented brand, does that need to change? >> i think the taller walls does need to change a little bit and you're seeing it internationally where you're seeing the abc and fox shows under the star brand and that being a content hub under disney plus. we think if we look at the u.s., the growth has been a little slow for disney plus here in the last year because of the lack of content flow while that is ramping up we think as you're competing with netflix and amazon and hbo plus, you are going to need a more complete package we prefer that they either create a, you know, a cooler, star brand underneath disney plus, charge more, or get more aggressive on the bundle pricing they're doing with star plus and disney plus in latin america
sort of breach that idea that they don't have the number of content titles coming through the door that netflix does on a monthly basis. >> guys, we'll leave it there for now. appreciate it. thank you, ben and neal. still ahead, rivian revving higher the stock, which priced ipo at $78 a share, continues to skyrocket up another 11% right now. $111 plus per share. we'll be talking about this more with a former ford exec previously on the board at rivian 'rba itwo. pping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!
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welcome back i'm rahel solomon. here is your cnbc news update at this hour. the chinese communist party is setting the stage for president xi jinping to remain in power for an extended period at a leadership meeting it called his ideology the essence of chinese culture. xi and president biden are expected to hold a virtual summit on monday. f.w. de klerk former president of south africa who shared the nobel peace prize with nelson mandela died at 85 he played an important role in the end of white minority role some blame him for violence against black south africans and anti-apartheid activists during his time in power. in the u.s. the nation honoring the men and women who served in the military world war i ended on this day in 1919 and it is the 100-year anniversary of the tomb of the
unknown soldier in arlington national cemetery. you're now up to date. morgan, back to you. >> this is when i say happy veterans day and thank you for your service and sacrifice and all you do for us on a daily basis. >> can't say it enough. >> thank you let's get back to rivian, surging 29% yesterday during its public debut it is surging again today up double digits. ford investing in the company back in 2019, currently has a 12% stake and for more we turn to phil lebeau who joins us with a special guest. hi, phil >> hi, morgan, let's bring in the former president of the automotive division from ford motor company. joining us from his car as he's headed on a trip, kind enough to join us. tell us about your thoughts as you watch the rivian ipo take place and the demand for this stock continue to accelerate >> yeah. thanks very exciting day for the rivian
team and r.j. personally excited to see strong demand for the stock. not surprised by that. r.j. is a great partner and friend and when we invested starting in 1819, really found that r.j. to be a trustworthy, you know, kind of modest, humble partner, and i'm not surprised by his success >> which raises the question a lot of people when they look at rivian keep hearing people say, hey, it's the next tesla, the company that could take on tesla, and they immediately start saying is r.j. like elon paint a picture of what we can expect as investors watch him and expect r.j. as a ceo >> yeah. i mean, r.j. is very humble, very modest. if you think about the beginnings of this company that started in 2009, probably the worst time in the world to start an auto company, he stuck with it for nine years really before he got major investors, and he lived in an apartment, you know, that my son actually lived in,
complex my son lived in, a year out of college that tells you the commitment that r.j. had to the business over nine years. you were talking about it today, you know, he diluted himself significantly through the whole process to get the right investors, right partners, whether amazon or ford or cox or financial institutions, or even lj the early investors, down to 1.5% of the company. he was committed to the growth of the company in a different way than i think a lot of other people have when they start their own companies like this. 12-year journey culminating yesterday with the ipo but what we found great about r.j., he's humble, modest, knew where he needed help, searched out partners and had a great vision for the rivian brand and tech and auto partners he was searching out for. >> which then raises the question for investors, how confident can they be that rivian will continue to grow from here? already people are saying they want to get to a million vehicles sold by 2030. we think they're going to get there. why is rivian different than say
a fis ker or a lucid or any other ev start-up? >> i think you think about the investment partners amazon, ford or cox, cox for service, ford for manufacturing, stamping a body and engineering and amazon for data and software and amazon is our largest investorand customer what makes it so different than anybody else, they have a captive customer in amazon if you pick a company in the world you want to be a partner with in the logistics and vehicle space, that's one of the ones you would pick. it separates out rivian dramatically also go back to r.j. he's the kind of person committed to this for the long term, invested his whole life and sacrificed to get here, you will see him continue to do that to build the companies the right way. >> the ford piece of this a little bit more, given the move in the stock since it went public yesterday, a boon for ford and the stake it has, how
does the company leverage this >> i retired from ford last year so it wouldn't be appropriate to talk about how they do it. they've made major investment announcements for that electric as far as assembly plants for battery cells, also plant for the f-150 battery electric truck in the future and talked about, you know, paying off debt, so you can see where they've started anticipating the returns and what they're doing we'll leave it for them to talk about, but clearly a big windfall for ford, and i'm happy for them. >> seems like different companies are taking different approaches to the manufacturing processes, some vertically integrated, some doing outsourcing through this process as well. with three models rolling out at rivian back to back, what will it take for that process to happen and how does it speak to how they're assembling these new cars >> yeah. i mean it's an ambitious launch schedule we went on a board a couple years ago, spent a lot of time
talking about this period of time, launching the amazon vans and the rivian truck and suv and at the time we also were working on a product for ford and how do we schedule all that very ambitious that's one of the reasons why r.j. reached out and wanted an automotive partner, gm or ford at that time, to help with launch and quality processes and the manufacturing and engineering. they've hired a lot of great people and got resources from retirement out of ford, and they really learned a lot over the years. there's a lot to do. they're in that manufacturing hell time frame that elon musk talked about in the past but i have confidence they've done it the right way, doing it the right way, and amazon will be a great patient customer and partner and the rivian product will also be great when they come out >> joe, it's phil again. there are so many of these ev companies, the startups or the legacy automakers ramping up ev production, adam jonas from morgan stanley out with a note today saying look, the problem is not demand. the problem is, there's just not
enough battery supply. lithium and ion battery supply over the next couple years, near term how worried, knowing what you know about the manufacturing pipeline here in the u.s. and north america, how worried are you that people are going to not be able to see the growth that many are forecasting for evs over the next say three or four years? >> well, i know you're seeing a lot of announcements being made at capacity going into play, so it's quickly being put in place, gm or ford or other suppliers or competitors out there making announcements. obviously the raw materials are also really important. you hear a lot about that and the developments going on in cell batteries and things of that nature as well. i think we should all watch this very carefully, but i think the capacity is going in place over the next couple years. the raw material availability from the countries around the world there is and the technology continuesto develop so we can get new solution or better than the rithium ion or
nickel cobolt or whatever is out there today. an interesting space to watch but the capacity is going in place to match the demand in the next couple years. >> joe, thank you very much. especially joining us from the car as i know you are on a trip. not stopping in columbus for your buckeyes have the ohio state university, but kind enough to join us. guys, i will send it back to you. one of the things to keep in mind as you watch rivian and watch these electric vehicle startups, yes, they are making these plans, but the question is, can they execute that is going to be the primary question here and one reason for the excitement about rivian is many people do believe that they'll be able to execute on their plan. >> fantastic stuff, phil, as always what a week. our phil lebeau. as we go to break we are watching shares of amc after adam aaron sold shares part of his estate planning ahead of turning 67 next year that chunk is half of what he ultimately plans to offload under a selling program with the
s.e.c. hanging on to a $20 billion market cap more ahead, stay with us. ♪♪ ♪why do you build me up (build me up)♪ butter... cup... baby... up would be the operative word there pal. oh, yeah, yeah. sorry, have a good day! if you ride, you get it. - come on in! oh wow, we're really backed up. geico motorcycle. fifteen minutes could save you fifteen percent or more. so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know.
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of essential sustainability intelligence. s&p global sustainable1. uncover risk scenarios, reveal transition pathways, and optimize your net zero opportunities with our unparalleled data and insight. accelerate to zero with us. just a few minutes left for china's singles day celebration with alibaba and j.d.com both up today as you see and getting a boost from a lot of sales. eunice yoon is live from beijing and can fill us in on what's going on >> hey, david. as you all know singles day is the main online shopping holiday in china it's usually a day about big discounts, big sales, but not this year. that is why i am standing at an alibaba sponsored recycling center where people are encouraged to bring in their old
packaging materials after their deliveries this year's singles day under the sway of ps the xi jinping's common prosperity drive. this is a vague notion about social equality. regulators have warned the companies about engaging in aggressive promotion the companies usually would be giving us hourly updates of their sales numbers. we have some information, alibaba says that about 400 brands including apple raked in about $15 million in sales each. j.d. says its sales as of this afternoon hit about $48 billion, but again, no retail real-time sales information really playing down the consumerism and instead playing up a lot of their social initiatives which seem to align with beijing's goals for example, alibaba is urging its sellers to donate some proceeds to charity. it's also offering about $15 million in what they call green vouchers, so this is to promote the purchases of eco-friendly
products j.d. is shifting its sales time to accommodate people in more rural areas, and pinduoduo has been showcasing support for farmers. alibaba's partner has set up 13,000 of these recycling centers just for this singles day. you know, recycling actually isn't a very prevalent practice here in china. we have been seeing a steady stream of people, though, coming in and they have one big incentive, and that is, that for every single box you bring in, you get a free egg they have prepared 500,000 eggs for this day carl >> fascinating cultural differences for sure eunice, thank you so much. eunice yoon helping us stay honest on singles day. watch shares of bubble crushed after reporting a wired than expected loss. we will talk to whitney wolfe
herd in the next hour on "tech check. josh lipton is in salt lake with a look at what's still ahead in the show josh >> that's right. on this veterans day we are here at black rifle coffee company, a veteran-led business with a lot of momentum. i spoke to the ceo and we'll inyohicoen aerhebrg u s mmtsft t break. so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!
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welcome back to "squawk on the street." back to josh lipton, live in utah looking at a veteran led company that continues to have significant growth josh >> that's right, david on this veterans day we're here today at black rifle coffee company. this is a veteran-founded, led and operating business with as lot of buzz and momentum evan hafer, a former green beret, founded this company seven years ago with a very clear mission, serving premium coffee while supporting veterans and their families >> when i go to work every day, what charges me up is knowing that i can build -- i have an opportunity to build something that creates that infrastructure support for guys like me >> today, about half of the company's roughly 600 employees
are veterans, reservist or military spouses, and it has also set a bold, long-term goal for itself to hire 10,000 veterans that requires, though, a lot of money, so black rifle coffee has agreed to go public through a merger with a spac that transaction is going to provide the company's balance sheet with an additional $225 million in cash, which evan hafer will use to aggressively expand his footprint of physical stores. >> you can create more employment opportunities in physical locations throughout the communities of the united states that becomes a really big funnel to bring in thousands of employees. >> now we know the company has made headlines for other reasons, too, though a writer was photographed wearing a black rifle coffee house, kyle rittenhouse for killing two people during a blm protest, photographed wearing a black rifle coffee t-shirt,
reportedly when released on bond evan hafer distances himself from these telling me that black rifle coffee represents no political party or movement. back to you all. >> we know who the black rifle employee is. who is the target customer >> so it's so, if you talk to t company, they talk about their customer, it generally skews morgan, young, higher income relative to the general population i was talking to another executive here and i asked him who he thinks about when he's thinking about his customer. he told me it's a veteran, it's a blue collar individual he told me with solid income, probably driving f150 you look at this company's growth, this company was started in 2014 in evan's garage, 2015, he was doing about a million in revenue and fast forward this year, this company will do 230 million revenue, that's a 40% year over year pop, guys >> josh lipton, thank you.
spacex transporting four more astronauts, to the international space station last night. picture-perfect falcon 9 launch from florida crew3 will spend six months in space once they dock with the iss tonight just after 7:00 p.m. eastern. after the break, we'll speak with someone who knows a thing or two about making such a trip with spacex to orbit jared isaacman was commander of inspiration 4 which launched back in september. his company shift 4 just reported earnings and announced a new deal with spacex stock spiked 16% yesterday it's under pressure right now, though stay with us so, you want evs, you have come to the right place. is that tom brady?
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welcome back to "squawk on the street." spacex successfully launching a crew of four to the international space station. for that sarks it's the company's overall fifthed crewed mission into or dbit. joining us now is jared isaacman his company shift4 just reported earnings just announced a new deal with spacex as well jared, it's great to have you back on the show >> oh, thanks for having me back, morgan
great to be here. >> so i do want to get into the goings on at shift4, but first given the fact that we did see this crew 3 liftoff last night as someone who made a similar journey yourself less than two months ago, i want to get your thoughts on what it was to witness that with feet firmly planted back on the ground and having done it yourself. >> oh, yeah. well, exciting time in human space exploration. we haven't seen this kind of back-to-back pace of human space flight since materially days of space program. decades ago. so, it's so exciting that we're getting in this rhythm right now. i watched the live stream of crew 3's launch, every step of the way imagining exactly what it was like when myself and my crew were in that situation just two months ago couldn't be more thrilled for them on their journey now to the space station. >> yeah. so, shift 4 reported earnings yesterday and announced a number of agreements and partnerships
including a five-year deal to process payments for starlink which is spacex's satellite internet service that's quickly rolling out. talk to us a little bit about that deal and what that means in terms of growth opportunity for shift4 over the next couple of years. >> yeah. so, i've been very busy re-adjusting to my terrestrial life since i've come back to space with shift4. we had a great quarter i think we surpassed a lot of expectations for the quarter and reaffirmed our 2020 guidance and gave an awesome outlook for the years ahead on the shoulder of several strategic wins we announced our entry into nonprofits with healthcare with st. jude children's hospital these were all really exciting but for sure, starlink, everybody knows that that's going to be a big disrupter, a second wave of cord cutting get
rid of your modem cables we're happy to be a little bit of a small part in that journey. >> yeah. you mentioned on the conference call that starlink is already doing over $1 billion in payment volume, of course this is a service that's still transitioning out of beta. i think that was eye popping for the analysts and investors who were tuned in there. the fact that you issued 2024 guidance, you just mentioned that you're expanding into a number of verticals, the new restaurant platform, you're expanding in gaming, travel beyond hotels with this deal with alegion as well where is the future of not only shift4 but this payments and payment processing architecture going? >> yeah, shift4 is an integrated payments company, which means we connect our payment processing service into software. 99% of the transactions we process, which is nearly a quarter of a trillion a year, are originate through software it doesn't just have to be restaurant or hotel or specialty retail software, it can be in gaming, it can be in ecommerce
which we're in already, sports and entertainment venues, it can be in cool sexy tech like starlink but also in healthcare and nonprofit. for us if there's software delivering a commerce experience, really anywhere in the world, we can connect into it and deliver a lot of value back for our customer so, you know, our long-term growth targets of 50% volume growth over the next three years, that's in line with our historical trends. i mean, we grew through the pandemic at nearly a 48% over the last three years with a lot of restaurants and hotels not hard to think we're going to get there and surpass expectations when you think about the new exciting verticals we're in. >> yeah. couple weeks ago jack dorsey, the ceo of square, which is one of your competitors, put a pretty controversial tweet out there about hyperinflation, some folks pointed to that and said he's stocking his book around bitcoin, but given all the data that square is sitting on, that raised eyebrows about just what kind of inflationary data may be
seeing through that perhaps company, are you seeing signs of inflation and is it sticky based on what you're seeing within your own company >> well, for sure, we are seeing it i mean, we cater to again restaurants, hotels, specialty retailers. we touch all avenues of ecommerce and nearly a quarter trillion over the year there's no doubt we're seeing prices go up you know, i don't think it's a healthy thing to some extent we are a beneficiary of it. we earn a spread off of payment volume when average ticket sizes go up, it actually is a little bit of a boost for us. i don't think that's fully appreciated in the market right now. but for sure we're very close to industries right now that are experiencing quite a bit of inflation i'm not necessarily in jack dorsey's camp nor do i think we compete if you look at the verticals we're in versus where they're at right now i don't agree that it's to the same extent that he's currently predicting >> all right jared isaacman, thanks for
joining us today >> thanks for having us, morgan. thank you to all the veterans who served our country appreciate it. >> thank you. real quick look at the markets. yesterday tough day for the nasdaq a reversal a bit today chip stock take a quick look at qualcomm, nvidia having quite a good session that will do it for us on "squawk on the street. "techcheck" starts now ♪ ♪ good thursday morning. welcome to "techcheck" i'm carl quintanilla with jon fortt, deirdre bosa and julia boorstin. today disney disappoints sending shares lower this morning. then out with the old and in with the new inside $90 billion valuation for