Closing Bell - Closing Bell: Debating the AI Interruption 2/4/26

Episode Date: February 4, 2026

Is the selling in tech overblown? Investors are looking for some clarity and pivoting their attention to Alphabet which reports in Overtime. We run through what to expect with shareholder Doug Clinton from Intelligent Alpha and Oppenheimer analyst Jason Helfstein. Plus, former St. Louis Fed President Jim Bullard weighs in on what could be next for the Fed under Kevin Warsh. And, the big battle between Anthropic and OpenAI is headed to the Superbowl. We explain. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome to closing bell. I'm Leslie Picker in for Scott Wapner today, live from post nine here at the New York Stock Exchange. This make or break hour begins with here's swirling around AI disruption and if investors are throwing in the tech towel. Let's get straight to the scorecard. A mixed picture for the majors with the NASDAQ, really the big laggard here, but well off the lows of the day. Software and semis remain the story. Shares of AMD weighing heavily on the broader market, having their worst day in nearly nine years. The CEO is, defending the company's results exclusively to CNBC, will have a special report on that in just a moment. Software stocks again facing pressure, Oracle and CrowdStrike, extending their losses, the IGV heading for its seventh straight-down day. And that, of course, takes us to our talk of the tape.

And just how real is this AI interruption? Is this selling overblown? Investors are looking for some clarity pivoting their attention to alphabet, which reports results in just under an hour from now. We will have more on that in a moment, but first we want to get straight to Sima Modi on the huge moves we've seen in the software space recently. Sima. And Leslie, hedge funds are increasingly shorting their bets against software stocks. That's according to the conversation we had with two prominent funds today.

The latest data from S3 partners does show about a $24 billion windfall so far in software stocks this year. The hedge fund sources wouldn't comment on specific names, but it does speak to the speed at which these stocks have been falling. and the momentum that we've been seeing to the downside. Speaking of, that today's biggest losers, take a look at App Loven. Palantir, giving back the big gains it saw yesterday tied to its strong earnings report and Intab down about 17% just today.

There are some names that are bouncing back, Adobe Workday, Ring Central, looking to sort of claw back some of the losses from earlier in the week. This, as we count down to earnings from Atlassian and Fortinette, Leslie, these are two mid-cap names and software that once again, their CEOs will be in the spotlight to answer questions on how they're fending off competition

from these disruptive tools that are being revealed. Seema, when you look for comments from CEOs that are trying to kind of defend their position in the software space right now, are there any messages that are actually getting through to the market? Because it does feel like there's just this kind of broad-based selling in the sector. And I'm just curious if there are any defenses

that are actually working in the current environment. That's a great point. So far, the message from CEOs is one of strength. You're not seeing any attrition from companies like ServiceNow or others that are reporting better than expected numbers. I would say the guide has been a bit more conservative. So that is something that we're going to look for in the coming days, not just from Atlassian and Fortinet, but next week we have Monday.com, Datadog, companies that are seen as more as AI beneficiaries, whether they can defend their business models and show that they're not seeing that threat

or seeing customers move away to these more disruptive platforms. Yeah, it's certainly an interesting space right now. Glad to have you all over at SEMA. Thank you. AMD shares sinking after earnings. Christina Parts of Nevelis here with more on that stock. Christina. Sinking is, I guess, a nice word. Down quite a bit, almost 14% today, despite beating earnings.

They didn't mention any supply problems like competitor intel as well. It really comes down to expectations just getting way, oh, 16% lower now, getting way too high into the print. A big chunk of the fourth quarter beat came from unexpected MI308 sales, specifically chips made for China, before these export restrictions actually tightened. Investors are also pushing back on the uptick in operating expenses. As R&D costs continue to ramp,

so those are some negatives, I guess you could say, for the earnings or I guess contributing to the share price drop. But CEO Lisa Suh spoke to CNBC earlier this morning and really tried to shift the focus to the future. Listen. I think when I say that we're seeing acceleration, I would say in the last 60 to 90 days, we have actually seen an acceleration, particularly when we think about 2026. And, you know, that comes in terms of, you know, demand patterns, forecasts, and just the general feeling like there's not enough compute out there for everything that wants to be done.

Speaking of compute, the real test really comes with the launch of the MI455 chip, which is just a more advanced GPU chip, AMD's next generation AI chip that really needs to prove it can compete with NVIDIA's Blackwell offerings, management affirmed on the call, on-time delivery for third quarter with bigger volume in the fourth quarter. But until those chips ship in meaningful volume, AMD kind of remains a show-me kind of story, which is why you're also seeing that sell off. The market just wants execution right now, not roadmaps necessarily for tomorrow. And it's not just AMD. You're seeing that in a lot of pockets of chips or just overall, Leslie, the fact that people want to see finally the returns in the immediate term

and not, okay, we're going to make billions of dollars on AI in the coming years. Yeah, Christine, you've covered many of these for many quarters now. Do you see this as a big sentiment shift in terms of what the market is willing to underwrite at this point in time? Yes, 100%. Because remember last year, not even like six months ago, we were celebrating the massive spending in CAPEX, and all of a sudden now we're like, well, where's the return?

turn on investment for all of this spending. You say that people want to, you'll keep buying compute, but why isn't the guide for AMD a little bit higher than what we saw? So I think there's just a lot more, we're questioning just the near-term, you know, momentum. Is it really there? Is it going to justify all of the KAP-X spend that we've had just over the last year and continue to have into 2020-30, for example? Right, because even if the thought is, oh, well, it's overvalued, it's run up so much. I mean, it's down nearly 17 percent to your. Your point, sinking may not even be a strong enough word, maybe like slumping or plummeting is a better descriptor here and clearly signaling a shift, at least in terms of what the market

is willing to support at this juncture. And a rotation. I should say, too. There are definitely some winners within tech. It's just rotating out of the most popular compute names. Yeah, good point. Christina, thank you. Let's turn our attention to Alphabet.

McKenzie Segalo is here with a look at what she's watching with those numbers in about 55 minutes, Mac. Hey, Leslie. So this is the first full quarter since Gemini 3 launched, the release that put ChatGBTGBT on the back foot and sent Open AI into Code Red mode. So today's print is all about AI and whether ad momentum holds up as Google hands out Gemini for free. Investors have bought into Google's full stack advantage, models, cloud, and its own AI chips. The stock is up more than 70% in six months, and Google just joined the $4 trillion club. So now Wall Street wants proof that it's translating into strong. cloud demand and a clear path to monetizing Gemini.

The other big focus is Apple. This is Alphabet's first earnings call since Apple chose Gemini to power series overhaul across its two and a half billion devices. And Cappex Leslie is the wildcard. Alphabet already promised to increase 2026 spending from its current target of around $93 billion at the high end. But it has to thread the needle. We're talking steady ad growth and an accelerating cloud business to justify it.

Yeah, it really does feel like the quarter where CapEx is so in focus. That was true with the banks. We're seeing it with the chips. And, of course, companies like Alphabet as well, that will be in focus. Mack, thank you. We know you will be all over those numbers after the close. Let's now bring in Alphabet shareholder, Intelligent Alphas, Doug Clinton and Oppenheimer analyst Jason Halstein. Thank you both very much for being here.

Doug, let's start with you. What are you focused on, at least in terms of the quarter? This was, of course, the quarter where Gemini really broke out relative to some of its AI competitors. How much do you think that matters in today's print? I think it matters a lot, Leslie, and I think we expect to see a couple of things on the Gemini front. First of all, we rewind back into Q4. We heard Google say they had over 600 million monthly active users on Gemini. I would love to see a number closer to a billion if they put out a number today.

I think that would put them right on par with OpenAI in terms of some of the user metrics. And so I think investors will definitely pay attention to anything they say there in terms of usage. The other big part of Gemini obviously is converting that into cloud services usage and with enterprises. I think that's going to be the other big number here. I think the street and investors are probably looking for something in the low, mid-30% growth range. And I think if Google can deliver that, the stock probably works. Wow. No, that's a great point as it pertains to Cloud as well as Gemini. Jason, you know, we were just talking with Mac about Cappex and the market's appetite.

What do you think is the kind of the pain threshold for Cappex in the quarter? How much, you know, would really spook the market here and how much are you expecting? I think Google is still, Alphabet is still a positive margin story. And so I think, you know, they can spend. more as long as the revenue is going up. I think when you compare that to meta, you know, basically what investors are struggling there is, you know, basically the CAPX is eating up all of the free cash flow, and then you basically have kind of basically no improvement in operating leverage.

Whereas here, alphabet, you know, first of all, their CAPX is fungible between search and between the cloud business. And so, you know, they just are showing a level of efficiency around CAPX spend. and overall OPEX been than other companies aren't. And to this point, so far at least, it seems that they have not been particularly capacity-contrained compared to other companies. Yeah, that will be something to watch for.

And of course, they were the best performer of the MAG-7 last year. It's truly a consensus long. How high do you think expectations are, Jason, going into the print? It was down a bit today, along with the broader MAG-7 complex, for the most part.

Do you read anything into that? Would you say that's a buying opportunity, potentially? Yeah, look, I mean, you're obviously seeing a broad sell-up in tech right now. But we think, you know, we're looking for search up 14 as our published number. My guess is investors are probably looking for a little bit better than that. At 15, we're at 16% for the first course on acceleration. I think investors also want to hear more data points around ads in AI.

So basically, there's been a discussion of like when do ads come into AI? mode, when to ads coming to AIO reviews. They cited AI overviews as, you know, a driver of a 300-bases point acceleration in paid clicks in the last quarter. So can that further improve? So really, whatever linear data points you can get to say more people are using AI through Alphabet products, and the ad opportunity is yet to come. And Doug, how are you thinking about ads as a shareholder? I just look at kind of two examples today, the New York Times reporting earnings.

It wasn't necessarily an ad story per se, but those shares currently down 7% Washington Post laying off a third of their workforce. How do you kind of look at the AI or at the advertising ecosystem as it pertains to kind of legacy media versus the opportunity for some of these AI players? Ads are still the golden goose for Alphabet, obviously. it is the vast majority of their business. It's highly profitable for them. And so to Jason's point, I think they'll have a nice, healthy number here in Q1. As we think about this story longer term, though, Leslie, we think a little bit more about what are they going to do in terms of personal AI, how are they going to monetize AI? Because I do think ads will always continue to be part of Google's ecosystem. I think ads will be part of these AI services we use. Open AI, obviously, is dabbling in

ads right now. Anthropics making fun of them for digital. doing that if anybody's following that. But I think that over time, the subscription nature of AI and what these services can do for customers, that to me is maybe the bigger story as we think about how Google's business could evolve for the next several years. Yeah. Jason, what's your take? What are you looking for from the executives on the conference call? What question would you be asking? I guess it's really, you know, when do we start to see search revenue accelerate with the adoption of AI. I fully agree with Doug's point. Google is in probably the best position to be the personal assistant because they have so much personal data.

They're very good at data security. And so it seems like consumers will trust this company. And then ultimately you're going to weave ads or at least use that data to do a better job of targeting it. So think about it. If you can get an acceleration in advertising in the next few quarters just on like, we'll call the pretty rudimentary things they've done around AI. Think about a year or two years from now what they could ultimately do if they become your kind of true assistant. And Doug, as we kind of reflect on what we've seen so far this week, I am aware it is only Wednesday. How are you thinking about the market's ability to appropriately value some of the speed of change that we've seen so far with AI capabilities, rather,

to incumbents and software and other potential disruption candidates. Do you think that that valuation change is taking place appropriately? It's going to be a challenge because, I mean, I would tell you, you know, Lisa Sue, we had her commentary on just a minute ago. Talking about the rate of change over the last 60 to 90 days, it's been incredible. And if you're not in AI close to these tools, close to these companies, it's maybe hard to understand what Claude Code has sort of done. what this new personal assistant called Claudebot or OpenClaw has really opened the imagination,

I think, in terms of what people can do, and then how it might also affect legacy companies, particularly in the software space. And so I think the market's going to have a hard time as these new products and these new evolutions from AI keep coming out. I think we'll see some of these rapid revisions like we saw yesterday and some of the Infotech names around legal when we do have other announcements from these companies. So it's kind of of a minefield, you have to be careful. I do feel, though, that you go back to what we're talking about now with Google. You look at an Apple. I think those are the kinds of franchises where if you don't want to try to jump into the fray too much, they seem like easy ones to own because they

will be winners in the long run from AI. Yeah. No, it definitely feels like the market is sitting up and paying attention to every new product launch and reacting. We'll see kind of the long-term implications of all of that. Doug and Jason, thank you very much for your time today. Appreciate Let's bring in RBC Capital Markets, Lori Calvesina, Ned Davis, researches, Ed Clissold, and wealth enhancement groups Ayako Yoshioca. Thank you guys for being here today. So maybe Lori, we'll start with you because earning season, of course, is in full swing. You've paid very close attention.

You described this earning season as, quote, slightly squishy so far. What do you mean by that? So it's really all about the numbers, Leslie. And when we look at the rate of upward revisions, which is our favorite way to gauge earning sentiment in a quantitative way, we see a really interesting contrast between what we're getting today and what we got back in September. Back in September, and this was after, you know, we kind of went through the reporting season where all the companies adjusted their tariff impacts. Things weren't as bad as initially kind of baked into guidance, and we saw 65% upward revisions. What we're seeing now, our latest update, was about 51.4% upward revisions.

And we were seeing pretty dramatic deceleration in that stat for the time. top 10 market cap names in the S&P 500, as well as the rest of the market. And we've seen a number of sectors come down. I haven't updated tech this week, but what we did see in our latest update there was that the tech sector itself was still sort of sitting around all-time highs on this stat that hadn't really decelerated yet. So we've said that's going to be a chart we're watching very closely as reporting season continues to unfold.

The other thing I would tell you, Leslie, as everyone goes around talking about the beats, we have seen most companies beating expectations. but on our last update, that stat was actually coming in a little bit lower than what we had seen in last quarter. So the numbers are still generally very good, but not quite as good as they have been. Yeah, on that front, Ed, I wanted to read you this stat from Goldman Sachs, where they say that their high beta or unconstrained momentum basket is on track for its worst day since 2020. That surpassed the post-deep-seek sell-off last January. And they say basically there's no smoking gun for the move.

it just happens that the market is chasing the strongest earnings revision possible. So short-term performance technicals got a little bit extreme. How do you kind of change your portfolio allocation in an environment like that? What we've seen is that it's really been about SMID value versus the mega cap growth stocks, which were the leaders, which probably is what the Goldman Sachs portfolio is picking up on. And so some of this is the uncertainty over these super fast-growing, companies over the long run. But if you have uncertainty, are you going to pay that kind of multiple? So, for example, what we've seen is year-to-date, the highest 20% of stocks in the

large-cap space by long-term earnings growth, they're down about 10% versus the lowest 20% are actually up. And if you look at one-year-forward earnings growth, they're basically at break-even with each other. So it's really all this uncertainty premium. coming back out of the market. And so in that environment, probably want to avoid some of the high flyers and go into smid cap value. That means a place to go.

Yeah, uncertainty. Premium is a good way to describe it. Aya, you're not ruling out the likelihood of a 10% correction here. Why, when, and how? Sure. First of all, it's a midterm election year. And markets tend to be a little bit more volatile during midterm election years.

So we do anticipate some of that. And then when you look at overall, earnings for the SMP 500, the market's still anticipating double-digit earnings growth. The multiple is where the squishiness, I think, can happen, where everybody has been expecting so much growth out of a lot of these AI tech names that some of that is just broadening out and rotating to other areas, especially when the economy remains relatively stable. And the Fed's really not in play at least so far in 2026. Lori, what's your read-through for the macro environment, both from an earnings standpoint, from the economic data, and then just we're seeing what we're seeing with the broadening out of the broader market?

So look, I would say in terms of earnings itself, I think earnings are going to be the driver of the stock market this year. We've had a 77, 50, 12-month price target on the S&P 500, which represents about 13% appreciation from the December 31st close. And that really is in line with where the consensus earnings growth expectation has been. kind of fluctuating around this 313 level, but more or less it's still coming in around 13%. So that's good news that that 313 does seem to be holding for now. I would say on the broadening, I think the cross currents here are very, very complex. On the one hand, we came into the year with a tremendous amount of AI jitters, tremendous amount of concerns that we witnessed in investors in the whole second half of last year

in our client conversations about where valuations were, especially for that top 10 market cap cohort. And we haven't really seen any kind of expansion in the multiple sense then. And so we come into the year, and that's against the backdrop of a lot of excitement about the one big, beautiful bill. Economic expectations for this year have been moving up pretty dramatically. I think that's one of the things that's really helped the small caps. But at the same time, we're going through this earnings reporting season where the commentary is not off to the races. You know, things seem to be fine underneath the surface, but we're still hearing a bit about, you know, kind of pressures on the consumer,

some uncertainty that's percolating in the business community. And I would say that what I've heard so far in this reporting season, just kind of the overall discussion of the macro, doesn't necessarily match up to the hype of what I've been hearing from investors the last few months. Interesting. Ed, are you keeping your overweight in stocks rotating to value maybe as you see some of these moves? Or are you a little bit worried about kind of the tenuous nature of what we've seen recently? So we've maintained a modest overweight to stocks for now, and we have rotated into value. Although I would say I think earnings are going to be okay this year. Economic growth looks pretty solid.

Our concerns for a bigger correction this year actually have to be with other macro factors. Growth could actually slow in the second half as one big beautiful bill stimulus starts to fade. When you get a new Fed share, on average, it's a 15% correction in the first six months. There's something sort of crisis pops up and the market tends to shoot first, ask questions later, because they don't know who, you know, how the new leader is going to react. In midterm years tend to be weaker as well. Again, certainty heading into election. There could be plenty of that.

So there's a lot of ingredients here to suggest we could get a bigger correction. You know, we don't have all the data to say, you know, that's an imminent thing that's going to happen. But we want to keep an eye on that. Now is the time to maybe do the homework on your portfolios to be ready to get more defensive. Yeah, always the time to do your homework, but maybe you do it a little bit more frequently these days. Lori Ed and Iya, thank you very much for joining us today. We are just getting started. Up next, the battle over Fed Independence.

Former St. Louis Fed President Jim Bowler joins us to discuss that and a Fed future under Kevin Warsh. We're live from the New York Stock Exchanger, watching closing bell on CNBC. I believe in the independence of the Federal Reserve, but I also believe in accountability. I mean, can you explain how you put those two together? Sure, I would welcome. We've seen these cost overruns. The Fed, the Fed has a, the independence of the Fed is based on its trust with the American people. And the Federal Reserve lost the trust of American people when it created,

when it allowed the greatest inflation of 49 years to ravage, ravage working people in this country. That was Treasury Secretary Scott Besson earlier testifying on Capitol Hill. Joining me now is former St. Louis Fed President Jim Bullard. Thank you very much for being here, Jim. I'm curious what you make of the Secretary's comments there in front of the House Financial Services Committee. Do you believe that the Fed has diminished its credibility in recent years? I think the Treasury Secretary was talking about the the dial of accountability and responsibility and you want that to be

you know well managed by the federal reserve but on the other hand you don't want politics to intrude on these important central banking decisions and so it's an art form to turn the the dial of independence in the way that that would benefit society and the best yeah do comments like that impact the public's thoughts surrounding Fed independence, the market's thoughts surrounding Fed independence? There were lots of questions kind of of of this nature, and he kind of repeated the same refrain. I listened to the whole conversation earlier today on Capitol Hill. I'm just curious

what you make of that, that posture. Yeah, I mean, I've backed off the term independence because I think it gives the impression that the Fed is off on its own island doesn't have to be responsible that. I don't think that that's true. That does have to be responsible to the electorate. We do live in a democracy. So I think that's important. But on the other hand, you don't want it to be too close to the political process because countries that have allowed that have gotten poor outcomes, both with respect to employment and with respect to inflation. So I think, you know, you want to be close enough to be responsible and accountable, but far enough from day-to-day politics so that you can make good decisions on monetary policy. Do you think Kevin Warsh, if approved, would kind of change his thinking as it pertains to improving Fed accountability, Fed credibility in any way?

Does it change the way maybe he communicates with the market or the way that he communicates with the committee? Well, I think he'll ultimately be responsible for operations at the Fed, and I'm sure he has ideas about how he wants a Fed reform to go. He's argued about a smaller footprint for the organization. I think when he gets into it, I think he'll find that many things have been done in recent years, but other things he may want to push forward a little faster. know, they can range from how the Fed handles supervision and regulation to how it handles the balance sheet and how it handles sort of ordinary operations as well.

So there's a lot to manage and I'm sure he'll do a good job. Yeah, that was another key topic of conversation, of course, given that this was the House Financial Services Committee, kind of just the state of the banking industry. And in his opening remarks, Secretary Besson essentially said, you know, there's been this kind of regulatory, purgatory, or regulatory and reflex situation where there's a crisis, and then the Fed and regulators react, and he thinks that's been bad for economic growth. And so I'm curious how you see that changing under Warsh, and whether or not you think that the banking industry is in a situation where it needs or should have more deregulation.

Because later in the conversation, Secretary Besson also said that the interest rate caps on credit cards is justified because the banking industry has done really well, and therefore they should be able to handle something like that in the pursuit of affordability for average Americans. Yeah, I think one of the issues in regulation over the last 15 years has been that the Dodd-Frank Act and its amendments have been designed for the very largest banks and financial institutions. and we may have lost Jim Bullard there. We will move on from here. Still ahead, Anthropic taking its competition with Open AI

to a new arena, we'll explain. And later, it's not just Alphabet reporting in overtime. We'll run you through what to watch when Snap and Qualcomm report at the top of the hour. Closing Bell will be right back. Welcome back to Closing Bell. The AI arms race is heating up with Anthropic upping the ante. Open AI in a new way. A Super Bowl ad. Kate Rooney here with more. When we think of the AI

arms race, we don't necessarily think about ad spending. We think more at CapEx. So this is a nice twist here. Yeah, definitely. In a very splashy way, Leslie, it's interesting. Yeah, we have not seen this yet. Anthropic Super Bowl commercial is a not so subtle jab at its biggest rival. Open AI does parody OpenAI's move into advertising. And it's chatbot chat GPT. OpenAI is some of the context here, we should say announced recently, would test advertising said they would be clearly labeled and not influence answers? Take a listen to this, a portion of this commercial. Hey, can I get a six-pack quickly? Perfect. That is a clear and achievable goal. But confidence isn't just built in the gym.

Try step boost max, the insoles that add one vertical inch of height and help Short King stand tall. Sam Altman, I should say, hitting back on social media in the last hour, he says the ads were funny, concedes that. But, quote, I wonder why Anthropic would go for something so clearly dishonest, says our most important principle for ads says that we won't do exactly this. We would obviously never run ads in the way Anthropic depicts them. Says, in part, we are not stupid and we know our users would reject that. It does highlight some key differences between these companies, as we reported, are looking to go public as early as this year. anthropic, very much an enterprise B2B business, and then Open AI has traditionally been a consumer business that has been pushing into enterprise to diversify grow revenue and then fund

its massive data center spending commitments, Leslie. So there's no sense that OpenAI will have an ad in the Super Bowl, too? They will. It definitely won't be as spicy. They've, they, there has been some reporting that they will have an ad, but it's a little more neutral, not going after a competitor. I would say it does speak volumes. If you think about Anthropic strategy here, average cost of a Super Bowl ad is roughly $8 million. They're not advertising. They're not going towards that revenue stream. We've heard the co-founder Darya Amadeh say that at Davos, but the fact that they're taking out an ad to talk about the fact that they're not going to be advertising is sort of just an interesting strategy if you step back. But clearly, they see value in calling attention to

open AI and chat GPT and that strategy. So interesting, just glimpse into probably how they're thinking about it and how they're justifying. No, $8 million is not nothing. Not the same as building a data center, but it's expensive. Yeah, it's pennies compared to the data centers. And who knows, maybe this will be the big test of chat GPT. Can you rework a commercial to be a bit more spicy between now and Sunday? They have time before Sunday, exactly.

Yeah, we'll see if that works out. Thank you, Kate. And a quick programming note. Closing bell will be live from California, Thursday, and Friday ahead of the Super Bowl. big interviews with Joe Montana, George Pine, Brad Gerstner, and many more you do not want to miss it. Up next, we are tracking the biggest movers

as we head into the close. Christina Parts of Nevel is standing by with that, Christina. Monday's going to be tough for a lot of people, but let's talk about what's coming up. Crypto markets under pressure, a major media company sees shares slide on rising legal costs

while pharmaceutical giant surges on blockbuster drug demand. Those movers next. Welcome back, 15 minutes until the closing bell. Let's get back to Christina Partes. Let us for a look at the key stocks to watch. Christina. I'll start with a cryptocurrency first because Bitcoin,

we gotta talk about it. It's continuing its decline down around 12% week today and almost touching $72,000 just today. It's now trading above $73,000. After yesterday it hit its lowest level in 16 months, Ether and Solana also falling as well, pacing for their worst week since February 2025 and then November 2022.

Shares of the New York Times also sinking 6% as investors just really grow concerned about increased spending. Operating costs rose by about 10% during the fourth quarter, led partially by growing costs over AI copyright infringement lawsuits. But the Times still brought in. 450,000 new digital-only subscribers during the quarter bringing its total to nearly 12.8 million subscribers. And Eli Lilly shares just, they're rising right now, up about 10, almost 11% on an earnings beat, a revenue. guidance also came in higher. The drug maker said it will benefit this year from strong demand from Banjarro and Zepbound and the expected launch of its obesity pill, which is coming in the

second quarter, Leslie. All right, Christina, thank you. Some big movers there. We're also keeping an eye on shares of Enphase. Pippa Stevens tracking that move for us. Pippa. Hey, Leslie, so Enphase is popping after an earnings beat and guidance raise. And CEO, Bajika Thondar Amon told me he expects some weakness during the current quarter, but that that will be the trough. Demand was pulled forward into last quarter thanks to the expiration of a key tax credit. But longer term, Kuthandaraman said rising power prices thanks to data centers and lower interest rates could support rooftop solar. Now tariffs were an overhang for the quarter, cutting margins by about 5%. With Kithand telling me there is no safe haven. For the time being, the company is absorbing those

higher costs. Now, the stock is on track for its second best day on record up here 40%, although it does have a relatively high short interest at 22%. So Leslie, no doubt, some squeeze activity as well. Yeah, I was going to ask how much of that is, is momentum driven by some of the potential squeezing there. Pippa, thank you. Up next, your earnings rundown, what to watch from Snap, Qualcomm, and, yes, Alphabet, all reporting at the top of the hour, that and much more when we take you inside the market zone. Welcome back. We are now in the closing bell market zone. Mike Santoli is here to break down those crucial moments of the trading day. Plus, we're big earning setup. Julia Borson watching Snap Christina Pritzenevarez with a look at Qualcomm. Mackenzie Segalos has one last look at Alphabet

before those numbers come out. And capital wealth planning's Kevin Simpson owns that stock and he'll tell us what he'll be watching from that report. Mike, let's start with you. Yeah, Leslie, I mean, this market today continues to impress with how it manages to contain the damage when you have such aggressive liquidation going on still in parts of tech, in momentum. Really, I mean, you know this from kind of tracking hedge fund strategies. This was a mini-quake today. You had high momentum strategies completely for sale all day. One of the most extreme moments of underperformance.

You did have a buying panic in some defensive parts of the market to compensate for it. and we've kind of held the overall indexes, mostly harmless. Today, I believe, is the 18th day in the last 38 sessions at the S&P 500 has crossed the 6,900 level. We are thoroughly stuck around these thresholds, but it's not really mattering. So, yep, the market's still confident in the cyclical story. We're still buying regional banks. We're still buying transports, along with those defensive areas. I continue to think it's a little bit of a dangerous way to proceed

because it does seem as if a lot of the internal volatility might just break loose. loose at some point. We did have a similar kind of momentum unwind last February. So I think that's on everybody's mind, but so far, market really hangs in pretty well. Yeah, that momentum unwind. Goldman's saying their high beta or unconstrained momentum basket is on track for its worst day since 2022, and that surpassed the sell-off last January post-deep-seek. So clearly seeing a bit of that today. Mike, what do you have on tap? Obviously, a lot of earnings in overtime. What else? For sure. Going deep on alphabet, which, of course, the stakes are in incredibly high because that has been perceived as the one safe mag seven AI play. So presumably

there's a lot of aggressive positioning in there as well as a real look at whether the wreckage and software is starting to surface some value with somebody who has been bearish on software because of AI for quite some time. Yeah, can't wait. It's going to be a great show, Mike. Thank you. Now let's send it over to Julia Borsden for a look at what she'll be watching from SNAP's results. Julia. Well, Leslie, with Snap shares down about 20% since its last earnings report, investors are looking to see the value of its new ad formats and its AI partnerships. They're also looking for a path to profitability for augmented reality. Snap's expected to report 9% revenue growth, which is slower than the prior quarter, on a 7% decline in earnings per share.

While Snap shares popped on last quarter's strong revenue forecast and also a $14 million perplexity deal, they have struggles since. significantly since then on concerns about revenue per user lagging meta and Pinterest, a dip in North American Daily Active users in the third quarter, along with questions about its plans to create an augmented reality subsidiary. Plus, we're going to have to see out the likes of Australia's social media ban for teens will impact the company. Analysts are very much on the sideline. 73% have a hold, 90% by 8% sell. Leslie?

Wow, Julia, thanks for covering that for us. Julia Borson. Christina Partonvarez here with a lot of. look at what to watch from Qualcomm. Seems like analysts are expecting a solid quarter roughly in line with estimates around $12.2 billion in revenue driven by premium Android demand

and steady growth within auto and the internet of things. But the focus is going to be on the guidance. March quarter estimates are coming down as memory prices really hit into that. Chinese original equipment manufacturers are raising prices and Qualcomm may need to cut prices by

roughly 5 to 10% to support those customers. And that pressures both volume and margins. The stock has lagged in the last three months, especially when you compare it to the SMH. You can see on your screen, SMH up 8%, Qualcomm down over 13. And the memory headwind really explains why that's happening. So the key questions for the call, how much is rising memory cost hurting smartphone demand? Is Samsung taking more chip business in-house? And what's the progress on Qualcomm's data center and AI push? The diversification story for Qualcomm is definitely real, but smartphones are still over 70% of the business. So if memory,

costs keep climbing, that's a problem. Qualcomm can't diversify away, at least not yet. Yeah, that's a good flag and some important questions. Christina, thank you. Let's send it over to McKenzie for a final look at Alphabet. Mac. So Leslie, the big question hanging over this print is search durability. It is still the profit and revenue engine of the company. No signs yet that Gemini is cannibalizing it, but that is one of the big metrics to watch as Alphabet integrates Gemini across its products. Now, the other story is Google's custom AI chips, the new Ironwood TPUs are ramping, helping Google win cloud workloads who rivals Amazon and Microsoft.

That full-stack story models, cloud chips is what's gotten alphabet to $4 trillion. And then there's CAPEX. Meta raised its outlook and rallied last week because AI is showing up in ads. Microsoft spent big and got punished when Azure was light on whisper numbers. So Google Cloud, it is still a distant third, even with backlog, surging 79% last quarter, so they will need to keep up momentum in Q4 to justify the build out. All right, Mac, thank you. Capital wealth planning's. Kevin Simpson owns

Alphabet here to discuss. Kevin, what are you looking for from today's print? Yeah, hi, Leslie. I think McKenzie gave us a really good setup. You know, the expectations are massive, 20% earnings growth. That's nothing to sneeze at. But the problem is companies not only have to deliver, it's all about guidance. You look at AMD yesterday. I mean, they beat, they raised guidance and they got slammed. I think we'll see more of a meta-like. report from Alphabet today. I'm expecting the numbers to look very positive, but it's really about the guidance. You have to look at what's happening with Gemini. Is search still a portal to make Gemini a real thing, an ad thing? You talk about their TPUs, their chips. It's exciting. Their cloud

business is probably the biggest thing that we want to look at, really, really high expectations there for growth. And then there's some other things under the hood that you listen to in the call, things having to do with YouTube TV. And really this time, maybe for the first thing, time in quite some time, I want to hear what they say about Waymo. You know, that's not something we talk about a lot. Obviously, it's not a revenue driver, but they just had a valuation and a funding round of like $126 billion. So there's a lot under the hood with Alphabet today. I think they're going to deliver. I don't know that it's going to be a story where you need to buy it right here at the close, but if they can hold up and deliver great guidance, then it's going to

justify the move that we've seen in the sock, 60% over the past 12 months, six or seven percent on year. I think they can deliver and I'm excited to see the print. No, it's a good, a good point. Why do you think, why do you analogize it to what we saw with meta versus Microsoft? What tenants of alphabet are similar to meta and the way that the market is kind of valuing this and looking at the potential flywheel effects of all that KAPEX spending? Yeah, that's a great question, Leslie. And I think it really comes down to advertising, advertising on YouTube TV, advertising on search and then somehow transitioning that into Gemini 2.5, Gemini 3.0 to be an ad story. Microsoft went down before we saw the issues that software has really suffered over this past

week. So I also think meta had performed very poorly as a stock, most of the latter half of 2025. It's been the opposite story. Google Alphabet has been, if not the best performer, certainly one of the best performers. So they need to live up to the bill, which I think they will so we don't see a sell the news event in the aftermarket. And real quickly, it sounds like you're holding today in anticipation of the print. Would you be in the mindset of buying more? I mean, if it sells off to why some of these stocks have gotten slammed for no reason, I think you can absolutely enter the position tomorrow if you're a long-term investor.

I love all the things and all the levers that they're pulling, but this is a stock that's moved up. The PE ratios are higher than Microsoft at the moment. So you really need it to come down quite a bit to really feel good about the entry point. But this is a stock being able to hold for the long term. This is an investment out of phase.