Closing Bell - Closing Bell Overtime: 8/5/25

Episode Date: August 5, 2025

From the open to the close, “Closing Bell” and “Closing Bell: Overtime” have you covered. From what’s driving market moves to how investors are reacting, Scott Wapner, Jon Fortt, Morgan Brennan and Michael Santoli guide listeners through each trading session and bring to you some of the biggest names in business.

Without all marks the end of regulation, Avidia Bank Corp, ringing the closing bell at the New York Stock Exchange, themes ETS doing the honors at the NASDAQ. It was a volatile day for stocks. Markets lost momentum after the ISM services data came in at the lowest level since May. The Dow was down 250 points at the lows, but ending off less than 75 points. Small caps were the outperformers today. Materials, consumer discretionary, and real estate were the top performers.

Utilities and energy lag. Speaking of energy, oiled down for the fourth straight session, another 1.5%. It's off nearly 6% in the past week, and a mixed day for metals, gold and silver shining, while copper's lower after two days a gains. Well, that's the scorecard on Wall Street. Welcome to Closing Bell overtime. I'm Morgan Brennan, along with John Fort. We have an hour jam-packed with earnings.

We're going to hear from Chip Giant AMD, Dow Component Amgen, and Social Darling snap. We'll also get numbers from Rivian and talk to the company's CEO before. he talks to analysts on the conference call. And Daniel Perez of Hinge Health will join us before the call on its first report as a public company. Plus, Zouette is falling after its results this morning.

CEO, Kirsten Peck, is coming up on overtime to talk about that. And as we wait for those results to roll in, let's begin with what we saw in today's session. Christina Parts of Nevelis is at the NASDAQ. Christina. Well, we saw President Trump hinting at new semiconductor tariffs

as soon as next week during his CNBC appearance this morning on Squawk Box, and that caused a lot of chip names like NVIDIA Broadcom and just the broader Sox ETF to fall. You can see down almost a percent. The declines weren't as sharp since the administration has really been telegraphing these tariffs are quite some time, making them somewhat priced in today.

But Intel, I want to highlight them, because they were the clear outlier in the chips world, jumping as much as 5% earlier today, closing 3.5% higher after President Trump said these chips need to be made on U.S. soil. There aren't many options for advanced chip manufacturing, TSM in Arizona, Intel, Samsung to a certain degree, global foundries for lagging-edge nodes. Speaking of global foundries, the world's third largest foundries saw shares drop about almost 10% after earnings showed they're still getting hit by slow smartphone demand recovery. Those earnings came out before the bell this morning.

One earnings mover that's buck in the tech sector trend entirely is Palantir hitting a record high after posting a billion dollars in quarterly revenue for the first time ever with the software analytics provider. lifting its foliar outlook. And so you can see shares up almost 8% at the end of the day, guys. Yeah, it's interesting. Three different companies at the intersection of security and AI, Axon, Palantir, and Lytos, all leading the gains, or I guess, bucking the trend of not having gains in the S&B 500. Christina Parts Nevelas, thank you. We've got bond yields mixed today, still not recovering from Friday's big drop. Let's get to Rick Santelli in Chicago for more. Rick. You know, we had so many data points. today that didn't necessarily make sense, but I'll try to make some sense out of it.

Normally, when you get weakness and we saw 50.1, there's a one-year chart of the ISM services headline. And even though it's only the lowest level since May, look at the trajectory of the chart. Now, if you look at prices paid, a complete opposite, of course, a whisker under 70. That's the most on the prices paid side in almost three years. Well, normally, something like that would put long end yields higher. But today, everything reversed a bit. As you look at twos, tens, and thirties on one chart, the minute the two years saw the weaker growth

and the higher prices paid, it most likely rallied on yields dropped in price because of the implications for the Fed. The exact opposite of what happened on Friday with the weak jobs report. And the longer the maturity, well, the less it was affected to the upside in yield, concentrating more on the slowing of the economy.

as you see, 30-year bonds are actually lower in yield, higher in price today. The 10 years virtually on chains, and you're up about a handful of basis points in a two-year. So we need to really pay attention. Now, we also had a three-year auction today, $58 billion. It wasn't a terrific auction. I'm sure the data didn't help the short maturities whose yields were up flattening the yield curve. Tomorrow, $42 billion, 10 years, it will be an important auction to monitor. The long-dated treasury yields are really important in terms of,

supply but do remember we issue a whole lot more T bills lately and we're holding back a little bit on the coupons. The administration thinks yields in the future will be lower. John, back to you. Rick, thanks. And it was another down day for the S&P 500 as investors digest weak economic data this morning. Our next guest sees volatility ahead, calling August one of the weakest months of the year, especially in post-election periods, but he's not bearish. Let's bring in Carson Group chief market strategist Ryan Dietrich and our own senior markets commentator Mike Santoli guys welcome Ryan you're saying four to six percent pullback here in the S&P wouldn't be unusual yet you're still overweight tech and and some of the growth of your stuff you like industrials

financials as well why do you see this as a volatile time with weak labor data but not a reason to sell yeah John thanks for having me back and happy one-year anniversary, right? A year ago today was the worst of the end-carry trade, down 3% with the 50 VIX spike. So it's a long way from there. You think about it, I've come on with you guys all summer, so they expect a summer rally. Well, that's happened, right? 28% rally. We know that. And then we never say blindly invest in seasonals, but it is what it is. And one of the charts I sent you, August doesn't do well post-election years. When you have a second-term president, stocks has never been higher, right, down six times.

So that's just something to think about. But one of the near-term worries I have, get a little technical here. but the number of stocks above their 20-day moving average has been trending lower the last couple weeks, whereas the S&P has been going higher. That's just some internal things that are saying maybe it's time for a pause, maybe it's time for a break. The reality, though, is this is still a global bull market, not just a global bull market being led by strong earnings, profit margins. We get into some of that stuff. But, you know, just be aware, we've been pretty spoiled. And August tends to be that month, you kind of slip out of banana a little bit, and I think maybe expect some turbulence here sometime over the next several weeks. Mike Santoli, this is a market, it feels like, that continues to largely shake off doubts and bad news.

I guess that's how bull markets react. Typically, yeah, John. And, you know, arguably something might have changed. I mean, almost in a too cute fashion on August 1st when we finally broke that pattern of being like well above our short term moving averages, having no 1% down days. So we kind of get out of that mode. Now, the question is, does that automatically mean? You know, you could sort of mark down the sort of sharp but benign pullback that it makes sense to expect based on what Ryan's saying. I mean, I guess where I come down on it is it's the most plausible scenario for expectation-setting purposes to just sort of not be too surprised if we do run into something here.

But, you know, as that echo of the yen carry trade last year kind of reminds us, it's not so much just that it became August. It's that something came along and the market wasn't able to shake off. and therefore stress levels go up. So I'm looking at a very, very kind of 50, 50 day in terms of breath today, not big moves in the indexes, and the volatility index notches up a little bit because it shows you we're sort of clenching for the possibility that we could hit a little bit of turbulence. Ryan, what does bracing for turbulence look like, especially if August is known for these out of the blue events like the Yen-Cerry Trade Unwind

that we're talking about last year? Right. Well, great question there, Morgan. We think it'd be fairly contained, like I said, between 4 to 6 percent, pullback that could be right about the 50-day moving average on the S&P 500 and right about the February peak. So we don't expect something major. Remember, on average, you see about three to four, five percent mild pullbacks a year. So that could be one thing.

Now, one thing is, let's have some good news here. When you're higher in May, June, and July, like we just were. So that's that cell in May. Everyone tells you how bad it's supposed to be. But higher those first three months, the rest of the year has been higher 15 out of 17 times with a median return of more than 8%. So I'm just saying, you know, maybe we chop around, maybe frustrated a little bit, but we are still overweight equities. We have been, honestly, for two and a half years now. And we still think that's the way to go, but just race for some volatility, how we're trying to tell our Carson advisors right here. Mike, I know we touched on this in Power Lunch, but to rehash, what is the read-through when you see some of these companies putting up beats and raises with their quarterly earnings like Eaton today?

You can make the argument with Zouettis. We're going to speak to that CEO a little bit later in the show as well. and yet the stock trades lower. What is that telling us? Well, it shows you, Morgan, how much we'd run in advance of earnings season. Everyone says, well, expectations were for 4% earnings growth in the S&P 500 and we're coming in toward 10. Well, expectations only as defined by the official consensus forecast was 4%. The actual expectations of investors embedded into stock prices was a good deal higher. Why? Because the past couple of quarters, we've had massive beat rates like six or seven percentage points, as we're seeing this time. So I do think that's essentially what it tells you is that, you know, we kind of got fully valued.

We've priced in some benign outcomes, perhaps, when it comes to trade policy and the ability, you know, maybe of the Fed to come in and cushion any further weakness we have in the economy. I do take some heart in the fact that in general, more cyclical parts of the market have been holding up okay. So if you take that as a message that you can rely on a little bit, it does suggest that maybe the underlying economy isn't falling away. But, you know, we can see the market's been wrong before. Okay. Mike Santoli, Ryan Dietrich. Thank you both for kicking off the hour with us. Speaking of earnings, we have our first report to bring you.

Amgen results are out, and Angelica Peebles has the numbers. Hi, Angelica. Hey, Morgan. Well, Amgen beating on the top and bottom line, adjusted EPS coming in at $6 and $2 a share versus the $5.29 that the street was looking for. Revenue also coming in ahead, $9.18 billion versus the $8.94 billion estimate. Some of the highlights here, osteoporosis drug prolio, at revenues, those met expectations. That drugs are now facing biosimilar competition in the U.S. Some other highlights, rare disease, cancer drugs.

There was some weakness and inflammation, excluding their drug O-Tesla. And on the rest of the year, it's a mixed forecast for the full year. They're slightly increasing the full-year revenue estimates. They now expect $35 to $36 billion, and the street was looking for $35.37 billion. dollars. They're also increasing their fully adjusted EPS guidance, but that midpoint is slightly lower than what analysts we're looking for. And they're saying that the guidance does not, that it includes the estimated impact of implemented tariffs, but it does not expect any future tariffs like those pharma-specific tariffs that we're looking for in any possible price

adjustments there. And I do want to call out that they are now saying that they expect data from part two of its phase two obesity trial in the fourth quarter. Previously, they were saying the second half of the year. So now we have a little bit more detail on when you can expect those results, guys. All right. Angelica, thank you. Well, Super Micro and Sky Warwick's earnings are out. One's dropping. One's popping. Christina Parts of Nevelas has the numbers. Christina. Yeah, let's start with Super Micro, the one dropping. This is an AI server assembler for their earnings report. They came in at $5.76 billion. That was a miss with 41 cents adjusted for EPS earnings per share, a three cent missed compared to what the street was anticipated. They were hit

by what analysts are saying competition, Dell, HPE, stealing some market share for their Q1 revenue guide between $6 and $7 billion. Okay, we'll take that. But it was the Q1 EPS guide that was well below estimates. And so that is why you're seeing shares down about 11%. Moving on to Skyworks. Skyworks is a chip name. They make analog radio frequency chips. The Apple is their biggest customer. What they did is they beat on EPS, $1.33 adjusted. on $965 million of revenue. Both are higher than what the street anticipated. They also increased their dividend by 1%. And then for their Q4 revenue, they had a range of $1 billion to 1.03, much higher than what the street anticipated at $887 million. EPS guide was also higher.

So you're really seeing two diverging stories, guidance playing a big role for both names. Skyworks outperforming right now, 8% higher. Guys? All right. Christina Parts and Eveless, double duty. Thank you. earnings are out. Julia Borson has the numbers. Hi, Julia. Hey, Morgan. Snap revenues basically in line with expectations at $1.34 billion. But we see the stock is plummeting. Now down about 15 percent. This after the company reported a gap loss of 16 cents per share that is not comparable to analyst's expectations, but adjusted EBITDA of $41 million. That chose a miss of the street account estimate of $53 million.

The company's daily active users grew $2 million faster than anticipated to end at $4,000. $169 million. And third quarter guidance was ahead of estimates. The company guiding to revenue in a range of 1.475 to $1.5 billion. The bottom end of that range is what analysts had anticipated. And the midpoint of the company's guidance for third quarter EBITA is $12.5 million that is ahead of estimates of $116 million. But looking at that stock trading lower, the company did say that its top line growth in the quarter was impacted by a number of factors, including an issue-related. to its ad platform. Investors just seem concerned about those bottom line results, Morgan. All right. Julia Borson, thank you, with shares a snapdown almost 15% right now. We've got lots of results still to come. That's ahead this hour. We're going to dive into Rivian's results with the company's CEO. That stock is down about 4% right now. Plus, the Hinge Health CEO is about to join us with that stock up more than 7% after its first earnings report as a public company just moments ago. It was a beat in a raise. The stock's up 40% since

it's made debut. Overtime, we'll be right back. Welcome back to Overtime. Shares of AXON, the best performing stock in the S&P 500 today, hitting an all-time high, finishing up more than 16%. Results that beat estimates on earnings and revenue, the company raised its full year guidance. Analyst's positive on the company's booking acceleration with a number of brokerage firms raising their price targets, including J.P. Morgan, Raymond James, Goldman Sachs, Needham, and UBS. Of course, Axon as the maker of tasers and body cams, and also runs all that AI-enabled software with all the data that all of those devices are collecting. Also pushing more into drones and counter drones as well. Right. Well, meantime, Rivian earnings are out.

Our Phil LeBow has those numbers. Phil. John, thank you very much. This is a wider than expected loss for the second quarter for Rivian. The company losing 80 cents a share. The street was expecting a loss of 65 cents. share. Revenue roughly in line with expectations coming in at $1.3 billion. The company, after two straight quarters of a gross profit, swung to a negative, a gross loss, if you will, $206 million in the second quarter. No change in the full year delivery guidance still expecting to deliver between 40 and 46,000 vehicles, but it is widening the full year loss that it expects now to a range of $2 billion to $2.25 billion. Previously, the company expected a loss

of 1.7 billion to 1.9 billion. Let's bring in RJ Scouringe, the founder and CEO of Rivian, joining us from the company's facilities out in Palo Alto, California. RJ, wider than expected loss for the full year is expected. Why is that? Yeah, well, thanks, Phil, for having me on. As you said in your opening statements there, in Q2, we had lower production than what we had planned for, and really the big driver of that were some of the big changes we've seen in terms of trade policy. And so that affected us directly with the heavy rare earth metals being controlled in terms of exports out of China. And that had a big, very significant impact on our overall production volume.

And related to that, we saw the overall supply chain endure a lot of change and a lot of uncertainty. And we felt that a number of constrained suppliers actually led to our production going from Q1 of over 14,000 units to Q2 around 6,000 units. And so that significant drop is what drove the numbers in Q2. And we see that play out across the four-year numbers as well. Well, that's my next question. I mean, we're not going to see a resolution with China. At least it's not expected any time soon. Are you going to have trouble getting the rare earth metals that you need, which are so key to the components within your vehicles? Yeah. Well, I'm glad you asked. We spent the the second quarter really working hard to come up with the right solutions across our supply base.

And of course, key among those is the heavier earth metals, which are necessary to make the electric motors that go into the vehicle. And, you know, given that 100% of our vehicles are produced in the United States, and given that 100% of our vehicles are electric, this export control and heavier earth metals is particularly impactful to us. And so we developed a range of different solutions over the course of the quarter that have allowed us to have confidence that Q3, Q4 are going to return to much higher production levels and, you know, ultimately allow us to produce more vehicles in the second half of 2025 relative to the first half of 2025. You're in the back, and behind you is the R2 next generation model that you guys go into production

with early next year. Is this shortage of rare earth metals likely to postpone that at all, or do you still believe you'll hit the production target that you have put out there in terms of starting production? No, I mean, we couldn't be more excited about R2. In fact, I've never been more bullish on a product that we've developed than I am on R2. It's the packaging, the product market fit, the pricing, importantly, the cost that enables the pricing vehicle starts at $45,000 is really, really exciting. And so in order to make sure that this ramp is smooth and successful, a key focus for us has been the supply chain. and within that, of course, looking at some of the changing dynamics around certain materials, in particular heavier earths.

And in the case of the heavy earth metals, we've really thoughtfully sourced those materials and also done it in a way that protects us in the event that we see some of the same export challenges. RJ, a busy day with a lot of earnings reports we're going to have to get to. I wish we could talk a little longer. We're going to have to catch up with you at a later date, if you will. RJ Scorange, the founder and CEO of Rivian, joining us from Palo Alto, California. John, I'll send it back to you.

Phil, thank you. Now AMD earnings are out as well. Shares fractionally higher. Christina Parts and Nevelas has those numbers. Christina? Yeah, the earnings per share for AMD came in light at 48 cents adjusted, the first missed since November 2022, specifically for EPS. But revenues did grow 32% year-over-year, driven by data center revenue and client revenue.

Both of those categories falling in line with estimates. to point out that revenue for the quarter came in at $7.7 billion. CEO Lisa Su-saying, quote, they are still well positioned to deliver significant growth in the second half of the year, driven by the ramp of our AMD Instinct MI 350 series accelerators, which is just the next AI iteration for their GPUs. Gross margins for the quarter coming in at 43%. Keep in mind they were impacted by U.S. government restrictions on chips to China

for their outlook. Q3, they expect margins to increase to 54% which is in line with estimates, Q3 revenue coming in at 8.7 billion. And I think that is the reason why you're seeing shares marginally higher because the whisper number I was seeing in some by side reports was 8.5 billion. But a lot will be riding on the second half demand of the next core GPU chips that they're launching. John? Yeah, so we want to hear as much from Lisa Sue as possible.

Christina, thanks. Speaking of, coming up tomorrow on Squawk on the Street, AMD CEO, Lisa Sue, 9 a.m. Eastern. Well, coming up right here on overtime, Hinge Health shares are up about 9% right now. Following the first report as a public company, we're going to break down the results. Talk to CEO Daniel Perez as this jam-packed edition of Overtime continues. Welcome back to Overtime Hinge Health, moving up by about 8%. The company did beat on revenue. gross margin during its first quarter as a publicly traded company.

Also guided higher as well. Joining us now in a CNBC exclusive is Hinge Health CEO and co-founder Daniel Perez. Daniel first report as a public company, revenue up 55% with the street expected 40. You're guiding to 41% growth in revenue at the midpoint, well above with the street expected. Non-gap gross margin at 83% was better than the maybe 80-ish expected. Tell us what you saw on the ground in the business. that led to the outperformance. Well, first of all, thank you so much for having me, John.

And look, what's driving our results is, you know, we're seeing a lot of great momentum on our commercial execution and our product innovation. And on, you know, our go-to-market, we're seeing a lot more eligible lives from both new and existing clients. We're seeing better than expected enrollment from customers who have bought us. That is more of their members, their employees,

the spouse and independents are signing up to our program, which means more people are benefiting. And on the product side, our product innovation continues to accelerate. We're, you know, continue to keep our members engaged and satisfied with our program. We've been shipping a lot of new end user value, particularly around our AI initiatives and some key efficiency gains as well. We also just launched an in-person provider network combining our digital programs with with in-person care. So we're really excited. So for the folks who might have forgotten since the IPO, you guys deal with musculoskeletal issues, allowing people to get treatment.

at home and virtually through technology, et cetera. And you announced Hinge Select coming up that it sounds like it's going to allow people access to some kind of bespoke in-person care, but at lower rates and they might otherwise have to pay. How is that going to add to revenue and when? Great question. So look, first of all, about one and two Americans do have a musculoskeletal condition in a given year.

And about 9% of people see a PT. and so we've been able to show that, you know, a lot more, there's a lot more demand for PT than there is availability or people's ability to see it for cost reasons, for convenience reasons, et cetera. And so we've done a really good job of giving people access to digital physical therapy, but the fact is sometimes you do need to see a provider in person. You know, not all aspects of care can yet be automated by software and connected hardware. And so for folks who want to see a provider in person, say you, you know, you felt a pop in your knee playing tennis or you really injured your back horseing around with the kids,

we now give people access to in-person care providers. And for folks on a non-high doctorate health plan, we're able to waive the co-pay. No co-pay, no cost share, no co-insurance. And people on a high-doctor health plan, we're able to give them much lower fees. So we're negotiating rates that are, you know, between 30 to 50% below normal insurance rates with in-person providers. We already have 2,100 clinics nationally that are in our network. We've signed many more just in July, which we're excited to share in our next quarterly release. So, Daniel, I want to fit in one more because I know you got to get to the call, but square this for me.

We're seeing managed care providers like United Health kind of getting slammed in this economy because people are seeking care more than expected. You're outperforming. What's really happening with patients that's driving these disparate outcomes? Well, look, we are seeing a lot more higher utilization. We're also seeing high utilization for Hinge. When people use our program, our clients actually save money because we're giving. giving people access to conservative management care, you know, digital physical therapy, it allows them to reduce their pain without having to have, you know, a $5,000 MRI,

without having to have a joint injection, without having to go through an expensive surgery. And what we're seeing is that a lot of these other organizations are having a spike, particularly in musculoskeletal spend. Elective surgeries are a huge, huge component of that spend. And we're giving people a viable non-surgical alternative for the pain relief. And that's helping our clients save money. All right. We'll let you get ready for the call.

Daniel Perez, CEO of Hinge Health. Thank you. Thanks for having me, John. Well, shares of Pallantir hire today after an earnings beat. Continuing an epic run for this stock, it's the best performer on the S&P 500 so far this year and over the past 52 weeks. Coming up, we're going to talk to Trace Stevens,

an early Palliare employee who went on to co-found fast-growing startup and rural industries. He joins us next. Welcome back to overtime. Another win for the up-and-coming defense tech sector today. As Andrell announced, it is now the third supplier of solid rocket motors for the United States. Joining L3 Harris and Northrop Grumman, Andrewle opening a full-rate manufacturing facility in Mississippi,

aiming to produce 6,000 tactical motors by the end of 2026 per year by the end of 2026. Joining us now for an exclusive interview is Trace Stevens. Andrell co-founder and executive chairman and a partner at Founders Fund. Trey, it's great to have you back on the show. Welcome. Hey, Morgan. Hey, John. How are you guys? So let's talk about this. Solid Rocket Motors, because this has been one of those challenges when you talk about supply chain issues within aerospace and defense and the need to stockpile or replenish weapons. This has been the area that has been holding a lot of that up.

So what does Andrell's foray into this marketplace now enable? That's exactly right. You know, if you're looking to build new missiles or supplying new missiles to restock the inventory that we're burning through quite rapidly, you need to be able to acquire the engines to do that. And when Andrew went out and started trying to find places where we could source those motors, we were shocked that there was a multi-year lead time. And so starting about 18 months ago,

we launched into this project to build our own manufacturing facility in McKinnery, Mississippi. And over that 18-month period, we've gotten to this point where we're launching the factory, and as you said, we'll be at full-scale production putting out about 6,000 motors by the end of 2026 per year. So incredibly important part of the supply chain, especially as you see in these forum wars

where we are supplying our partners and allies, we're running through that inventory very quickly. Yeah, 18 months is fast, just to put it in perspective, when I speak to other companies in this industry. Do you already have customers in place? Are you already basically building to fulfill orders? Absolutely, yeah. We have partnerships with our European partners.

as well as with the Navy and the Army to supply rocket motors to both existing platforms and new platforms that are and roll developed internally. So we're well underway. We've been producing at a smaller scale for research and development purposes, and this will enable us to really scale into that production, which is really the name of the game. You shouldn't have to wait until a war happens to ramp up production. We want to have that in place so that we can ensure that our deterrent capabilities exist and exist in the quantities that are needed to.

to protect ourselves and our allies. How does it speak to the broader growth of the Androl portfolio, especially when Palmer Lucky was on with me earlier in the summer and basically confirmed that an IPO will be in the cards? Wow, yeah. The tease continues. No immediate plans to IPO, despite all the really positive news from our friends over at Palantir.

But, yeah, we've been ramping incredibly quickly, both on our solid rocket motor platforms, as well as all the other business units, that exist inside of the company, everything from counter intrusion, counter air systems, all the way out to CCA, the collaborative combat aircraft that we're working on with the United States Air Force, which is essentially an autonomous fighter plane. We have this effort that you're aware of, Morgan in Ohio, a 5 million square foot manufacturing facility that we call Arsenal One.

And this SRM facility is another leg on that stool of building up that supply chain and production capacity that our customer needs to be able to supply to the demands of the warfighter. You mentioned Palantir. You're an early employee there. Palantir and SpaceX arguably helped pave the pathway for the end rules of the world and some of the other defense tech startups to now exist and to be able to get a toehold in with the Pentagon. So I do want to get your thoughts on what we are seeing from Palantir post earnings. I mean, I couldn't be happier. I would be nowhere in my career if it weren't for all the learnings that I got from Dr. Karp and Shamm and others at Palantir. You know, crossing the billion dollar in a quarter revenue mark is an incredible accomplishment for them. I'd like to claim, you know, 0.001% of that success as being something that maybe I contributed

in my six years at the company. You know, I saw that Dr. Karp said, read them and weep to the numbers that they're posting. I'm pretty sure that's similar to something that I said to him the first time I closed a $100,000 contract. So there are a lot further along than they were when I was there many, many years ago. I mean, Pountier is one of these early use cases of AI taking root in certain industries right now and seeing those returns be realized. You're also in this unique position at Founders Fund as an investor there to be investing on the front lines of this AI revolution.

Do you think 2025 is the turning point in terms of realizing that return on investment across more industries and in the application layer? I think it's certainly getting there. We're seeing that turn, as you said, from early research and, you know, using LLMs, mostly as a consumer products, to figuring out ways that they can be leveraged not only in startups and technology companies, but also in these legacy industries. Defense has always been kind of an early customer of new technologies. AI is no exception. The Pentagon has been working on these programs for a very, very long time.

We're starting to see a resurgence in the interest of the big tech companies to come in and work alongside the Pentagon in delivering these critical capabilities to the warfighter. This goes along with Andrel as well. You know, we recently announced a partnership with META for the augmented reality platform that we used to be called IVAS. We're our approach that we're calling Eagle Eye. And we're also partnering with some of the large foundational model companies as well as we approach some of these new problems in command and control and in autonomy. Okay. Trace Devens.

Thank you for joining me. Thanks so much, Morgan. And still ahead, much more on today's Overtime's earnings action as we count down to the analyst calls from AMD, Snap, and more at the top of the hour. Plus, ZOETIS, one of the worst performers in the S&P 500, despite a big earnings beat. We're going to hear from the Animal Health Company CEO coming up on overtime. Welcome back. Let's check the moves on some of the companies reporting at the top of the hour. Arista networks, a big following a beat on both sales and profits. The company provides

AI networking for data centers and more. It says its customers are continuing to spend on its platform. You can see those shares are up 9.5%. Another AI stock heading in a different direction, though, is super micro. That's after we're coming up short in both earnings and revenue. Earnings guidance for the first quarter, also less than what analysts were expecting those shares are down 15%. And we will end with shares of Cleveo. Earnings were better than expected. Revenue also beating. Guidance higher than the streets forecast as well. The company provides tools to retailers and says its AI tools are helping its brands connect with customers and those shares are up 15%. Yeah. Well, Disney is one of the big names on tomorrow's

earnings calendar. The stock's up 6% this year underperform most of its peers. Julia Borsden looks at what investors will be watching for in this report. Julia. Well, John Morgan, with Disney shares up nearly 30% since it's better than expected earnings in May, now the focus is on streaming, which is the fastest growing part of his profits, and also on its parks and experiences division, which is Disney's biggest driver of operating income. So the parks will be closely watched for commentary on the impact of tariffs and consumer spending trends. The wild card is the opening of Universal's Epic Universe in May.

We'll see what the company says about that new competition. Now Morgan Stanley is forecasting the division's operating income growth will accelerate to over 10% in fiscal 2026. Meanwhile, Disney's streaming business is in focus on the heels of Disney completing the buyout of Comcast stake in Hulu, giving it full control and ahead of the launch of its full ESPN streaming product, which we're expecting in the next month. Now, this quarter analysts are looking for the addition of about one and a half million Disney Plus subscribers. They're also watching to see whether ESPN will announce a deal with the NFL. There's been a lot of speculation that the NFL

will take an ownership stake in ESPN in exchange for ESPN acquiring NFL media assets, including potentially the NFL network and Red Zone, which would be very interesting. Now, Julia, the Disney Plus thing confuses me, though, because Disney was spending like drunken sailors on that thing before, making too many episodes of too many things. They cut back on that. Do investors have to adjust their growth expectations for Disney Plus because they're not making as much content? Or was it, were they really just wasting money on content they didn't need to be making in order for the thing to grow? I think they were establishing the value of Disney Plus in the marketplace. And Bob Iger has talked about how maybe they put too many Star Wars, too much Star Wars content on Disney.

Plus, and they need to rebalance that to make sure that they have the right balance. And so talking to folks at the company, it seems like they're really trying to make sure that not only are they spending the right amount of money on content for Disney Plus, but they're spending on the right type of content for Disney Plus. But what they're doing now is really focusing on this bundle. They don't want you just to subscribe to Disney Plus. They also want you to get Hulu and now ESPN. And I think when we see this launch of this ESPN flagship product, which is really all of

ESPN, they're going to really be driving the value of the bundle. So it's almost not worth it to not get all of them at once. I got to shift gears here. We just laid out a whole bunch of big movers here on overtime on the heels of earnings. What we didn't talk about yet is SNAP, which I know you just delivered those results to us. I mean, this is a volatile name every quarter and this quarter is no different. Look, we saw such strong results, both from meta and YouTube in terms of advertising. The fact that SNAP revenues were just in line was a big disappointment.

And if you dig into these numbers, average revenue per user, lower than expected. And if you look at the North American user base for SNAP, it actually declined by $1 million in the quarter. So, yes, they grew overall users faster than expected. But to see that weakness in that valuable North American user market does indicate that there's some issues there. We're going to have the call with SNAP that starts just at the top of the hour. So I'm sure we'll hear more from Evan Spiegel about what's actually going on there. All right. We're going to keep you busy.

Julia Borsten. Thank you. Great to have you here on set. Great to be here. Well, it's time now for a CNBC News Update with Bertha Coombs. Hi, Bertha. Hey, Morgan. A federal judge issued a preliminary injunction today to block the Trump administration from transferring funds from a disaster prevention grant program.

Last month, 20 states stood the administration alleging that FEMA did not have the authority to cancel the program without congressional approval. The program covers funds for infrastructure projects that are meant to protect communities from natural disasters, including evacuation shelters and floodwall. Meanwhile, FEMA is cutting $64 million in security funding for New York City, money from a fund created by Congress to help cities prevent terrorist attacks. The notice comes just days after a gunman killed four people inside a Midtown office building. And a McLaren, if, F1, once owned by Oracle founder, Larry Ellison, is on the block at Sotheby's, the Supercar. called a chassis number 62 is one of seven that was exported to the U.S. back in the 1990s. If the rare car is sold close to its assessed value, which Sotheby's has listed at more than $23 million, it'll be the most expensive McLaren ever sold. Very pretty car. Back to you.

All right, Bertha, thanks. Up next, the CEO of Animal Health Company, Zoedis, breaks down a big earnings beat and whether tariffs are impacting her business. We'll be right back. Welcome back. This morning, we got second quarter results from Zoettis, which showed the company beating estimates, raising its guidance. The stock did close lower on weakness from Librella. This is its osteoarthritis medication for dogs. But joining us now on set for an exclusive interview is Zoetta CEO, Kristen Peck. Kristen, it's great to have you on. And it was. It was a beat and raised quarter, and yet shares were under pressure. I guess just walk me through what you're seeing with Librella, as that seems to be what investors are picking apart here.

Well, first of all, it is great to be back with both of you today, and especially after such great results and an increase on the guide. And what really drove the results today was our diverse, durable, broad-based portfolio. As we highlighted on the call, we had 11% growth in our innovative franchises, which include pain and Lebrella, dermatology, and parasiticides, but also saw strong growth in places like livestock. And I think where you saw some of the pressure today was in Librella, which is our osteoarthritis pain product. And, you know, we're seeing great customer satisfaction with over 75% of pet owners extremely or very satisfied with the products.

But we've had some headwinds that we've been trying to overcome there. And we're really focused on meeting with vets and pet owners through medical education and greater awareness to drive the adoption of Lavella. Okay. The other sort of big news of the day, macro news, is pharmaceutical tariffs. President Trump was on CNBC earlier today and basically said 232s are coming. Is that something that's going to affect pet care and therapies? Do we know yet?

It is, you know, I was listening to you all day, and it is a very dynamic tariff environment for certain. You know, what's really great about Zoetis is the broad-based growth and the strong secular trends that drive our industry. I think we've got a strong portfolio, we've got a strong pipeline, we've got a strong supply chain. So we have multiple mitigation strategies across multiple time frames. But as you think about animal health, it isn't yet clear whether animal health is part of pharmaceutical tariffs. And we really think, as we talked about the last time I was on, there's a really strong argument to be excluded. We have been investing in American manufacturing for a long time. We've put $1 billion into American manufacturing and investments here over the last five years.

When I spoke to you last time, 75% of what we sell in the United States, we make in the United States, and 60% of our global manufacturing is in the U.S. with only 50% of our sales here. So we're a net exporter. So we're really focused on, you know, the fact that we've been investing, in manufacturing, and in IP, almost 100% of her intellectual property sits in the United States. Back to LeBrella for a moment. It sounds like you're saying that customers who are using it are happy with it. So what exactly is the issue? Are the side effects either more common or worse than expected, or is it a messaging issue where people who haven't tried it are more afraid to than one might expect?

It is more of a messaging issue. You know, the product is incredibly safe and effective. and we're very confident in the long-term potential of this product. We haven't changed any of our guidance there, but it is a messaging. And what we're focused on is making sure that pet owners better understand osteoarthritis pain and the product. We're also trying to make sure vets feel comfortable recommending because the customers who are on it are very satisfied, 75% of them. But it's making that confidence to recommend for new customers. So that's really the focus. Again, it's a phenomenal product.

It has very strong safety and efficacy, and we're very careful. committed to it and confident in it. All right, Kristen Peck of Zoetas. Thank you for joining us here on set. Great to have you. Great to be here. Well, up next, a look at tomorrow's huge slate of earnings featuring a pair of Dow components and some high-profile gig economy stocks. And what goes up must come down. Shares of Defense and Space Company, Voyager technology is sinking today after its first earnings report since its June IPO. The stock price at $31 a share. It's now trading after the loss today right around 34 and change. The CEO is going to join Fast money that's coming up at 5 p.m. Eastern overtime. We'll be back in two.