Closing Bell - Closing Bell Overtime: Amazon sinks on weak earnings guidance, Apple rallies on earnings beat 4/28/22

Episode Date: April 28, 2022

Earnings guidance dominates the after hours trading session. Shares of Amazon fall more than 10% after the company provided a weak Q2 revenue outlook. Dan Ives from Wedbush Securities gives his instant analysis to those numbers. But, Apple rallies following an earnings beat across the board and forecasts better-than-expected EPS and revenue. And Michael Santoli’s “Last Word” is “relief.”

Welcome to Overtime. I'm Scott Wapner. You just heard the bells. We, of course, just getting started and a huge show is ahead. Apple, Amazon, Intel earnings are imminent. That is our talk of the tape. Obviously, this critical moment for your money, especially after this very big day in the markets leading up to those numbers. Our experts, they're ready for all of it. The star Wedbush analyst Dan Ives is here with me on set right at post nine. Shannon Sikosha, Joe Terranova of the Halftime Investment Committee with all that is riding on these numbers, especially after a day like this. We're going to have those numbers. I said they're going to be imminent. Dan Ives, your expectations. We can start with Amazon. Thirty eight hundred dollars is your price target. You get a buy on that and the stock running up today right into it. I think right

now it's a white knuckle period. And I believe we see strength from Amazon as well as Apple. I think Amazon, the thing to focus on, the cloud story, similar as we saw with Microsoft as well as Google, that's important in terms of what we see on the enterprise side. And it just continues to be these are the stalwarts that will move tech higher. That's the key to what we're seeing this week. I'm looking at twenty eight00 is exactly where the stock is right now. AWS, the cloud grew 40% year over year last quarter. That's the critical number that you're gonna be looking at.

Yeah, I mean, when you look at it, it's called about 18, 19 billion is the bogey. And what's important here is just to have and have nots of tech earnings. We are seeing a story now painted from Qualcomm to Microsoft to I believe will be Amazon as well. Cloud enterprise strong and you're going to and I believe that along with Semi's takes tech higher. Yeah I mean it's Joe Terranova you just bought this stock earlier this

month. Yes I did Scott. The guidance is going to be critical here and I think the guidance is actually going to come in a little bit weaker. That could create a little bit of a problem here for Amazon. I'm a buyer on dips, but I actually think you're going to get some disappointment here from Amazon. Yeah, well, you're getting it right now. I mean, the stock is down in the OT about 10%, and we're going to tell you exactly what's going on in just a second.

Shannon Sikosha, you own it as well. I do. I agree with joe i think we're going to see second quarter estimates come in a little light but i think the back half of the year we're going to have great visibility on costs better retail sales comps so second half of the year i still think is a great name to own is that still a great name to own in the second half of the year? I think on these knee-jerk reactions, you continue to look at what's baked in. I think second half, you look at names like Amazon, Apple, Microsoft, the lead tech hire. Hold your thought because Dee Bosa has the numbers. You see the stock is reacting. Dee, what do we see here? Yeah, Amazon shares are plunging 10%. They're coming back a little bit though. A net loss of $3.8 billion. The street was expecting

a gain. This shouldn't be totally unexpected though, because that includes a $7.6 billion loss on its stake of Rivian, the electric car company. We saw a similar thing with Ford. Revenue was actually a little bit of a beat, $116.4 billion versus 116.3, which is what the street was expecting. In terms of earnings per share, the street was expecting $8.36. This is a loss, however, of $7.56. Again, I'm not sure if that's comparable because it is a lot of that Rivian stake.

We will continue to dig through this report, look at cloud, look at advertising, all the different businesses, and we'll bring you it as we get it, Scott. All right, Dee, I appreciate that. Sounds noisy a little bit, right? We have to figure out exactly what's going on. What's your initial read, though, in hearing what Dee just told us?

Yeah, the Rivian Street will pull that out. I mean, that's a one-time in terms of, and that was pretty well telegraphed. It's all about top line. It's all about the cloud piece. That's what tells the story in terms of tech. You combine that with what I believe we see with Apple, comes down tech, huge week, the stalwarts are performing. I mean, is the top line good enough? 16.2, 16.3 we'll call it was the estimate,

16.4 was the number, or 1.16, excuse me. 1.16.3 billion, the estimate, 1.16.4 was the actual number. So it barely gets above that. But relative to this environment, especially on the consumer side, better than fear. And then when you look what's happened on cloud, they'll give conservative guidance, but it comes down to what's baked in. Street was fearing train wreck going in, I think better than expected in terms

of Taipan. That's the key. You've got consumer spending issues that relate here, right? Because of the e-commerce business, which is such a large part of the business, inflationary pressures. Now, maybe inflation has a bit of a two-side argument when it comes to Amazon. But nonetheless, they instituted the surcharge, what, a few weeks back? Well, I mean, that's the key. Can they pass it on to the consumer? Prime, obviously, you saw the increase there. And that's really going to be the focus. Netflix, they raised prices. You saw a churn increase. Can the likes of Amazon and others, can they raise prices? And you don't see that. That's why passing it through is something that's going to be a key dynamic during earnings season. Dee has guidance for us, Dee.

Yeah, and it appears, Scott, that this is what is hitting the stock so hard. This is the company is predicting or forecasting Q2 revenue guidance of between $116 billion versus $121 billion. The street was looking for more than $125 billion. So that likely shows a lot of the slowdown in its core e-commerce. Also, the company predicting a Q2 operating loss of $1 billion to a profit of $3 billion. That wide range certainly is not unusual from Amazon. We know that it's facing a lot of cost inflations in terms of labor and logistics and supply chain. So we'll get more details from that on the call. And when I talk to the CFO shortly back to you.

Yeah, that's good information that Deboza just updated us on that guidance. Guidance is light. Yeah, it looks soft guidance. But again, it goes back to companies here. They're going to give conservative guidance. You got to see on. They're going to give conservative guidance. You've got to see on the call in terms of the dynamics there. Right now, the street will react negatively, but it all comes down to, you know, is this sort of the sandbag number? Clear the decks, stock gets hit, and then ultimately, as Shannon was talking about, set up for a second-half rally.

I mean, you know the history better than anybody, though. I mean, does the guidance, do they normally guide this conservative if that's the way that you want to frame it? Relative to this environment, I think that's the prudent approach. And I think we've seen that across tech earnings. And I think especially how they're exposed on the consumer side. You also have to, it's important to break it out. You've got to break it out between the consumer piece and the cloud piece. Because ultimately, the big part of the sum of the parts with Amazon is the cloud piece. Yeah. Joe, what's your read here? I mean, you've

heard what Dee had to say. Now you've had a chance to actually see the guidance as well. You feel good about this purchase earlier in the month? I'm fine with it. This is the type of company, along with Apple, that I believe once the market is able to stabilize, once we get these Federal Reserve interest rate hikes past us, these are the names that you'll experience a V-shaped recovery. They're the type of equities that I want to own. They're returning capital to shareholders. They've got the strong revenue growth. They've got the margins. But I expected this. I said this at the top of the show. The guidance is going to be disappointing. I think the guidance with Apple is going to be incredibly important as well. Dan's correct. It's the right approach in this environment. And this is really probably the

best read-through towards the high-end consumer and what spending is ultimately going to be now and looking forward. And I think Amazon's doing the right thing here. It's what I expected. I do think it's a buy on the dip. And I also see, and I don't know how Dan feels on this one, but it looks like they're pricing in that Prime Day will occur in July in Q3. I saw that. And before you answer that, let me get to Frank Holland, because Intel's out as well, Frank. Yeah, absolutely, Scott. Shares of Intel down now 4%. The company had a beat on the top line and a beat on the bottom line,

six cents above EPS. This stock's falling again, now 4.5% on weak guidance for Q2. It's EPS and revenue guidance just slightly below what the street was expecting. Also, we look at this quarter, while it was a beat on revenue, its biggest segment, client computing,

that's chips for PCs, for corporate and consumer use, that fell just below estimates. Full-year guidance is pretty much in line with estimates, also reaffirming it. But again, that Q2 guidance, relatively weak for Intel right now. The PC market overall declining in Q1, down about 7%, globally 17% in the U.S. Shares again down about now 5.25%. Back over to you. All right, Frank Holland, thanks so much. Shannon Sacocia, little margin for error when it comes to something like Intel, right? They had to deliver. And you heard Stacey Raskin in the prior hour of closing bell, a company that's losing market share. They're losing the

conversation to the AMDs and to the NVIDIAs of the world. They're spending a fortune on CapEx. You heard some of these numbers here from Frank about what the PC market is doing, evidence that it might be rolling over. The company has been calling for growth there. And as I said, if you're an investor in this stock, it's a five-year story. As Raskin said, you're not in it. What would make you get in? Yeah, I mean, we have to see execution here.

I mean, Scott, I mean, if you put the numbers on paper and you frame out the story, there's no reason why Intel shouldn't be able to take back its competitive advantage over AMD. It's been back and forth for years. The challenge here is that they just haven't been able to execute. And I think everything on paper, you go to the investor day, you hear the presentations, it all sounds great. But when it comes to earnings, you know, we just don't see the actual execution. And so I think at this point, if you're going to play in the semi space, I mean, for us,

we don't have a lot of exposure there. But you've got to be in the quality names with quality management that knows where the markets are going. AI, for instance, not the PC market. Well, I mean, speaking of management, Pat Gelsinger, he's a CEO. He's getting paid like he's quality. And he's going to speak directly tomorrow, 11 a.m. John Ford's going to have that interview. He, of course, is the Intel CEO. And he is going to have to answer some of these questions that all of us are asking. We look forward to that. Sima Modi, Robinhood is out. And Scott, we're seeing a significant drop in trading volume,

leading to a wider than expected loss of 45 cents a share. Revenue was a miss. Transaction-based revenues down 48% year over year, led by a 73% drop in equities, crypto and options also lower. Really tough comps here, of course, given the meme stock mania that unfolded in the first quarter of last year. Net cumulative funded accounts did increase to 22.8 million. That's up 27 percent, primarily driven by cryptocurrencies, the company says, and up 22.7 in the last quarter. So a gain of around 100,000 accounts, although they did see monthly active users decrease by 10 percent for this quarter. So a gain of around 100,000 accounts, although they did see monthly active users decrease by 10% for this quarter. And you're looking at shares of Robinhood reversing today's gains down about 8% here in extended trade. And of course, it's been a tough couple of months,

Scott, to say the least for the company. Back to you. I think we were just talking not a couple of days ago about job reductions at Robinhood, and that crossed during overtime. So they're already going through some of these issues as maybe they're not getting as much activity as they were in the height of the pandemic, Seema. And you've got to think about the competition from established players as well, Fidelity to Charles Schwab. That certainly adds to the equation here. So we'll have to hear what the company and the CEO has to say about future growth, the new projects they've unveiled from the crypto wallet to features like extended trading hours to see if that is also helping boost longer term engagement all right we'll keep our eyes there too as you see that stock on the move uh in the ot as well

sima modi my thanks to you i want to go back to you dan ives because the word on amazon is it's the slowest sales growth uh the slowest growth in years. And we're talking a lot of years, about two decades, revenue growth of 7% in the quarter. Can that just all be explained away? I think, look, this is a massive COVID beneficiary. We knew comps are going to fall off a cliff, at least from a consumer perspective. The important thing here is it's a reset. It's more normalized growth going forward. And that's why if you look at guidance combined with cloud, that's really going to be the key here as investors, given where the valuations are, just like we saw with Meta and others. I'd really just say just massively negative news priced in. Very important to see what we hear in the conference call.

All right, Dee Bosa, back to you. Yeah, so to Dan's point, I know he's looking at cloud and that was actually a bright spot in the earnings report. AWS revenue was better than expected, grew 37% year over year. So that is still a very strong number. Its core though, e-commerce was light on a number of metrics. North America was light. International was light. Online stores as a whole also came in less than the street was expecting. Also, I want to flag subscription services because remember Scott and Dan, that Amazon raised the price of its prime membership last quarter.

That was also light coming in at $8.4 billion. 8.6 is what the street was looking at. Advertising as well. I mentioned this is the metric that they recently broke out. Higher margin business like AWS. That was also a little light. 8.2 is expected coming in at 7.9.

Growth still of 25% year over year. But you see that mix. Cloud still very much that bright spot. All right, D, thank you. You have a reaction to that? You want to answer that directly? I mean, cloud is the ultimate key to the store. I mean, very similar.

But it's slowing. Growth is slowing. Yeah, but relative to the numbers, if you look at what's happened on cloud, we are still, relative to what people expected, if you look at what's happened on cloud, we are still, relative to what people expected, that they thought it would de-sell significantly. It shows you, combined with what we saw with Google and Microsoft, the digital transformation cloud story across enterprise is robust. And that's what I believe is probably the most important thing here for the broader

market in terms of tech, and even when we look at software and semis. I mean, don't forget what we mentioned going in here the cloud grew aws did 40 year over year last quarter as debosa just told us 37 so yes is it still robust of course is it at the strong levels that it was in the past uh not if you measure it up to what the company delivered uh last quarter you can see by the way we're showing you on the screen here all of the all of the e-commerce players. Joe, take a look at these names. It's not just Amazon that is falling in sympathy with what we're hearing from this company at Shopify and Wayfair and Etsy. And I'm sure you can find some others if you want as well. Because I'm thinking about inflation here, Scott, listen, Amazon already.

And I've said I think Amazon is a buy on the dip, but let's at least acknowledge here inflation is present in this earnings report. It has to be. Worldwide shipping costs are up double digit. Amazon has already raised prime by $20. They've got an inflation surcharge that they're building in here for merchants. So I think it's pretty clear that inflation is evident and it's beginning to impact margins and certainly looking forward for guidance. I don't think management is going to have the expectation that they're going to be offered any relief from those inflationary pressures in the coming quarter. Julia Borsten, Roku. Yes, we're getting the results from Roku. A little bit of a mixed bag. Earnings missing estimates by one penny coming in at a loss of 19 cents versus the 18 cent loss that was anticipated. Revenues beat those 734 million versus the718 million that Wall Street expected. Q2 revenue guidance, a little bit lighter than expected at $805 million versus the $816 million estimated. But that user number, that all-important user number of active accounts, pretty much right

in line with expectations, ending with $61.3 million, the addition of 1.1 million active accounts in the quarter. And Scott, just because we have been talking so much about supply chain disruptions, just want to point out here that they note that ongoing supply chain disruptions contributed to increased U.S. TV prices, resulting in industry wide TV unit sales that were below 2019 and that their player unit sales remained above the 2019 levels, but we're still down 12 percent year over year. So they are feeling the pinch there as well. And we see shares are pretty much flat. They're flat because, you know, as you're giving this report, Julia, and I'm so glad that it's you doing it because you cover Netflix as well.

And all I can think about is, is this more evidence that it is a Netflix specific issue that was affecting Netflix when you hear these kinds of numbers? And if you want to go anecdotally from others, too, maybe you can come away with that conclusion. What's your own take? Well, look, I do think it's interesting just to dig into this report here. They note that year over year, net ads moderated given the end of government stimulus payments that serve to temporarily drive discretionary consumer spending in the first quarter of 2021. So I think it's worth noting that they are facing some of these macroeconomic issues as well. But also remember, Scott, that Roku sold off so much in the wake

of those Netflix earnings results. There was so much concern after Netflix's earnings that it could be just a bloodbath for the rest of the streaming sector. I think we are seeing some of these other pressures, but Netflix is unique in that it was a first mover and it is so much more saturated than the rest of these players and also doesn't have the ad-supported business, which helps moderate things a little bit. I mean, look, when you look at the stock price in and of itself, you're like, OK, it's at ninety four dollars and change. And Julia,

thank you. And we'll come back to you certainly if you have more news that we need to hear about. The stock was at four ninety. I mean, it gives you an idea of just how much some of these stocks have come down as we're looking at the numbers and looking for the reaction and, you know, seeing what's what and saying, you thing was almost 500 bucks like Netflix, which was like 700 bucks not that long ago. Well, I think that's why you have to also look at have and have nots in terms of tech. You're starting to see a picture now painted,

enterprise, software, semis, strong, not slowing. Consumer, work from home, pull forward, slowing. And I think what's important is bifurcation. I think you i think you see it today in terms of tech and the qualcomm numbers as well you're starting to see that fork in the room for tech but what i do believe the weeds tech hire is cloud it's off it's semis and what we saw here even on the amazon number that's important for the broader tech side do i need to be worried um you've mentioned consumer being weak as it relates to tech do

i need to be worried about what's going to cross the tape in a matter of moments? AAPL, better known as Apple? Look, I think Cupertino, even despite what we're seeing on demand as well as on supply, you know, overall on the consumer side, I think it's a beat in terms of iPhone numbers. And, you know, you take out about 15 million iPhones that really get stripped away because of the supply issues. That continues to be a rock of Gibraltar stock. And I believe that print is going to be important, not just in terms of on the supply side, demand. Are we continuing to see demand on iPhones? That's a telling tale. Yeah. Shannon, you want to give me your read here now that you've had a chance to see these

numbers come out? You've heard the analysis from our own experts. What's yours? Yeah, I mean, I think the Roku story is particularly interesting because I think you touched on a really important point being an owner of Netflix, as you know I am. I think that the direct-to-consumer story is fully intact. I believe they're just cannibalizing each other. And so it actually speaks to, you know, Roku being successful going forward because you are going to have a number of these streaming apps. The other thing I would mention is just if you think about what we're seeing from a consumer perspective, it's how the consumer is spending and what they're spending it on. And I think it sort of speaks to this transition over to services.

And so it'll be really interesting to see these numbers come out in other ways later in the quarter and things like apparel as we determine if there's actually this shift from goods to services spending against that inflationary backdrop that Joe mentioned. So, Joe, speaking of you, this bifurcation, if you want to call it that, in tech, the way that Dan Ives next to me describes it, enterprise, software, semis are strong, and then maybe bets are off when you come to other areas of tech. How are you going to think of this starting in the moments after these reports come out and how you how you want to invest in those moments i think i think dan is is spot on and and i'll touch on robin hood's earnings for a

second right uh robin hood a name that has been decimated in terms of performance so far year to date it's indicative of the type of name that's going to have that L-shaped recovery in technology. It's just not going to come back quickly. And you're going to have to go back and respect valuation and fundamentals once again. And I think that's important for investors to kind of make this unique shift. It's clearly a paradigm shift in the way that they're focusing on the market. Scott, you know, in the last couple they're focusing on the market. Scott, you know, in the last couple of weeks, what have I been buying and talking about on halftime?

I've been buying names like Walmart. I am not going in. I'm not looking at names where the high P valuations have been present for many years. They benefited from the pandemic and they've fallen so dramatically. I just don't think those names are coming back anytime soon. All right. I want everybody to stand by because we do have Apple earnings on deck. The company out with results in just moments. We're going to take a quick break. We're going to get set up for all of that. Plus Santoli's take on Amazon.

Please don't go anywhere. Overtime's back in two minutes. Back now in the overtime. Another check on some of the big names that just reported you can see those numbers there from amazon the stock is down about eight percent the others intel missing the stock is down uh four percent robin hood uh withdrawing their quarterly guidance now you can see that that stock is off by some eight percent as well and roku getting a little bit of a lift maybe a relief rally there santoli Santoli, taking a look at all these.

What's your take on Amazon? The slowest growth in a long time, Mike. Yeah, so 7% top line year over year, showing signs of maturity, even with the AWS, of course, growing very fast within it. And for a company that might be in that position, obviously it can pick up growth again.

We're not saying that that's the new run rate, But, you know, the buyback is relatively meager, $10 billion. They bought back $2.5 billion. I think a lot of investors would like to see them run the company a little bit more for, you know, capital allocation in a disciplined way. I will also point out almost all the massive pandemic beneficiary stocks have essentially retraced the pandemic gains. That would take Amazon. I'm not saying it's going to happen, but it was a twenty one hundred dollars a share before you got into the pandemic February of 2020. So you're still holding above that, maybe with, you know, somewhat deserved. But it's just a way to benchmark how Amazon is doing relative to the others. Finally, can we put to rest the idea that you should buy a stock

strictly because it splits? Because March 9th or 8th, when they announced it, the stock ran and popped right to 2,900. People were buying it on that basis. And here we are. Let me correct something that I said as well. I think I said that Intel missed and that was the reason why the stock was down. They actually beat it was the guidance that was weak. So I just want to make sure everybody is on the same page, including me. So that stock, as we show Amazon, is 8%. Dan Ives, the split. Mike brings up a great point.

But what happens now? It's all about sort of whether you've opened up the playing field to more players. No, I mean, look, you're not buying a stock because it splits. And as Mike talks about, obviously from a retail perspective, we've seen that, especially with big cap tech. But ultimately, it just shows fundamentals are going to dictate where stocks go. But when you look at what we're seeing with the stock splits, that becomes a high cost problem because they are splitting because ultimately during the pandemic, the strong got stronger. That's why we're seeing there were stock splits across the board.

All right. We are just moments where we'll be back with Mike Santoli, obviously, before the end of the program. Apple's numbers expected to hit the tape in just a few moments. We're going to take a quick break. We're going to come back and get you set up for that. There is the countdown clock. We're back right after this in overtime. Want to give you another check on the big action in the OT. Amazon is plunging, as you see on your screen, down nearly 10 percent. It was a mixed quarter. Guidance was a little bit light, and that's

the culprit there. Apple slightly higher after reporting a top and bottom line beat. The company also increasing its buyback program by $90 billion. We're going to have much more on all of this coming up. But first, Shepard Smith as our CNBC News Update. Hey, Shep. Hey, Scott. From the news on CNBC, here's what's happening. President Biden asking Congress for $33 billion in additional military and humanitarian aid for Ukraine. The president calls it a small price to pay to punish Russian aggression that will reduce the risk of future conflicts. But Russian aggression on full display in Kiev. The mayor there, Vitaly Klitschko, says at least one person was killed and several others injured when a section of the capital city was rocked by two explosions. The attack came shortly after President Zelensky met with the U.N. Secretary General Antonio Guterres in the Ukrainian capital.

And Trevor Reed is back at home on American soil. The Marine veteran landing in San Antonio just after midnight. He spent three years in a Russian jail and was released yesterday as part of a prisoner swap with a convicted Russian drug trafficker serving time in Connecticut. Tonight, some of the nation's largest pharmacy chains are cracking down on telehealth startups and some of the prescriptions they're writing. We'll show you why tonight after Jim Cramer, 7 Eastern CNBC. Scott, back to you. All right. Good stuff,

Shep. Thank you. That's Shepard Smith. Up next, Deirdre Bosa just spoke to the Amazon CFO. She's going to give us those headlines plus instant reaction from a shareholder. Overtime's back after this. Welcome back. Amazon shares, they are plunging in overtime. Apple, as you can see, slightly higher after reporting earnings just a few moments ago. Let's bring in a shareholder of both companies. Mark Lehman is the CEO of JMP Securities. It's good to see you. Amazon first. The guide was a little light. What's your take? Guides that are a little light are not perceived well by the markets, as you know. And this wasn't great.

Amazon also has a history of having some of the kind of guidance that makes the stock go down a lot during some of their previous quarters. So it's not all too surprising, given the year we have ahead, that setting the bar a little lower is what the company wanted to do. But the market's very disappointed, obviously. And that's why the stock's down. We'll see what the call goes like. But this is a miss. And I find it very interesting that we're having these kind of numbers. We'll talk about Apple shortly. But the FANG acronym and all the things that we've been talking about, we're not going to talk about, I think, going forward. We're going to talk about the haves and have nots, not FANG anymore. Be real quick for me so I can get to Apple. But you sound sort of like a concerned shareholder here of Amazon.

Well, it is concerning. I mean, this quarter has definitely been the tail of two cities with the haves and have nots. You saw Microsoft put up what they did. You saw Facebook have kind of a relief rally today. And then you saw the blowouts that we saw, obviously, with Microsoft and now Apple putting up a strong number. They have something to prove here. The cloud is obviously what people are looking at, but their fears of a consumer that's a little bit softer, their fears of retail, I think that is softer. And they didn't see the explosive number out of the cloud that people would have wanted. So down 10 percent. That's a tough that's a tough pill to crack. We'll see

how it reacts tomorrow. But this is not a great quarter and certainly not a great guy. Forgive me. Twenty six hundred is where the stock currently is. A real quick on Apple, if you could sum up China, not as bad as feared. Is that your takeaway? I think it's partially that, but I think it's more this is going to look more and more like a services company. We talked in the past that this is not just the tech companies are touching so many parts of our life as it looks more like a services companies and takes over more of our life, whether it's entertainment or auto or all the other parts, health care that they're going to get deeper and deeper into. It's just a tremendous quarter. And I think there's multiple expansion that you're going to have here. And yes, there's a relief rally on what they did out of China. And that's why the stock's doing well tonight.

Yeah. Yeah. It was up into the number. It looks like it's, you know, trying to stay above water here in overtime as well. Mark, I appreciate it. We'll talk to you soon. That's Mark Lehman with the quick reaction for both Amazon and Apple. Up next, more on the story of the night. It is Amazon. Deirdre Bosa just spoke with the company's CFO. She'll join us next with what she got right on that phone call. All right, welcome back to Overtime. I said Deirdre Bosa was speaking with Amazon CFO. She's off the phone now.

Deirdre, what do we know? Yeah, so CFO Brian Olsalski first talked about the impact of inflation. He said that inflationary pressures added $6 billion in incremental costs compared to last year. And he doesn't expect those pressures to ease up anytime soon. We also had this fascinating discussion about supply and demand. Amazon doubled its network over the last two years. And now he says they actually have too much space. I asked him if they overstated demand or if demand is perhaps waning. He said that's not the case.

He insists that it still remains strong, but they wanted that optionality. So that huge amount of investment sort of allows them to ramp back up if they need to, particularly in that fourth quarter, the holiday quarter. That call is still ongoing. So I'll bring you more. But some kind of fascinating forces at work here. That investment number has been huge and it has led to too much space. So he says the demand picture is still good and tons on that inflationary number, $6 billion, a lot of incremental costs. All right. Good stuff. I appreciate that reporting. Dee Bosa, thank you very much for that. Up next is Santoli's last word on Apple and this huge week of earnings. Mike Santoli is here for his last word, and it is?

Well, on Apple, it's kind of whoo, you know, we're glad. It's a relief. I wrote down relief. There you go. Thinking that it might be that. All the investors wanted to see out of these numbers from the big guys was that nothing much has changed, and it's kind of predictable, and the long-term stories are intact. Obviously, the buyback really reinforces this idea that Apple's on your side. Obviously, demand is there. They've smoothed out the upgrade cycle.

So I don't think the stakes are very high. It has small moves after earnings these days because it's considered so steady. And it's outperformed massively. It's up 22% over the last 12 months. So it's held. I think tomorrow the bigger influence, though, in the short term, it might be Amazon. Just because the market, after a 3% NASDAQ rally today, it's going to have to absorb that guy down and really figure out like long term where this thing belongs. I was going to ask you what, you know, we're running out of time, too,

but what today was really about and then now what this means for tomorrow. I mean, I think we were primed for a bounce attempt for many reasons. Down 8 percent month to date almost, you know, never happens. And you usually get a little relief. Sentiments real nasty. A few kind of really disappointing rally attempts that went nowhere, I think, had people not prepared for some upside jolts. So some mechanical stuff, some technical stuff, some sentiment stuff and also earnings in big picture ways, not as bad as they could have been. Yeah. I mean, you'll have some talk about where the consumer really is as you look at Amazon's e-commerce business.

And the rest of that story, too. That stock got down about 10%. I appreciate it. Thank you. That's Mike Santoli with his last word. I'll see you tomorrow.