Closing Bell - Closing Bell Overtime: Databricks CEO on New Fundraise; What’s going on in energy markets? 12/16/25

Episode Date: December 16, 2025

Bob Elliott of Unlimited joins the show to break down the market backdrop as investors weigh growth, risk, and positioning, before Leslie Picker reports on what could be the biggest IPO of 2025 with Medline set to price. Databricks CEO Ali Ghodsi discusses his company’s latest valuation and what it signals for private AI companies. Collapsing oil prices and unusual Venezuelan shipping activity with Bill Perkins of Skylar Capital. Julia Boorstin explains Instagram’s push onto the TV screen. Eric Mandl of Guggenheim on the outlook for tech M&A and what deals could define the next phase for the sector. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Well, that's the end of regulation. The Advertising Hall of Fame ringing the closing bell at the New York Stock Exchange. Essette's Lazio, doing the honors, at the NASDAQ. A mostly down day for stocks after the jobs number leads to concerns about the strength of the economy. The doubt losing about 200 points, the S&P 500 with a small loss here. And the NASDAQ, that is a late rally into the green. The Russell 2000, though, that closed lower. Energy was the worst performing S&P sector today. Utilities also lower, health care falling as well,

though it's by far the best group over the past three months. The reason for energies pullback will continue to decline in the price of crude oil falling below 55 bucks a barrel today. That's for WTI. It's a nearly five-year low dating back to February of 2021. We've got much more on that coming up. Gold and silver with small gains, Bitcoin perking up just a little bit to back above 87,000 today. And that is the scorecard on Wall Street, but when they're stay late. Welcome to closing bell over time. I'm John Ford alongside Morgan Brennan, and we are awaiting pricing on MedLines, expected to be the biggest IPO of 2025.

And we're also looking ahead to what could be the biggest IPO of next year. Databricks announcing a new funding round that values the company at $134 billion. CEO Ali Godsey is going to join us. It's not just IPOs. 2026 also expected to be a big year for mergers and acquisitions. Ben Mandela of Guggenheim will be here. He says next year could be the biggest year ever for tech deals. But let's begin with the markets.

As stocks fell for the second straight day, Seema Modi, joining us from the NASDAQ with more. Hi, Sima. Hey, Morgan, the real weakness today centered around energy. That was the worst performing sector as the price of oil continues to drop. Now at the lowest level since 2021, yes, it's good for gas prices, but it does pose a challenge for the oil producers. Marathon Petroleum, Halliburton, Baker Hughes down as much as 4 percent or more. The rotation out of certain names in tech continued. The NASDAQ did outperform, but there was Coral Weave experiencing reportedly some data center delays that sent its stock lower and its credit default swap higher.

And semiconductors also weakness there led by arm holdings as investors count down to earnings from Micron tomorrow. Oracle is seeing its first positive day in four credit rating agency Moody's referencing the challenges Oracle is facing but did not downgrade the company's rating to junk. It's seen as a short-term win, and a notable outperformance in some travel names, specifically United Airlines. That was the second best performer on the S&P 500 today, while Southwest Air got an upgrade at Barclays. Analyst there believe the carrier will benefit from its new commercial strategy. This, as we watched Tesla hitting another all-time high today at the street rallying around Robotaxy hype despite slow EV sales. John?

All right, Seema, thank you. Well, how did the bond market react to this morning's jobs data? showed a neck decline in jobs with the past two months combined. Rick Santelli in Chicago can tell us, Rick? Absolutely, John. Interest rates across the curve were lower, and the curve actually flattened a little today, meaning the short end started to move lower

a little less aggressively than the long end. But let's start at the beginning. If we're going to look at the employment report, I would say the easiest way to assess whether it was good or bad just to look at the unemployment rate. And if you go back to early, early 2021, you'll see that at 4.6, it's basically at a four-year high, highest in September of 21. And do keep in mind, two and a half years ago, it was at 3.4%. So the rate of change

has been rather significant. Now, how did all that play out? Well, let's pick a one-month chart. If you look at two years for one month, you can clearly see that it has been moving lower and rather aggressively, and that has been a leading indicator steepening the yield curve outside of today, of course. And if you add in the dollar index, which is at the lowest level since October, you can see that there's definitely a correlation with the short end of the market, which obviously has a correlation with the Fed and the path of interest rates. And finally, when you add in a 10-year outside of today's little downturn, you can see the pattern is completely different. The 10-year has been much more robust. We've held on to about 80% of

the steepening over the last two or three weeks. And if we consider that even retail sales today didn't get the pop in the market that that 4.6 did, we continue to look forward to see any more clues as to the pace of deterioration of the labor market. Morgan, back to you. All right, Rick Santelli. Thank you. It's a down day on Wall Street, with the exception of the NASDAQ, a third negative day in a row for the S&P 500. As an increase in unemployment rate is raising concerns about the state of the economy heading into next year. Now, a contrast is Bank of America's latest fund manager survey, which shows most bullish sentiment in three and a half years. So should investors still expect another strong year ahead? Well, joining us now as Unlimited

CEO and CIO, Bob Elliott. Bob, it's great to have you on. Actually, I want to start right there with that B of A survey, because as Mike Santoli has pointed out many times before, when you see this much optimism in a survey like this, it tends to be a contrarian indicator. Your thoughts? One of my favorite parts about that survey is highlighting that essentially all All bears are dead in the market. When you look at the question about what sort of landing we're going to have, only 3% of respondents said that we were going to have a hard landing in 2026, the lowest in three years. And that's happening just at a time the same day when the data is coming out for the U.S. economy that shows that, you know, after some optimism over the summer, we're starting to really reinforce the weakness, whether it be in spending or employment, as we entered the fall. And so that's quite the contrast between the optimism of those fund managers and the reality, the cold, hard reality of the data that we're seeing.

So what do you think of the cold, hard reality of the data we're seeing? Like, how much stock do you put into that a little bit of pun intended? Well, I think the economy has been slowing for a while. And I think there's a lot of hope in the market, particularly over the summer when we saw a pickup in household spending after the tariffs were. at least brought down to some extent. But all those hopes are now basically dashed as we get this data into the fall with retail sales basically flat for a couple of months. And I think probably even more concerning for those of us who stare at the timely spending data, like the credit card data, we're actually seeing some indications that this holiday season spending might

actually be below where it was last year, which would be quite weak in any reasonable context. And so you look at that picture and you say to yourself, this is probably not the time to be bowled up on stocks. And it may be the time to add some fixed income to your portfolio as you wrap up the year. Bob, what particular data is giving you that impression about holiday? I had seen still expectations that five plus percent growth in holiday season spending was in the cards. Is that tilted one way or another? Do you think that's absolutely not panning out? Does it have to do with the short season?

Well, I think you could look at, for instance, the Chase Card spending data, which really gives you, you know, day versus day matching of spending this year versus last year. And what you see on a cumulative basis is basically really since mid-November, the spending dynamics that existed, you know, that have existed over the course of the last month are very, very soft. And that's confirmed by when you look at the Bank of America, timely spending data that they publish in their consumer checkpoint. And so you put those two things together between Chase Cards and Bank of America, you've got a significant majority of overall spending in the economy from households. And you see those two reeds and you say to yourself, those look pretty weak. Those are not the sort of reeds that would align with, you know, a strong holiday season or consumers really, you know, getting fired up about the first quarter. We're expecting some stimulus, though, in the first half of the year in effect, anyway. Do the effects of a slower holiday season perhaps get masked by that and therefore the market impact as well?

Yeah, I think one of the challenges is we're going to have a couple of big cross-cutting forces early in the year. For many folks, particularly those with lower incomes, they're going to see significant increases in health care-related costs. And that is almost a one-for-one drag in terms of their spending. And months later, there may be some pickup in refund checks, though, of course, the vast majority of that is going to be received by high-income earners. And so you sort of put those things together, and I think there's a lot of hope in the market right now that the first quarter of the year is going to be very positive, but it may well be a false dawn that's coming with a lot of hope relative to the reality of just. the last six months, every time we've looked at the labor market, it's gotten a bit weaker. If we get another six months of that, you know, it's going to be quite a challenging circumstance for the economy. All right. Bob Elliott, from Unlimited. Thank you.

Well, this afternoon, we expect to get pricing for the public offering of shares of Medline. Medline aims to raise more than $5 billion. Could be the biggest IPO of the year, not just in the U.S., but in the world. Leslie Picker has more details for us. Leslie. Hey, John. Yeah, I'm told that the bankers, the private equity backers, the company and founding family currently huddled together to discuss that final price. We should have a sense of that within the hour. Now, the latest indication I have gotten from a person familiar with the matter was that the group was discussing potentially upsizing the offering, offering more shares than the 179 million that they had been marketing. However, I was told that it's unlikely that Medline prices at the top of the range. That would be 30. $30 per share. However, it's still looking likely to be in the top half of that range. Now, this is likely, as you mentioned, to be the biggest IPO, actually ever of a company that was purchased through a leveraged buyout, a sponsor-backed company. Medline manufactures

and distributes medical supply products, things like masks and gowns and lab kits. It was taken private by a consortium of private equity firms, including Blackstone, Carlisle, and Hellman and Friedman back in 2021, which was then the largest LBO post-financial crisis. Medline is perceived to have a sticky, resilient business having grown net sales each year since inception in the 1960s at a cager of 18 percent, according to the prospectus. The company says it will benefit from secular tailwinds like an aging population and consolidation of providers. Medline acquired several companies as well and plans to continue doing so, which is a key part of its growth strategy, guys. Leslie, you just mentioned the fact that this is poised to become the biggest ever P.E. back. IPO. How does it speak to how much is sort of sitting in the pipeline from a private equity standpoint?

Because we've heard for several years now that that has been stuck and that a lot of the capital is going to have to start churning after that starts moving again. Yeah, I think, Morgan, that is the most important question we have to be asking as we await the final pricing on this because I'm told they have a lot of quality investors in the book, that it is oversubscribed, that they do have the demand. However, given this is such a big water, moment. And toward the high end of the range, they would be looking at making about $20 billion in profit from where they purchased this company, the valuation by which they purchased this company back in 2021. So this is a deal that everybody is really incentivized to go smoothly, because if it does,

that could then kind of signal to other companies that are waiting in the wings, you know, part of that 2021 mega buyout year that we saw that, hey, the water's warm. Maybe it is time to go public and therefore get some liquidity for your investors, which of course is important for the flywheel machine to turn back on for fundraising. So this is a really, really important and in many ways historic deal for the markets. Yeah, and one that doesn't involve AI. Wheelchairs and surgical gloves. Leslie Picker. Real things. Thank you. We've got some news on the battle for Warner Brothers. Julie Borson has the story. Hi, Julia. Well, Warner Brothers is reportedly preparing to tell its shareholders to reject the offer from Paramount Skydance. Skydance.

As soon as Wednesday, this is according to report in the Wall Street Journal. And the ideas that Warner Brothers Discover would be recommending to its shareholders as soon as tomorrow that they support the existing deal with Netflix over the proposal from Paramount Skydance. We've reached out to the companies for comment. We have not heard yet. But just looking at the shares in terms of after hours trading, fairly unmoved, though Paramount Skydance is down about 1%. Back over to you. Right, Julia, thank you. Coming up, we'll turn our attention to what could be the biggest IPO of next year. Databricks, announcing its latest funding round, creating evaluation of around $134 billion.

By the way, maybe not the biggest IPO next year, roughly in line with Palo Alto and CrowdStrike, but a little less than service now. Up next, Databricks CEO, Ali Goetzie, talk about the latest funding round. Anything about those IPO plans, overtime's back in two. Welcome back to overtime. Shares with Booz Island, Hamilton, lower by about 7% today. The company's CFO is leaving to take a similar job at S&P Global. The move is effective February 1st. But today's slide, adding to a rough year for the government services and defense tech stock,

which has lost about a third of its value in 2025. Well, cloud data platform data bricks, number three on this year's CNBC Disruptor 50 list, turning heads as a new fundraise values the company at 130, $34 billion, that's nearly double the $75 billion public market cap of Snowflake, one of its biggest rivals. Joining me now on a first on CNBC interview, Databricks co-founder and CEO, Ali Gautzy. Ali, welcome. Big numbers here. We've been talking about IPO possibilities for Databricks for a long time, but let's talk about revenue.

You're right up against a $5 billion revenue run rate, growing at 55%. Could you still do that if you were public? Yeah, I think so right now. But I think if the question was, if we had gone public in 2021 and stayed public in 2022 when everything was going down and, you know, interest rates were going up, then I don't think we would have been at this growth rate right now. Well, I mean, is that a reference to Snowflake? Because they weren't public right around them.

Many, many companies. But yeah, they were one of them. But there were many companies that ended up in that situation. So that allowed us to invest in, you know, agents. It allowed us to do the database. acquisition of neon, so we have lake base. So, you know, we would not have been able to do those. How do you think your free cash flow compares? We do have a number for that in Snowflake, but we don't have it for Databricks. Talk to me about your cash management strategy,

how that factors into your raise here and your vision for the future. Yeah, so, you know, we've said that over the last 12 months, we've been free cashful positive. So, you know, we're efficient business, but we're investing it. We're not. You know, we're not trying to produce lots of, lots of free cash flow. We just want to stay at this break-even and invest it back in agents, you know, in databases, lake base. There's this new category of applications out there that are being built. We call them data, intelligent applications.

We want to invest in that. A lot of times companies will go public in part so that people feel like they're stable, they're enduring, they're in for the long term. Companies already know your name, clearly, by this growth. And right now, the market is absolutely. a place with data with AI where some are questioning evaluations are a little on the high side. How much does that factor into your choice of whether you go public in 2026? Yeah, I mean, look, we will be public. I wouldn't rule out that we wouldn't be public next year,

so I wouldn't rule that out. But, you know, I don't want to also take the company public, and then 2022 happens, and then the market wants to have 30% EBITA, and, you know, we can't invest in these. I mean, there's a huge secular shift happening. Like, no matter what happens with this AI, you know, whether it's a bubble or not, people are not going to stop using AI. For instance, software engineers are not going to stop using AI for software engineering. This trend will continue. All that software that they wrote before is now cheaper to write.

All that software needs a database that works well with the agents. That's what Blake Base is about. All of them will be building these applications. So I would hate it if the market forces us not to be able to invest in these growth areas in these innovations. So how will you know? Well, you know, kind of see how the markets is evolving. We were just fundraising, right?

We just raised over $4 billion. And we talked to every institutional investor out there, right? The ones that are managing trillions of dollars of AUM. And the number one question they're asking is, do you think there's a bubble? Do you think what's going on? What do you think about these deals? So, you know, those questions themselves reflect people's Psyphes.

Well, I would just, I focus it on our business, which is, I think, that there is amazing amount of automation that can happen, an amazing amount of augmentation of AI that we are doing with Agent Brits. I tell them about the use cases at Royal Bank of Canada. We're able to build an agent that in real time, when an earnings call comes in, you'll like this, immediately gets the earnings calls, gets the previous earnings calls, get all the competitors' earnings calls, figures out what's happening in the market and puts together, you know, equity research report within 15 minutes.

It takes the industry, as you know, two hours or, you know, much longer to do that. And they can do it in the tone of the particular equity research analyst. So use cases like this. We just want to sort of continue delivering those. So I focus on that so much, not so much, you know, but they want to talk a lot about data centers and energy and how many gigawatts do we actually need and so on. Yeah.

And, you know, who knows? Okay. Well, I want to talk to you a lot more about this. We'll have to do it in a Fort Knox update. Ali Godtsey, Databricks, CEO on the occasion of this big fundraise. Thanks for joining us first on CNBC. Thank you. Coming up, a big gain for shares of circle as it gets a vote of confidence for its stable coin.

And stable might be good for a stable coin, but not for a market looking to break out. Mike Santoli is going to be here to look at why the S&P seems stuck. Overtime, we'll be right back. Welcome back to Overtime. Shares of Circle, a big gainer today. Visa says that Will. allow banks to settle transactions using U.S.D.C. That circle's stable coin. Circle stock could use a good day. It's lost nearly three quarters of its value from its all-time high,

near $300 a share. That was the day after its IPO in June. Now let's bring in senior markets commentator Mike Santoli for a look at how the S&P just can't seem to break out and, well, seems to be stuck, Mike. Yeah, Morgan, for at least the last couple of months, we've been churning around this level. Close right at $6,800. Also, today at the lows hit the 50-day moving average. Again, haven't been able to really get kind of escape velocity off of that trend line, though we did close above it. But there has been a lot of push-pull movement underneath the surface.

So we're at the same level in the S&P as we were on, let's say, October 24th when we first got here. And yet, bank stocks are up big. A lot of other cyclicals have worked, and obviously the AI trade has struggled just a little bit. So so far, it's not saying that somehow it's a topping pattern, but it's definitely showing were kind of caught in these opposing currents at the moment. So take a look at some of the other parts of the market on an equal-weighted basis that have been trying to get in gear. This is a two-year chart.

That's equal-weighted financials. Looks pretty good, nosing above the old highs from post-election rally in 2024, although it's curled just a little bit lower. That's the overall equal-weighted S&P 500. And again, it's made a new high that is certainly a net positive for the broad kind of rank-and-file stocks, although it's not too far above where it did hit. back there in late 2024 and the other. That's equal-weighted health care. We know that's had a

really good move. And likewise, it's trying to contend with these old highs. So I guess we're basically sitting here saying, you know, a vigil to see if this broadening out is going to work or if this afternoon's trade, which was, guess what, a re-rotation back into mega-caps with Tesla making a new high and meta and Microsoft and Nvidia playing along for it is now going to take the baton back. I mean, at this time of the year, you start to see volume sweep out of the market to. And historically, this tends to be the second half of December, a very strong time of year for stocks. So what would you be looking for to see that that actually kicks into gear again? I think we're going to get through this week where you do have some kind of noise around

options expiration. We're going to get into the holiday interrupted weeks. I want to see volatility start to bleed lower than to be the VIX. We did actually stay below 17 today. And it creates air pockets upside and downside air pockets. So, you know, if the market, doesn't play the script and get a little bit of progress to the upside in the last couple of weeks, it could be sending at least a faint warning about some, you know, unfinished business into the first part of next year. That has happened in the past. We finished on the flat side in 2021. We finished kind of week in last year, as a matter of fact, in late December as well. And eventually in February, you did have a deeper correction starting. All right. Mike Santhali,

thank you. We'll see you a little bit later in the show. Time now for a CNBC News Update with Bertha Coombs. Bertha. John, moments ago, the Los Angeles District Attorney announced the son of Rob and Michelle Singer-Riner will be charged with two counts of first-degree murder. Nick Reiner is accused of killing the legendary Hollywood actor and director and his wife over the weekend in their L.A. home. The DA said no decision has been made about pursuing the death penalty.

Reiner is currently being held without bail. A former California doctor was sentenced today to eight months of home detention for his role in the overdose death of Friends star Matthew Perry. Chavez pleaded guilty to ketamine distribution last year and faced up to 10 years in prison. He is one of five people charged in Perry's death. FIFA announced today that it will offer a new $60 ticket. that that'll be a tier for each World Cup match following fan outrage over steep prices for the tournament. The tickets will be reserved for supporters of the two teams that are playing.

They will be dispersed by teams' national federations who will set their own distribution process. And hopefully the bots won't get in there ahead of the true fans. Indeed, Bertha, thank you. Well, a big drop in the price of oil. today. These are levels we haven't seen since early 2021. That made energy the worst performing group in the S&P 500. Every single stock in the sector was lower. We got much more on energy's big declines. Next on Overtime.

Welcome back to Overtime. Let's look at the market action today. Losses for the Dow, S&P, and Russell 2000. But check out the NASDAQ chart. rally giving it a little game. Healthcare stocks had been making a strong comeback, but not today. Pfizer lower by more than 3%. Its 2026 guidance was below street forecast. And elsewhere in healthcare, Humana also lowered today by 6%. An executive shake up there as the head of its insurance unit retires to be replaced by a former Amazon exec. Well, Lanar earnings are out. Diana Oleg has the numbers. Diana. Well, John, for Q4, Lenar is reporting EPS of a dollar 93 cents, but it's unclear if that's comparable to the $2.22. Wall Street expected.

Lanar said earnings were weighed down by a $156 million one-time loss related to a Millrose property's exchange offer. Revenue came in at $9.37 billion versus estimates of $9.02 billion, so a beat there. Gross margin on home sales of 17% was short of the forecast, 17.5%. Deliveries increased 4% year-over-year beating expectations. New orders came in very slightly lower, than expectations, but up 18% from the year before. Now, Lenar's executive chairman, Stuart Miller, said in the release, even as interest rates moved slightly lower in our fourth quarter, the overall market remained challenged. Accordingly, our fourth quarter and full year 2025 results reflect a disciplined commitment to increasing housing supply in a market constrained by

affordability challenges, as well as weak consumer confidence. Now, to address that he continued that market declines, he said we maintained approximately 14 percent in. incentives and price adjustments. On guidance, though, a big miss. Q1 deliveries between 17 and 18,000 versus estimates of over 20,000 new orders between 18 and 19,000 versus estimates of close to 20,000 Q1 prices also look to be lower from Q4. Back to you, John. All right, Diana, thank you. And we got another development on the bid for Warner Brothers Discovery. Amen Jabbers has that. Amen. John, that's right. Jared Kushner's affinity partners says it is now out of the project to purchase Warner Brothers Discovery alongside the Paramount offer.

Remember, Jared Kushner had been one of the investors listed in that through his private equity firm. We now have a statement from that private equity firm, Affinity Partners, a spokesperson there telling us with two strong competitors vying to secure the future of this unique American asset, Affinity has decided no longer to pursue the opportunity. The dynamics of the investment have changed significantly since we initially became involved in October. We continue to believe there is a strong strategic rationale for Paramount's offer. So the question here, John, is what does that word dynamics mean in this statement from

Jared Kushner's firm? They say the dynamics of the investment have changed considerably. They don't say what those dynamics are. And of course, I guess all the horse race folks will try to figure out whether this makes it more or less likely that Paramount might succeed in all this. Back over you. All right. Amen Jabbers. I'll take it. Thank you. You back. and oil briefly falling below $55 per barrel. That's for WTI. It's the lowest level since early 2021, a nearly five-year low. U.S. crude is down over 20% for the year on pace for its worst performance since 2018. Energy was the worst sector today with every component closing lower

in the red. Performers include APA, Marathon Petroleum, Phillips 66. Why are we seeing such a drastic move lower? And will it continue? Joining us now, Bill Perkins. He is the founder, managing and head trader for Skylar Capital and energy-focused fund. And Bill, it's great to have you back on the show. Welcome. Thanks. Great to be back. A lot to get into here.

But first, I do want to start with the move we've seen in crude oil and the fact that we are at multi-year lows. Loz we haven't seen since before the Ukraine war. How much of this is a reflection of the economy, globally? How much this is a reflection of geopolitics may be starting to quiet down a little bit? I mean, my personal opinion is geopolitics. It's kind of the biggest driver. Peace in Ukraine, which is rumored to be happy.

happening. We hear your headlines about breakthroughs happening in the negotiations. What's good for Ukraine is bearish oil, which is then bearish oil producers. In the background, we also have the fundamental picture. If you look through the earnings reports of all these producers, we're hearing efficiency, efficiency, particularly Matador Resources talks about 10% reduction in CAPEX, but a 5% increase in production or somewhere around those numbers. And these are incredible numbers coming out in the Permian producers. And so we have producers that are able to survive or produce in a lower price environment, and we have the idea that more supply might be coming on via Russia sanctions season, vis-a-vis

the sanctions being lifted and peace in Ukraine. And just speaking of geopolitics, because you did come with some images, some satellite images, which is something else that you focus on as well. I do want to get your thoughts on the role that being able to see the world, the technology, the capabilities, space included, is playing in the energy markets and this dynamic that we're seeing around geopolitics. Right. So these images, you know, they come from simmax.com and other vendors.

Geospatial awareness of the globe is a must in trading right now, particularly energy trading, tracking assets, tracking tankers, understanding, you know, these shadow fleets, what they're doing, how much oil is actually flowing versus what's reported. I think this is a must have for most traders just to understand our world. And so as, you know, SpaceX and other launch providers made it cheaper for satellites to go up, the access to this information is becoming more plentiful. And so it's part of everybody's cookbook. Yeah, not gas.

It's been volatile, as it usually is. It's an area you focus on. We're still up on the year, but the fact that we've come off as much as we have here in recent days, signals what? It signals the weather. We had a huge run-up with, you know, much colder than normal weather. And then over a weekend, it all disappeared and went much warmer. And so weather is the biggest driver in the winter, and we've had some volatile weather forecast. And if you wake up in the morning and you see a move in natural gas, you pretty much know what the weather forecast has changed or what the models have done.

You know, we're pretty much model jockeys right now during the winter. And as the winter progresses, we get into other fundamental factors that matter more. In terms of fundamentals, I mean, we keep talking about the AI infrastructure build out and the fact that power is sort of the key thing to see all of this compute possibility realized. When does that start to factor more into the fundamentals for some of these energy prices? I think in, you know, year over year, we used to argue whether or not we're going to see 0.5% electricity growth or 0.9. And now we're talking numbers 2.5% and 3. And so these are quite staggering numbers. and then natural gas gets a lion share of that and renewable.

So it's that, that produces more gas demand. On the flip side, never doubt the American producer. You know, we're tracking rigs and fracrues with geospatial data, as I mentioned before. And it's really, they've been able to meet every call for needed supply ever made upon them and then some. And so what we're going to have to decide is, is load growth bigger, or are the producers more Herculean than any low growth that can be produced? So how does this set us up for 2026? Oh, 202026 is a year of tightly balanced.

And one of the things we're finding is that when things change, they move pretty drastically. Like we've had a 33% range in the past six or seven days in natural gas. And so the brakes on the system make it a little bit more volatile, but we seem to be finely tuned to be neutral at these price levels. But who knows, the weather might come even warmer or colder, and we'll whip around. Okay, Bill Perkins, great to have you on. Thank you. All right. Thanks for having me. Well, META is taken on Google's YouTube by launching an Instagram TV app.

Up next to look at what's at stake for both of those companies and why it could even have implications for Netflix's bid to buy Warner Brothers Discovery. Plus, a top tech banker on why AI could drive a record amount of tech mergers in 2026. Overtime will be right back. Welcome back to overtime. All good things must come to an end. And that's true for Lockheed Martin. Snapping a 10-day win streak after Morgan Stanley downgraded the stock to hold from buy, cut its price target to $543 from 630. The analyst there is citing slower than average expected earnings growth compared to its rival. Shares finished down.

one and a half percent. Well, Google's YouTube has become a dominant force on TV screens, and now Meta's Instagram making a move to replicate that success. Julia Borsden explains, Julia. John, Instagram is launching a new TV app. Initially, it'll be available on Amazon's fire devices. This app will auto play reels customized based on people's interests, and it'll also allow users to explore different channels and categories. Meta says the app will launch without ads, will eventually add them. This follows YouTube success on TV, announcing in January that it had more viewing on televisions than on mobile devices.

Ads on connected TVs can cost two to three times as much as ads on mobile devices because over 90% of people complete watching connected TV ads rather than skipping them. So now Meta is joining YouTube and going after a fast-growing market. E-marketer estimates that $33 billion will be spent on connected TV. ads this year compared to 50 billion spent on linear TV, projecting that connected TV ads will surpass linear TV ads by 2027. The growth of short-form video on televisions has implications for Netflix's battle to buy Warner Brothers Discovery.

Netflix argues it's not just competing with the media giants and their streamers, but also with the social platforms, because you can watch all the content on the same screen. Morgan? Interesting. I mean, I guess it's the expectation that the lines here are bold. blurring further. And if so, when we're talking about connected versus linear, are the ad loads different? Or are we going to start to see those lines blur too? Well, remember, this Instagram app is going to start without ads, but I think that you'll see a different cadence of ads.

I mean, now you're used to seeing ads mixed in with your reels. You're used to seeing your ads on YouTube shorts. And so the question is just how valuable that ad time will be on a TV set when you're leaning back, as opposed to on your phone when you may be distracted. All right. Julia Borson, thank you. Up next. a top dealmaker on why he thinks the floodgates are about to open for a record year of tech mergers and the industries within tech that could see the most deals and later mike santoli sifts through the november jobs report looking at why the numbers could help the case for more fed rate cuts we'll be right back welcome back to overtime let's talk acquisitions we saw a rebound in deals

year on pace to be the second highest year for deal activity. That's according to Bain and company. And our next guest says next year could be bigger. Joining us now is Eric Mandel from Guggenheim. Eric, I mean, you got Warner Brothers Discovery. You've got Service Now that just closed a deal and was rumored to be doing another one. What's driving this pace? Why do you think it can continue? Yeah. It's great to be here with you, John Morgan. Thank you for having me again. there are two things going on right now that kind of feel like they fly in the face of one another, but creates an environment that likely drives more M&A. The first is we have this massive AI boom, and I know we'll talk about that a little more,

but let's just take it at face value that it's a boom. On the other side, we have a tremendous amount of self-imposed pressure by CEOs of how are they going to be able to do two things at the same time. grow and generate free cash flow. Now, when you combine all of that, right, you've got the stress of trying to keep up of what's happening in AI, and you combine that with the need to grow faster

than you typically do in an organic fashion. It's a perfect recipe for Eminet. What happened to the valuation hesitation that was keeping M&A from happening before? Is it just that the big names got bigger too, so it's like everybody's big so they can buy, And does it mean that if we get a downturn in the market, which is likely to hit the smaller names and maybe the private names harder, that will make even more M&A happen? Phenomenal question and perfect setup.

So if you are in the boardroom right now, not only the CEO, you're in the boardroom, you actually have a fair amount of responsibility, especially if you are one of the mega caps, one of the magnificent seven, and the next 10. So think like Service Now, IBM, Cisco, many others. The amount of pressure that you have to be able to not only solve what your customers are asking you to solve, but your desires for the next five years. AI has changed the way in which people need to forecast. It's not really a baby shift. It really is a seismic shift. And I love the way you ask the question.

As an investment banker, we spend a massive amount of time with public companies. We spend a lot of time with private companies. And, you know, I think next year we're going to see some true IPOs. I thought your interview with the Databricks CEO was really fascinating. If I was a betting man, I think something happens in 26 rather than 27. But private companies are most interesting for the following reason. This is a statistic that, you know, when I remind myself of it, it's a little daunting. We have over 1,000 unicorns, and they are valued at $5 trillion.

So if you do quick math, right? 1,000 unicorns, oh, so they're each worth $5 billion? No. The vast majority of them are now worth less than the value that they were marked when they raised capital. So they're not even worth a billion dollars that they're called unicorns because they're marked at that level, but they're much lower. That doesn't mean they're not great companies. It doesn't mean they have great talent. But what it does mean is the likelihood of them being able to get public is very low.

And that massively opens the M&A floodgates to them. It's interesting you say that because that's exactly where I was going to go with you. We have a couple of potentially high profile, very big ticket IPOs on the horizon for 2026. We've got one that has nothing to do with tech or AI pricing for tomorrow with Medline as well. And that is, it hasn't been a great year for the companies that have gone public. Maybe it has been on like day one or day two, but a lot of these names are actually trading lower than where they were with the IPO price or at least have come back down to Earth. So how does that, I guess, lend itself to a setup for 2026 in that going public pipeline? It's a phenomenal question. You're right. I think there were a bunch of things going on 25. The tariff trade sort of eviscerated the first quarter, and it took a long time to recover. There were a lot of companies that wanted to go public, and they just were not able to. I mean, I've been doing this for a few years. I remember back in the day, you'd have 20 IPOs in a week. Now we don't even have 20 IPOs in a month sometime. So I think we're going to get closer to that. And I think there's also a desire to get out there for portfolio.

managers. They want to deploy capital. If you've owned Nvidia, you know, it has its ups and downs. It's a wonderful thing to own. But if you want to play the specificity of one little specific area tech or media at telco, you have to own an IPO. And also the good news is sometimes when businesses go public, it's actually a path to them becoming breakout companies. Corwea's had its ups and downs this year. It's up since its IPO. It's in an area where at least as an investor, you have the ability to play that upside. All right. Eric Mandel. It's great to have you on set.

Thanks for joining us. Wonderful to be here. Thank you both. Well, the under-employment rate hitting a new cycle high in the November jobs report, Mike Santoli breaks it down and what it could mean for the future Fed rate cuts. Stay with us. Welcome back to overtime. One key number in this morning's delayed jobs report could support a more dovish tone by the Fed.

Mike Santoli joins us with that. Mike? Yeah, John, so this is maybe known as the underemployment rate. It's a more inclusive measure of slack in the labor market. So it includes the standard unemployment rate, which did rise to 4.6 percent as of this morning's report. And it adds in what they call marginally attached workers, which means they've looked for a job in the last year, but haven't currently been looking as well as those who say they're working. part-time for economic reasons. In other words, they would like to work full-time. So we're up to 8.7% as of November. Not super high in a broad historical context, but it is as high as we've

been since early 2017. And you'll see that we've had these periods where it's very high, even outside of a recession. That was sort of after the labor market had taken its hits, and we had one version or another of a jobless recovery or kind of a slow labor market recovery. So this would seem to add to the idea that slack is building. It's disinflationary. We missed on average hourly earnings today. And even though 4.6% itself is not an alarming level. It's above where most of the Fed thought we'd get to by the end of this year.

So if we're looking for Dovish inputs, this might be one. Of course, everybody hopes this doesn't start to snowball and really get some acceleration to the upside. Interesting type of data, Mike. It reminds me in a way of the job openings and labor turnover survey. is it's interesting for what it implies, even more than what it actually says. For sure. I mean, look, you can look at the 4.6% and say, oh, but, you know, it went up for the right reasons, which is more people came into the labor force that they were looking for work. This sort of is a little more of an inclusive view of kind of sidelined workers for one reason

or another. So we have a lot of explanations about people retiring and all the rest of it for why overall job growth has been kind of weak. And, of course, there's a hope that economic growth picks up next year and is going to perhaps firm up demand for labor. We don't know if that's going to happen, but it is, if nonetheless, plausible even if, you know, we can't necessarily bank on it at this point. All right. Mike Santoli. Thank you. You know, Morgan, it's interesting. The S&P is sitting right at 6,800, which would have been like it was an all-time high just a couple months ago. It's a market that feels interesting off the highs. Yeah, absolutely. And that goes back to what Santoli was saying just earlier in the show. I mean, we still have a lot more data

this week. We also have earnings. Micron right here, a little less than 24 hours from now as we continue to track that AI trade. Also, seven major central banks with decisions before the week is out, most of them leaning a little more hawkish. So keep an eye on that, too, for global markets. That does it for us here at overtime. Fast money starts now.