Closing Bell - Closing Bell Overtime: Jobs Report Analysis: What Will Fed Do? & Samsara CEO on Strong Earnings, AI ROI 9/5/25

Episode Date: September 5, 2025

KPMG Chief Economist Diane Swonk breaks down the jobs report reaction while Baird Investment Strategist Ross Mayfield explores whether we're in a Goldilocks scenario for markets. Roblox CEO David Baszucki discusses new AI features and child protection initiatives on the platform. Samsara CEO Sanjit Biswas provides earnings reaction and outlook for the IoT sector. Vital Knowledge Founder Adam Crisafulli rounds out the show with next week's key market catalysts. 

Well, that's standard regulation. The free market's ETF bringing the closing belt, the New York Stock Exchange, Fennec. Pharmaceuticals doing the honors of the NASDAQ closing may be mixed here on the day on that weaker than expected jobs report. The NASDAQ 100 at least closing in the green. Everything else in the red. We're off the worst levels of the day. The Dow, the S&P 500, the NASDAQ, all did hit record highs earlier this morning in the session before turning negative. For the week, the Dow down slightly, the S&P up slightly, and the NASDAQ, the winner with a gain of more than 1%. We saw big drops and bond yields today on this jobs report that adding to the Treasury rally that we've seen really all week. The 10-year yields just above 4%. The lowest level since early April, that led to a big drop in mortgage rates. The biggest one-day drop in more than a year, actually. 30-year fixed now at 6.29%. According to Mortgage News Daily, it's the lowest level in nearly a year. All of this helping to catapult gold to another record high, the 30th of the year. It's posted its best week since late May as well. Wow, that's the scorecard on Wall Street, but winter stay late. Welcome to closing about

overtime. I'm John Ford alongside Morgan Brennan. Ahead, we're discussing and dissecting why today's early rally faded. Are markets more concerned about the strength of the economy? Are those worries, even a rate cut can't soothe? And we will also speak to the CEO of Roblox about his company's new AI push, also about the seemingly never-ending controversy about how to protect children on the platform. And shares of Samsara jumping after posting strong results, raising guidance. The company's CEO, Sanjit Viswas, also joining us coming up and over time. Let's begin, though, with the markets and the big moves we saw today. First, hitting new highs before falling from those levels. Christina Parts of Nevelas joins us from the NASDAQ. Christina.

Well, markets really struggled to find that Goldilocks scenario today, a weaker than expected jobs report, though there were some positives like real rage growth remained positive. Initially, wait on trading. But we did. see a little bit of a turnaround just in the last hour so, helping the NASDAQ as an example, with the case where a September rate cut cut cut, just continuing to build. And that rate cut optimism sent the real estate sector soaring to sector-leading gains. You had the logic. The logic is pretty straightforward. Lower rates boosts home demand and drive up property prices. And that's why you saw some construction giants capitalize with Lenard, D.R. Horton,

Pulte Group, all closing on you can see on your screen over 2% higher. Now let's switch to the AI trade, because it delivered drama on. on both sides today. Broadcom hit an all-time high. It's surge closing over 9% higher on strength across its VMware software business and growing AI custom chip backlog. But the main driver for Broadcom is landing open AI as a new $10 billion customer. And this recognized the custom chips versus

Nvidia GPU debate. Is the AI pie expanding enough for both players and a few more players, or is Broadcom stealing Nvidia's lunch? Invideo closed to lower, you can see almost 3% lower, suggesting investors maybe are picking sides today, possibly profit-taking. InVIDA wasn't alone in the penalty box. AMD dropped about almost 7%, almost 7% today after Seaport Research downgraded the stock,

citing concerns about the chipmakers' AI business momentum. Bottom line, though, rate cut hopes are definitely reshaping sector rotation within the markets, but the AI chip wars are far from being settled. Okay, Christina Parts-Nevelas, thank you. We saw huge moves and bond deals today, too, following that weaker than expected jobs report. So let's get to Rick Santelli in Chicago for more. Hi, Rick. Hi, indeed. What a big move. But I'll tell you what, on closer inspection, there's certain metrics in what is a weak jobs report that based on history aren't as bad as they may appear. Let's look at year over year, average hourly earnings came in at 3.7 percent, down from 3.9.

This chart goes a year pre-COVID. Look at the left side. Look at the right side. The left side is lower, which means we're between 3.0 and. and 3.5% for average hourly earnings on a year-over-year basis pre-COVID. It's more of a normalization based on history. And if you look at the unemployment rate at 4.3, indeed, it's the highest it's been since October of 2021. However, if you look towards history, it's still relatively tame. So we want to be very careful. Weak jobs report might not mean the economy is going to act horribly in the future. Now, let's look at a two-year note yield.

Right now, as it sits, it's down 10 bases. points on the week, any close in yield below 3.5, 4% would represent a three-year low yield close. And if you look at tens, they just can't get below this kind of 4% area. Right now, we're hovering at a five-month low yield close. And once again, this 4% basically the low close of the year, it's an important metric from early April, and we like double bottoms in this series in the 10-year. So look for potentially it to hold if we close above 4% 15 before we close below 4%. And finally, the dollar index. One would think it would be following the two-year and really moving back again towards multi-year lows. But it's avoided it. It had

multi-year lows in early July, as you can see on this chart. Even though it's down, it's still above those levels. John, back to you. Rick Santelli, thank you. Now let's get into this jobs report. About two-thirds of the major categories saw negative job growth, including government job losses of 16,000, professional and business services of 17,000. Revisions also painted a gloomy picture with non-farm payrolls for June and July down by a combined 21,000. Well, joining us now is Diane, KPMG chief economist. Diane, the markets are near record highs, but on the labor front, things may be stalling out. How dire a sign is this?

Well, we're still at very low unemployment rates, but what I worry about is under the hood. What we're seeing is a lot of inequality, and the economic aggregates are masking that inequality. The stress unemployment rate, that that includes people working part-time instead of being able to find full-time jobs, those marginalized workers that are discouraged out there, that unemployment rate went to 8.1% its highest rate since late 2021. We also saw the ranks of the long-term unemployed. People moved from 15 to 26 weeks into 27 weeks or longer. Those ballooned to the highest levels since 2021 as well.

And so that underlying weakness in the labor market, it really shows the labor market, which is consistent with what we've seen in a lot of private sector data as well, one that is freezing up a bit where those workers who have a job are frozen in place and those workers who want a job are frozen out. Diane, so what does that mean we look for next to signal the impacts on the market and the longer-term direction of the economy? And my impression has been for the last couple of years, the solid jobs picture has propped up stretched credit. It's propped up rising rents.

Consumers have been able to sort of get by, but these numbers concern me in the sense that maybe that period of labor backing up everything else could be drawing to a close. Well, that certainly is the concern of doves at the Fed and some at the Federal Reserve. We will see a rate cut. The question is, will it be enough for us to not see a dissent? And we could see dissents in two directions because there is a concern out there that, given the fact that we've not tamed the inflation, that's gone on for more than four years now fully from the pandemic, at the same time that we have a tariff-induced bump in prices that is not just a one-time bump, but sequential because of the way that tariffs were rolled out. out, that has sort of really split the Federal Reserve. So you've got doves arguing for at least

a half percent or more cut at the next meeting and hawks on the other side of it likely to dissent for no cut whatsoever. And it really is a hard situation. It's one thing for the Federal Reserve to forecast a mild bout of stagflation, which they have since tariffs have come into the mix. It's another thing to live it in real time. So would it be safe to say, as the market is pricing in that a 25 basis point cut is basically a four one conclusion for the rest of this month. And if so, how much now hinges on something like CPI, the inflation data we get next week. We get more labor data revisions next week as well. What would it take to constitute a larger cut and or more cuts behind this one? Well, we do expect three cuts by the end of the year

now. But I think to get a larger than a quarter point cut, you'd have to see a much cooler CPI, and I think we're going to see a hotter CPI, one of the things to watch very closely in the CPI is not only goods inflation, because that, again, it could just be a step up and, you know, it's prolonged because of the uneven rollout of tariffs. That could dissipate over time. What we are watching very closely is the inequality out there. Affluent consumers are propping up service sector inflation, which accelerated last month, that that continues to accelerate. That's going to be very worrisome for the Fed because that adds. a new element to inflation that they thought would be an offset to inflation going forward.

And so if we see a very hot inflation number, it's going to keep it to a quarter point, but there will be pushback and you could see dissents on both sides. If you see a cooler inflation number or not as bad as people expect, that could prompt a Fed to cut more aggressively and do a full half percent. Okay. Diane Swank. Thank you. Let's break down what this jobs report means for stocks after the major averages fell from the record high, as they said earlier today. Joining us now is Ross Mayfield. He is an investment strategist at Baird Private Wealth Management. Ross, it's great to have you on. Given what we've seen

in the data, not only today, but this week, what we're seeing in the bond market, do stocks hovering right near-record highs? Does that make sense? Or are we looking at maybe a near-term peak here? No, I think it makes sense. I mean, look, it wasn't a perfect report today, but people are still working. I mean, the unemployment rate is still historically low. People are not being let go, initial claims are down. And as you mentioned earlier, wage growth is still above inflation. So it's fueling consumer spending. We see consumer stocks equal weight discretionary right at all-time highs, which to me is a sign that maybe the narrative about the economy is not nearly as dire as it's being painted. And instead, the market is painting a picture of a consumer that's doing

decently and looking forward to a couple of rate cuts this year as well. That's pretty interesting activity, trading activity under the hood here, because not only did you have tech, stuff that's, you know, tied to AI taking it on the chin today. But you had some of the more cyclical sectors like energy and financial selling off as well. We don't see that dynamic a lot. What does it tell us? Yeah, I think the message is that the economy is that investors are a little bit worried about the economy here. It's a bad news or bad data is bad news, not the other way around. The job market, as was mentioned earlier, has been the primary driver of the economy of this bull market, the consumer spending coming out of the COVID-19 pandemic. So it's very,

very important to keep the job market afloat. I think today, you know, the rotation out of cyclicals a little bit, despite, again, being at all-time highs just earlier this week, is a sign that investors are slightly concerned about the labor market picture and the idea that the Fed is behind the curve, that 25 basis points in September might not be enough. Ross, I'm concerned after a few earnings reports lately about what retail might be telling us about tariff costs bringing pain in Q4, maybe not to consumers. I mean, if discounting is really required during the holiday season to move inventory and keep consumers in the game, I mean, that could be a real margin twister, couldn't it? Yeah, it could. I mean, look, we're watching the consumer stocks

very closely to see what level of prices they're going to pass onto the consumer and what level they're going to try and eat. But at the highest of high levels, the S&P 500, you know, aggregate margins are hovering near all-time highs. I mean, we're seeing, you know, we got productivity data revised higher this week. I think we're starting to see a nascent productivity story. It might not be all AI, but companies are just very, very good at managing uncertainty. And so while the narrative is that, hey, we'd love to know the tariff picture. We'd love to know the rate picture. You know, that level of certainty is just not going to be around the corner. In the meantime, companies are printing record earnings and margins are actually on the way up. So consumer stocks are, again,

trading at all-time highs. You're seeing things like home builders kick in. You're seeing things like retail, leisure, hospitality do well. So I actually think that the narrative is that the consumer picture is okay. And we'll probably have a decent to good holiday season if I had to place money on it. All right. Ross Mayfield. Thank you. Coming up, the CEO of Roblox joins us. The company unveiling new AI tools, making it easier for gamers to make stuff on the platform. Will that be a big boost to earnings? And Kenview shares are sinking on a report that Health Secretary Kennedy plans to link Tylenol to autism.

We have the full story coming up. Overtimes back in two. Welcome back to Overtime. A big move lower in shares of Kenview today down more than 9% on a report that health. Secretary Robert F. Kennedy Jr. is going to link Tylenol use in pregnancy to autism. Our Angelica Peoples, joining us now with more on the story. Angelica. Hey, John. Well, Secretary Kennedy is planning to link use of Tylenol and pregnancy to autism, and that's according to a report from the Wall Street Journal, according to people familiar with

the matter. Now, Kennedy's been promising to pinpoint the cause of autism by September, that's of course this month, saying that certain interventions are clearly causing the developmental disorder. And that report will also reportedly link low levels of folate during pregnancy to autism. An HHS spokesperson, though, saying that until we release a final report, any claims about its contents are nothing more than speculation. And Kenbue in a statement saying that nothing is more important to us than the health and safety of people who use our products.

We have continuously evaluated the science and continue to believe there's no causal link between acetaminopin use during pregnancy and autism. Now, whether there is a link between Tylenol use during pregnancy and autism, has become a focus of research and lawsuits in recent years. And Morgan, as we both know, Tylenol is the only pain reliever considered safe by the FDA and the American College of Obstetricians and Gynecologists. And so we'll be watching this very closely to see what new findings we get from that HHS report later this month.

So in terms of the studies that have been done so far, what have those results yielded? And I guess perhaps just as importantly, when you hear the word link, how ambiguous is that term versus scientifically meaningful? Yeah. So I was actually talking to a researcher a little bit earlier this afternoon who was saying that this has become a focus of research over the past 10 years or so. And some small studies have found an increased risk. And he and his team, they went and they looked at about 2.5 million children in Sweden. And when you adjusted for siblings, of course, because there's, you know, we think genetic factors at play, when you adjust for the siblings, they found no increased risk. And even when you didn't adjust it,

was only a modest increase between acetaminopin use, Tylenol use, and autism, ADHD, and other developmental disorders. And he was saying at best, you know, he doesn't think there's a lot of evidence there to support the link. And at best, he thinks it's quite weak evidence. And really, all of these studies, they're all looking at the data, looking at the models, the observations, you know, trying to see if there's, you know, any correlation in the numbers. But you're not, when we talk about the scientific side of these things, we're not, you know,

giving someone Tylenol or not and seeing whether that directly causes something because of course that wouldn't be ethical and also it's hard to do you're not going to say hey you're pregnant I'm going to give you this and see if your child has a developmental defect so all of these studies are looking at the data of what

we know and trying to parse some of those findings out okay all right Angelica Peebles thank you well Roblox announcing new AI driven tools that let users generate advanced interactive 3D objects for their games on the platform. The stock has had a blowout year. It's up 122% in 2025, but it has taken a pause

in recent weeks. That's following a lawsuit regarding child safety. Our Steve Kovac is joined exclusively by Roblox CEO. Steve, take it away. Thank you so much, Morgan. Dave Wazuki, aka Builderman in Roblox, thank you so much for joining us off the heels of several announcements coming out of you guys. I think you just told me it was your biggest one ever as in terms of announcements, but I got to focus on artificial intelligence. Absolutely. Let's talk about this 4D AI product that you just announced, building on the 3D one that we talked about last time you're on with me.

This idea that you can just tell the system what you want to create in Roblox. It creates it for you. You go out there and sell it. So far, how much, at least on the 3D version of this, I know this hasn't launched yet, but you've launched an early version of it. What kind of momentum or growth have you seen in there? And when are we going to get to the point where people like me who have no idea how to make a game in Roblox or at all or design anything can just go in there and tell Roblox this is the experience I want to make? Well, thank you for coming. We're live at RDC. We're on a mission to have 10% of all gaming on the platform. We're surrounded by some of the most creative people in the world.

And yeah, one of our big announcements today was on AI, not just for building experiences, but literally AI working inside of experiences. So, for example, we saw the creative jailbreak using AI live on stage to allow anyone to create their own vehicle just by talking about it. We used to think we're going to create clothing in Roblox by cutting it with scissors and using a sewing machine. We're showing off today the technology where we would just talk about the clothing, and one of us might be a fashion designer.

So we call this 4D. It's really generating things inside of a game that don't just look good, but actually function. So we're showing off building some mecks that look like a shark. We are showing us some watermelon guns and things like that. These are all things that can be created just by talking about them in Roblox. And then sold, presumably. Yeah.

Well, it's really, we're taking a big visionary look of AI here and saying the traditional thing is, yes, we might use AI to build experiences. But imagine if every game or experience we were in, you could talk about things and have them magically appear. magically appear. And so we've seen that in movies and sci-fi for a long time. We're literally showing it and we made an announcement to ship our 40 generation by the end of this year. Now let's talk about safety. You did have a new safety announcement this year. The age estimation, basically someone takes a selfie. They can see it. At the same time,

there was the Louisiana Attorney General's lawsuit against you. There's also the Schlepp controversy, this sort of vigilante, so to speak, who was going after after child predators and you kicked them off your platform. As you guys continue to think about safety and go after this, why is it so easy for someone like a Schlep to go in and play Chris Hansen and sort of find these things that you guys aren't finding? Yeah, I want to highlight every single person we talk to,

whether it's the general, whether it's people in D.C., whatever. It's universal. Around the world, everyone wants kids to be safe on platforms like Roblox. So that's really important. What we announced this week on Wednesday is really what we feel is going to become the industry standard. We're going to do it first. We're doing it before any laws, before any legislation. And in addition to everything we already do, and what we already do is there is no image sharing on Roblox.

We filter all the texts. We monitor for critical harms. And we really actually focus on keeping people on Roblox rather than other platforms where bad things tend to happen. We added two new things that we announced this week. Number one, we're going to use age estimation, including ID or AI-based selfie, to literally know everyone's age on our platform who's using any form of communication,

including filtered communication. The second thing we announced is generally, we'll use this technology, for example, to adjust, should a minor ever talk to an adult unless they know each other in real life. So not from the law, not from, you know, anything else. It's really our vision of safety.

We think every other social communication platform is going to look at this and say, this is the new standard. So how should users be thinking about this, though? Because some, this is a very passionate issue among your user base in your community. And they find stuff too. And it was a big controversy

when you kick this guy off the platform. Yeah, we want to highlight. How should they be thinking about that? Yeah. We want to highlight really, we have no tolerance for people who don't follow our policies. And so, for example, we, We don't allow people on our platform to impersonate other people or to do other things

on our platform. We're really consistent. But I would highlight, we've reached out to Schlep, we've reached out to the general. We love their feedback and input to how to scale our systems. We work at such a scale. We've shared that we had over 100 million DAUs. These things have to be solved from a major systemic issue. To be clear, this is not just the Robox issue as well.

And I would say what we're optimistic about is both with our vision of a new standard, really setting the groundwork for this. It is, as you mentioned, an industry-wide issue. It's why we focus so much on keeping everyone on Roblox where they can share images or where all text is filtered as opposed to maybe other platforms where some of these bad things happen. Real quick, we're out to run out of time. Let's talk about the app stores. Apple's rules have since gotten loosened here in the United States.

loosened up in the EU, giving companies like you and a chance to monetize without giving Apple a rake. You haven't really taken advantage of that in a real way. Why not? Well, I would say first, we're great partners with Apple, with Google, with Microsoft, with Sony, all of these partners. We have taken advantages, actually, and we have seen consumers on our website, for example, get 25% more Robux when they buy there than when they buy on our platform. And we have seen that when consumers have this information, they do like to go and find Robux for the most economical thing. So we've started rolling that out with our gift cards, with other things. We have seen, you know, Apple recently have a little bit more flexibility, so I would say stay

tuned on that. Okay, that sounds good. We'll leave it there. Dave Mizuki, the Overman, CEO of Roblox. Thanks so much for joining us. Thank you so much. Morgan, I'll send it back over to you. All right. And our thanks to you, Steve Kovac. Well, coming up, we mentioned the big moves in bonds today, Mike Santoli, he's going to be here with a look at what the drop in yields means for the stock market. And as we had to break, check out shares of Figma, the lockup expiring today after its IPO in July. Many insiders will be able to sell the stock down more than 20% this week after its first earnings report as a public company. Stock closed a little bit better than flat. We'll be right back. Welcome back to overtime as bonds rally and

some hot parts of the equity market come off the boil. The market seems to be shifting priorities. Mike Santoli joins us here on set. He has a look at that. Mike. Yes, yeah, and that's good to be here with you. I mean, for a market that really on a net basis only moved to third of a percent today in the S&P, there is a lot of shifting going around.

And this ferocious rally in treasuries has actually been helping one particular strategy, risk parity. There is an ETF for that, R PAR, which has had a great run, and it's kind of making pretty much a new high right here. So what they do is put leverage on top of bond holdings. It's an asset allocation thing. They own stocks and commodities as well. But the idea is to sort of equalize the risk levels of various assets using leverage.

And so when stocks and bonds are strong, in particular, if bonds have a move higher in price, they're going to get the benefit of it. So that's something that's kind of coming out of the wilderness to a fair degree because bonds have obviously been a tough investment for a few years. The other part of it is, I guess, the sort of speculative, high beta. story stock trade that has backed away. So you got the meme type stocks, which is the Buzz ETF, and then the recent IPO. So FPX is one of those IPO indexes. And now, nothing really damaging has happened here, but it does reflect that the market has kind of slowed down. It's flattened out a little bit. It's maybe become a little bit more selective. And the retail ferment has maybe calmed somewhat as August has given way to September.

So not necessarily, but I think maybe a healthy thing here. I'm curious what I want to talk about something that we haven't been talking about very much, and I think we should be, and that's credit spreads, especially after you saw so much issuance in the corporate bond market this week. Credit spreads are very tight, therefore credit conditions are very generous for big companies especially, and it's this unusual situation to some degree, which is we have absolute certainty the Fed's going to be cutting at a time when the credit markets are saying, you know, give us all you got in terms of the new paper, and when volatility has been generally low and you have stocks at new highs and valuations rich and all the rest of it.

So I think that's one of the reasons the market's been looking more or less on the bright side of this rate cutting cycle because for now, and you know, today's jobs number gave us a little bit of a pause on this. For now, it's not because it's trying to support a faltering economy. Beginning of the year, the conversation was good hard data but negative sentiment and which was going to correct to which direction. Now we seem to know the data, hard data has definitely gotten worse. So, why are we not reacting to that? Well, it's interesting. The labor market data certainly has gotten worse. There's kind of no way around that. And one reason we're not necessarily reacting adversely to that yet is that there are stories and explanations for why this

might not be quite as bad as it looks on face value. Labor surprise going down. Obviously, the immigration story is part of it. And companies are kind of in this productivity mode. That being said, I think you also need the offset of things like this week, the ISM service, is being strong. It can't just be, yeah, but, and we're explaining away the negative numbers. So I don't know. I think the market has been able to lead on the AI theme and the idea that the tariff shock has worn off to some degree or is being absorbed and kind of figured out. Whether that's true or not, I think the market is leaning on that premise. All right. Mike, we trapped you here in New Jersey now, so you've got to come back a little later

in the show. Time now for our CNBC News Update with Kate Rogers. Kate. Hi, John. A federal judge blocked the Trump administration from ending temporary protections for more than 1.1 million Venezuelans and Haitians to work and live in the United States. The judge's ruling today also means 600,000 Venezuelans whose protections either expired in April or were set to expire in September can stay and work in the U.S. CBS's Sunday show Face the Nation will stop editing its taped interviews. After Homeland Security Secretary, Christy Noem accused the network about, deceptively editing her appearance. CBS News said, today, the show will only broadcast live or unedited interviews with exceptions only for national security or violations of broadcast standards.

CBS attributed the policy to, quote, audience feedback. And on Sunday, Pope Leo will canonize an Italian teen as the first millennial saint. Carlo Acutis, who died of leukemia in 2006 at age 15, coded websites to spread the Catholic faith. Acutus was beatified in 2020, and last year, Pope Francis approved the second miracle needed in order to make him a saint. Back over to you, John. Okay, thank you. That's pretty cool. Yeah.

Coming up, we are looking at two of the day's biggest movers, Sam Sara, moving higher on strong earnings and guidance. The company's CEO will join us. And the Lulamins struggles continuing. The stock has now lost more than half its value this year. We're going to get into the details behind the latest leg lower. That's coming up on overtime. Welcome back to overtime. A wild day for stocks. The Open jumping to record highs following the jobs report, then reversing course and moving lower before rebounding in the afternoon to close in the middle of the day's highs and lows. We also saw a big drop in yields, the tenure falling to its lowest level since April. Alphabet of more than 10% over the past three sessions. Its best three-day rally since late last year, that comes following the judge's ruling earlier this week against breaking up the company. And Tesla also higher, as the board proposed. a new pay package for Elon Musk. It could earn Musk as much as a trillion dollars in stock

over the next 10 years, but the company saying Musk and Tesla would have to hit some pretty aggressive targets, to say the least, to actually earn it. And Nvidia down once again today. That's the sixth decline in the last seven sessions, dating back to the day it reported earnings just last week. It finished down about 2.5% today. Even with the fall in Nvidia, though, if you added up, the tech industry's $8 trillion companies gained a combined $420 billion in market cap this week. Those companies now account for roughly 36%, so more than a third of the S&P 500. That is a big chunk. All right, now take a look at Samsara, the logistics technology company,

soaring after beating on earnings, raising guidance after winning several large contracts. He was up more than 17%. Those contracts included Alaska Airlines, SRM Concrete. The company also saying it's expanding abroad and seeing strong growth across Europe. Joining us now in a CNBC exclusive, Samsara CEO, Sanjit Biswas.

Sanjit, good to see you. I want to start something that you said on the call about customers turning to AI and the fast payback ROI that they're seeing on your platform. Can you give some examples of the type of savings? and how that's leading to increased product adoption. Absolutely. Well, John, thanks again for having me on.

One great example of this is customers using data and artificial intelligence to just re-plan how they run their operations. Great example of this would be Mohawk Industries. They're the world's largest flooring companies, so they're making deliveries all over the place. They were able to analyze all of the stops they make along the way as they're running their routes, find ways to save about seven and three quarters million dollars. So we're talking about almost eight million dollars. about almost $8 million in savings, just from finding ways to run much more efficiently in terms of how many miles they're driving every day, which stops they're making, which order.

And that's a data problem. It's something that people have a lot of trouble making sense of, but a computer can really look at it all at one place, figure out those trends and patterns, and help you operate smarter. You also talked about the land and expand motion, getting a customer with maybe one product and then selling them multiple. poll, I wonder at what point is there a concern about you running out of products to sell them? Can you continue expanding? How should investors think about the total addressable market available for the customers that you already have? Well, I think one thing that's important to

remember is our customers have large, vast operations. These are very big enterprises. They have a lot going on. And so often what happens is they'll start with Samsara in a pocket of what they're working on. That might be a subsidiary, it may be a region, and so they'll expand just simply the amount of their operations that's on the platform. And then, like you said, we have a lot of different products on the platform, so they'll go deeper. Great example that would be adopting commercial navigation. That's a new product that we just released. The idea is that instead of using Google Maps to figure out which way you're driving your trucks, you should use a commercial navigation product that's aware of, hazmat restrictions and bridge heights and all those other kinds

of challenges that large trucks have. So many of our customers will start with one of our core products and then expand over time to say, hey, we're going to do routing, we're going to do commercial navigation, we'll do maintenance, we'll do training. There's a lot more that you can do on our platform. We're just talking to Mike Santoli about this idea that investors are seeing this tariff shock being absorbed by companies right now. And I wonder what it's meant for you and whether tariff headwinds at the beginning of the year, maybe are becoming tailwinds for you now. Well, I would say that there was a definite shock to the system when the tariffs were announced.

You know, when they rolled out in April, the magnitude of them was pretty severe. And many of our customers were simply just trying to figure out what did they need to reposition to do. Now they've had a time to digest that, absorb what that means for their business. And what they're saying is, okay, these tariffs are going to be here to say the rates may fluctuate a little bit, but we need to find ways to be a little smarter and more efficient in our operations. Specifically, they're sweating assets longer.

They're running them for extended periods of time. They do that through smarter maintenance schedules, through better utilization. So all of this is, I think, resulting in people getting a little bit smarter about how they operate. And for us, that means that they're going to want more data. How is your growth in Europe similar to or different from the profile that we've seen thus far in North America? I would say a lot of similarities. These industries that we serve, they're very much global in nature. You're talking about construction and utilities and all of the physical operations businesses.

So that's the same all around the world. What we're seeing in Europe, though, are higher fuel prices, so energy is simply more expensive for them. They're more conscious about how fuel efficient they can be. The way that they think about risk is also very similar, but has some regional differences. But overall, the adoption curve is very similar. I would just say that the U.S. is a much larger geography, a much larger market. But what we see in the U.K. mirrors what we see here in the U.S. and Canada, for example.

Great to see you on another quarter. Sanjit Biswas, Samsara, CEO. Thank you. Great. Thanks, John. Well, Lulu Lemon getting absolutely crushed today as tariffs take an enormous toll on that company's guidance. We've got those details straight ahead. Plus, we'll discuss which stocks on next week's earnings calendar could potentially be big market catalyst for Wall Street. We'll come right back. Welcome back to overtime. Lulu Lemon, by far the worst performer in the S&P 500 today. The appelleezer maker beating profit estimates, but sales were lower than expectations.

The retailer slashing full-year guidance for a second straight quarter, warning tariffs will cause a $240 million hit to its profits this year. It's been a rough year for shareholders, with Lulu falling nearly 60% in 2025, as you could see right there on your screen, down 18.5% today. Yeah. Up next, Mike Santoli looks at whether the expected Fed rate cut this month would matter more for Main Street or Wall Street. We'll be right back. Welcome back to overtime. Let's bring back Mike Santoli for a look at potential rate cut impact. on Main Street versus Wall Street. Mike? Yeah, John, so the chat we were just having about corporate credit conditions being very flush

is a good setup for this because that's public market, you know, corporate credit spreads and other indicators of capital markets health. But if you look at the Main Street financial conditions, they are much tighter. This is an index, the blue line here created by Ned Davis research, to approximate kind of real economy financial conditions. So it's things like real home prices, consumer loan credit conditions, so how tight consumer credit is, and things like that. And obviously, you see there's this pretty big gap that has opened up. And arguably, this is the kind of thing that Fed rate cuts can take the pressure off

of, right? You can reset loan rates and things like that. And you allow smaller businesses to have a little more breathing room. So arguably, this is what the rate cuts are for, as opposed to, you know, because as I was saying earlier, hey, markets are out of high. You know, corporate credit is very available and cheap, this is the idea. Now, it's not that easy to fine-tune these things, but I do think that it's worth keeping that in mind. Now, you can also take a look at the shares today and just recently of home builders and community banks. That's this chart right here. They've been moving together, QABAs, community banks, ETF, and they're well below their highs, but they've been trying to recover as rate cut expectations have grown.

Now, there are circumstances under which a rate cut might not have the expected impact. people not might not businesses might not respond in the way it's expected when might that be i think if it's just about the idea that demand is just not going to be there no matter whether they expand or higher um that would be one way and the kind of idea of uh the old line of pushing on a string right when it's just there's so much slack in the economy that just making borrowing a little bit cheaper it's not going to necessarily make a difference i mean it always does turn the dial a little bit but um you know You just don't know if that's the exact prescription that the economy needs. All right.

Mike Santoli, we'll see. Thank you. Well, while a pair of big inflation reports will take center stage next week, adding to this conversation, I might add, there's another under-the-radar market catalyst that you need to know about. We're going to tell you what it is on the other side of this break. Let's get you set up with next week's trade this week. On the economic calendar, we will get the latest consumer credit data

on Monday. Small business optimism Tuesday. Wednesday brings a key reading on inflation with the producer price index along with wholesale trade, and Thursday will feature the consumer price index and weekly jobless claims. On the earnings front, we'll get Oracle, rubric, synopsis, air environment, and game stop on Tuesday. Chewy's the highlight Wednesday, and Adobe and Kroger wrap things up on Thursday. Well, our next guest joins us with a catalyst that he thinks will be the most important for investors next week. Let's bring in Vital Knowledge, founder, Adam Krista Foley. Adam, it's great to have you on. Let's start right there. Is it inflation? Is it big tech earnings or is it something else? I think inflation is going to be really critical.

You know, the Fed has two mandates. It's clearly meeting the threshold on one of those mandates to move very aggressively on easing. We got another negative jobs report this morning. This is the latest in a long string of downbeat labor numbers. And so it's really inflation that's keeping them from moving. And so PPI and the CPR are going to be really crucial. Even if they're in line. You know, I think that's going to give the green light for the Fed. Now I want to go to 25 basis points on the 17th, or probably 25 basis points at each of the three final meetings of the year, so 75 in total for this year, which the proximate the market's pricing in as of today. But, you know, a lot of the Fed officials are kind of looking through the current round of

inflation, a tariff given inflation, look putting in the transitory bucket, but it's really going to be crucial that we don't see a further acceleration in the PPI and CPI. All right. So given the data picture that we have gotten so far, and as we do, look to next week. Given what we've seen this, like, massive move this week in the bond market, how closely you're watching some of these treasury auctions that we're expecting too? Yeah, those are going to be really crucial as well, especially Wednesday and Thursday with tens in the 30-year auction, the long run in the curve. Those are usually the most sensitive. You know, based on the price action today, and assuming we don't get a super hot EPA or CPI,

they should go off relatively well. But those are going to be very important, you know, as markets kind of digest this new landscape of very subdued jobs numbers, and then, got, you know, the resumption of Fed easing. Depending for your thoughts, Adam, on Adobe versus Oracle last week, especially in light of what we saw this week from Salesforce. I mean, Adobe in a way similar being that enterprise, kind of pure play software company, whereas Oracle has that legacy in hardware, which seemed perhaps odd to some are controversial at the time, but has put them more in this AI benefit target.

Yeah, I think both things are going to be very important. And Oracle in particular, you know, it's very much become, you know, one of the key AI stocks, and we've seen a lot of very mixed data, very mixed earnings out of the AI-linked names in the last couple weeks. Marvell, Dell, and Video were a little bit underwhelming. Broadcom last night was very strong. You know, so the bar is kind of very high for Oracle. Investors are going to be watching very closely to see the booking summary, the RPO figure

that really kind of drive sentiment on this stock, as well as cash flow, which was underwhelming in the prior quarter, just given elevated FX. So those two numbers are going to be in focus. Adobe, you know, investors are very negative on the outlook for that stock, just given there's a lot of concern that it faces, you know, secular risk from new AI companies, AI tools kind of displacing their core products. We had sort of underwhelming thing more reports out, results out this week. And so Adobe is kind of more company-specific Oracle, I think, will play a big role in the broader market and then protect specifically.

Two key inflation reads. We just talked about PPI, wholesale inflation, and CPI. After this jobs report. What in particular in those reeds are you looking for? Just more evidence about the various buckets that are most exposed to tariffs. You know, the durable goods numbers, you know, the goods categories that are really exposed to tariffs have been sort of mixed in the last couple of months. It's really on the services side, which is not really supposed to be exposed to tariffs that you can see in acceleration. So I'm really going to be parsing through the CPI to see if those paraphrink buckets are kind of steadying out or if they're seeing further acceleration, if they've even drop down a little bit. And then on services, shelter in particular, you know, if there's really

any hope for the price landscape to offset what's happening with Paris, it's probably going to come in the shelter category as given how large that is. And if you were to see housing prices within the CPI start to move sideways or even kind of ticked down a little bit, you know, that would obviously be very helpful from the Fed's perspective in allowing them to have more leeway to move forward with easing. We obviously saw a reversal in stocks today, but the Russell 2000, the small caps did finish the day up almost half a percent. Nazak 100 eeked out the ever-so-slightest gain. What do you think of stocks at these levels,

given all of these conversations we're having, as we do look to next week in these possible catalysts? I think the macro-themed support kind of a further rotation. So away from your mega-cap tech, away from growth momentum, more into more cyclical value names. You know, that trades, so a little bit, some hiccups today, you know, banks and energy are both key cyclical value groups.

say underperform today for a variety of reasons. You know, on the rate front, the decline in rates is raising some concerns about the outlook for net interest income. And that's actually on banks. And then for energy, it's just talk of a big OPEC hype this weekend that hurt oil prices. All right. Adam Chris O'Fooley, covered a lot there. Thank you for joining us.

Well, that does it for us here at overtime.