Power Lunch - S&P 500 is little changed as Meta and Microsoft fail to prop up broader market, Figma opens for trading 7/31/25

Episode Date: July 31, 2025

Stocks wavered on Thursday, with the S&P 500 and Nasdaq hitting intraday records before pulling back, as struggles in the broader market overshadowed blockbuster results from tech giants Microsoft and Meta Platforms.Plus, Figma opened trading at $85 per share on NYSE Thursday afternoon. The opening level for the design software company’s shares was more than double its IPO price of $33. We’ll tell you all that you need to know. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Yeah, we're going to pick it right up there, John. Thank you very much. As you can just see, we should go right back to that major hype at the New York Stock Exchange. By the way, welcome to Power Lunch, everybody. I am Brian Sullivan. Technology once again in focus today, you got big earnings beats from the magnificent seven stocks. AI spending continues to go up. We'll get to all that in a minute. But as you just saw happening right now is that first trade of design software company Figma. Now, that company is set to open or just opened up. I'm not exactly. sure at $90 a share. Now let's go back to that shot if we can, guys. It opened up, kill the music, go back to that shot. It opened up at $33 a share. Look at that. It is indicated at $93 and 50. You just saw the founder, Dylan Fields. I know he's young looking. He's 33 years of field, singular field. He is 33 years old. Let's go down now to Michael Santoli.

at the New York Stock Exchange, Michael, not only a big deal IPO for the NYSC, all the employees there, but Mr. Field, at 33 years old, owns 61.3 million shares. He is now one of the richest tech founders in the history of America and off the top of my head. I'm just going to say it until it's confirmed otherwise, one of the five youngest self-made billionaires of all time. Yeah, I couldn't think of that many more of them, Brian. Yeah, there's no doubt about it. So obviously a pretty big event, the way they're basically getting to a $50 billion-ish market cap at the opening price. Now, it did price to the new issues market at $33 last night, opened at $85.

The opening trade that was mediated here, about $5 million shares crossed at that $85 opening level. And then once it was free to trade, it did trade up to the low 90s, $935, may have hit a sort of technical. trading halt just because of the percent gain off that price. Nonetheless, the story remains the same, which is a very, very coveted IPO. 40 to 1 over subscribed is what we heard. It did show some indications along the way before it opened that it could go as high as 105 or 110. When those indications flashed, clearly it brought out some supply of those people who were lucky enough to get it at 33 and they're going to cash in some. So about, you know, one out of every eight shares offered, did trade in the opening print. We'll see how it carries on from here.

Yeah, I mean, does it matter, Michael, you know, I'm going to ask you to speculate a little bit. I mean, Figma, most people haven't heard about it. I certainly haven't. I looked it up. Looks pretty cool. Like you just heard John Fort say, Adobe tried to buy it for 20. Now that would look like the deal of the century based on where it's valued. Is this a sign of anything else or just a Figma thing because the company is so fast growing? I think it's, it is a sign of something else, which is a relative. of scarcity of software companies where they demonstrated very strong growth rate and an AI story to tell. It's not building out AI infrastructure. It's a team-based sort of collaborative design

software company that has an AI enabling kicker to it. It has been growing fast. There has been a lot of buzz about the company in the private community and, of course, the Adobe deal that was backed away a couple of years ago, also put a spotlight on it. So there's a skill. So there's a skill. of deals that fit a lot of those criteria. In fact, other software as a service companies have been struggling because maybe they don't see a way to work in a new kind of AI-enabled world. I would say that's basically what we're talking about. Now, first day pops of this magnitude. They could be a sign of sustained demand and basically the start of really another company that's going to, you know, reach new heights. Or it could be exhausting a lot of that investor excitement

near the open. At a $50 billion market cap where it opened, it's like, you know, over 30 times expected sales for next year. It's aggressively valued, no matter how you put. Well, you know, we call this producing from the chair. And the producers love it when I just said, let's call an audible like Peyton Manning, but hopefully somebody will catch it. We got Craig Moffat, Julia Borson, Steve Kovac, who just put down his phone. Hi, Steve, I could see over there. I want to roll them into the conversation, but Mike Santoli, I want to keep you there as well if we can because Julia Borson, you covered Facebook, you still do. I believe that Zuckerberg was like 29, 28-ish when they went public and he became a multi-billionaire. We showed earlier

Dylan Field, and I know I'm getting older. He looked like he's about 14 years old. He's 33. He's got to be one of the all-time richest self-made billionaires ever, right? Yeah, and this has been a long road to this IPO here. You know, obviously there was a lot of movement towards doing a deal when that didn't go through. Now it seems like it's all turning out for the best to have this IPO go through here, Brian. Yeah, the road, I don't know how long it could have been, Julie, given that he's 33. That said, they almost got thought now they didn't. We got Craig Moffat.

We've got Steve Kovac with us as well. Well, Craig Moffat, as an analyst, I'm going to kind of ask you the same question that I just asked Mike Santoli. I know you don't cover the company. I'm not asking you to comment on the earnings or anything like that. But does this IPO mean anything to macro tech in what has been just a bonkers in a good way market for big tech the last couple of years? Well, sure. I guess there's two ways to look at it, though, right? I mean, on the one hand, it certainly portends more IPOs. If you doubted whether the market was receptive to companies coming public, well, this is a pretty good answer. On the other hand, and you can't escape this, it speaks to the speculative fervor in the market right now,

and you have to be at least somewhat sober about whether this is sustainable and healthy. So that's kind of where I was going, Craig, with it. Was this idea not good for Figma, good for Dylan Fields, good for the field, good for the employees, good for anybody who made money on this. We're happy. We're seeing B.C. It's a good thing. But I guess Steve Kovac, I do wonder the word froth has been thrown around. Again, we're seeing these IPOs.

Either the bankers really screwed up because they obviously mispriced the stock or the demand for just technology. stocks is so high. The stock just tripled. It's IPO price. Yeah, it kind of reminds me of the core we've IPO a couple months ago. And if Bill Gurley was here, the famous VC out here, he'd be, maybe he's already tweeting it, that money has been left on the table here, to your point, that it was probably may have been mispriced. We know it's 40x over subscribed and things like that. But look, it's, it's, everyone's thirsty for a gross story. That's why there's, I'm out here in Silicon Valley this week covering earnings. And that's why everyone's, and that's why everyone's, so excited about what they're seeing from Open AI. That is a huge growth story. That even showed up

yesterday, Brian, in Microsoft's results because so much of the cloud benefit that Microsoft is seeing in artificial intelligence is coming from those hypergrowth startups like OpenAI. So it's bleeding into big tech as well as we cover all these big tech earnings, Brian. Yeah, and Michael Centauloli, listen, Corwee was a big win for the NASDAQ. This is a big win for the New York Stock Exchange. So both exchanges right now can say we've had these blockbuster IPOs. You don't see these moods much anymore. It is like there's human beings there. It's packed.

People banging smile. Now, if they're all rich, I guess I'd be smiling too. But it's a big time media scene as well when you have an IPO like this. Well, there's no doubt about it. And, you know, we can't overlook the fact that we've been focusing in on it here. And then what do you know? Over the course of the morning, there's been a lot. a lot of building attention toward this possibility that it ends up being kind of a blockbuster

open. We also had Circle. That was another one we had here at the New York Stock Exchange, the stable coin play, and that did kind of open at a peak, and then it's really pulled back a fair bit. You know, just as a benchmark of whether the stock was underpriced at the offer, whatever, the bankers are selling it to people that are looking at the current revenue rate and making some reasonable assumptions on growth, and they say, here's my multiple, I'm willing to pay for that. Now, there's been this, a lot of remarking about, upon the co-founder Dylan Fields and CEO having this kind of spring-loaded stock compensation package as part of all this and basically getting a lot more stock granted. It's like an Elon Musk style if big

supposed moonshot goals were met in terms of the stock price, right? Those started at $60 a share and it has to be an average of 60 days above $60. You get that incentive kick in. Well, that's sort of gives you a sense of what they thought was a moonshot when they were pricing this deal and setting that compensation packets. And they go from 60 to 130, all those scaled incentive threshold. And the stock is halted right now again for volatility. It is halted at $112 and 77 cents a share. The stock was priced at $33 a share. I just broke out this thing they call a calculator on my phone. And according to S&P Capital IQ, Dillon Field owns $61. 1.32 million shares.

That's according to S&B Capital IQ. A lot of that's locked up, whatever. You can't sell it. This is what we call a good problem, by the way, guys. So according to my calculator, at that price, Dylan Field, all of 33, is worth $6.9 billion. Mike Santoli, I'm sure we're going to see you more in just a few minutes. We got Craig. We've got Julia and we have Steve Kovac still with us.

Appreciate the patience to all of you because we're, we brought. you on to talk about meta and Microsoft, which we're going to get to right now, and we're going to continue to show Figma once it starts to trade again. Craig, kind of go back to the previous point you were just making. Corweave Circle, these are all new companies. A lot of, a lot of euphoria. I'm trying to find the right word without being like TV dramatic. A lot of euphoria around these stocks. Is it deserve? I mean, does deserve have anything to do with it? Well, I'm not going to comment on stocks I don't cover, but I will say, you know, I was around, this is an embarrassing admission of my age, I was around in the 1999 internet and telecom bubble

and the euphoria around those stocks. And the problem that you create, and I heard some of your guests on earlier shows during the day today, talking about this issue is when it starts to crowd out everything else, to the point that it becomes this kind of very single-minded focus on a very small number of growth stories. Right now, that's all around AI. And where most of the rest of the market, not just some of the rest of the market, but most of the rest of the market is being left behind, it's hard not to start to feel like that as a problematic setup. Yeah, and by the way, you don't have to date yourself, Craig.

I was at the NASDAQ on TV in 99 when a lot of those companies went public, companies, many of which don't exist anymore, not because they got bought because they simply went away. And at some point, they're worth billions of dollars. Julia Borsten, let's go back now to one that not only survived, but thrived, of course. That is meta. How big were these numbers last night? I mean, META has now established a pretty steady track record of beating expectations. One of the key metrics that I thought was so interesting was revenue growth. META's revenue growth was expected to decelerate from 16% last quarter.

The expectation was for 15% this quarter. But instead, they re-accelerated revenue growth to 22% revenue growth. And what that was about along with the higher than anticipated margins, the fact that people saw more ads than expected, it all came down to AI. Their AI tools, which have been deployed across their advertising tech stack and also to drive more engagement, they're working. And that all results in higher results than anticipated.

So I think what it comes down to, Brian, is this idea that Mark Zuckerberg has lofty ambitions when it comes to building personal superintelligence. But because AI is also serving their core business, investors are fine with, have an appetite for his increasing spending on these AI costs, both infrastructure and personnel. Yeah. And speaking of super intelligence, I don't have it. Steve, maybe you do. Because I'm going to admit, it's tough to sit at the side of the camera and be like, I don't know that, right? Everybody on TV is like, I'm the smartest person. What is Microsoft? Like, I know obviously what we use Outlook every day. I don't know what we're paying to use it.

But Microsoft is a four plus trillion dollar company, okay? Microsoft's value. its market cap is now greater than the entire economic output of Japan. I know it's not a one-to-one, but try to make a TV point. But what is Microsoft? Why is it worth $4.2 trillion? Yeah, it's the cloud. That's the easy answer there, Brian. Azure Cloud is growing beyond the expectations of Wall Street.

And they gave us that first real revenue number for Azure for the cool fiscal year, $75 billion. Think of it as sort of the backbone of artificial intelligence. So they have those AI products like co-pilot, which fine. They said they're 100 million users. That's pretty small compared to what we're seeing from other AI companies. But it's the cloud services that we're seeing all the energy and the juice happening. That's Open AI, by the way, you know, spending billions of dollars with Microsoft to run their stuff on the Azure Cloud. In fact, Open AI is getting so big. Microsoft can't even handle all of it. That's why we're going to do. we're seeing these enormous CAP-X numbers again from Microsoft.

They're on pace right now for their new fiscal year to spend $120 billion further building out their cloud and to kind of supplement or support rather the growth that they're seeing in the cloud. It's just screaming business here. And by the way, all the other metrics that we care about over at Microsoft also beat expectations here. So when you ask what is Microsoft, it's not necessarily the user-facing AI. stuff that we talk about so often. It's the backbone. It's the cloud services. It ain't clippy and it's

not Zoom any longer. Craig Moffitt, let's go back. We have Apple tonight. And listen, we're in TV, I get it. We like to lump things together, right? Mag 7. They're all wildly different companies. Are they not? When you look at it and the companies that you cover, do you see one or two names that really stand above the rest? Because we like to, we like to lump them in together. But Apple is not Microsoft is not meta is not Tesla? No, it's a great point, Brian. I mean, you know, I think about Apple right now, and I think the burning question for Apple is,

is whether Apple is part of this AI conversation or not. You know, they have, the stock has held in quite well. It's underperformed the rest of the Mag 7 quite dramatically. But the question I get the most often from investors is not, why is it down so much? The question I get is why isn't it down more? Because they've missed on AI and they have these potentially really large legal overhangs, especially the risk that they lose all of the search revenue from Google as a result of the ongoing antitrust case there. That's 20% of their EBIT. And by the way, there was all this enthusiasm last year for how great AI

was going to be in terms of driving a super cycle for them and phones and potentially service revenue. I look right now, all of that story has gone away, and yet estimates aren't really down at all. Estimates for iPhone revenue haven't budged. Estimates for next year's services revenue haven't budged despite the fact that they lost the Epic Games case. People have left estimates It's, by the way, very little in the back part of this calendar year for tariffs. It's almost like tariffs were going to be a one-quarter event and then stop. And there's all this potential bad news that Apple hasn't really reacted to because it's got the halo of the growth engine of the rest of the Mag 7, except it's not growing like they

are. So what are we missing? Well, I don't know. There's two ways to look at it, right? You can, on the one hand, you could say that people have been very complacent and that Apple, without any meaningful growth story, trading it 30 times earnings and 21 times EBITDA is a badly overpriced stock and therefore presents a lot of risk. Or the argument that I hear more and more people making today is, well, it's taken all this bad news and hasn't gone down that much so it's already been de-risk. That second argument strikes me as a very, very frothy market argument. That sounds good at the moment, but ends up looking really bad if the market frothiness sort of returns to a more sober perspective on valuation in general for the market.

Well, listen, Craig, people are going to call you a downer, I'm sure, but we need that voice because not everything goes up all the time and we were really exuberant. We've been really exuberant many times, and sometimes it doesn't end as well. I don't know what's going to happen now, but it's a good warning. Craig Moffa, thank you. Julie Borson, thank you. Steve Kovac, thank you. By the way, the macro market, a little bit down, Dow's down 200 points right now. If anybody cares about that, they don't. They care about that. What you're seeing on the screen, if you're on the radio, we're showing Figma. Again, stock company you've probably never heard of. IPO today. 33 was the price. Figma stock right now is trading called 109.90. It's moving so quickly. If I gave you a price in one second, it's not going to be

active. It's 110, 109 bucks. It's up 233 points from the IPO price. Figma, which tried to get bought by Adobe for $20 billion last year. Regulators said, no way. So guess what? It went public, and now the backers of it are even richer than they were. All right. So we just talked to Craig Marfut a little bit about this idea, sort of about the froth. Earlier today, Leslie Picker, asked JP Morgan CEO, Jamie Diamond, kind of about this frenzy, if you will, back in the stock market. I'm not catatonic over it. It's a lie, but I still look at, I'm talking about long factors here now. We had $10 trillion borrowed and spent in the last five years. That by happened over the seas too. So almost every country did large amounts of deficit spending.

huge amount of QE, and that's still going through the system. And that very well may be which lean to higher prices and asset prices. And so, you know, obviously when prices are high and credit spreads are low, you have a longer way to fall. So, yeah, I'm a little cautious about the value of those things. Yeah, that was Jamie Diamond earlier today. So let's bring in now another smart voice on this. That is Tom Lee, of course, head of Fund Strat Research, got a brand new ETF, Granny shots ETF, which is the fastest ever in less than a year to get to, I think, how many in assets?

Two billion, Tom? Two billion, yes. So you're like the figma of ETFs. Well, if Granny opens up 130 points, yes, that would be correct. I mean, okay, but you get the broader point I'm making. Yes, I do. You take a lot of, I will say, it's a family network, do-do for being bullish all the time. But you've been right. Like when you've been bullish and held strong and held fast,

when others were cutting their S&P forecast, people gave you grief, you've been right. Do you worry, is there any part of Tom Lee that worries it all, not the drummer, that worries at all that things are getting a little frothy? Brian, we've seen markets get frothy and correct. I've been covering markets for 35 years. So, you know, I was went through 99. We went through 2019 and 2022 and the 2021 top that was painful into 2022. And I'd say that signs of a top are really reckless use of borrowing at a time when cycle indicators are at a top. One thing to be mindful of in 2025 is that the ISM manufacturing hasn't stayed above 50 for 29 months.

That's the longest stretch in history. So we know businesses have been ultra cautious. Despite what people say is froth, I mean, maybe the Robin Hood community is quite enthusiastic, but in a general sense, because FundStrat has, you know, 10,000 RIA clients and over 400 hedge funds, our community of clients is not that enthusiastic. I think it really does sync up with the $7 trillion of cash that you see. People are cautious. And when people are cautious at the top, as you know, that's not bell ringing. That's generally more mid-cycle. Yeah. I'm going to give another stat here from, I don't want to steal people's stats without giving them credit. My friend and colleague Max Myers

says that meta and Microsoft now have the combined market cap of the entire Tokyo stock exchange. Every company in Japan, the world's fourth or fifth biggest economy, every company combined is now the same size as just two American companies. Does that kind of stuff worry you, Tom, or are we that much better? Is our system better? Our companies better? We deserve that.

Well, I like Max's stats, but one thing Max should keep in mind is that if you look at earnings growth since 2019 to now, the U.S. has left every other country in the dust. India is the second closest, but almost 20 percentage points behind. Of the top 25 profitable, most profitable companies in the world today, 21 are U.S. companies. So there's a reason Microsoft and META dwarf other countries, they're leaders in innovation. And if we look at what really is the juggernaut of the U.S. economy, it's technology and spearheaded by AI and now digital assets. but it's also financial innovation, and that's Jamie at the helm there, the leadership of these two sort of things driving the U.S. economy are kind of unassailable. So in my opinion, I think

it's justified that these are the largest companies in the world. Yeah, and we've got Figma back up on the screen. It's lost some steam, Tom. It's now only at 103, not 110, 210, 212 percent above its IPO price of 33. You heard Craig earlier, and we're all getting to, you know, We've all been around the block a few times, Tom. We see that. Craig was clearly nervous, right? He was talking about froth and comparing it to 99, talking about Apple. And I don't, you know, Craig's gone, so I don't want you to go after him too much because he's not here to defend himself.

But he had a point, I think, right? Like, there's no harm in being a little nervous when meme stocks are going up 40% a day again. Yes. Craig brings up valid points. I was an equity analyst when Craig was at Bernstein, I believe. So we were peers at that time. And in the 99 period, the companies that were commanding these eye-popping valuations weren't really central to any thesis except that they were sort of names, you know,

whether it was pets.com, et cetera. But we're seeing in these pops, whether it's Circle, which was an astounding IPO or now Figma, is this is really a function of scarcity, right? That there is very few new waste for institutional investors and retail to get exposure to an AI name that isn't already a mag 7. So you're right, there is price discovery, but circles held onto its gains. In fact, it's built upon it. So if it was a bubble, that's not the kind of bubble that I'm used to seeing.

I think if Circle had round-tripped back to its opening price, that would be disappointing. But, you know, it opened at 77 and it's now at 180. Yeah, and we've talked about three companies in the last few minutes. CoreWeave, obviously sort of lease, for lack of a better term, leasing out space for AI. Circle, stable coin company, kind of new bank, maybe, if you will, I'm speaking in very general terms. And Figma, which, as I admitted earlier, I don't use, I don't work for a startup. I don't know it. I have a job, so I don't go do other things.

they don't have anything in common, except Tom, that a lot of people want to own them. That's right. And, you know, there is what is obviously going to be price discovery taking place. Because just because Figma is commanding this valuation doesn't mean that the 20 other startups behind it will get that valuation. But we also know that the economy is changing rapidly because of AI. And so if Figma is a way for people to enable themselves, and for startups to move faster in a world of AI,

and then it itself is inherently AI. I'm not making any opinion or judgment on Figma itself. How about this? I'm thinking. It's hard to interrupt, Tom, because I don't want to lose my thought, because I lose thoughts quickly. I feel like in my career, 30 years, done this a long time,

this is like the third complete transformation of business. The first one was literally, you and I are about the same age or we can say we watch the internet be created. I was on a message board in high school in 1987. We used to use digital,

a fake digital currency in the 90s down in Blacksburg, Virginia, and the Blacksburg Electronic Village. The creation of the internet was round one. The software is, you know, and that included global crossing and like the physical buildout. The softwareization

was sort of round two. where the World Wide Web became a visual medium software was built. I feel like with crypto and everything else, this is kind of the third wave, and the history books will write about this moment. Is that too much? I think you're spot on, Brian, because we're really seeing actually sort of a dual movement at this moment

because AI and the digital world in ChatGPT have made people comfortable with sort of interacting with this sort of digital agentic world, and now there's going to be robots and things that are ingesting additional data. At the same time that the White House has really pushed the U.S. in a quantum way forward on digital assets using tokens, today the SEC wants to financialize the entire financial system onto the blockchain, but the blockchain is where everyone meets. That's how you control robots. You're exactly right. It's a really important moment, and companies like Figma sort of going to play a role.

We're trying to figure that out. But you're right. And it's coming at a time where this probably strengthens the U.S. lead. So I know Max might, his next update might be that Microsoft is bigger than the entire continent of, you know, take one of the seven. And it may happen, yes. I mean, isn't it amazing how much Europe has this gotten blown away, left behind, Tom? I mean, it's, it's, Germany, I got a lot of friends in Europe. I go there for work, for pleasure.

I'll be there in a couple weeks. Their biggest software company, I think, is SAP in Germany with a market cap of like $250 billion. And Microsoft's worth $4 trillion. It's insane what's happened to Europe. They had their chance. That's right. There's no other way to write a different narrative.

Europe had a very different approach to innovation, which is really to regulate it and to prevent innovation and disruption and to protect legacy systems. And now we're seeing a huge. bifurcations. A lot of bureaucrats there in Brussels kind of overseeing things to their own way. But either way, the capital's coming to America. The capital's coming to American companies. Tom Lee, you're the capital of the Bulls. And we appreciate it because you've been right. And we appreciate it. Tom, thank you very much. Folks, markets basically flat, Figma soaring, some of the MAG 7 up. We'll be right back.

Go back. Crypto is having a moment. A very big moment. Crypto inflows into ETFs at record levels, and it's only expected to grow from here. Your next guest says this might be the perfect time for any still skeptical investors out there who've been on the fence to get off that fence and get in the game. Let's find out why. Joining us on Market Navigator, Todd Sown, senior ETF and technical strategist at Stratigis Research. First, you think there's somebody still on the fence, Todd? And if there is, what would you say to him or her to say, get off the fence, get in the game?

Yeah, well, here's the problem. They may be stuck on the fence because they literally cannot buy crypto or crypto ETS because of regulatory aspects, right? There's a lot of advisors out there who simply can't buy crypto ETS because they're too volatile, right? So that's a major problem. So these structural issues need to go away. And I think if you're looking for something to help diversify a portfolio, especially when you have Invidia, size of the health care sector and almost the industrial sector too. You got to think about trying to get some other asset classes in there. So that's where the crypto part of this, structurally speaking,

fits in. So what do we do then? What's your advice to people out there that are, they're not stuck, they're able to. What do they do? Listen, the ETFs are all about access. You can get any sort of type of instrument you want an ETF. I think you go, you buy a Bitcoin ETF. You buy an Ethereum me ETF. Now, tactically, I would be surprised if these consolidate here, right? The market might be heading into a little bit more of a risk off seasonal. I would be shocked if crypto didn't go along for that ride. So if you see Bitcoin ETFs, whether it's the I shares of the Bitwise product, dip back towards that 110,000 level. I think that's where you're going to step in and start to allocate. But if you have zero exposure, you know, it cannot hurt to nibble at it at least, right?

At least get it in your portfolio, start to add it over time, and then as trading opportunities present themselves, especially when it's in a good uptrend like it is now. That's when you're going to start to add even more exposure, as long as you're comfortable with that risk and volatility. It's amazing. It went from like the dark corners of the web, you know, Ross Albrecht 15 years ago to now RAs and financial advisors saying, add a little percent to your portfolio. Todd Sone on Market Navigator, we appreciate it, Todd.

Thank you. All right, on deck. Maybe the wild card that the market is not. pricing in, and it's around trade. All right, welcome back. If you're not aware, the big market story is that stock right there. It's on the, if you're on the radio, it's called Figma. Stock is trading wildly.

It's at $108 a share. Figma, sort of graphic design, AI, automation. You can use it to build stuff, make stuff prettier. It's very basic, I know. $33 pricing. It opened at $85. It's now at $107. Figma got almost bought last year by Adobe.

Figma's founder, he's a guy named Dylan Field. He's 33 years old. That is him. Dylan Field, I would put my arm up too, because he's now worth $6 billion making that gentleman right there in the, what is that, lavender, purplish suit, maroon, thank you.

One of the youngest ever tech self-made tech billionaires in global history. Congratulations, Dylan Field and team. All right, in the meantime, now let us switch it over to trade, because while the deals are getting all the headlines, there is a huge wildcard, almost nobody else is talking about, the possibility that a court overturns those trade deals.

Well, today, a federal appeals court is hearing oral arguments that President Trump overstepped his authority to impose all the tariffs. All these trade deals are then by far. by default, illegal and overturned if a court rules that way. Is it a possibility? It sure is. Andrew LaPereere is head of U.S. policy at Piper Sandler. He has been one of the few, Andy, that's been talking about it, which is how I know about it,

because I read, you're and your team's excellent work. Is this a possibility? I think it's the likelihood. I mean, the oral arguments were this morning, and I think the administration continues to have a hard time, I mean, they're basically arguing that the president can declare a national emergency and then do whatever he wants. And I don't think that there's any statute that gives him the authority to do that. Aipa doesn't give him the authority to do that. And if you just think through the implications of that, you know, it would just be such far-reaching power for the president.

And it was clear that a lot of the judges, there's 11 of them, have had a lot of problems with that. And so I think the text of the law doesn't give them anything like that kind of power. And if it did, then it would probably be unconstitutional because the authority to raise tariffs is found in Article 1, Section 8, which is Congress. Congress has the authority to. Because it's effectively a taxing power in a very rough way. Yeah. So if – Well, even explicitly, the Constitution explicitly gives the Congress the authority.

to impose tariffs as well as taxes. Oh, so I, yeah, my, my, my civics, C-minus and civics coming back to haunt me, Andy. So if the court of appeals says these are not legal, that it's not an emergency, I've got to imagine the White House will appeal itself then to the Supreme Court. Sure, absolutely. Yes. I mean, I think this is headed to the Supreme Court one way or the other. You've got a number of oral arguments that are going to take place in September.

So we'll probably have a number of, a number of. of appeals court rulings sometime in the next few months. And I think it's pretty likely the court takes this case and decides the matter by June. It could be a lot earlier than that. But I think this is definitely headed to the Supreme Court. Any way to kind of figure out what they might do? Do these trade deals ultimately stand? So I think it's very likely the Supreme Court's going to strike this down. I mean, I think you look a long line of opinions over the last several years. The originalist conservative judges on the court are, I think they're going to kind of maintain their consistency that the text of a statute has got to give the president really broad authority if he's

actually exercising really broad authority. And I think the liberals are going to join the conservatives on this one because they're not going to want to give Trump just a complete blank check. And, you know, this immigration issue is really similar kind of argument. where the president's pulling a statute that's 200 years old saying we're at war with Venezuela and therefore I have the right to suspend habeas corpus because I'm declaring emergency and the courts didn't have any patience for that argument. I think it's a very similar case here. And so I think you're looking at a very one-sided opinion. Okay. By the way, if the originalists, bizarrely, I agree with you, the liberal. on the Supreme Court would go with the originalists, in part just because, you know, Trump and

whatever. But that aside, so why is the market pricing in, you're a smart guy, Andy, but there's other smart people out there. Why is the market seemingly pricing in any possibility that all these trade deals are whacked? Well, it's strange. It's hard to know what the market is pricing in, right? I mean, in a way the, I think the investors don't seem to be too, concerned about these tariffs. And so if they were to go away, you know, what would the market reaction be? So I think it's a, it's kind of tricky what the market is pricing. And it seems like the consensus of the market has been, we've seen the worst of it. We can digest these tariffs. And I think it's been the consensus. So this is, I think, disappearing because it's not true

that, you know, that we're going to have deals that lower tariffs. We're not getting deals that lower tariffs. We're getting deals at raised tariffs. So I think the, um, You know, what has been the consensus, we've been kind of pushing back against it. But it just doesn't seem to matter. You know, the market thinks we're going to get deals in lower tariffs. We get deals at raised tariffs. And it doesn't seem to be bothering the market very much. Well, we don't, because we don't know how the appeals court might rule.

We don't know. We can have, to your point, we can look at history. We can look at who's on the courts. We don't know. But it's, it's an, I'm glad we did the interview, Andy. And we'll say goodbye because at least now, I know you've been putting out notes, sort of on a national media on the record, that this is a risk for the market

that not a lot of people are talking about. Andrew, Andy LaPereereer-Piper Sandler, Andy, thank you. Thanks for having me. Appreciate it. Oh, cool. Take care. All right, coming up, the head of one of the world's largest cruise companies and Contessa Brewer, what could be better than those two?

CryptoWatch is sponsored by Crypto.com. Crypto.com is America's premier crypto platform. All right, welcome back to Power Lunch. Norwegian cruise line stock up nicely today. They reported earnings before the bell this morning. This will actually be the seventh consecutive month, that the stock has had a double-digit move month to date. Huh.

Let's find out more about Norwegian, why they're doing what they're doing, bringing our friend Contessa Brewer, who has a special guest. Thank you, Brian, very much. Yeah, we saw the stock really popping after earnings today. And with me to talk more about it is Norwegian, Cruise Line holding CEO, Harry Summer. Harry, it's good to see you. It probably feels like a relief to

you to see that kind of double-digit move higher because it's been a pretty bumpy, it's been rough seas, so to speak, earlier this spring. I love the analogy contestant. Thank you for having me on this afternoon. Listen, April was a rough month. You know, that was the month where we had the first announcement of tariffs and some macro uncertainties in the market. And, you know, of course, we had our earnings cold just at the end of that month where there's a little bit uncertainty in the future. But I have to say since then, the booking pace, the consumer demand has been fantastic. We had record months over the last three months, May, April, June, excuse me. I'm sorry. Yeah, May, June and July. I know my month. I'm sorry about that. And the booking demand for the

future looks incredible. In fact, on the call today, you were even talking about what the website traffic has seen the last couple days and what some of those just in the last couple days, what the demand is looking like. I'm just curious because so much attention is being paid to your investments in the Caribbean with Great Sturrup K and the big new water park that you're building there that will open next summer. And yet, at the same time, you're talking about shortening some itineraries in Europe and maybe reducing some of the deployments there.

Are you seeing that as a trend that maybe the Caribbean is the place to be and slightly less so in Europe? Yeah, I think absolutely. You know, we've seen a shift in consumer patterns, consumer demand, so to speak, where they're trying to look for slightly shorter and slightly closer to home itineraries. So I think this investment that you reference in Great Sturke, which we believe is the greatest private island destination in the Caribbean, I mean, one of the largest and these investments that were making in water parks and relaxation areas, adult only beach clubs. We even have a jet cart track. I mean, it's going to be incredible. There's a, going to be something for everyone. So I think these investments and the great experience that

people are going to have on the island will just reinforce these consumer demand patterns. You talked a lot about getting customers to spend more on board. And again, across the industry, that's a theme. How do you balance that push with the fact that the reason why there's all this demand for cruises is because they're considered good value? Yeah, I think the value proposition is so strong that even when we are successful in getting consumers to spend more on board than we are, the value still is an incredible value. Our research seems to indicate that cruising is about 30% less expensive than a typical hotel stay.

I mean, I don't know which of your viewers have recently been in American hotels. They're not what they once were. We have been serviced and such a vast array of amenities from shows, multiple restaurants, spas, I mean, everything, great entertainment options, everything you could possibly imagine all under one roof. And if we are able to collect some money on board the ship, that's fantastic. But the value preposition still remains quite strong. Is that what really is driving all the demand for capacity? Because you have 13 ships on order. In fact, you said one thing that's limiting growth is there's only four shipbuilding facilities in the world right now. Where is all that demand that you see in order to

order 13 more ships come from? So, you know, the good thing here is because of the four shipyards that you mentioned that we talked about on the coal, the industry can only grow at 5% a year. You know, the 13 ships that we have on order are over the next 10 or 11 years. So it represents about a 4% cagger, 4% growth on an annual basis. Given how under-penterated the cruise industry is, about 2% of all vacations are cruises, we think, and this limitation of growth can only be or five percent a year, we have no challenges with seeing future demand to fill these ships. These new ships are going to be bigger, have more amenities, more innovative, more experience. Guests are going to love what we deliver.

Norwegians share price up 8.5% on the day. Harry, it's good of you to join us on the day that you announce earnings. Thank you for your time. And Contessa, we hope to welcome you in great stir K soon. Oh, I hope to be there too. You know who hopes it even more than me? The twin children. The boys would love that. Bring them along. They'll have a great time. Thank you, Harry. How much, gosh, bigger ships.

There's like, don't they have like a 5,000 person ship already? It's insane. I mean, the ship, they're going both ways, right? Because they're one building bigger ships that are like these floating cities. And at the same time, river cruising is becoming more important, the smaller ships that catered to, you know, higher level clientele, not for the kids. You know, not a place. Yeah, more like the river cruise, you know, a little maybe empty nesters. You're on the low slung ship.

Have a class. On the Danube or the Mississippi River. Either way. Or the Columbia. Sure. Ohio is nicest time of year. St. Lawrence Waterway. Those have the paddle wheels, right?

You know, and you can meet Mark Twain. Right. It would be great. All of that. Contessa, thank you. All right. Before we go, an interesting update to an ongoing issue in Washington, a Senate committee voting to advance Senator Josh Hawley's bill

that could ban stock trading by members of Congress, as well as the executive branch, presidents, VPs, and more, but a lot of pressure of congressional leaders to move on the issue, but some GOP detractors and the president himself have argued the law would punish the wealthy

and disincentivize some from serving in Congress. Huh. Joining us to talk about where this is, is Gungin Banerjee, a lead writer at the Wall Street Journal, of course, a CNBC contributor. The issue, Gungeon, like everything, has become politicized because they name this the Pelosi Act,

after Nancy Pelosi and her husband who have been pretty successful stock traders. But where does this, is this going to actually pass? Look, Brian, what we've seen in the past is that this is an issue that tends to make people and lawmakers on both sides of the aisle really angry. But these efforts have not really gone anywhere in the past. You know, the journal reported that there was a similar effort underway in 2022. But again, it did not pass muster in Congress with the president. So it's tough to see where this goes. And right now, as you pointed out, this does have a lot of Republican opposition. President Trump tweeted about it and criticized Josh Hawley, who's backing the bill this year on social media. Although, as the journal has reported, it really has been lawmakers on both sides of the aisle who've been trading, not just Democrats or Republicans. And we've investigated thousands of House disclosures and found that, you know, trading really hit a fever pitch this year during the tariff turmoil.

Yeah, and it's well said as usual. It's not a Democratic issue or a Republican issue. There's a few people. There tend to be a few people from each party that do the bulk of the trading. But some of this trading, Gungent, is like tens of thousands of shares a year. I mean, these are not people betting a thousand dollars on something. This is millions and millions of dollars of trading. I don't understand why there's even any opposition to this. It's been shocking to see the number of trades. The reports that we analyzed during the tariff turmoil showed that there were more than 700 trades placed by just a handful of lawmakers, right? And they are wagering in everything from stocks to options, shares of things like cruise

lines and airlines and technology stocks. So the activity is really broad-based. And investors, lawmakers, and everyday Americans seem to get really, really angry about the fact that this trading bug that has swept everyday Americans has also hit lawmakers. But at the same time, there does tend to be this standoff in the House and Senate over where this goes. Do we have any indication of how this may end up? Will this pass? Or is this going to be another thing that gets some attention and then goes away?

Look, right now, there is quite a bit of pushback or it seems to be based on news reports over this bill. The timing is interesting, though, because just recently, the House Ethics Committee, as the journal reported, released this report showing that they had concerns over House lawmaker Mike Kelly and trades that his wife placed a few years ago. Basically, just the day before he learned, or sorry, the day after he learned that certain steel plants would remain open. She bought shares of that steel operator, spurring concerns about insider trading. Yeah, and it's, it is, it's, these are not corporate insiders. I want to be clear. It's not like a CEO buying shares of his own company because he knows he's going to do a deal.

This is policy. So it's kind of a gray area a little bit more. But when you see a lawmaker buy this, let's say the shares of a bunch of German defense companies. And then a week later, Germany does this huge stimulus plan where they give a bunch of money to defense companies. It's hard as a private citizen not be like, that's weird. And I think that's why this has really.

had a spotlight put on it this year because of negotiations around tariffs, right? These were matters pertaining to Congress. Lawmakers might have had sensitive information there, and yet we saw trading hit a frenzy. And I think that's why people are just paying a lot of attention to this this year. Yeah, it's well said. We'll see where it goes. We appreciate you coming on. Gungeon, Banerjee, Wall Street Journal, lead writer, CNBC contributor, and all around great person. Gungeon, thank you very much. Thank you, Brian. All right, no worries. All right, we got to leave you with this, folks. We've got one minute left to go on the show. How do we not show you Figma? If you're just joining us, maybe you're waking up in Guam. Figma, or Guam tomorrow, either way, Figma is up $74 a share.

Okay, Figma went public today. It priced at 33. It opened at 85. It's now at $107 end change, making this one of the most successful IPOs, not just of this year, but of many, many years. Figma AI-based, sort of graphic design, helps build design. You can use it. If you're a startup, you can use Figma to build presentations. I'm being very basic because I don't know a whole lot about the company, but I do know this. Investors love it. And the demand for Figma booming, add to core weave, add to circle.

And you've got three massive IPOs this year. I'm sure closing bell will have much more on Figma coming up. So we're going to leave it to them. Folks, busy day. Thanks very much for watching. Power Lunch. Closing bell starts right now.