tv Squawk Alley CNBC January 27, 2016 11:00am-12:01pm EST
markets struggling a bit in large part because of apple. shares are slumping after iphone sales posted their slowest year on year growth rate in history. josh lipton spoke to tim cook and joins us with more. >> carl are the best days for iphone growth in the past? that's what investors are asking this morning. that's why so people think apple is breaking out the growth of the services business. that includes apple pay, app store and itunes. apple revealing there are now 1 billion active apple devices which generated 5.5 billion revenue in the first quarter and that was a new record but rbc asked whether apple could be highlighting services because iphone unit verss have peaked. you take a look at unit sales. the iphone had been on the upward trend and now the worry is apple hit a growth ceiling. there was fractional growth in the holiday quarter and ubs
estimates a drop of 15% in for q-2. tony on the call did question tim cook about whether there's now a saturated smartphone market. cook disagreed. >> the market itself we don't spend a lot of time on predi predicting. if we make a great product and have a great experience we ought to be able to convince enough people to look over. so as i look at your broader umbrella point about a question on saturation, the metrics i see would strongly suggest otherwise. >> when i spoke to cook he emphasized that bullish view. he told me that the iphone franchise is strong with record numbers of android switchers. 60% of iphone users still on older models. big opportunities long-term in
emerging markets and big products in the pipeline. back to you. >> thank you for that. josh lipton we'll continue in a moment but first breaking news on fiat chrysler. phil is in chicago. >> fiat chrysler announced earnings this morning and on the conference call it was expected that the ceo of fiat chrysler would outline production plans of how they're shifting in the united states. this is a big deal. they'll be building more jeeps and more of their plans. why? they have raised their guidance for sales of jeeps by 2018 globally to hit 2 million vehicles annually. to give you some context on that back in 2009 they sold just a quarter million jeeps globally in 2009. they're up to 1.3 million. they expect that to grow by 60% in 2018 and summarizing why there's bigger demand, low gas prices now seen as permanent condition. so there you have it. that's why jeep production is
being expanded. guys back to you. >> busy day for you phil. thanks a lot. iphone growth, the slow down has finally begun taking it's bite out of apple's revenue. company seeing some head winds from china. this is what tim cook had to say on yesterday's conference call. >> we began to see some science of economic softness in greater china earlier this month. most notably in hong kong. beyond the short-term volatility we remain very confident about the potential of the china market and the large opportunities ahead of us and we are maintaining our investment plans. >> gene is of course an analyst. good to see you again. good morning. >> hello, good morning. >> you had already made your -- you laid your case out going into the print. did any of the macro discussion take you by surprise though? >> yeah, if intensity that they came after the macro did take us by surprise. we counted the 9 times they
referred to negative commentary regarding the outlook in 20 minutes of prepared remarks. about once in every two minutes they said something negative. not a surprise that they would say something negative but that aggressiveness at how negative they are about the future really stung investors today and made them question whether the june numbers are now at risk. >> i want to go to that. it wasn't just the number of times that they cited negative macro. it was the language around. let me quote, we're seeing extreme conditions unlike anything we have experienced before. just about everywhere we look. and then they go on to site specific markets. i mean, i'm not sure that we're reading that through perhaps enough to the industry as a whole. to other companies. what do you take that to mean? what's the fall out for the rest of the tech sector in that language. >> we'll hear more tonight with
facebook and ebay and paypal and i expect they'll have the same commentary. if they do investors are going to step back and say you're in delusion and ultimately you're going to miss. so the most appropriate thing that apple could have done is to be negative about the outlook and i think you're going to see that similar tone. we obviously heard it from a few other companies but that's going to be the resinating theme over the next couple of weeks from the tech companies is that it's going to be a tough year in 2016. >> do you see this as an overall reracking of our expectations for apple the company going forward or as some are saying this morning rip the band aid off and reset this. >> they're resetting it. investors don't want to hear this today but this is what a lot of people wanted and the reason is that if you have the foresight to look to the middle and back half of this year the comps are going to get easier
and that's been the thing that's been dragging on this story for a long time so i think if you have the foresight to realize the more negative ironically it's more positive over the next 6 to 12 months. >> a big part of your call last week was obviously about a return to enthusiasm once the seven comes along. there's a dual track conversation about the optionally of developing revenue outside of phones. do you still give that equal credence and why is it taking so long? that call has been out for two years. >> well it takes so long because the iphone is such a big part of the business. the watch was a disappointment. 4.7 units and it was around 5.5 million. so the big picture is that it's just hard to come up with categories to really offset it. that's why this iphone upgrade program and getting that to other parts of the country we talked about why that's so important because that's something that actually can move
the needle longer term if you can speed up the pace that people buy the iphones. tim cook had some comments that said don't expect a lot in 2016 about that but he's optimistic about it longer term so to answer your question is they have to figure out how to get the iphone business to be more exciting and that's going to be one of the key factors. >> that's going to be -- yeah, that's a big part of the discussion, gene and i mean some still argue it may not be the a macro talk weighing on it today but you disagree with that wholeheartedly i imagine. >> i do. it's going to go in ebbs and flows and i think we're at the trough in the march quarter but that's going to go flat in september and up in december so i think the important part is this, the multiple expands going into full cycles and the comps are going to get easier and to me that sets up well for the
next six moss. >> it's good to talk to you again. gene munster talking apple again. >> thank you. >> there's also signs apple may be suffering from a perception problem. a record quarterly revenue but that's not what everybody is talking about. here's tim cook trying to drive that narrative. >> today we're reporting apple's strongest financial results ever. we generated all time record quarterly revenue of $75.9 billion in december quarter in line with our expectations and up 2% over last year's blockbuster results. this is a huge accomplishment for our company. especially given the turbulent world warnd us. >> let's bring in andy cunningham that used to work for steve jobs and apple. she is now the founder of the silicon valley marketing firm cunningham collective. you helped with the mac launch but he also brought you in to help with next which didn't go
as smoothly as the mac. great technology. everybody acknowledges but didn't really sell. so if you're apple right now how do you pivot from telling a growth story to more of a maintenance story, at least in the near term. >> they're switching it from the iphone to what they call services and other products. the growth in that area was impressive. so if they can leverage that growth to awaken the force of the 1 billion active devices they have out there they have a pretty powerful software and services opportunity in front of them and i think that's where they're going. >> but are they doing a good job shifting that narrative? some people say it feels abrupt given that they were talking about the ipad projust a little bit ago. just last quarter talking about how they didn't feel the china economic weakness. now they're feeling it in a significant way. how is apple doing at telling
that story? >> i think they're doing okay. not great but okay. what's really going to be the telling nature of that story is what is the substance that lies underneath it. what are they going to show in the software and services space that's going to indicate growth going forward. they haven't shown a lot other than growth but they need to show points of evidence to prove that they're doing new things in software and services. >> andy as the company has grown though it's taken on attributes that look untech. they have plateauing growth. they also could do a lot of m&a. jim cramer compared it to pfizer. when you think about those attributes do you think that any of that needs to change or can all of that stay intact as a tech company that can keep growing. >> well, i think like all tech companies they do reach their peak and apple may have reached his peak here which means they have to explore other things in order to continue on as a really relevant company. they have got that under control
but probably need to move quicker given the market conditions. >> apple has been an underdog for most of its history. it's anything but that now with this huge amount of cash that they have in the bank. tim cook also emphasizing that saying they have the mother of all balance sheets. when you have a reputation as an upstart, you have a famous marketing campaign in the past, how do you market yourself when you're big and now at least growth wise you're looking a little slower than you have in the past. how do you frame yourself and your brand? >> i think they have to stay at the forefront or the edge of what's going on from a technology perspective. it may not drive iphone growth but it will drive the perception of the company. people love am and they're addicted to their devices and they have to be on the cutting edge of that going forward if they're going to keep in the heart and minds of their consumer today. >> as the stock falls it
narrowed the gap with google which is very close to leapfrogging apple as the world's largest company. that's more of a stock market formality but do you think that would change perception if those positions switched? >> yes i do think. so apple has been on top for a really long time and i don't think people are going to look at apple as an underdog for quite awhile. if they switch positions with google it will definitely take their reputation down which means they have to get at the leading edge of the new stuff and this virtual reality stuff they're working on just may be the ticket. >> a couple of years ago they switched positions with exxon. we see how that went. you were there at the beginning. thanks for sharing your insight today. >> thank you. thanks a lot. >> meanwhile, let's get a check in on the markets. pretty much everyone has their eye on what the fed will say this afternoon. we did get pretty good housing data this morning too but you can see what apple and boeing have done to the dow down 109
points. s&p down 9 points. nasdaq down more than 1%. much of that is apple. shares of boeing continue to fall even though earnings and revenue topped estimates for the most recent quarter but it was the company's 2016 full year forecast that came in well below expectations. boeing is currently the biggest loser on the dow. we'll have to see what headlines come out of the conference call. shares of vmware hit after the company announced it would cut jobs and the ceo was re-signing. also a disappointing forecast and much of that depends on what happens with the big deal. >> when we come back, shares of sprint see a nice gain on the heels of a better than expected third quarter. the ceo is with us live. plus amazon revealing the first ever ad for the super bowl. we're going to show that to you and twitter's fundamental problem is that it's just too hard to use. his latest piece for recode. he's with us live to make that case when squawk alley continues in a moment.
you've upgraded all your old technology... so what about this? it's time to get into the new with ford ♪ come and get it if you really want it... ♪ new is ecoboost technology. new is a foot-activated liftgate. new is tougher, stronger and lighter. new is ford. america's best-selling brand. now get into a new focus, fusion, or escape with 0% financing for 60 months plus $2,000 dollars trade-assist cash. only at your local ford dealer.
>> sprint shares holding steady after the company reported a smaller loss than expected yesterday and boosted guidance. david faber joins us with more. >> it has been a good week as you said for sprint, certainly it's shares but still plenty of questions involving the company's debt load it's turn around plan and how it's going to compete long-term with significant competition. joining me now to break it all down is the sprint ceo.
nice to have you as always. thank you for joining us. >> hi, david. thanks for having me. >> few would argue with the fact that you made significant progress since you took over as ceo but many still look at the $35 billion debt load that you're lugging around at that company and wonder how you can effectively invest in the network and also compete in a very difficult market in which price certainly is still a very important parameter. how can you layout for people the plan that keeps sprint in the game if you will. >> i think first and foremost you have to make progress in the right direction but put it in perspective. the company is going to generate close to $8 billion this year and we expect to generate close to $10 billion. so there's 33 million in debt but there's also a company that year over year is going to be increasing and, you know, with a pretty clear plan to liquidity
that we're addressing so the best way to look at it is what we achieved this quarter, we're hitting pretty much every single me trick that we set up for the turn around. revenues are stable and from now on revenues are going to be growing. which is subscribers are going up. you know, we added close to 501,000 subscribers. going down. best ever in the 20 years of sprint history. we're taking costs out of the business. we took out $800 million. we expect to take next year between 2 to $2.5 billion of cost. our network is performing better than ever. so we feel we're making great progress and we have a plan for sprint to start making money and start delivering in the near future. >> right. although all that said, you $7 billion in debt that's due. let's call it over the next three years. you mentioned the progress you have made but at the same time you're dealing with price competition from competitors
investing as much as $21 billion a year. that being at&t for example and capex in their network and you're not talking about going free cash flow positive any time soon. yesterday on the call you wouldn't answer when that date will be so how can people be confident that you will actually continue on the path you're describing? >> first and foremost, we had $6 billion in liquidity at the end of the quarter including $2.2 billion in cash. we have a new instrument that we did our first one that generated $1.1 billion and now we're going to do it on a monthly or quarterly basis. we're establishing a network. 3 to $5 billion. so if you add all that we have sufficient money to pay all the bonds that are coming due in the next 24 months. so we feel very good about our liquidity. as it relates to investing we're making the right investment as you can see by the chart and
everything published our network is performing at best levels ever. we have more awards in the history of sprint. it's faster than at&t and verizon and t-mobile and we have a lot more spectrum so as we den densify our network you'll see something others will not have. the best way to look at it is our customers are staying. we've had the lowest journey in history and the lowest drop so we feel we're making great progress. we have liquidity. we're taking customers from verizon and at&t so we feel very good. >> yesterday or maybe this morning in a note craig moffett that follows your company has not been particularly positive on it wrote the following and i'd like your reaction or response. slashing prices helped them stop the bleeding of subscribers but for a company with the highest costs in the industry and one
that is still burning cash at an unsustainable rate slashing prices is not a sensible strategy. your response. >> it depends on how you see it. today we have an offer attracting verizon and at&t customers. most of the customers that come stay pretty much within the same money that we're spending with verizon and at&t and they're getting more data from us. we feel good. we have been very clear yesterday. our average billion per user is increasing. meaning our customers have been giving us more money for the services that we're performing. we feel good about that. we do have the highest cost structure and we're making great progress. $800 million and projection of $2 billion and we made it clear we're taking 2 to $2.5 billion of cost with 2016 and we plan to take more in 2017. we're going to make sure that sprint has the lower cost of
picking up the carrier. this quarter was the first time that our total freak outflow after we got the money from the leasing company for hand set we generated positive cash flow. in the future as we continue to increase our sales we feel railroad good that we're going to generate cash flow. we don't want to give a specific date because there's a lot of moving pieces but i can tell you that in the plan that we have forward i have clear visibility for sprint to start getting free cash flow and start delivering. >> average revenue per user, down year over year, isn't that a negative. >> month, the average billion per user was up 4%. what was down is service revenue. that's something we have to address in the industry. as we move customers away from subsidy we're collecting the same amount of money. the difference we're collecting say $20 a month for hand set and 50 or $60 for a service. so it's all the same.
so don't get any services going down. but total operating revenue is going up. >> i understand. >> if you look in the last few years we have been decreasing revenue. no longer. revenue is stable. from now on revenue is going to go up. >> john ford has a question. >> thanks. >> you say that it's at an all time low but you're giving customers a really good short-term deal that runs out in 2018. what happens then? are you going to have to permanantly lower pricing to keep those customers from churning or is something that you do in the next 18 months, two years going to keep them once that deal runs out? >> one of the things that we do is if you sign up for sprint we let you know that this is a 24 month promotion. we want you to come and test our network and then we remind you every single month going forward that in 24 month your bill is going to go up or you'll be able to choose any of the normal sprint rate plans.
we have done this in the past. customers come and test our network and they like it and they stay. so last year we did a very similar in which ke gave the one year promotion. that promotion has expired and we have the last three consecutive quarter. people don't know how good sprint's network is. as people come they're incredibly surprised and they're staying. the best test to let you know how customers are staying is something more important than any survey or anything else. our customers are happy. >> we will be watching it closely in the months and years to come. finally, i watched a lot of football this weekend as many other people did.
it is just to remind everybody. sprint has 212 awards. those are crippling to both and then what we're trying to show is that it is a fact today. today is sprint l.t. plus network is faster than verizon, t-mobile and at&t. it's nielson is 75 million data points and that's what we're trying to show in the commercials. we're going to continue to let the american consumers know that sprint has the best product at the best product at the best price and keep our continuing customers. >> we appreciate you for joining us today. the ceo of sprint. >> thank you. >> up next, amazon taking the wraps off it's first ever super bowl ad. we'll show it to you in just a moment. >> one eye on the markets. the dow down 75 points but coming up in a few minutes time
>> 1 in 5 u.s. adults is members of amazon prime but the company is extending it's reach in a big way. teaming up with alec baldwin and hall of fame quarterback dan moreno to preview the first ever super bowl ad. take a look. >> let's hear it. >> cheerleaders? again? i thought you were the expert at these parties. >> what about a snack stadium. >> what's a snack stadium? >> a stadium built entirely of snacks. >> i'm going to need an architect, a five star chef. >> that's smart. that's good. >> cheerleaders.
>> cheerleaders. >> reportedly planning two more teasers in the lead up to the next big game. probably not surprising that the echo now has capabilities to give you live stores and what i do find a bit surprising is they're choosing to provide it for the first time. not the kindle paper. not the kindle tablet device itself but this device that does a number of things ties you into the prime eco system in a broader way. >> beating netflix. and it's the properties and checks to do that. >> let's count you down to the u.k. close here. europe close about 90 seconds ago. stocks did erase earlier losses
after brent rebounded in reaction to that u.s. inventory data but disappointing earnings news in the mix. the swiss drug maker with a fourth quarter miss. germany's chemical giant a full year profit warning and royal bank of scotland expects another full year loss after putting aside 3.6 billion to cover some regulatory issues including u.s. mortgage backed security regulation. apple's outlook did weigh on holdings which provides chip technology for the iphone. overall we have those u.s. indices well off the lows. we were down 179. now down 54 as oil is gaining steam. >> that helps. coming up, twitter's fundamental problem is simple. it's just too hard to use. so says walt in his latest piece. we'll see if he's got some solutions. he'll join us live when we come right back. cond it's there. then, woosh, it's gone. i swear i saw it swallow seven people. seven.
>> hello everyone. here is your cnbc news update at this hour. another driver died in a crash involving an exploding takata air bag. it's unclear however whether the air bag was the cause of death. takata says in u.s. government documents that the driver of a 2007 honda civic died in india but the cause of death is undetermined. if the air bag is the cause it would be the 11th person killed worldwide. at least one person was killed and four others are missing after a chinese fishing boat capsized off the coast of south
korea. the video showed the capsized boat surrounded by south korean coast guard patrol ships and rescue boats. wendy's is investigating reports of unusual activity on payment cards used at some restaurants. it's telling customers watch out for any unauthorized charges on their cards. and pope francis meeting with a group of circus performers following his weekly audience in st. peters square. the group joined the audience before carrying out a short show as you can see in front of the pope. that's the news update this hour. let's get back to squawk alley. something i didn't really ever think i'd see carl in st. peters square but you never know, do you? >> your news updates tend to do that. thank you. >> thanks carl. >> dow is now down a mere 15 points. we were down almost to 180. s&p has gone green. oil shot above 32 so we're seeing this midday reversal here which we'll keep an eye on.
investors obviously seem concerned with just one product and that is the iphone. is this a sign of am slipping from its innovation throne. jason good to see you again. good morning. >> great to be here carl. >> i was curious what you thought of the quarter. you didn't mention it last night as far as what i could see on twitter. what is your take today? >> obviously they had a record quarter but we all know that the iphone and smartphones in general are starting to hit peak innovation. in other words why upgrade? when you look at your desktop computer or flat panel tv there was a period of time when you were obsessed with upgrading those devices and at some point you said it does the job. i don't need to upgrade it. that's what is happening in smartphones so people are saying my iphone 6, my iphone 5s maybe this is good enough. maybe i can wait another 6 months or a year. they don't have the desire to
upgrade as fast which means their best selling product is going to slow down and they'll have to find growth in other areas. >> has apple relied too much on the eco system here and i include carriers here. used to be you have a big network upgrade. you went from 2.5 or 2-g to 3-g to lte and that drove sales but there also used to be in the mac area that you had ilife drawing sales as well. further ahead of the competition. one might argue they don't have the same sort of argument anymore on phones. i have to have the iphone because there's software on it i can't get anywhere else. is that part of the issue here? >> yeah those are astute observations. they played the entire eco system perfectly to build a car chest of over $200 billion. so whatever play book they deployed they did it perfectly. they now have a war chest but now what's the reason to stick with the iphone and upgrade it
become the questions. and now the photos app does what the cloud is supposed to do. it took them five years but they got it right. growth is going to have to come from other places and obviously the watch is a solid product. we'll see what 2.0 and 3.0 look like but it's not going to get them there. that means cars or other innovative product like a head set has to be something else that powers them into the next decade. i think it's going to be cars and vr. >> jason is it even worth talking about the ipad that's sinking like a stone? where will the ipad be a couple of years from now? >> it's a brilliant device and great for education. great for games. great for watching movies but if you look around your house or your friend's houses, you know, ipad 2 good enough. people can pick them up and
watch a movie on them. there's no desire to buy a new one this year or next year. that's why you're seeing apple do things like come out with different sizes, right? they fought differ sizes for years and then they finally added different sizes. they fought making peripherals and now they have come out with a battery pack. that's signs that the core product doesn't have as much growth and they're looking for growth in other places and tim cook is blatantly coy. hey, we have a lot of cash. maybe we'll do something with that. he's basically telling you the story without explicitly telling you he's going to buy tesla or another company like that but they're going to start buying some big companies in order to find growth because there is no way to top the iphone spectacular run except to find growth in other places by buying it. >> jason, they made a big point of the 1 billion active devices. why does it need to be outside of that base of potential services which is already a big
business? >> yeah, the services business could add something to the bottom line. apple knows how to make money selling hardware at a very high margin and by having the best product in the category. so will they go try to do what microsoft did in selling package software? will they do what google did? they already said we're not going to be in the advertising business. we hate the advertising business. we hate violating your privacy so advertising is off the table. do they want to sell prescription software? i don't think so. i don't think that's going to be their market. they'll keep coming out with the best world class hardware with a high margin and you'll see new products coming for the next couple of years. do they buy stuff or keep building it themselves and the vr space and the car space are the next two likely candidates to build products that tens of millions and then hundreds of millions of people buy. >> all right. jason, thanks. >> my pleasure. >> when we come back, stocks
>> rick santelli and the santelli exchange. i haven't missed being on a trading floor. we had a lot of renditions and a lot of facilities that were trading floors that no longer are trading floors since 1979. something very special about a fed day. this one in particular i was glad we had mark on today. and i think in my opinion after many discussions and interviews with people like mark formerly with the fed. it's painted into a corner. so now if we put our strategic on and how can they do the best
job considering the hand that they have that they're holding and the difference is as mark pointed out as well is trying to find some wiggle room t. committee is maintaining it's policy of reinvesting principle payments from its agency mortgage backed securities and mortgage backed in the market until normalization of the level of fed funds is well underway. this policy by keeping the committee holdings of longer term securities at sizable levels should help maintain financial conditions. of course what they're talking about is reinvesting or going back to auction to continually hold the same amount of securities without letting them run off when they mature and making the balance sheet smaller. so what mark oleson thinks will be best is to get that accommodation out that muddies these two terms. get the accommodation out. make normalization something
different than tightening so a good way to perceive would be by lightening up the balance sheet. but the fed doesn't want to let the securities go. they don't really want to sell them. they don't want to diminish the balance sheet. why? that's pretty easy. it will be steeper if they were thrown into the marketplace. maybe a whole lot more volatile. it's a whole lot more real but i don't think they're going to do it. by letting the run off go they can normalize without really officially tightening. that will be a difference. it will be a good transition to get the pain away in the corner of the room. back to you. >> thanks. up next, twitter's biggest problem is that it's just too hard to use. here's a few solutions of his own and walt will join us when we come back.
complicated. consuming it is arguably slow because you have to go outside of twitter to get most of it. it's like a frat party where you don't know anybody complete with the secret handshakes as you point out. which is the bigger problem here? the fact that it's complicated to create the content or that it's slow to consume it. you know, john, i don't know that i can rank those. i think they're both equally difficult but i think there's even more to it. to use the service properly you have to use secrets and tricks like putting a period before someone's handle if you happen to use it at the beginning of a tweet. that's something that they need to look at all of those things and clean it all up and secondly it's the reverse chronological news feed which means you really -- unless you sit there
all day looking at it you're really going to miss large numbers of tweets that might be really interesting to you. >> walt, two thoughts on this. i loved your piece today. one is apple is notoriously stingy about manuals when you get a new device and twit areas long time thesis is the users will determine how the product changes. if they don't call for change we're not going to change. does that not give them some leeway? >> it does give them some leeway except two things. one is jack dorsey said multiple times it needs to change and he knows it needs to change. needs to be more approachable. the difficult trick he has to pull off is to make it more approachable for new users without alienating the core that's on there. the second thing i would mention is if i look at my twitter notification stream this morning
it's full of people who basically agree with me and they're already twitter users. not everybody. some people disagree with me of course. that's the way it always is. >> and we know where they're buried. >> that's right but there's a surprising number of people that are already on there that say that this thing needs to be clearer and easier to use. >> i loved a tweet that was some what facetious at the time this morning that said how do we reconcile the idea that twitter is failing because it's too hard to use while snapchat isn't despites being impossible. it's almost the secret handshake part of snapchat which is why teens and kids love it because their parents can't figure out how to use it. >> yeah. i saw that tweet. i think it's at this moment than
snapchat for all of it's success a clever trick that you can figure out. even if you're an old guy like me you can figure it out. there aren't thousands of things built up by the users over the years and by the company that need to be rethought but what i'm saying at the end of this piece i use this term, i think they need to rethink. not a rethink of their fundamental purpose or how they differ from facebook. i think all of that is valuable but a rethink of how to make that attract more people and attract more usage. >> we have former twitter ceo dick costollo on the program yesterday. he was talking about the outlook
for the company. what's your reaction to something he said. >> jack is a great leader. jack is a great inspirational leader so i defer to him on the future of the company. the company is in capable hands with him. i have been about as public as i can be about it. he speaks with a purity of thought and a clarity of vision about the product that i think is unrivalled. so i am very financially invested in twitter's future and i think jack is the right leader for the company. >> walt, can he make the product as clear as his talk about it? >> you know, that's the $64 million question here but i know jack dorsey. i also know dick. i think jack means what he says. i think he's committed. i don't know his secret plan. i don't know where he will wind up. he's obviously got a bunch of jobs to fill that will be crucial in doing this. he can't do it all by himself.
but as a twitter user and as a fan of twitter i'm reasonably comfortable that jack dorsey is a good choice to try to fix this because he is a product guy. >> he is, indeed. >> and we'll have to leave it there. always great to get your insight. >> take care. >> never enough time for walt. when we come back, more clues on google's drone delivery program. we'll explain in just a moment.
>> we may be getting more clues on google's drone delivery project. the company filed a patent with the u.s. government for a delivery receptical. while the nature of the delivery wasn't issued on the filing it would take packages to a safe location like the garage and that's on the heels of amazon pushing hard in the drone delivery space. we all know what's going on here don't we? >> sounds like twitter. just as simple as that. we'll see what they actually come up with but amazon and google on similar tracks with this drone innovation it seems. >> we're watching the markets recover from an early stumble. apple guidance didn't help this morning but oil met a reversal
to the upside. >> and boeings conference call was actually delayed because of technical issues. that will restart at 1:00 p.m. eastern time. 10:00 a.m. pacific as if they needed another issue. >> just in time for the fed statement at 2. let's get back to headquaters. scott and the half. ♪ >> all right. welcome to the halftime show. let's meet your starting line-up for today. steven weiss is here. along with joe, pete and on set for the hour is bank of america's head of u.s. equity strategy. also joining us cnbc senior markets commentator michael santoli. our game plan looks like this. decision day two hours away from the fed's statement on interest rates. we'll break down what the markets need to hear. morris code, city's top oil man on where crude goes next and whether a bottom really is in. stocks are working their way back at this hour after starting the day well into the red. take a