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tv   Closing Bell  CNBC  August 9, 2016 3:00pm-5:01pm EDT

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>> just -- >> i've done much worse. >> oh, i know. i know. >> folks, thank you very much for watching. on that note -- >> we'd like to thank you for tuning into the special edition of "power lunch." i'm going to eat every second. "closing bell" begins right now. welcome to the "closing bell." i'm sara eisen in for kelly evans. >> welcome aboard. i'm bill griffeth. a record setting day on wall street earlier. s&p and nasdaq both hit intraday records just not right now. we've got one money manager saying that the u.s. is still the best place to invest and she'll explain why coming up. >> dow component disney set to report after the bell. bringing you the numbers as soon as they cross. plus, a first on cnbc interview of disney chairman and ceo bob
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iger. >> it's been a year since sounding the alarm on espn and the stock tumbled as a result. >> a modest growth number. that's the word. meanwhile, speaking of modest growth, coach shares under pressure after they mis d ed slightly on revenue and sales. they're in the midst of a turnaround and ceo joins us in a an exclusive interview here at the new york stock exchange. talk to victor luis about the relatively new strategy. >> i thought you were going to say new handbags. >> that, too. i'm sure you'll be interested. maybe bring you some. not a reversing course and we'll talk about this. >> certainly investors have liked the turn around story. trump supporter carl icahn telling cnbc today that the nominee is the best choice for the middle class worker. >> the audrey bunker of the world, used to watch it, they're going to vote for him because they're smart guys, they know they're getting screwed.
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>> who does not love archie bunker and "all in the family"? robert frank did some digging and said a loophole in the trump tax plan could create a winfall for the well think. those details coming up. >> courtney reagan spending the day at the nasdaq. tracking the action frl us right now. court? >> hi there, bill f. you think it's a quiet summer day on the markets, you would be wrong. we hit an intraday high on the nasdaq. we have since pulled back because the drop in crude oil prices sort of dulled out the market when it comes to the risk-on rally we are seeing and it happened. that means it's in the record books now. if you want to take a look at some of the stocks that helped get the nasdaq to cross that intraday closing high, charter communications, adding more than any other stock, adding more than 5 points to get the nasdaq composite over that intraday high.
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google parent alphabet, both class "a" and "c" shares adding and broadcom, amazon and apple with a point. last friday, the nasdaq composite crossed a record closing high and in the year to date for 2016, two of those four fang stocks helped us get there year to date for the nasdaq. with facebook adding more than 34 points to the nasdaq composite. and then we have amazon adding more than 30 points year to date. again, we are talking point impact to hit that record closing high that we hit last friday. trading somewhere close to there now and see what we can do closing out. we hit the record. it is in the books. it is over now. we got it, moving on. back to you. >> courtney, thank you. we'll watch the levels into the close. and now to the new data that we got this morning showing u.s. productivity is stuck in reverse for a third consecutive quarter. a lot of economists writing about this today.
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steve liesman here to tell us what is driving that lower productivity. steve. >> not a good number. we have never had three quarters of productivity decline outside of recession. last two times, 1974 and 1979. not years you want to emulate. but ubs doesn't think it reflects a coming recession and the economy will continue to grow and not everyone is so sure. over at deutsch bank, they say it corroborates the worst fears and that's for sluggish growth and bad job growth in the coming months. morgan stanley says as bad as expectations are, q2 managed significantly disapoint looking for half-point increase and ended up with 0.4% decline. here's jim paul sen thinking the data could be bad. points out that real wages are rising. if accurate, suggests companies constantly paying up for a resource delivering sub par performance.
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either wages are overstated or producktivety is overstated. having trouble measuring and some are panicking and others are dismissing it not backed up by other data. the alternative explanation to paul sen's is that growth is lower and bernanke talked about that a little bit today. >> yeah. i want to get to that in a second but it's easy to pick on the data when you don't like what it says, i guess. >> that's an idea, bill. it does raise the question, though, which is, why are real wages rising? why are they paying more for workers not as productive. >> let's talk about bernanke. he's a blogger and made a point in the latest installment, trying to guess what the fed does, look at the data and don't listen to the fed speak that's
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confusing right now. this makes sense but you still need to listen what they're saying, don't you? >> yeah. i agree with a lot of things but not the ultimate conclusion not to listen to them for the following reason, right? you have to know what they think about data and affects their idea of how much interest rates should rise. real really, it was janet yellen's press conference and not a policy statement or a forecast. what she sort of talked about how the fed was a little -- she was more pessimistic ultimately of the outlook of growth and maybe more permanent and what bernanke is talking about is the forecasts have come down for growth, interest rates have come down and he says if you follow the forecasts, you get a better look of data point to data point and you need to listen to what they're saying. >> we'll hear from her august 26th? >> something like that. whatever that friday is. i'll be there. >> all right. we know you will. >> take your fishing pole. i know you will. >> oh yeah. >> thank you, steve.
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closing bell exchange for this tuesday, mark lasheny, willis and rick santelli is back. taking every other monday back now. for the summer? >> absolutely. >> good for you. ben, so we just continue to creep higher and pull back a little bit here. we talked ad nauseam about the summer doldrums and we are sitting at all-time highs. >> i'm glad to add to the ad nauseam. the fact of the matter is the market is controlled by central banks. the bid early came in china and the idea of cpi and ppi numbers soft enough to continueth soft b their currency and follows with the bank of england again allowing the sterling to continue under pressure and puts the prop under the dollar but what appears to me in this market you see the market open with strength because that's european buying. tends to soften and take over later in the day seeing things
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like oil soften up. but the fact of the matter is we continue to keep that two steps up, one step back. >> right. >> very good tendency for the market. we never got the full pullback i would have liked to see from an overbought condition and looks like the direction is still to the upside and a very slow summer pace. >> we were talking with steve about the productivity numbers. if you add it with the numbers we have been getting on business investment which is pretty weak, not to mention the corporate earnings which are slowly winding to a halt, what is your assessment right now about corporate america as we look into the current third quarter? >> well, sara, there's really a lot there. the lack of productivity leading to more hiring to fulfill the output through perhaps a business investment which we haven't really seen in a year and a half in a positive fashion through the quarterly gdp release is indicative of a situation leading to i think pressure on corporate profits. we see corporate profit margins
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shrinking for two years and we think likely to continue, particularly if hiring and or wage growth occurring. the atlanta fed gdp and wage tracker indicate 3.6% analyzed wage growth to crimp corporate profit margins and put pressure on corporate profits and a low profile earnings growth scenario and equities advance, marginally and fittingly. >> rick, i'm curious. your thoughts on bernanke's thought there on the blog that we should just pay attention to the data. we all can see the same data together and draw our own conclusions and don't need to be confused by the conflicting fed discussions coming out from the various members of the fed. what do you think about that? >> wow. i'll tell you what. if you carry it to the next level, i hear that the fed yaps a lot and isn't worth it. pay attention to the data.
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on that point, i totally agree. as for mr. bernanke delivering the message, that's like p.t. bar numb telling you to be careful of hucksters. he wrote the book on communications and steve was spot on. his database even longer than mine. mine goes back to '85. i couldn't find three negative quarters in a row either on productivity. as far as the, you know, where's the air here? i think the air is most likely on the wage side a bit but i really do think the real issue is if you want companies to get more productive, clear the zone. anybody -- listen. i love my in-laws but staying over, the household isn't running as smoothly as it normally does and i think that is the same analogy to use with the fed and the economy. think need to clear the zone. go back to what they used to do. quit sending everybody out in three different directions. and then ease back some of the structural issues janet yellen's
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woken up to. >> so many good analogies there as always, rick. ben, talk about catalysts. we did see oil for instance start the day a little bit higher and we have lost some ground. is that going to be one? there's also quantitative easing and officially started in the uk weakening the pound. >> the doyle seems to have an influence intraday and trending up for the last few days but the overall, crb index, the commodities index, continues to show continued downward movement which is a positive. the cost of input for businesses means that that cost is going lower. this means higher profit margins and the like. so, that being said, oil -- you need to keep an eye on it as a trader. as far as lock step, tends to break throughout the day and not necessarily be in the focus as you come in the morning and more important to what the central bankers are doing. i just would like to see the
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fmoc listen to ben bernanke and rates would be higher already. the fact of the matter they're not. it's important to listen to what they have to say because they're confusing themselves and talking them out of a situation where they're told by the american public and by their statute that they should be letting rates rise and they have not allowed that to happen. as far as the employment cost index, that's a pretty tight measure on what's being paid out. but again, trying to measure the productivity on the service index i think i need to call into question the people that are doing the measuring. it's not that simple a game. >> nobody said transparency wasn't messy. it certainly has become that with the fed. thank you. appreciate it. >> thank you. >> welcome back, rick. see you later. 48 minutes left in the trading session here. the dow down 5. it was higher earlier and the s&p. down a fraction. the nasdaq holding on to the gains today. the travel nightmare for delta airlines passengers still not over. a leading aviation expert discusses technical issues at
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the heart of delta's mess and which other airlines to suffer the same fate and why does this keep happening. >> yes, we'll ask. and prepare for another earnings onslaught after the bell tonight. disney, solarcity and yelp among the headliners tonight. we'll break down the numbers the instant they hit the tape coming up here. disney ceo bob iger speaking with julia boorstin right after the entertainment giant reports results. it's coming up in the next hour. energy is a complex challenge. people want power. and power plants account for more than a third of energy-related carbon emissions. the challenge is to capture the emissions before they're released into the atmosphere. exxonmobil is a leader in carbon capture. our team is working to make this technology better, more affordable so it can reduce emissions around the world. that's what we're working on right now.
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welcome back. 44 minutes left in the trading session. let's get you caught up on movers today. valaent pharmaceuticals popping despite reporting a quarterly earnings and revenue miss. here's why the stock is higher. valaent is maintaining the full-year guidance amid expectations that it would have to lower that yet again. company also said that it may sell assets that could be worth about $8 billion. then renegotiate terms with lenders and reorganize into three main segments so that lot going on there. the stock up 24% today.
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endo international surging on an earnings beat out late yesterday. the company's u.s. generic drug business saw a 67% jump in revenue thanks in large part to the recent acquisition of par pharmaceutical holdings. that stock up 21% today. big movers today, sara. delta flights resuming today after the airline experienced a system-wide outage. yesterday morning. as of today, delta canceled 530 flights and more than 1,600 flight departures. gill west with an update saying we are seeing slowness in a system that customer service agents use to process check-ins, conduct boarding and dispatch aircraft. we continue with our resetting efforts. >> now, critics point to outdated software as a root of this issue. but is the solution as simple as
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updating the computer system? joining us right now is michael boyd who's an airline consultant with boyd group international. now, in the past he's consulted with aircraft manufacturers and assisted with airline planning for american, northwest and delta. although you're not working with delta right now. i got to say, it drives you crazy when we do talk about computer systems because that shows a misunderstanding of what the airlines use for all of the different processes they have rig rig right. >> yeah. there are dozens of computer systems. developed separately. linked together in certain ways. delta's not exactly in the age when it comes to i.t. they're up there with everyone else, but they're also subject to things that will go wrong. in this case, an electrical system. so these things happen. but there's no one computer system that's a same airline to airline. >> i wonder if, michael, at all
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this is a product of the mergers that we have seen. systems are too complex the more they try to integrate quickly to serve the customers. >> it could have something to do with it. delta and northwest when they merged did a good job of it. american and u.s. air did a tremendous job more recently and putting systems together, a tremendous amount of work to try to put disparate systems together. we had a power outage. in the case of southwest, a router that took everything down that they said was 100-year issue. probably was. >> yeah. you know, sara, like many people said, why does this keep happening. your point is it doesn't happen as much as people expect given the come plesty of the systems we are talking about here. right? >> no. it really doesn't. keep in mind these things make everything move smoother, efficiently. you know, back when i started we hand wrote tickets and went into a saver system for reservations. we don't have that anymore.
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as long as anything is made with the hand of made take it to las vegas. it is going to break. >> or, i wonder if, i mean, yes, not doing paper tickets and doesn't feel like the airlines are on the cutting age of technology and coming to the operating systems. how old are the i.t. systems they're using? >> there was one silly story coming out saying southwest with a 35-year-old computer system. that's not true. it is really 40. we designed it back in the '60s. but -- >> isn't that the problem? >> it is the software. no, it is not. that's the software. that's all the software they needed up until now. the equipment is running on is not 35-year-old equipment. you have people with a little bit of information, misreport it. southwest is smart not to waste money on i.t. they didn't need and not running on all ibm pcs. they're really advanced as far as that goes. >> the headline here is there's no sling l solution to this? it will happen again and probably a different problem the next time it happens. right? >> that's exactly it. we can't anticipate everything.
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like i said, as long as we humans are involved, bank on it. we make mistakes. >> good to see you. thank you for joining us today. >> thank you. >> michael boyd of boyd group international. isn't flying fun? >> it happens. at least it's happens on with a variety of airlines, not just one single airline. all right. 40 minutes to go here before the closing bell. and let's just show you where we are. off the record highs on the s&p and the nasdaq. the nasdaq still managing to stay positive up .2%. the dow's down about 8 points. little action on the other major, too. coming up, what analysts are expecting from disney's earnings report after the bell today and ceo bob iger will speak with us right after the results are released. and up next, forget about the medals. we'll go live to rio where our very own carl quintanilla is asking the athletes what they would do with cash from a $1 million endorsement deal. wait until you hear the answers.
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cruise line operators are under pressure with miami-based norwegian cruise line cutting the profit forecast for this year and next. citing lower demand both here in the u.s. and in europe. and norwegian is also blaming the weaker pound after the uk's vote to leave the european union. the company's ceo says that the zika virus is not having an affect on miami cruises so far
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but that is seeing softness in south america where the situation is more acute. speaking of south america, bill, let's go live to rio where competition for olympic medals is hotter than ever. karlt quintanilla on special assignment. kel again, carl. >> hey, sara. that's right. a lot at stake for olympians in rio, a lucrative endorsement deal or a sponsorship. we asked some athletes what they would do with a $1 million endorsement deal in a segment we call "ask the athletes." ♪ >> travel. a lot of travel. and part of travel making the travel so when i stop this part, i was like, oh my god, i will not travel anymore. with $1 million, i would travel all the world. >> invest it. definitely invest it. bitcoin is one and definitely some stable companies. >> probably put in it a bank account until i find something
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good to do with it. >> if i have enough time and all be gone and save it. some of it. and then, i'll definitely have to invest. the money keeps coming in. >> spend it. no. i'm going to invest it. oh, like one of the biggest shares in nigeria. >> reporter: i see that spanish athlete says put it in a bank. i wonder the kind of rate but clearly these athletes down the road can count on some major money. i think usain bolt is one of the highest paid with annual earnings in the neighborhood of $10 million. >> i like the bitcoin answer. i wonder what would happen to the earnings. >> reporter: i knew you would. >> it makes me think of the big money in the olympics and the sproips from -- a lot of companies that i cover like coca-cola and prom or the & gamble and invested so much and i wonder the presence they have and getting the bang for the
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buck over there. >> reporter: i think -- i mean, look. you turn and see a coke umbrella here in the park. p&g with an athlete house. mcdonald's is only franchised food in the house. they're not many of them sponsors but around the olympics, you are going to see that logo. and that's what those companies are counting on. >> now that you're there and for a few days, you know, we were all concerned about zika and the hype leading up to that. do you see much evidence of precautions or is everybody obsessing about it? talking about it? what's the deal now that you're there? >> reporter: yeah. i mean, obviously, we came down here, bill, with a top of mind. certainly worry for me and a lot of crew. it's close to zero percent of the conversation. there's a lot more discussion about efficiency, security, prugs even. zika is one nonstory taken us by surprise, for sure. >> yeah. >> all right. thanks for now, carl. see you soon. >> thank you.
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>> out in rio. live coverage starting 5:00 p.m. eastern time. >> did rugby. it's back. >> it is back. i know. >> talking about that later. meantime, time for a cnbc news update. with sue herrera. >> florida governor rick scott announcing florida health officials have identified four additional people in florida with the zika virus. they likely got it through a mosquito bite. this brings the total number of locally transmitted zika to 21 and believe it's coming from the wynwood section. in kosovo, taerlgas to disrupt the work of a commission on a border demarcation agreement with montenegro. the opposition said they lost more than 20,000 acres because of that deal. >> police with dmen stray or thes in pee rue and protesters tried to reach the government buildings to reject the naming
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of new officials at public universities. riot police shot teargas to disperse the crowd. take a look at that. that is a 22-caliber pistol. it was found loaded with live ammunition in a passenger's carry-on bag at the reno tahoe international hospital and built from parts made with a 3d printer. the tsa described the revolver as a realistic replica. the passenger chose to leave it behind and was not arrested. so the debate here in the newsroom, guys, is, is that a real gun? it was loaded with live ammunition. >> right. >> or, is it a replica? >> does it work? do we know? >> we assume it works because it was loaded with live rounds. >> right, right, right. >> but they said it was a replica. >> if it works then -- >> that's what i said. >> shouldn't be allowed on the plane either way. >> very interesting debate, though. more to come on that i'm sure. >> thank you. >> see you in an hour.
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we have 30 minutes left in the trading session here. the dow starting to move higher again up about 3 points. s&p back in positive territory and the nasdaq higher, as well. and the nasdaq higher, as well. we have a leading trader your insurance company
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you qualify for a multi-policy discount, saving you money on your car and home coverage. call for a free quote today. liberty stands with you™. liberty mutual insurance. less than half an hour to go before the closing bell. joining us now, gordon. is it important that we are holding near the highs? >> i think it is. most important half hour of the day so whatever liquidity is around we'll see here. numbers going into it are also muted and between yesterday and today, feels like the summer. this is the kind of seasonal trading that summers used to bring and feeling it last couple of days. but your point is well taken. we're holding the highs. and there's an all adage. never short a dull market. and it feels to us a lot of the
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guys leary of the market from the short side. why? because a lot of the news is already out there. and central banks have made their statements and earnings are out there and yet we're holding up here at these levels. what does that mean? that means they could start to explode here with a little bit of cash infusion and see movement. >> what's the overriding driver in the market? oil on the move. little data. big earnings left still and some qe starting abroad. >> yeah. look. we can look at the calendar. really most of it is already happened. i mean, look at jackson hole coming up the end of the month and can't really trade or preposition for that. i guess the election and when's happening here in the presidential election. something that people focus on. again, that is market where you have to be real careful you don't get caught watching the paint dry. >> gordon, thank you. >> pleasure. >> for the commentary. that's gordon. bill? speaking of the presidential campaign, gop nominee donald
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trump unveiled the new and improved economic plan yesterday. you saw it here and the friend activist investor carl icahn believes it's trump's ticket to the white house. >> we have a massive problem and donald is addressing it. democrats are not. donald gave a speech that was to my mind right on about it. and if he sticks with that economic theme, he should definitely win hands down because i don't know why you wouldn't vote for him. >> well, despite his strong belief in trump, not everyone is so convinced that the plan is all thattic witible. here with more on the holes in the plan is cnbc's wealth reporter robert frank. sflobt. >> trump says the plan is for every day workers and the biggest could go to the well think and little known section of the tax code of pass through income, income a comes from a partnership or investment vehicle that's passed through as personal income.
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so right now, the top tax rate for pass through income is 39.6%. trump's plan cuts that to 15% he says to help small companies and butzs. and it would. but the highest earnerins woulde the largest beneficiaries. in 2013, more than $800 billion in pass-through income, more than two thirds of that to the top 1% of taxpayers, according to a report of center of budget priorities. the really rich benefit the most. $94.5 million each in average income of pass throughs. under trump's tax cut, they would save an average of $37 million each per year. experts also say this could cause massive tax avoid dance as people would shift income to pass throughs and they do it by declaring themselves as contractors or changing their business designations, guys. back over to you. >> good analysis, robert.
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i also wonder about the tax break that donald trump announced and his daughter felt strongly about it for child care. who is that targeted for? >> basically, for that deduction to be beneficial, you have to have a large amount of agi, adjustable growth income or taxable income. the well think have the largest amount and they could take the largest deductions and they spend the most on child care. so nannies and all that kind of -- high-end child care. you could take the largest deduction. again, the benefits of deductions flow to the highest taxpayers so also a part of the plan that sort of tilts toward the top. >> yeah. speaking of which, the estate tax, wants to eliminate that and have the same effect, right? >> you know, he said, look, this is the death tax. people shouldn't -- if you work all of your life and pay taxes, you shouldn't have to be taxed again when you die. that is for estates of $11 million basically or more. so you're talking about .2% of
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the american population that has estates at $11 million or more and also a reduction for those at the very top. >> all right. good stuff, robert. as always. thank you. see you later. we've got 23 minutes left in the trading session. the dow is hovering around unchanged at the moment. >> no other way to put that. down less than a point. >> yes. but we move on. coach on the comeback? maybe. earnings out today showed an increase in u.s. sales for the luxury goods maker but total sales fell short of expectations. we are going to talk with ceo victor luis about the turnaround plan for the company coming up. after the bell, disney will be out with earnings and we will talk to the ruler of the magic kingdom, bob iger, the ceo himself. look at you. you're at the top of your game. at work or at play, you're unstoppable. nothing can throw you off track. oh hey, she's cute. nice going man. things are going great for you. you've earned a night out.
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good drinks, good friends. yeah, we can go ahead and call this a good night. wait, is that your car? uh oh. not smart. yeah, i saw that coming. say goodbye to her. ouch! that will hurt your bank account. you're looking at around ten grand in fines, legal fees, and increased insurance rates. i hope you like eating frozen dinners. alone. let's try this again. smart move. because buzzed driving is drunk driving.
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shares of coach are trading lower today on the back of earnings which showed total sales falling short of expectations but sales at existing north american stores did rise at their best rate in four years. they were up 2%. >> the company also announced it will be closing approximately 25% of its north american department store locations. this is all part of the company's effort to attract more shoppers to its independent
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shops. let's talk strategy now. coach ceo victor luis. good to see you. >> welcome back. >> thank you. >> a lot of folks pointing at the north american sales number as a sign of progress. where are you in this turnaround? >> well, we are in just completing year two and incredibly proud of the team and the quarter we had. we had 15% growth driven by as you've mentioned the 2% north american comp growth. first time since third quarter of fy-13 we had comp growth in north america and double digit growth in china and europe. china especially in mainland china. and as well helped by the growth in our acquisition that we made last year. that, of course, leading to leverage on our cost base and a 45 cents non-gap earnings per share versus 31 cents last year and proud of the team and the performance. >> you want to make the coach brand exclusive again. the previous strategy was to
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have it become more accessible in the department stores. and it increased market share. but it lost something for the brand itself. so now you're kind of taking that back and trying to make it more exclusive again. right? >> i don't think the key word is exclusive. we're trying to differentiate from the competition. if you look at the positioning relative to the european competitors seeing themselves as exclusive, we are much more approachable and part of the dna since our founding 75 years ago. >> as we're talking about, trying -- closing the department store locations because the discounting going on, because of -- that speaks to wanting to be more exclusive. coming up with a different word but that's the idea. >> elevating the brand and ma making it more emotional to the consumer. the work involved in doing that is a tremendous amount of investment behind product, obviously behind our store fleet. we have renovated 450 dlocation.
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we will have 730 locations and the vast majority of our traffic globally within the new store concept of the modern luxury concept and tremendous amount of investment of marketing which includes the launch of 1941 collection through runway and new york fashion week for the last three seasons. >> bill brought up the discounting point which has been a big factor. so how much less are you discounting these days? and what makes you confident that your consumer will come back and pay up the higher prices? >> quite substantial relative to, let's say, several years ago, two to three years ago before beginning this journey. an important step we took was the reduction of the eos or flash sales. we deuced that by $300 million. that's a step we took two years ago and some of the competitors talk about and this next step in terms of reducing the amount of promotional impressions within the department store channel is not just about bringing
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consumers into our own stores, but about creating a little bit of parody of the channels and the confusion for the consumers across the channel. >> how much more does it make you vulnerable to sales downturns in the economy overall? >> we have put it in estimates provided for next year and guidance provided. this takedown within the distribution, within the wholesale channel, approximately 250 locations as well as a reduction in the markdown dollars we will be providing the channel will cost us about one growth point. i think it's important to note that the wholesale channel in north america represents 5% of the global business and not at all our largest channel. and we have terrific relationships with all of these partners, we have been talking to them for quite a listening time and this isn't about necessarily leaving that channel. this is about us focusing our resources and most important doors and we are actually also increasing the distribution with some specialty retailers. earlier sara talking about
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visiting opening ceremony in l.a. and saw coach for the first time. >> i did -- i have to say. >> as well as tier one department stores doors and recently not carried coach and now engaging with the brand for the first time in a while. >> a lot of people worried seeing kate spade earnings lowering the outlook. that stock dropped 20%. i mean, speaks to how tough of a retail environment it is right now. lower tourist spending from abroad. how would you characterize that and pull off a turnaround in that environment? >> consistency, hard work and continuing to believe in the brand, obviously. and investing behind it. we have an amazing team across the world. to the point you have made, sara, an obviously amount of macro economic pressures taking place. impacting currency, brexit, and of course, some of the tragic terrorist attacks that impact sentiment. but long term this is an amazing category. i believe the most attractive
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category in the fashion space to be in. and so, we have a tremendous amount of belief. increasingly, playing in other categories, specifically the footwear category with stewart weissman and outerwear, as well. combined represents a $79 billion to $80 billion opportunity. tremendous room for growth. >> clearly you're energized. i can feel it sitting here. >> thank you. >> and investors. they like the story. >> thank you. glad to have you here. >> good to be here. about 13 minutes to go before the closing bell. let's show you where we are. the dow up 2 points. s&p 500 is up almost a point. and the nasdaq continues to outperform with tech. it is up about a quarter of a percent. within the s&p tech is a best performing sector right now. >> talking disney. how much has finding dory helped disney's bottom line? what to expect from the earnings report with a preview coming up next. stay tuned. , what's happening here?
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ten minutes left in the trading session. waiting for disney earnings. julia boorstin, give us a preview what to expect from those. >> bill, investors are watching to see whether disney returns to
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the pattern of beating wall street expectations after missing those analysts' expectations last quarter. they protect earnings to grow 11%. investors looking for commentary on the health of the tv business in particular of skinny tv bundles as well as the outlook for the theme parks to see if the stock can reverse the losses of 9% in the past quarter. i'll ask ceo bob iger about all that and more when we sit down for a first on cnbc interview after those disney earnings cross at about 4:15 p.m. eastern. back over to you. >> all right. thank you, julia. see you then. joining us on the floor of new york stock exchange as we head toward the close, samantha azarella with us. the conversation we're asking is we're in the doldrums and at high levels right now. it is not like we're meandering underwater. what do you make of this trend right now? >> well, i think it's surprising that the market rallying given the weakness in earnings.
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it is moving into a better trend, we might hit a bottom in q1 and interesting falling back on the idea of continued fed easing. >> is there anything, any asset right now, that looks fairly valued or not overvalued? >> sara, i think there's truth to the statement and as well looking globally, zooming out, the global equity space, u.s. equity assets look more quality. we're talking about moving up, fixed income or equities and you can argue that u.s. equities are in fact higher quality play than european or japanese stocks. >> you mentioned earnings. we have been in the earnings recession. you feel like it's a bottom here. why? >> we think q1 the bottom and too soon to say. q2, slightly less negative and
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continuing into the second half of the year and into 2017. one thing that's on our radar, though, we think is looming is wage growth which could really hit earnings coming online in 2017. >> within that, which sectors do you like? >> so, we're still liking cyclicals over defensives. we can see the attractiveness for the yield play, for example, but we still believe in the strength of the u.s. economy and the expansion continues and we like health care, info tech and discretiona discretionary. >> looking overseas much? >> slightly underweight europe given the brexit and the truth is we haven't seen economic strength in europe translate to gains and frankly disappointing. >> the fear for investors is that if we get into the cycle and the u.s. looks better and economy heals then the fed might raise interest rates and the dollar strengthen again and hurt earnings all over again. >> back to where we started. >> right? >> we are thinking that the fed has their eye on inflation.
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i don't think the jobs report as fantastic as it was is what they need to see to move. they want to see higher inflation. i think they would be happy with 3% for a period of time so until we get that the fed is on pause. >> a fed that wants higher inflation. counter intuitive. >> especially seeing the wage growth you point to. >> yep. >> thank you. >> thank you for joining us. samantha of j p morgan funds. arthur cashin said -- it's a nonevent. today the same. $100 million side sell and don't expect much action there. we'll have the closing countdown in a moment.
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about three minutes left here before the close with the dow up a point. bob pisani and i stuck in the middle of -- who are all these people on the floor of new york stock exchange. >> why are they in our office? we have work to do. >> s&p and the nasdaq hit all-time highs early on this morning. we've got a one-year chart there. that's awfully nice. year to date chart which shows where we are as we continue to just kind of -- >> gradually they track. >> after the low there. isn't that nice? wti crude volatility continues there today. 42.50 was the number i kept hearing that they wanted to see if it would stay above that and
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it did. opened higher. now lower down a quarter percent there. >> the real action in natural gas down over 4%. weather's not as hot in the northeast and i think some people concerned not seeing as much movement. there's nat gas down 4.6% there. a lot of the big exploration production companies with high natural gas exposure and why the stocks were weak today. >> and because sara's with us this week we must mention a currency by contractual obligation in this segment. and so, british pound at $1.30 is one they're watching very carefully beginning the quantitative easing program there in the uk. >> norwegian cruise lines said specifically this morning weak pound was a factor in why they lowered their earnings guidance. the main one being also u.s. cruise ship people were not going to europe because of concerns over terrorism. >> plenty to talk about after the close tonight. earnings.
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disney will be the big headline and we have solarcity which itself can be a headline by itself and then yelp reporting and done pretty well today. up almost 3% here. >> yeah. what happened, this is one of the things where you get every day a couple of points in the s&p and so you're at a new high on a daily basis and then breakouts and had almost 240 stocks at new highs and 100 yesterday. when it starts getting to 400 i'm really interested and going on for a few more days, even just a few points you get stocks breaking out. tech stocks noticing for a long time. broadcom's at a new high. google, cisco. on new highs of an intraday basis and noting time and again, the last few weeks, tech earnings better than expected. all the names doing very well. i just want to note, people talking about u.s. steel. a secondary and why the stock is down. of course, they have done very well recently. we have some -- working in their favor and in there.
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6%. >> all right. going out flat essentially for the major averages and we'll wait for the earnings from disney and we'll hear exclusively from company ceo bob iger coming uppen the second hour of "the closing bell." welcome, to "the closing bell." i'm sara eisen in today for kelly evans. bill will be rejoining us in a moment. let's look at how we're finishing the day on the dow. a record and nasdaq and close off the highs but still managed to close in the green just barely. the dow closing up 3 points b y buoyed by disney. the nasdaq outperforming all day. the tech heavy index finishing higher by a quarter of one percentage point. moments away from big earnings.
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julia boorstin covering disney. jane wells waiting for solarcity. josh lipton waiting for yelp and speaking to bob iger about the company's latest results. that is a first on cnbc interview coming up in moments with julia. you do not want to miss it. but joining us for the hour we have got dennis berman of "wall street journal" and robert luna and steve grasso will be joining us in a moment. dennis, disney finishing at the top of the dow on a quiet trading day and mentioning stocks holding the gains. >> actually a pretty boring day. let's be real. right? nothing much changed but -- >> boring? i'm not familiar with that word. we tend not to use this. >> i'm sorry. >> quiet is fine. >> quiet is fine. perhaps not the most exciting day and the point of stocks continuing to perform, here we are. 10-year about 1.56. bond yields around the world
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close to 0 or almost negative. same spot as we like to say at "wall street journal" and write it on the whiteboard. tina. there is no alternative. that's bearing out. what's interesting is to see how that mind-set, philosophy, sweeping in the nasdaq stocks underperforming for basically all of 2016. >> robert luna, how much longer do you thinkty in's going to work? as an investment philosophy. >> yeah, bill. i'd are to agree. i think until you get that 10-year creating some competition for ek ties. back above 2%. you continue the see the rotation and, you know, chopping around right here kind of at a tug of war between the bulls and the bears but even the bears i think secretly want to buy the market on a pullback and continue to see more of the same with the treasury below 2%. earnings pretty good. valuations aren't ridiculous. stocks are the best place to be for investors. >> goes to the tina point. i would count ter boring
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argument with the fact we have notably weak and surprising economic data in the form of productivity numbers this morning. >> yes. >> energy, oil lost its gains and energy closed down half a percent. and yet, we continue to climb this wall of worry. >> yeah. >> on some sluggish economic data and earnings forecasts. >> natural gas if you add that, too. down 4% or so. i have to agree with you. overall -- again, as we like to say the chronic conditions remain what they are and we are as i love to say, just stuck. stuck from the economic conditions. stuck from a growth perspective. stuck in productivity. stuck in inflation. and yet, somehow stocks -- >> stuck at the top. >> i have to say. tina. there is no alternative and the market is voting with the feet. >> stand by. we have a news alert on donald trump. john harwood has the details. what is the story? >> bill, one day after donald trump tried to restart with his economic stop, he said something
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extraordinary in north carolina. let's take a listen. >> hillary wants to abolish essentially, abolish the second amendment. by the way, if she gets to pick -- if she gets to pick her judges, nothing you can do, folks. although the second amendment people, maybe there is. i don't know. >> so the second amendment people, maybe there's something they can do. what does that mean? obviously, the second amendment refers to the right to keep and bear arms. hillary clinton's campaign just put out a statement saying that this statement by donald trump shows that he is dangerous and that a candidate for president should not suggest violence in any way. the trump campaign followed with its response saying, donald trump was referring to unifying the country behind support of the second amendment. and support for donald trump. now, don't know whether there's fallout to this. reminiscent of the controversy a
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few days ago when donald trump suggested that the russians get hillary clinton's e-mails and said i'm joking. the campaign is putting some distance and saying one thing, at a time when many republicans are distancing themselves from donald trump, and speaker paul ryan has said there is a limit, it's not a blank check. my endorsement of donald trump and not specified what might cause him to walk away. if something like this becomes interpreted by many of the american people as something closer to the clinton campaign than the trump campaign, that could be the thing that causes a flood of republicans to walk away from donald trump, guys. >> and just to reiterate, the language here, john, i mean, the controversy is surrounding the fact that it seemed like he was insinuating something violent? >> the immediate reaction on social media and then affirmed by the clinton campaign was that there was a suggestion that when he was telling the north carolina audience that you would
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be helpless to do anything about hillary clinton's judges if she gets elected and then he said, well, maybe the second amendment people, maybe there is, something that you can do, people interpreted that as a suggestion, second amendment, right to bear arms, do something, they connected those facts. and so, people speculated that was this is a joking call to violence by donald trump. donald trump and his campaign are saying, no, it is not. that's what the clinton campaign is saying and this argument is joined and it's throwing off track what donald trump hoped would be a re-orientation of his cam pin. >> talking later with andy puzner in a little while here. john harwood, thank you. we'll see you later. steve grasso joined us now. i was looking at the volume. i'm surprised it was this heavy
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today. felt quiet and it wasn't. from that standpoint. >> i think people are looking for a reason to trade. they have had many reasons to sit on their hands. always waiting for something else to trade on. and i think at this point, you starting to see flows and we know where the flows are coming out of. obviously, utilities and staples and i think is probably a mistake and funds have to do it. and there's still chasing tech, still unsure of financials. i don't think you're going to see rates rise the way people were hoping that would rise and there's rotation and the volume coming from. >> you would be buying telecom up 20% so far this year? >> what's a fair multiple? i know nothing's changed and the fed told us that basically they're not going to -- do you think -- i'll toss the question back to you. where do you think rates are going under the fed? are the rates going to skyrocket from here? >> doesn't matter my opinion. this is a low interest rate world. and a high bar. >> that's my point. people say it's overvalued, we
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have never seen this environment before so for me i'm talking about multiple expansion. maybe you look at utilities or staples and telecom, they have rallied. they have only sold off just a bit. i think the conversation is more about multiple expansion versus, you know, overpaying for stocks. >> tina multiple we are talking about here. yes, ma'am? >> we have to get to yelp. earnings are out. josh? >> sara, yelp reporting eps here of 1 cent, versus an expectation of a loss of 7 cents. revenue clocking in at 173 million. that's versus expectations of 170 million. just locking through the release here, local advertising accounts, so the number of local businesses paying to advertise on yelp, grew 32% to about 128,000. it looks like local revenue totalled about 152 million. that would represent growth of about 41%. also, some changes to announce
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here in the c-suite. yelp's coo there since 2007 retiring. he will be replaced by jed knockman. finally guidance. q3, the net revenue it looks like yelp guiding for 180 to 184 million. and for the full year net revenue guidance here of 700 million to 708 million. heading into print the stock up about 20% over 3 months. the guys at cantor largely chalk it up to a revamped management team and sales force. this call kicking off at 4:30 eastern. back to you. >> and the stock up right now. thank you. we'll be checking back with you. robert luna, i don't think the 20% is a tina premium necessarily. do you like yelp at these levels? >> no, bill. you know, i think yelp is a great company but current valuations i think a lot of that is built in. i think longer term they run into challenges with competitors
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of facebook, google, because they haven't built up that ecosystem and while they have a great user base, i don't think they have the ability to monetize that long term. i think it's a great story. could be a takeover target for some point and at these stocks, this is not long. >> it's long looked as a takeover target and now posting earnings. second quarter in a row investors were expecting a loss. they got a profit. they got better revenues. the ihorn pop earlier in the year. >> i think everything that robert said is a story for quite sometime. and facebook can do it better and google. i think there was a pretty big short interest and with the latest run-up that josh just pointed out a lot of guys covered. i still wouldn't be a buyer here. i think replicated too quickly. and it's at an incredible run moving into the print. a disappointor and that's why you see the stock hanging in there at this point.
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>> from a logic point, it is making sense for google to buy yelp or google to allow yelp to assist and creates an appearance of choice in the marketplace. looking at the power of google, $545 million market cap versus yelp. let yelp do what it wants to do. >> google to buy twitter and yelp. we have all sorts of things. >> twitter is a more sense and the power of the tech companies as we saw in the earnings last week is just immense and incredible. >> hang on a second. we have more earnings to report to you. we have an alert here on fossil. courtney? >> hi there, sara. fossil's second quarter earnings at 12 cents, consensus for 9. that's a beat. revenues also stronger than expected at 685 million. versus expectations of 672 million. however, those comparable sales down 3%. analysts looking for a gain of
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0.7%. the americas region weak. net sales down 11% in the americas. watches, sales down 10%. if you're looking at the category. the ceo calls the current environment disruptive. and then for next quarter or the current quarter, rather, third quarter earnings, range that was given is significantly below what analysts are looking for. you can see there shares of sort bounced up and around after hours and some good and also a decent amount of bad here in the fossil release. back to you. >> court, thank you. steve, is this a company trying to deal with the apple watch phenomenon or what? >> trying to deal with the apple watch and the total environment and the company is realistic about their rhead winds right now. i don't know if you get behind their strategy until you have something to really get behind. they have an insurmountable headwind. looking around, people don't wear watches. >> i was thinking of that. >> it's a smartwatch.
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can they compensate that? yes. a lot of people don't wear a watch period. >> look at me. >> i remember wearing headsets around and we don't need a watch. i think this is perfect lbl candidate. >> it is an ugly chart down more than 50% in the last 12 months. >> maybe google should buy them. >> don't look at me! >> just a thought. i don't know. thank you. >> thank you. >> you're released now. steve grasso. robert luna will stick around waiting for disney here. earnings are due out any moment now. we'll have instant analysis of the results as soon as they release and then ceo robert iger right here before he speaks to the analysts. and also coming up, donald trump proposing massive across the board tax cuts but will he also detail plan to pay for those cuts? without raising the national debt. that is the question. trump supporter and cke restaurant ceo joins us later to discuss. you're watching cnbc. (lionel) ♪it's peyton...
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welcome back to "closing bell." i'm julia boorstin with disney's earnings and two other pieces of
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news out. disney beating on the top and bottom line. the company growing revenue 9% to $14.277 billion. analysts expecting $14.15 billion. earnings per share also coming in a penny better than expected at $1.62 per share. that's up 12 cents and again a penny better than expected. driving the better than expected results appear to be the movie studio with "captain america" and "finding dory" in the quarter and better than expected results at the theme parks. digging in just a bit to the cable networks which are obviously a big source of interest for so many investors, revenues at the cable networks up 1% and operating income at the cable networks up 1%. the company saying increase in operating income due to growth at espn. now, looking at some other news the company just announced, disney investing acquiring a 33% stake in bam tech which is a
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technology services and video streaming company being spun off from mlb advanced media. disney paying a billion dollars in two installments and an option of majority ownership of the company in coming years. now, disney saying here in this press release bam tech a partner for disney in the support enand delivery of streaming products across the company but disney's also announcing here that it will collaborate with espn to launch and distribute a new espn branded multi-sport subscription streaming service. this is not going to be just taking espn over the top. because they say here that current content on espn's linear networks will not appear on the new streaming service but it sounds like there are multitude of different streaming services in the works and one last piece of news out from disney, the company telling me that at&t directv working on the new directv now over the top service will include espn, espn2, abc,
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free form disney channel, disney xd and disney junior, the seven biggest television networks. in all subscription packages and important because there's a lot of concern that these new, smaller, over the top bundles would not include espn and espn2 and big money makers for disney and the news is that espn and espn2 and those other networks will be included in all of those subscription packages so, sara, a lot of news to digest here. shares now down about 2.5%. back over to you. >> you have a lot to talk about with mr. iger. >> we'll let you get ready and see you in a few minutes. we want reaction. robert, you're an owner i believe of the stock. 40% revenue growth in studio entertainment. we knew that was going to be a bright spot. 2% in the media networks. what stands out to you?
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>> what stands out to me, sara, the theme parks. one thing worried about in the report is theme parks. we had the terrorism in orlando, the tragedy there at the theme park itself. part of california's been shut down for the opening of "star wars" next year and concerned about challenges with the theme park. i'd be interested to see how shanghai played into that but the news of the skinny bundle of directv is great news for disney shareholders and the fact that the stock down 2% after hours is a complete gift. i think this is a great opportunity for long-term investors to buy possibly the greatest monetizing machine of all time out there. >> dennis? >> all right. disney owner loves disney. the bamtech purchase is interesting. an obscure thing and does power much of what we see online today. and to get a third of that company i think is meaningful. >> major league baseball? >> major league baseball online
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operation. >> this is something recode is reporting on a little while. a billion-dollar investment. >> right. i believe they run the technology for hbo's streaming service and they do it for a lot of others and long term it's a smart bet for disney because the straight cable provider as we know is changing and bamtech is in a lot of ways the future. >> all right. robert, you're excused now. thank you for contributions. >> he loves disney. buy disney. >> yes. stay tuned to see what bob iger has to say about this. see if you want to hold your disney position. i'm sure he will. we have much more on disney's earnings still to come. bob iger, ceo, joining us on a first on cnbc interview with shares under selling pressure after the results worth mentioning this is a stock, bill, down more than 11% in the last year or more. more later. twitter reportedly subleasing nearly 30% of the office space at the headquarters.
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energy lives here. disney out with results moments ago. >> to julia boorstin we go joined by disney ceo bob iger. first on cnbc. julia? >> thank you so much, bill. bob, thank you so much for joining us on the heels of these results. so, you had a big, better than expected results in the studio and also at the theme parks and you are reporting that espn seen increases in revenue as well as
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affiliate growth. can investors take these earnings to indicate this all their concerns over the past year are nothing to worry about anymore? >> look. we had a very strong quarter. in fact, on an adjusted basis, our 12th consecutive quarter of double digit growth. the studio was up over 60%, great theme park performance. which when you factor in the start-up costs of shanghai, tremendous, we had strong performance at espn. i think you have to look at this company as a whole, particularly the brands and the franchises from espn and pixar and marvel and lucasfilm and abc and disney, of course, i think it's a good quarter and a quarter you can look at and assume that the company is in extremely healthy shape and we had two big announcements with it. acquisition of 33% of bamtech, a great platform which we can talk about. and a new deal with at&t direct to be on its new over the top service which we're very encouraged by.
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>> later earnings but the b bamtech deal. why does it make sense to buy the company instead of just renting the technologies for the espn streaming? >> we think it's a good investment. we love the business model. we think that in today's world streaming on a scaled basis live sports and live programming is a competitive advantage and something that's necessary. we love the user interface. overall it's an investment. but as a partner, a part owner and ultimately as a majority owner, we feel it gives us an ability to jump start not only espn but our other business, as well, into a space that we think is not only very exciting but extremely important and a very dynamic media marketplace. much better to own than to rent. >> you've announced that you are working on a new bamtech espn streaming direct to consumer service. what is it going did look like?
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what type of consumer is it targeting? >> it is i think initially it is the sports fan that will be interested in this as you would expect. an espn branded service to include product that bamtech licensed from major league baseball and the nhl. adding to it a staple of product that espn has college football, basketball, tennis rights, rights of rugdy bs and cricket. a collection of many different sports, sports that are on espn but not products that's on espn. we're not taking product off of espn. >> how much does it cost? >> we haven't determined it but i think people looking at products like this thinking about what the monthly fee will be. i think ultimately you are going to see a lot of dynamic pricing and products like this. meaning, the consumer will ultimately be able to determine what sports they're interested in, what packages they want to buy over what period of time and i think there will be a lot of flexibility provided to the consumer so there will be a lot
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of variables in that regard. >> does this bam investment lay the groundwork for you to take traditional espn, totally over the top once your current deals expire? >> well, our primary priority as a company is to work on making sure that the multi-channel package is healthy creating value for our company. we know as a dynamic marketplace, there's shifting going on. what this does is it gives us the option or the optionality as they say to pivot if we have to. if the business model that is supporting these great media properties starts to fray in any significant way, we have the ability to pivot quickly and put out a direct to consumer product to potentially replace it or supplant it. that's really important. we are not suggesting it's going to happen. it's our hope that doesn't happen but this certainly putts us in a great position should it happen. >> you have that option. you mentioned you're working on
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other services. how soon could we see other over the top direct to consumer disney products? >> well, we have already tried a product in the uk called disney life and we have thought about bringing that to the united states. we obviously have properties, particularly marvel, "star wars," disney, that give us an ability to create a product that's complimentary to some of the product that we have in the marketplace already. and sell it direct to consumer and very, very user friendly ways. i think you will ultimately see us doing more of that but in terms of predicting how soon that's going to be or what it will be, premature. >> and these skinny bundles like over the top one that directv including you in, hulu one, are you earning as much from those as traditional tv? >> we are. actually, there's no disadvantage. if a customer decides to disconnect or to cancel their current mvpd service and migrate
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to directv's case to the over the top service, which is primarily an internet provided service, then there's no disadvantage to us. meaning, it's price neutral to us. that's very good thing. when's also very important is that we know that the ott platform is likely to grow and it ee's vital for us not just w espn but abc and disney as for an instance to be part of the over the top products that are being brought out and so the direct at&t announcement and deal is a big step in that direction. hulu will be launching a similar service later in the year. we fully expect to be part of that as an owner of hulu. and we believe -- we also own some other, sony has a product in the marketplace. dish has a product in the marketplace. we expect that we will be part of these new services on an ongoing basis. >> shifting gears over to the theme parks and orlando there's been so much attention on the potential impact of zika.
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what have you seen so far? has it impacted bookings? >> really hasn't. we have had a few calls on it but we haven't seen anything that we would be concerned about in terms of impact on visitation or bookings. >> can you give us any guidance into how healthy the theme park business is this current quarter in terms of bookings, reservations? >> talking more about it on our earnings call but our theme park business domestically is quite strong. it has a good quarter. we had difficult comps with the 60th anniversary of disneyland. in general, the business is good. some softness from a few markets, notably brazil and canada and looking at the international mix to orlando, it is about what it was. we had a stronger quarter than we expected from great britain. our business in europe is generally soft. meaning our theme park in paris because of everything that's going on in europe from brexit to the economy to some of the recent terrorist attacks. hong kong has strengthened. japan is still strong.
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of course, we are really excited about the opening of shanghai. which was june 16th. which was a flawless opening for a project that took a long time to build. and it was sort of years, really, years in the making and it is big and complicated and the opening with us just fantastic. >> can you give us a sense of how well it performed so far? >> very well. much more than a million people already visited. people are staying a lot longer per day or per visit than we expected, almost a couple of hours and says they like the product. awareness in shanghai is huge. intend to visit is tremendous. our current visitation is very diverse in terms of china. so there's a significant amount of people coming from outside of the shanghai area. that's very, very encouraging to us because we fully expected a lot of visitation early on from shanghai. turns out it's from all over china and, again, the most important thing is flawless opening, people love the
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product. it's going to be there for a listening time so we feel really good about it. >> you have a pretty good sense of the american economy between the theme parks and consumer products and movie going. a new study out today showed that business owners are concerned of investing because of uncertainty politically. are you seeing the same things in terms of your business or consumer? >> that doesn't describe us. we have been aggressive investors. we tend not the look at short-term cycles. the current political environment. we're building two "star wars" lands. we're opening an avatar land in orlando in 2017. we're building two new cruise ships. made an investment in bamtech. we have a lot of activity as a company that is clearly focused on or being -- our investments are being made with a long-term in mind. that's how we operate. we obviously feel bullish about our prospects in the world
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overall. and again, what's happening in the country today. meaning right now. really not much -- not much relevance to us of investment pattern. >> political uncertainty, something you're watching? >> it's interesting politically in the united states. we are watching that a lot. we like what abc news is doing in terms of coverage. uncertainty? you know, uncertainty is to some is the outcome of the presidential election and not having an impact on us. >> we are out of time. i have to ask if you have an update on the succession planning. >> it will be successful. >> it will be successful. okay. i didn't expect to get much there. you have so much other news out there. we appreciate it. bill, over to you. >> all right. julia, good job. thank you. we'll take a break. and come back with more "closing bell" in a moment.
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afternoon, everybody. here's what's happening at this hour. a federal judge upheld former illinois govern rod blagojevich's appeals. this came despite pleas. blagojevich went to prison in
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2012. pennsylvania attorney general kathleen cain arriving at court. she faces perjury and obstruction charges and prosecutors say stem from the drive for political revenge. a news conference held in buffalo concerning the largest seizure of narcotics ever in the western district of new york. authorities announcing the indictment of 17 defendants for their involvement in a drug trafficking conspiracy. and carl icahn phoned in to cnbc earlier today to discuss the support of donald trump and explained why middle class workers like the character of archie bunker should back him, as well. >> i certainly do not understand why any worker, any middle class worker, you know, the archie bunker of the world, and that was a great show, i used to watch it. those guys are going to vote for him because they're smart guys. they know they're getting screwed. >> as mr. iger said a few moments ago, it's an interesting
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political season. that's the update this hour. sara and bill, back to you. >> sue, thank you very much. we have more earnings. we have solarcity this time with jane wells. how do they look? >> archie! doing my best edith bunker there. better than expected quarter. earnings came in non-gap earnings at a loss of $2.32 a share. the street thought it would be worse at negative 2.44. revenues better than expected at 186 million versus 146 million the street expected and revenues came from people leasing. most of the revenues not from people buying the panels but leasing them or loans to finance that. all right. here's the q3 guidance. the eps, not gap eps minus to 255 to 265. revenues between 155 and 168 million. the street thought it might be 175 million. now, as for the $2.6 billion
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takeover by tesla, elon musk, of course, basically in charge of both companies, because of the tesla motors acquisition proposal, we have greater than normal delays closing commitments. i'm assuming more on the call about that and another rival how things are going in the solar world, sun power shares clobbered after hours after cutting 15% of the workforce. with oil so cheap right now, it is hard to be selling solar panels and elon musk wants to turn it into an energy storage battery conglomerate. back to you. >> all kinds of things. >> archie. archie. >> thank you so much. >> good. so what do you think? i mean, i guess tesla's buying them just in time. >> i guess so. if disney is a great monoization companies of all time. >> neither company has positive cash flow. >> no. it doesn't. as we see, the losses continue
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to mount for solarcity. if the expectations are not what they expect, it makes sense for potential backers to want to know whom they're giving credit. combined or solarcity. i think the position -- people should read the heard on the street of "wall street journal" with exception of putting the two companies together. >> a lot of questions. see if shareholders approve the deal on the table. donald trump proposing a temporary moratorium on new federal regulations. up next, supporter and cke restaurant ceo andrew puzder says it will spur job growth in the economy. twitter reportedly trying to sublease 30% of the headquarters in san francisco. we'll talk about what that means for the future of the company when we come back.
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we've just been hearing so much about how you're a digital company, yet here you are building a jet engine. well, ge is digital and industrial. like peanut butter and jelly.
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yeah. ham and cheese. cops and robbers. yeah. nachos and karate. ahh. not that one so much. the rest were really good. socks and shoes. ok, ricky... as part of the economic plan, republican nominee donald trump proposes to in his words massively cut regulation. listen. >> under my plan, no american company will pay more than 15% of their business income in taxes. i am going to cut regulations massively. massively. our lower business tax will also end job killing corporate
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inversions and cause trillions in new dollars and wealth to come pouring into our country. >> we welcome now andrew puzder of cke restaurants and an economic adviser to the trump campaign. good the see you again. thank you and welcome. so the corporate tax cut of 15% is one thing. >> thank you. >> how about the massive cuts to regulations? i'm sure it's music to your ears and we didn't get any real specifics there, andy. >> well, it's music to everybody's ears i think that's in the business community but the specifics were, number one, you stop the executive orders. put a moratorium on them and repeal the ones oppressive. number two, you go back through and look for business regulations that are oppressive and eliminate those. number three, he's actually going to tell every agency head to list the regulations under their supervision from most important to least important. and look at reducing the ones that are the least important.
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that's the kind of plan that could reduce regulations and coming from a ceo so, you know, it's very encouraging. i think the business community was happy to hear that from mr. trump. >> what do you say to those saying what mr. trump is proposing is more beneficial to the richest out there, elimination of the estate tax, the tax pass-through that would -- going from 39% to 15%? there are many well think americans who take advantage of that anyway. get the income that way. and on and on. is this the kind of tax plan that benefits the middle class as is talked about? >> yeah. absolutely. it is. what will benefit the middle class and the working class is the creation of good paying jobs, getting rid of the wage stagnation that we have experienced and seeing income inequality reduced with economic growth. economic growth will create jobs and will get wages back on track. this plan is aimed, not aimed at picking on the group or hurting
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that group or it's aimed at helping everybody by general rating economic growth nationwide. and when you -- you know, they're reducing taxes. there's now four brackets. imsy pli the tax code, everybody, including rich and poor. and the people that are getting the ben filths, the 15% tax break, these are businesses that will reinvest the funds to help create growth. we have to stop focusing on who we punish and who the bad guys -- >> who pays for it? isn't that going to cost trillions to the budget deficit? what happened to conservatives being concerned about high debt? >> nothing at all. they're still concerned. first of all, the evidence of that is that he had three income tax brackets. top one 25%. in this round of his tax plan, took the 25% for the highest earners to 30% and recognized not enough of a deficit impact of the initial plan and one way to get spending under control,
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get deficit spending under control and fund social programs like social security and medicare of economic growth. we need economic growth. the government can't do this. it can't mandate it. the whole plan, regulations or energy or tax, is aimed at economic growth which will help working class and middle class americans more than any plan to redistribute income. >> before we let you go, a response to something he said today campaigning in north carolina about the second amendment. it lit up the twitter-sphere and got a strong response from the clinton campaign. here's what he said and then i'll get your response to it. >> hillary wants to abolish essentially abolish the second amendment. by the way, if she gets to pick -- if she gets to pick her judges, nothing you can do, folks. although the second amendment people maybe there is.
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i don't know. >> it was viewed as an inflammatory comment that he made there at the end. you know, what do you as a supporter of his, is it tough for you to support him when he does make statements like that? do you think? >> that's a first time i've heard that but -- the thing that occurred to me referring to the lobbying power of the nra. the nra is a very, very powerful lobbying organization in d.c. and talking about the second amendment. look. i haven't followed this. i was in meetings before the interview and sounds to me like he's talking about the lobbying and not sure why anybody finds that offensive. they're very powerful with respect to lobbying. >> that's what the campaign is saying, as well. >> oh good. good. thank you for letting me know that. >> there you go. thank you for joining us. >> good do see you. thank you. >> ceo of cke restaurants. twitter trying to rent out a large portion of the headquarters in san francisco. is that a sign that the company is in trouble? we'll talk about it when we come back. ntech services start-up.
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a need a new office? turns out twitter is subleasing office space in its own san francisco headquarters. >> apparently in an effort to make better use of that space but is it a sign of trouble for twitter? we want to ask. what do you think? >> i think it's great news. i'd much rather be in the real estate than the social media business. bay area? no better business in this world. i think there's probably not insignificant money making opportunity for twitter. probably a decent sign refocusing. if they don't have the need for it, then so be it. they're willing to take the hard medicine now, keep their costs
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low. as we know, they're draining serious costs particularly adding in the employee stock expense each quarter so to me a positive sign acting like a mature company and growth rate is not great and recognizing it. >> being practical in that case. >> i know it's the bay area but they're perhaps practical. >> we don't know the neighborhood it is in. >> i was wondering. meanwhile, twitter is the social spot for the top trending topic these days that we're going to go there. you've seen it, first seven jobs. a question posed by a twitter user and being picked up all over the place by ceos and executives so we'll reveal. sara, you first? >> first job was a barista at a coffee shop in cincinnati, ohio. my second job was at camp. i was an aerobics instructor. in the best shape of my life. i worked in an art gallery first moved to new york city in college. and then my love of forex at
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forex tv.com with a blog own then a production assistant and first job in television and led me to become a reporter. >> five jobs to get to tv. >> i think the only person who's got aerobics instructor and fx blogger. only person on earth. >> what about you? >> do you have it? >> you forgot already? >> think i have -- i would help. i was a kroger bagboy. that's cincinnati company. back in kentucky. i was a kris scheme scooper in a par dorr. camp counselor. kind of ma you would expect. a dmv clerk. worst job i ever had. full of women that smoked cigarettes all day. construction worker. taught me a lot. data entry clerk. that stunk. ad agency intern. not so great. >> bill, you go. >> all right. here we go. you ready? honest to god, first job i ever had, i taught the accordion. >> that's pretty awesome. >> sue me. okay? that was all through high school
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there. >> a skill. >> i was a bookstore clerk. worst job is working in a chicken shop to pay for my prom. lasted a month. a shoe salesman. we worked on the campus bookstore. a book editor for a year because i couldn't find a job in tv and then i did. >> you were an accordion teacher? >> how's your game now? >> i haven't played it. i quit. >> accordion and aerobics. package deal. >> it is not a babe magnet. that's for sure. a quick break. >> and rugby making the first olympic appearance since 1994. >> the coach of the u.s. men's team will tell us what it all will take for his sport to go mainstream. >> hi, i'm madison hughes, captain of the usa men's rugby seven s team. so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right? oh, so my custom studies will go with me?
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exxonmobil is a leader in carbon capture. our team is working to make this technology better, more affordable so it can reduce emissions around the world. that's what we're working on right now. ♪ energy lives here. what's it going to take, coach, for a sponsor to come in, i mean, a major sponsor and help make it mainstream in. >> we need the nfl and the nba to grasp this. >> in what sense? >> i think if they position the game in high schools so when they get to college they have experienced it. these guys can learn the game of rugby and compliment them to
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become potential nfl stars, but alternatively, the nfl creates an alternative avenue, pathway for players that are unsuccessful. >> yeah. rugby is making a comeback this year at the olympics first time in 92 years and about to start here on cnbc. i think in the corporate world today a lot of sports trying to find a showcase for sponsorship. >> it's a wonderful showcase. r rugby is a great game and some injuries but not like football. i think in our lifetime bans real mets rather than having them -- as they did in the 1910s, i believe. >> not the only sport after a long time, golf. >> after 112 years. >> going after an international crowd, a lot of these sports that are trying to boost their ratings and their viewership and sports players. >> rugby sevens takes 30 minutes to play this game. so it's very friendly to television, too. make it easier. >> a lot of time. you can have an hour show with 30 minutes of commercials.
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music to bob iger's ear. >> always good to have you with us. see you tomorrow. >> see you tomorrow. we'll be matching. >> that does it for "closing bell." olympic co

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