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tv   Fast Money  CNBC  October 26, 2017 5:00pm-6:00pm EDT

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around in the sense that it grabs the attention from the other cyclicals. it definitely seems like it's reminding people that these are organic growers that have a lot of power to put up good numbers. >> and the retail continues to suffer mightily. thank you, that was fun. mike, we'll see you again tomorrow kelly is back with us as well at that time. "fast money" starts right now. see you tomorrow "fast money" starts right now on the biggest night of earnings for the quarter our traders on the desk, it is tech's big time to shine amazon, alphabet, microsoft, intel all higher jack jackie deangelis is gearing up for amazon in a few minutes. dom chu is here listening to intel. rich ross is standing by, ready
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for instant reaction gene munster is standing by for us, you can see him on his red iphone listening to those calls. we start off with tech nirvana, alphabet, amazon, microsoft, jumping on the after hours some impressive moves for stocks that have had huge runs this year do you just keep betting on tech pete >> yes and it's easy to me because of the fact that we went into this and talked about the fundamentals if you listen to the earnings calls almost across the board, everybody has incredible growth. i'm mostly focused on microsoft, i have a large position. i also have something on intel those are the two i care about the most when i look at microsoft and i see the commercial cloud and the growth they've got there, this is something that satya nadella put out there the day he came on
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board and he's executed every quarter. the fact that that stock is making new highs is not shocking there's plenty of room to the upside >> this could have been reason to sell, just sell the news. >> in terms of what we saw now, or tomorrow? >> in terms of the stock's runup. >> it sounds like you may have a view on tomorrow >> no, i don't, actually listen, the headline one that was the most pretty faimpressiv amazon in terms what it did technically and valuation is google, alphabet, whatever you want to call it, beat on eps, beat on revenue. valuation to me at 25 times forward earnings is reasonable held 930 all through the summer. we talked about that a number of times. if it were to open here, i believe it would be an all-time high so you've got to go back and look, back in may we basically topped out about a thousand and ten, give or take. we're right there now. this is the next plateau for
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dealing wi google to go through >> your question is like, late july, when we had earnings it was also -- >> that's why i asked the question >> it's a good question. we spent the last three months consolidating behind those high. google and facebook also made new highs, in a sneaky manner, telling you there's a pretty constructive price action. we essentially have two months left in the year these stocks all are up about 30, 40%. facebook's situation, 50% of the year they're not giving up, between now and the end of the year. especially when you think about what's going on with the tax situation. if you have massive gains in these stocks, you're not selling in 2017, especially if you think there's a much better chance that you have lower tax rates in 2018 >> look, google, their core business, pay clicks are up. you've got youtube monetizing in a way we haven't seen. i think there's enormous amount of leverage. as guy pointed out, the valuation is one that to me makes it the most interesting. it's the most compelling buy,
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the one i can cling to and say i love core parts of the business, it's up 25% versus others up 30, 40, or 50. in amazon's case, aws is back up 42%, you've kicked up some growth there, really impressive. let's face it, they are showing profitability, they are showing that earnings leverage in their core business. amazon peaked last july, 1045 was the level to sell it i do think this stock has enough ammunition to get significantly higher >> in terms of the retail side of the amazon does, whole foods had $1.3 billion in sales for whole foods just for five weeks. >> it shows you the complete domination, when amazon comes in we talk about it every single night. when they come into a category, they're going to win at any cost and they're still making money as they do that. the earnings number, forget that for right now. 52 cents versus 8 cents or
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something like that. but when you look at the revenue, aws is strong as well the interesting thing, again, if you look at forward pes, you guys were talking about google i still go with microsoft. you look at the growth they've got right now. they've passed google in terms of the competition in the world of cloud, this quarter, with this 20 plus billion dollars revenue run rate they're in right now. they are just behind aws so they are digging their feet in and making sure that they are going to make a move in the cloud. that's going to be very meaningful in the future >> obviously these are great results pretty much across the board. the stocks are flying in the after hours session. this will probably mean a pop for tech overall in tomorrow's session. but just a couple of days ago we were talking about the outperformance, the real strength in industrials. now we're talking about strength in technology, which is a good thing. you have to make a choice here >> are you trying sort of back door would you rather?
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>> what are you going to do here, pal? you're knocking at the back door >> i'm knocking at the front door maybe it's time for tech to take a breather if we're in a rising rate environment in which economies are growing around the world, maybe industrials and other cyclicals are better bets. >> fortunately you don't have to choose we've had industrials conversations for quite some time now, pointing out different stocks i here what pete is saying on microsoft. valuation-wise between google and microsoft, you're sort of splitting -- ♪ >> did you hear that >> we're heralding the point you were about to make >> i love how you handled that >> i cannot wait to hear it. >> that's what i was going to say. >> operating margins are 31.5% the street was down around -- i
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think their guidance was 28% that's very impressive not that i want to sort of nitpick it here, but alphabet's margins were slightly below consensus. not a big deal but something to point out >> this earnings season has been everything that it was supposed to be on whole at least for most of the names that needed to do it it gets back to the point, is the market, now that we've got this extraordinary earnings space, it priced the same quarters ago this has been the price action we had to earn the multiples, now we've shown we can earn it i think that markets that are basically priced to perfection can take these kinds of earnings numbers and make it very difficult at two to three weeks. >> make it very difficult -- >> for stocks to move higher >> oh, you don't think this is reason to go higher? >> what i think is, we've been struggling, even with great earnings in a number sectors, we've seen initial pops and the overall market struggling for the last week or so, or some of these trends to me are
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concerning fantastic numbers. >> but it speaks to the consolidation. you're talking about a sector that was already, you're saying, was fully valued, it went sideways between q2 and q3 you saw banks and industrials take off i'm in your camp, i don't see another leg up this year because this is what was expected. >> but you see a leg lower >> for the reasons i said before, because of the tax situation. i'll tell you one thing, i don't believe there's going to be sweeping tax reform. there may be cuts. the easier thing is to actually do repatriation. that benefits this group of stocks right there to me, i'm not telling you there's another leg up if we get that announcement, but i'm saying it definitely buoys them. >> for a more technical look, let's go off the charts with rich ross, he's at the plasma to break it all down. hi, rich >> hi, mel we've got strong earnings, strong charts, which makes for strong buys. we'll show you the breakouts here is the after hours action
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in amazon. you don't need the green arrow to see the decisive nature of that move. i'll give it to you anyway look at that one-year chart. here is this perfect setup where the stock is sort of lying in the weeds here over the summer you basically have this head and shoulders top. what happens when the head and shoulders doesn't come to fruition, you get a powerful move in the opposite direction i think that move will take us up to 1250 on amazon, i would be a buyer on the breakout earnings strong seasonality you've got the big google after hours pop. similarly, when we look at the one year chart here, it's equally bullish but in sort of a different way. got a trading range bound stock here now we've broken out in decisive fashion. the way we get our upside target, we take the height of this pattern, $80. we project it out. it takes us up to 1080, 1100
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you're buying google finally, the big boy, microsoft. you can see this big pop we're going to go in the wayback machine, we're not going to look at a one year, we'll look at a 20 year chart of microsoft a lot of people say look at the run this stock's been on, i'm chasing. but you're not chasing in microsoft. you're basing. it's 18 years of a base here, okay the stock in 2000 was at 60 bucks. we're at 85 now. that's an average annual return of about 3% if my math is somewhere close. i think there's a lot more upside in microsoft. 18 year base you've got the earnings. you've got the breakout. you've got to buy it >> if you had to choose, would you rather which chart would you use, rich? >> i like amazon when a head and shoulders doesn't fail, that neckline provides a very powerful springboard to higher prices of that that's a stock that will see 1200, 1250 >> the longer in space, the
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higher the place or something like that. i understand the whole breakout of amazon. i hear what -- wasn't the high back in june 1080, give or take? is there a chance we fail at these levels and put a short term double top in the aforementioned amazon? >> there's always a chance but this stock has very powerful momentum now that was an exhaustive reversal. the seasonality was poor now with the wind at your back, the earnings are going to carry you higher that chart break is just the start of it. >> rich, thanks. we'll go around the horn here. rick, by the way, is going to stay at the plasma the whole light. things can change at the conference calls in terms of what you might buy off earnings right now, what would you buy? >> i'm committed on long stock in microsoft and long calls in microsoft. if i was reading through all the different numbers, rich picked amazon, i'll pick microsoft. the reason i say that is, the
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breakout, i see another 10%. that puts it at $88 a share. so i like what i'm looking at right now. when i look at the growth factor, when i bring up that growth, it's actually up 90% year over year these numbers are absolutely staggering to me that's what the focus is on. that's where the growth is coming from. and linkedin pitched in. it will take a while to get all that money back, but it pitched in a little over a billion dollars this quarter that's pretty big. >> sometimes i like to pile on pete i talk about google a lot. let's talk about these numbers for microsoft. again, they were very important because they had strength across the board. the gross margins in the commercial cloud were very important, showing they're becoming that much more able to operationally leverage the windows profits dropped to the bottom line. microsoft on a multiple basis, this gets back to the age-old question, where is it supposed to trade i think these are numbers, if i look at them all, i like these the best
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>> amazon, heading into the next year this is one that probably has the least regulatory risk. google and facebook, that will be a 2018 story and could keep those stocks at bay. amazon is one that people don't care about valuation us consensus going from $4 in earnings to $8.50 in earnings, $15 in 2019. if those were real earnings that people got behind, this is a much higher stock. you know, in 2018. i'm not saying to buy it here. you said does it fail at 1050. if it stays at consolidation at year end, this could be a good setup for 2018 >> microsoft, again, i think alphabet proved itself again fact that it held at 930 is encouraging. g-o-o-g-l. coming up, we'll bring you the details as they break, don't miss a minute. plus jack is back, is twitter finding its trying to have could it be a buy sign for snap? the biotech beat down
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continues, first amgen, then celgene, now gilead sinking in the after hours session. we'll bring you the latest details right after this break your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory.
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throughout history, the one meal when we come together, break bread, share our day and connect as a family. [ bloop, clicking ] and connect, as a family. just, uh one second voice guy. [ bloop ] huh? hey? i paused it. bam, family time. so how is everyone? find your awesome with xfinity xfi and change the way you wifi. to "fast money." gilead sinking in after hours. meg terrell is at headquarters with more. >> reporter: on its face, gilead third quarter looked pretty good, a beat on top and bottom
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lines. the company raising the lower end of its 2017 product sales guidance what is driving the stock down 4% after hours if you dig into the numbers, the implied fourth quarter revenue from hepatitis c is looking pretty light if you add up the whole year, an annualized run rate for the hepc franchise. so people might be parsing through that and getting a little bit worried about the further degrading of the hepatitis c franchise for gilead there are questions about their new cancer drug they just got approved in their acquisition of kite pharmaceuticals all that happening on the call now. this negative news apparently for gilead really just following the whole biotech trend, a lot of bad news this earnings season
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for biotech. >> we saw the pressure on ibb today. thank you, meg terrell on gilead we saw the decline in shares of celge celgene, what a sharp decline, that hurt the entire level >> gilead is back to pre-kite levels they're in the hot space 8 cv, we knew this business, as meg pointed out, that sounded light, sounded extremely light hiv is better. i think people are concerned about m&a still. i think people still expect more to happen in this space and they're not -- >> if it's going to happen last night carter worth liked where the charts were setting up right nowamgen, yes. >> even though they had some declines in sales, we talked about the $41 billion last night. i think they're going to have to use that cash. we look at gilead and the pop they got out of kite now starting to fade back down
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again. still, that was a great acquisition they needed on cancer treatment i think this amgen chart is starting to set up, as carter was telling us those numbers, mel, that's room for m&a. maybe that starts to turn biotech around >> a week ago, the 19th, celgene came out and said they would discontinue the drug phase iii, discontinue the trial. they paid a lot of money for that drug, stock sold off in the aftermarket. that happens the selloff is overdone, i said then, 127 at the time. we've talked about celgene for literally years. that was a week ago. now they report a quarter which is a disaster. i knew they were going to report a week later not that i -- i didn't say this on the show that night but i said, you know what, if the quarter is not okay, why wouldn't they talk about it tonight? tonight be a week ago. so my problem is, what did -- everything they said today,
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celgene, they knew a week ago, absolutely why wouldn't you package that all together that's the problem i have. that's one of the first missteps they've taken in quite some time and the stock, the company paid for it today i do think they sort of have to explain what happened in a week's time. >> they have a credibility issue now. >> in my opinion, absolutely >> they would have been down 16% last week. >> fine. why didn't they do it all at the same time? >> it might have been down more. at the end of the day, listen, you guys have had single names, gilead, you called it, you've had the celgene move on the way up ibb, all year long you guys were talking, when it breaks at 300 it's going to be a big breakout. you all got that right now on the way down, you have to keep an eye out. the fundamental story has shifted. you had a reversal in sentiment from 2015 into that election period and everything like that. now maybe these guys, maybe this sector stays in, you know, the dirt for a little bit.
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to me, i think 300 is a big level. >> i'm simply saying it doesn't turn overnight the fundamentals in the sector still look very strong ahead, we're all over the after hours action alphabet, amazon, microsoft all soars on their earnings reports. alphabet's conference call under way, amazon and microsoft about to get started we'll bring you the latest i'm melissa lee, you're watching "fast money" on cnbc, first in business worldwide meantime here is what's coming up on "fast. jack is back with shares of square and twitter surging and the twitter turnaround could mean it's time to buy shares in another social giant we'll tell you which one plus the traders are eyeing d eyl tocks to buy anth'lname names, when "fast money" returns [vo] when it comes to investing,
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that is one ugly chart check out shares of mattel, tanked nearly 20% after hours, suspending its dividend. the company pointing to the toys "r" us bankruptcy for its big miss tim, i'll have to go to you on this, unfortunately. >> this story was turned around for a while. they've run into secular issues. management, to me, they've really miscommunicated where their business is. on this call they say we are clearly -- the word was "clearly" not going to make the targets we set in june that sounds awful. they've removed the dividend the punishment is this was at one point a 6.5% dividend stock and it looked fine all they talk about is cutting costs. their core brands are not hold ground these are the secular issues the company is facing. toys "r" us bankruptcy is a major hit.
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this is why these guys are saying this is short term stuff. but it's hard to believe what these guys say guy was talking about credibility of management teams. these guys continually misassess their business it's a big move. we turn now to a big earnings winner today, that would be twitter the stock is up nearly 20%, having its best day in more than a year as it broke through 20 bucks a share. the social media company adding 4 million new users, impressing the street, giving snap a boost too. check out these two stocks twitter is down 21% since the ipo with a market cap of $15 billion. meantime snap is down 15% from its ipo with a similar market cap of $17 billion is twitter's sudden surge a good sign for snap, will these two names become social climbers >> social climbers >> get it? >> there's a couple of really good things on twitter the fact that this stock had such a strong reaction to just 4 million monthly active users
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>> you don't think we're short covering >> they've basically conditioned investors, in my opinion, not to expect 10 million, 12 million. >> they did that two years ago >> i understand, but the stock kept going down 10, 15% after every quarter they reported for the last two years the only thing i'll say, at the end of the day, there's a $12.5 billion enterprise value versus snapchat at about 12 1/2 or something like that. to me, i think that twitter may be coming out of something, and snap may be trying to figure out a lot of stuff we've seen headlines about spectacles, evan spiegel >> you're not a believer >> i'm not a believer in snap at all. twitter, it's 7 million short stock shares in there that absolutely added i think to today. but on top of that, they actually had some pretty decent numbers. i'm not talking about the ads. i'm talking about the video and flip-through ad investment they've made that reads facebook.
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i feel like facebook and the investment in video and how much that's been something that zuckerberg has put out there i still think snap is losing to instagram, we'll see i still think instagram is dominating the space >> i trying to he with what dan is saying. you've had four consecutive quarters now of double digit user growth which isn't anything to do cartwheels over, but they're being rewarded for it. product innovation, not crazy innovative but it's starting to work >> what i thought was impressive, we talked about this over the summer, maybe this is starting to turn the corner a bit. quickly to pete's point, the stock traded at 112 million shares today typically trades 12 million shares so a lot of the shorts that pete talked about got squeezed today. the bad news is, we didn't take out the high we saw back in july which was either side of $21 if you enjoyed this move over the last couple of weeks, i don't think there's anything
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wrong with taking money off the table in twitter and looking for another entry point lower. facebook is set to report earnings next week, options market applying pretty big moves to the tech giant. dan? >> that stock was a 3% move for amazon for google, below what they've been averaging over the last four quarters. facebook's situation, it's a decent move, 4.5% in either direction. for me that's kind of interesting. it's showing a little bit of hesitation possibly on traders as we head into it call volume was two times that of puts. we know that obviously amazon, facebook, and google are all now back very near their 52-week highs. look at this facebook chart, just to give carter worth a little love here, he's been highlighting this one as a mean up trend look at the consolidation since the last quarter this thing is going much higher. i know pete will give a giddy-up
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to that. >> it's up 1.6% after hours today. >> one of the things that stuck out, a week and a half ago, someone bought 20,000 180s somebody thinks this thing has room to the upside i'm not in it, i think i want to get back in on the options side. still ahead, $2 trillion worth of tech stocks reporting earnings tonight, autonomous, facebook, microsoft, intel those calls kick off in just a few moments. dom chu is listening in on intel. we'll bring you the last oten all those stocks when a very busy "fast money" continues. well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all.
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well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade. hi, i'm the internet! you knoarmless bowling.lt? ahhhhhhhh! you know what's easy? building your website with godaddy. get your domain today and get a free trial of gocentral. build a better website in under an hour. aggressive styling, so you can break away from everyone else. the bold lexus is. experience amazing. hey, how's it going? um... who are you? i'm val. the orange money retirement squirrel from voya. i represent the money you save for the future. see?
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welcome back to "fast money. an earnings report on wynn resorts. let's get to leslie picker at headquarters >> reporter: investors were not impressed. shares trading down a little bit in the after hours
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some weakness in the macaw business investors are, quote, nitpicking over that region steve wynn said, if someone wants to nitpick, they're free to do it as for las vegas, this was the first earnings call since the mass shooting earlier this month at mandalay bay. wynn said the tragedy had no effect whatsoever on his company but added that the presumed shooter was a predict customer of wynn hotels and the community is still searching for a motivate >> we have nothing to add to the explanation of why this maniac did what he did. other than he just had a screw loose, he snapped or something as to what other hotels are doing, i'm sure that in every executive suite up and down the strip and in reno and everywhere else, and hotels around the country, everybody's trying to figure out, is there a way to
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use local parlance, to lower the odds of a repeat >> reporter: he added they took action a few years ago, speaking with consultants, and with ray kelly, former police commissioner of new york city, how to prevent their property from being used to attack others >> thank you, leslie picker on wynn pete >> i own the stock i agree with steve wynn, the nitpicking of what's going on with the numbers from macaw. the revenue numbers are up i think the numbers looked fine. the stock has made an incredible run, we all know that, particularly in the last -- >> not good enough >> we'll see tomorrow. it's been volatile in the post market, it was down, now it's bounced back towards where it flattened out today. >> we're at the sweet spot in the vegas cycle, that business is crushing it they've been given a bigger multiple, typically they blend
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the las vegas business and the macaw business nitpicking is fair when you this the composite multiple is reflective of that the cycle here in the states, despite the horrific event in nevada, it's unbelievable for these guys the casinos are raging and thes guys are in the middle of it >> mel, if we saw a hallosellofe home depot, another buy for me >> give me a percent >> if it was 5%, i would be a buy. >> he was more excited about the las vegas business, if you recall >> there we are. >> look at that beautiful suit it's fantastic >> the point is, tim is right, the macaw business is twice that the 11 in las vegas. he was thrilled with what's going on in las vegas, room for growth i don't think the multiple of 22
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1/2, 23 times is that expensive. it only gave back about half of today's gains. i still think the stock runs higher ahead, a tech earnings extravaganza tonight alphabet, amazon, microsoft, and inintel, all on the move conference calls are under way we'll bring you the latest it wouldn't be tech earnings without gene munster, he's fired up, manning the red phone. we'll get his take oquten arrs which means he is buying more "fast money" right after this
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welcome back to "fast money. two of the names reporting after the bell, intel and alphabet let's storm with dom chu on what intel's ceo had to say about the quarter. >> reporter: intel has tried to reinvent itself to get things turned around toward growth businesses they did make a point of emphasizing the fact that data centric businesses now represent a very large chunk of the intel business it's something that intel's ceo spoke about during the conference call. here's what he had to say about just how big it is >> our data centric businesses
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grew 15% year over year, reaching 45% of our revenue. proving that intel is becoming a data centric company we saw strong cloud growth, outgrew the service provider in market, and while enterprise declined moderated sequentially, we still see workloads moving to the cloud. >> reporter: all right so the internet of things business, record revenues there. some of the memory businesses, record revenues there. also the data center as well they also spent a good amount of time talking about the autonomous driving side of things a lot of growth there, obviously they bought mobileye, a big player in that business. the first question in q&a from the analysts just about ten minutes ago was about artificial intelligence it goes to show you guys how much a lot of these analysts out there are looking to see what intel can do with those growth areas of the business. the pc business is also big. remember, also, the biggest part of that business, we'll see if that gets more attention remember, we'll get a lot more
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color on this because bob swan, the ceo at intel himself, is going to be first on cnbc tomorrow morning joining the "squawk alley" crew. over to you. >> dom, thanks, dom chu here at the nasdaq dan, you've been bullish intel >> all the reasons that dom just mentioned, all these growth areas, they spent $33 billion in acquisitions over the last few years to get into these emerging technologies to me, that was the play i think it was underappreciated by the street, the stock was too cheap relative to the valuations that companies were getting bought for when you think about 2018, it's still a cheap stock. why i sold least week at 40 1/2, i didn't want to take the risk into the quarter but you're seeing consolidation in the low 40s and you buy for the new year >> the self-driving car aspect, the technology in waymo, that's
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pretty interesting >> people found a reason to put whatever they wanted on semiconductors it wasn't chasing, it was basing, how am i doing, rich this is the company that in the mega cap space offers some value. the fact that service and data center is roughly 60% of that high growth business for them, it is starting to move the needle it's reason to be excited. now let's get to josh lipton in san francisco, alphabet's earnings call wrapping up moments ago, josh, break it down for us >> reporter: melissa, google's ceo began the call by laying out his vision for this company. his focus on ai and how that technology is going to help define his products and his partnerships take a listen. >> companies are already experiencing how ai is important for computing. computers are adapting to people rather than people needing to adapt to computers fundamental to this experience is google search and assistant
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we introduced our assistant last year and it continues to get better every day, helping people get things done in the real world. walmart and target have recently integrated with google home, which means you can order everyday items from them much more easily. >> reporter: sundar pichai mentioned youtube, 1.5 million users who spend 60 minutes a day on mobile, 100 million hours of watch time in the living room every day, a big jump year over year he mentioned google cloud, and how the technology will set him apart from the competition, from amazon and microsoft of course it was just yesterday, google announced a new partnership with cisco in the cloud. also with hardware, in pichai's words, he remains committed to hardware, he believes google pixel preorders are double what they were last year. >> thank you, josh lipton in san
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francisco. it wouldn't be tech earnings without our "fast money" friend gene munster, monitoring the alphabet call on his red phone what do you make of the call so far? >> i'll give you one point we've all been talking about and a couple of points from the call, josh touched on some of this, but the best revenue growth for google, that's impressive. from the call, they're going to be doing everything in ai. this is like a race to see which ceos can talk more about ai. we'll count the number of times he mentioned that on the call tonight. this is a really big deal for investors, because the more that they can embed ai and really become an ai platform in the long haul, they can keep that revenue growth up. that's google. let me give you a couple of quick takeaways from amazon. the guidance for the december quarter, up 5%, excluding whole foods, compares to a 1% positive guidance in the last quarter so that's more optimistic. what they're seeing, and they've just talked about this on the
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call, is they sign up a boatload of prime users on prime day in the summer, and those users typically spend three or four x more they can model how that plays into the holiday quarter good news for amazon >> gene, thanks for those thoughts i'm on the "fast money" twitter feed and on it you have a lot of great comments you seem really excited about youtube. this is pretty staggering. youtube, mobile usage is an hour a day. it's getting 100 million daily hours watching every day, up 70%. the extrapolation is what, gene, for the rest of the space? >> i just want to point out even further, that's 100 million hours per day in the living room that's people with a connected tv mobile usage is probably close to a billion hours a day, these are crazy numbers. the impact is they haven't fully figured out how to fully monetize youtube video is a great platform for advertising. they keep experimenting with that i think this is going to be a
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growth we believe that the user growth was 30%, this outpaces the overall google growth. this will be an iron horse for their growth for the years to come >> we have to get your grades on each quarter amazon and alphabet. what are your grades >> i'm going to give, surprisingly here, google an a and amazon an a minus. the reason why google gets an a, best growth rate in three years, that's fantastic the reason i'm giving not a perfect score to amazon, while it's a great quarter, their unit growth slightly missed the street, plus 25 percent plus 27. i'm a hard grader here, but that's how i see it. >> gene, thanks. great to see you, gene munster of loop ventures who agrees with gene on those grades >> i do. and again, think about this. $700 billion market cap growing at 24% a year, trading at a multiple that to me is the greatest combination. as gene pointed out, they
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haven't even if i could out how to monetize this thing meantime, youtube is over the top, another competitor in the space. >> we alluded to it at the top of the show, in terms of alphabet ask pete -- >> why don't you just ask pete >> you can go across the table to me. >> you want to tell me what guy says >> ask him what he did last night when he got home from the show >> what did you do when you got home from the show >> when i come here to new york, where i no longer live, i don't have a television where i live in connecticut >> you're that guy >> i am that guy except for much more than one hour video, with twitter, facebook, and obviously youtube, the mobile idea behind this whole thing, what a growth area along with hardware. >> there's an easy answer. this is really youtube, the only social property that google has. they have seven properties that have a billion active users.
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they need twitter. when you think about this company, google's up in market cap terms more than twitter's enterprise value how do you move video around the web? how do you do it in a mobile platform with something like twitter. >> talk to the camera. >> i thought you told him to -- >> i've been saying it >> pete will talk to guy >> what are the implications on traditional media? we talk about disney all the time and the impact of cord cutters, comcast, the parent had earnings out this morning. >> at&t got torched. youtube is overwhelming with these ads for how you can basically for 35 bucks get everything you want including live sports. it puts it in perspective for people who just want to make it very simple. i do think they're a major rep >> check out amazon and microsoft, both soaring after hours. 'lbre conference calls are under wawel ing you the very latest when "fast money" returns.
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throughout history,
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the one meal when we come together, break bread, share our day and connect as a family. [ bloop, clicking ] and connect, as a family. just, uh one second voice guy. [ bloop ] huh? hey? i paused it. bam, family time. so how is everyone? find your awesome with xfinity xfi and change the way you wifi. welcome back to "fast money. microsoft and amazon soaring after hours. john ford and jackie deangelis have been monitoring the conference calls let's start with jon fortt >> here's how satya nadella started out the call >> i'm proud of the results that expand all of our segments we now have 120 million monthly
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active users of office 365 commercial we have more than 530 million g linkedin members azure compute usage more than doubled this quarter revenue grew 90% windows 10 commercial monthly active devices grew 90% year over year. >> the case he's making, margins are up 2 points year over year, usage is up, engagement is up on these projects he even focused in on gaming, saying that esports and streaming are a particular area of growth in that category >> thank you, jon fortt covering microsoft for us amazon surging in the after hours session as well. jackie deangelis has been listening. >> good evening, melissa, that's right. amazon has passed expectations on many fronts, not just the top and bottom line. amazon web services, that's amazon's version of the cloud.
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it was a particular segment of the business that everyone was watching in the quarter. revenue, $4 had$4.5 billion that was a blowout number. >> revenue growth was the same as q2. we're at a $18 billion run rate, last quarter we were at $16 billion. very pleased with the customer response in the aws business as well and usage growth is growing a lot higher than revenue growth so, you know, particularly pleased with the new customers that we've added, and the additional workloads that we've picked up from existing customers. >> melissa, it's a competitive part of the business they've been working at it since 2006 and making significant strides. >> jackie, thank you i know we said goodbye to gene munster, but he's got something to say about prime so we'll go back to you, gene, in minneapolis. >> melissa, they've stroke the
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genius, created a holiday in the middle of summer for us to buy stuff and sign up new prime users. this probably added, my back of the envelope is around 2 to 3 million new prime users. that's going to get us into the low 70 millions. again, those spend probably three to four x more than a non-prime user essentially they have these people buying into the system and they're talking on the call now about new benefits they're going to offer prime members for whole foods, basically a membership in the store, you'll be able to buy more fresh stuff and get discounts. a lot of good things coming out if you're a prime member >> i think we're all prime members except for maybe guy thanks, gene gene munster of loop ventures. they also recently announced they're selling these in-house cameras so people can come in and drop off packages. they're trying to make it -- >> what's going on there >> what could possibly go wrong?
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>> you see the person dropping off the package in your home anyway, anyway, they want to make buying frictionless >> they want to make everything frictionle frictionless whatever service you can think of that you're paying someone else for on a monthly basis, think of it in five years, it's going to be wrapped up in prime at some point. it could be your wireless service, your cable, original content. that's where it's going. when you see that prime growth sword they've been displaying, this is a company that's expected to do $200 billion in sales up from 135. >> i totally agree with that the publicbashback if we want t it, whole foods was once for sale, everybody wanted it, but it was dying it wasn't a particularly sexy business, they had no growth they've gone in there and become less asset-light and a lot of margins are things you should be worried about in the longer run. this will still be the crux for
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this company aws acceleration i think is the most impressive part about this quarter. it's less about the core business >> up 42%. >> i go back to microsoft again, just because when you listen to satya nadella and the excitement in terms of growth, not just the azure and 90% there, but you look at something like the windows 10, the active users they are killing it. it seems to me like that trajectory is enough to really push this thing higher >> you've been right, you've been long the stock, the stock rallied 8% into this report. listen, i know you love growth, you talk about growth. and people are willing to pay a certain multiple for amazon's 25% growth, google's 20% sales growth microsoft will probably be a double digit revenue grower again, it's just any going to be for me, at 24 times -- >> i disagree, i think your version for what they're doing in the cloud is absolutely skewed even the pc area was something growing for them video, talking about the
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streaming and gaming, one of the things that's hurting tim's mattel right now is video gaming that's what's killing it as well >> thanks, pete. >> sorry next, final trades
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so get back to it and do the best work of your life. final trade, pete? >> microsoft going higher. >> a leg to stand on, great charity, oktoberfest see you tonight. i'm going to sell his microsoft. >> good luck >> so aggressive to go against
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his -- >> late aggressiveness by dan nathan exxonmobil report tomorrow morning before the bell. on weakness you buy, on strength you add. >> i'm melissa lee thanks so much for watching. "mad money" with jim cramer starts right now my mission is simple to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends, i'm just trying to make you money. my job isn't just to entertain but to educate and teach you call me at 1-800-743-cnbc or tweet me @jimcramer. we always hear that safety never takes a vacation you always have to put

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