Skip to main content

tv   Squawk Alley  CNBC  November 24, 2017 11:00am-12:00pm EST

11:00 am
among the leaders. that does it for this hour of "squawk on the street. now back downtown for the start of "squawk alley." >> jackie, thanks. good morning, it is 8:00 a.m. where the doors are just opening at the best buy in san francisco. it's 11:00 a.m. on wall street, and "squawk alley" is live ♪ ♪ adobe analytics has new
11:01 am
numbers out moments ago on the surge in e-commerce. 640 million spent online so far today, up 18% year on year we have team coverage with courtney reagan and morgan brennan. courtney, to you first good morning >> good morning to you, carl so black friday certainly changed over the years, right, with the idea you can shop on thanksgiving day in the evening, you can shop online all the time, but it's still going to be retail's biggest day of the year somewhere between 30% to 60% of americans are going to shop on this black friday. >> personally, i like trying things on and it's really not that crowded right now, so i think we've had a good experience >> much easier to buy it and have it already rather than waiting for it to get here >> i went out last night with my dad. i like to get into the christmas spirit early, so as soon as thanksgiving dinner is done, yes, christmas, let's go out >> walmart's traffic was
11:02 am
stronger than target, at least during the beginning of the door busters on thanksgiving day or night, but then shoppers are also able to get what they came for, at least in walmart stores. this morning he went back to a couple walmart stores, crowds looked normal, but admitted it's hard to tell exactly because of so much commerce being done online and stretched out you just mention those new adobe numbers. we also know adobe says for the first 22 days of november sales were also up 18%, so a lot of shoppers got some of that done early. now, based on mobile searches today, when customers are looking for the top three retailers near me, best buy is number one, target is number two, and walmart is three. that's very different from last year when macy's was the number one searching for stores near me, then walmart, then home depot. when it comes to discounts market track actually says this year discounts are not as deep at a number of retailers, including best buy, jcpenney,
11:03 am
kohls, and target. that could be good for margins as long as the retailers can convince shoppers to buy one last thing, we noticed lowe's is having some website outages since about 9:00 a.m catch point pointing that out to us, so we'll continue to follow that for you back to you. >> court, thank you very much. we'll come back to you later today. morgan brennan is at one of target's busiest stores in the country. morgan >> hey, carl, that's right in the past hour since we last checked, i will tell you foot traffic here has certainly picked up really since this store reopened this morning at 6:00 a.m we've seen really a steady kind of moderate stream of people coming in and out to shop in the store. i'd really liken it to a busy weekend day, but the one area of the store that's seen the most action and the most lines far and away, it's the one behind me it's electronics so we caught up with shoppers to see what lured them into the
11:04 am
store rather than say buy their stuff online, and for many it was the hard to find high-tech devices like the apple iphone 10 >> i was up and i was checking to see if they were in stock, and they were, so i thought, well, i'm already awake. i might as well. >> i'm really interested in buying the google home mini and other christmas decoration deals and things >> this is $199 and we stumbled upon this coffee maker and now we're thinking about getting this speaker right here. >> so many of those electronics deals are only available in store. for example, many of the tvs one of the most high profile deals that's taken place here, westinghouse 55-inch ultra hd smart tv that was marked down to $250 last night on thanksgiving. unsurprisingly it's been one of the top sellers for target so far and locations like this one sold out last night. other hot deals, google home minis, iphone 8, which is not
11:05 am
markd down, but comes with a $250 target gift card, also gaming consoles from sony, microsoft, and nintendo. so all of this is important because electronics are a key area these big box retailers like target, walmart, best buy are competing against amazon and given the fact that last week from target we got disappointing quarter guidance by investors, electronics and how busy areas like this are are really in focus as we go into the crucial final weeks of the year. back over to you >> morgan, our good stuff. we'll come back to you later, as well morgan brennan books, movies, and video games among the most discounted products you see apparel at the right there might be the effect of colder weather we're getting as for most desirable products, tech gadgets topped the list >> a lot of the tech products you're seeing that some of the
11:06 am
home products that have technology built into them, you know, there's some interesting items that we're selling out of in our stores. a lot of that we can get back into some of that there is going to be a reduced supply of it, then it is going to come down to what fashion and other gifts she wants. >> meanwhile, amazon did hit some all-time highs today, 1176 or so. are brick and mortar retailers fighting a losing battle or not? oliver chen is over at cowen with a new note this morning and victor anthony is with us at post 9 happy black friday one of the great days of the year >> yes >> oliver, i'm seeing your new note better digital and physical store traffic. more selective promotions, colder weather, better margins, inventory control. is this goldilocks, or are we glossing over hard parts >> there is a brighter black friday stores were stuffed more than last night's turkey, so we're
11:07 am
looking to 4% to 5% growth also digital is a big part of the story, so online growth about 15% to 20%, as well. there are a lot of things moving in retail's favor, including cooler weather, good inventory control, and generally speaking a good economy with low unemployment so it's a brighter black friday, it twinkles, and inventory control has been good in terms of our overall call outs we like walmart, we like what we're seeing with everyday bargains there and we're also impressed with a lot of improvement at target versus last year. we agree electronics are a good deal and innovation and jeans, as well. >> you know what's brighter, too, the outlook for amazon going into the season. what has changed versus last year is people use alexa a lot more they are willing to buy more than they are comfortable online even more so than last year. are we going to see that in amazon's numbers >> first, this is probably the best set up for amazon, at least
11:08 am
for the holiday shopping season that i've seen in the 15 years we've covered the stock. >> basically ever. >> ever, right best setup driven by alexa echo devices, as well as mobile devices, which i think amazon has a very, very strong position in typically e-commerce and mobile, the rate of acceleration in fourth quarter increases significantly. mobile penetration, e-commerce penetration in the fourth quarter. this quarter is no exception particularly for amazon, when i took a look at the downloads this year, they had the highest number of downloads, ebay coming in second, of any company within the u.s. i took a look at activity yesterday, thanksgiving, amazon had the highest usage of any pure online retailer that i've seen ebay also coming in, walmart, target, as well. but they had the best performance in terms of mobile activity and that's 50% growth year over year and mobile
11:09 am
activity on a platform the prime fly wheel is working, e-commerce is working for them they dominated roughly 50% of online sales through amazon this year >> really quick, does it make you feel this will be the last of the strong seasons giving the inroads others have made >> no, i think because amazon is making -- the penetration of the home devices will set them apart. plus, they have the prime. no one really has that that is working in their favor significantly. >> how does the amazon story dove tail? in your note you note that amazon fashion deals have been going on all week. is that going to be a threat to some of the guys you cover >> there's no doubt it is a threat, but i would say mobile as a whole is about over 50% for our retailers, as well, and customers love immediate gratification. they still love stores over 80% of sales are done in store and black friday is really about experience, a social experience, an experience in lines. people really like it. they like being stuffed in
11:10 am
stores they like being with their friends and it's a fun occasion. that's something that can't be replicated online, but i agree voice technology, home, automation, thinking about artificial intelligence, that is the future of retail our view here is that bricks plus clicks matters and physical stores still matter, as well amazon is something to watch and what's also happened, melissa, a lot of the discounts occurred much earlier so we have had a long extended black friday period, but consumers are used to this, as well >> all right oliver, victor, thank you so much >> thank you >> thank you new developments in uber's massive hack attack and attempted cover up deirdre bosa is out west with all the details. deirdre? >> hi, melissa well, a new report says that current ceo knew of the hack two months before making it public of course, dara was not the ceo at the time, travis kalanick was back in the late 2016 when the hack actually happened, but dara
11:11 am
took up this position in september of this year and apparently found out two weeks after becoming the ceo now, he did acknowledge he knew about the hack before disclosing it in that blog post last week and brought in a third party to investigate and issue some recommendations. separately, though, uber did disclose the hack earlier to softbank as part of negotiations on a potential investment. "that was consistent with our duty to disclose to a potential investor even though our information at the time was preliminary and incomplete once our internal inquiry concluded, we disclosed to regulators and our customers in a very public way. guys, i spoke to one cybersecurity expert who didn't want to be named because he wasn't thosauthorized to talk at this issue he says the problem about this is uber hid it from everyone for a year he also says this so-called breach of reporting is there to protect your customers, not your
11:12 am
investors, and this is where uber fell short. customers and drivers were the very last to know, so he and other cybersecurity experts say that could open up uber to further fallout, legal, and possibly criminal. back over to you >> deirdre bosa covering all kinds of stories today for us. thank you very much. when we come back, toy retailers tying their fates to one comeback trend details on that. we'll talk to state of luxury retail and apparel with the ceo of ethan allen later how apple hopes to resurrect the holiday shopping season without its much anticipated apple homepod when "squawk alley" continues at fidelity, trades are now just $4.95. we cut the price of trades to give investors even more value. and at $4.95, you can trade with a clear advantage. fidelity, where smarter investors will always be. and at $4.95, you can trade with a clear advantage. at t-mobile, when you holiday together, great things come in twos.
11:13 am
like t-mobile and netflix. right now when you get an unlimited family plan, netflix is included. ho ho ho! t-mobile covers your netflix subscription... best christmas gift ever! you can binge watch all year long. now you're thinking christmas! and now when you buy any of this season's hot new samsung galaxy phones, you get a second one free to gift. that's one samsung for you. and one to give. t-mobile. holiday twogether. when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.
11:14 am
11:15 am
it is one of the few categories consumers will likely spend more on this year compared to last, toys. specifically, video game consoles for that we go to aditi roy at the toys "r" us which opened at 5:00 p.m. on thanksgiving day. hi, aditi. >> hi, melissa yes, they've been around for a long time here and one of the ways toys "r" us is trying to get more people through the door is putting big sales on video game consoles, as well as components this xbox is going for about $190 you're saving $90 here video games are also on sale big time look at all of these sales signs here one of them, this is a top
11:16 am
seller, this is $15 off. the toy retailer is trying to tap into the comeback of the video game console analysts predict the console is coming back because of various things, despite the explosion of digital downloads. they say that video game console sales are going up 27% this year over last, up to about $2 billion. the reason for it, they are saying companies are coming out with improved hardware, better content, and also that social networking component, which heightens the competition out there. one analyst says there's also that nostalgia factor. >> xbox and nintendos are really hot right now, especially coming from the gen z millennial populations. they are attracted to these toys because it reminds them of the time when their older parents or grandparents played with these toys, so there's a nostalgia factor when it comes to playing new consoles of xbox and
11:17 am
nintendo >> and video game stocks are soaring this year. seeing shares spike 80% year to date and also take two interactive seen shares go up 140% year to date. back to you. >> interesting, very interesting. given aditi's report, melissa, consoles are back, teddy ruxpin is back we now learned black friday nostalgia, i guess. >> nostalgia black friday and digital black friday we saw some footage of people putting giant teddy bears in the carts at walmart, so analog. >> as we go to break this morning, some fresh records for the s&p and nasdaq on this holiday-shortened trading day. dow is close to session highs up 68 we're going to talk the state of retail, threat of amazon, and more with the ceo of ethan allen when "squawk alley" comes back
11:18 am
with some friendly advice, a genuine smile and a warm welcome they make your town... well, your town. that's why american express is proud to be the founding partner of small business saturday. a day where you get to return that love, because shopping small makes a big difference. so, tomorrow get up, get out, and shop small. well, it'sonce again.eason >>yeah.
11:19 am
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. 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.
11:20 am
11:21 am
from an underperformer in retail to an out performer the e-commerce giant upping its pressure on traditional retail, targeting the furniture market launching two private brands this month earlier this week we spoke with williams-sonoma ceo about how the era of commerce has changed. >> research shows the customer goes back and forth and even the young adults will go to a store to sit on a sofa because of the nature of the product we're selling, but we are very active in our media channels. we have very strong relationships with our neighbors here in silicon valley, who are facebook and pinterest and we were some of the first people who went on to those platforms >> joining us now here at post 9, ethan allen chairman and ceo
11:22 am
farooq kathwari. farooq, it's great to see you. >> it's good to be here again. >> you got out in front of the launch of the two amazon brands, you have a design studio on the amazon website, which i was surfing around earlier this morning on how has that resulted in increased sales, if at all what have you seen >> well, as we have been hearing about amazon and the involvement in every other product category, they also got involved in home furnishings, and i felt about a year back that it might make sense for us to associate with amazon, so we got started this summer in establishing ethan allen design studio, in which it's a first for them, too rather than selling a product, they are involved with starting to sell a service like, for instance, our interior designers, we have 1,500 of
11:23 am
them, they are now starting to live chat on amazon and our designers. that, to me, is combining technology and personal service. and then we deliver the products because we have -- i was one of the best logistic networks in a category that requires a lot of service and lots of details. >> does that cannibalize sales on ethan i was also looking at the ethan allen website. products are sold on both and looks like you've got, for instance, on this embroidered diamond pillow on both sites, there's a sale going on with free shipping and 20% off, bringing it to the same value proposition as on the amazon design studio, where it is 20% off all the time and it's through prime, free shipping >> exactly the same. in fact, in our case our prices are exactly the same on our website and on amazon.
11:24 am
they basically act as a sales agent. we are the seller. we deliver the product different model because of the fact of our vertically integrated structure they also as you mentioned getting deeper into furniture category, still will, but i think today combining technology and personal service is key to providing great experience because especially in our business, it's not just selling the commodity. it's not just selling an item. today retail if you are a seller of a commodity, it's hard to have brick and mortar. so what do you have to do is, you have to really combine the best of technology, personal service, and creating a great experience you know, there's a lot of discussion going on, the future of brick and mortar. brick and mortar future is going to be limited unless they provide a great experience and in our case, you know, we have 300 design centers, 200 in north america.
11:25 am
we have 1,500 interior designers, and we make 75% of our furniture in our own workshops. >> can i ask you one follow-up question, for instance for this particular pillow or the set of three, for instance, when this offer is up on november 30th, on december 1st when i go on to the ethan allen website, are you going to have the same price as amazon, or is your price going to be higher >> amazon is having the same price as us, it's the other way around >> all right >> if i was a fellow retail ceo and thinking about establishing my own relationship with amazon and leaned on you for advice, lessons, surprises that occurred to you as you got to know those guys >> well, amazon, they are, you know, i had an opportunity of knowing jeff bezos, i used to be the chairman of the national retail federation years back i actually gave him an award for being a great retailer now amazon, they are good people they are straight forward, but they are very competitive.
11:26 am
now you've got to say to yourself what are the advantages of your getting and working with amazon you have to -- if you have to really survive, you have to be -- you've got to combine the best of the two. not many retailers have that in our case, it's our brand. it's our name. we only sell our products through our own network. amazon is part of that we are not basically selling a product line that we purchase from others. it's only ethan allen, it's our brand. that, i think, is different. if you don't have that, if you're selling a product that really does not have a great brand recognition and service and quality and a commodity, hard to compete. >> has -- >> do you think it should be reflected more in the stock price? >> yes i always felt that the best way to think of a stock price is like a kite. you fly the kite high.
11:27 am
the stock price to me is the tail we just recently a couple of weeks back issued a special dividend now, we have been profitable, you know, we are celebrating 85 years and have been profitable for 85 years not many companies can say that. i took the company private in a management buyout, young, foolish, with a 90% debt, but we not only paid it off, we generated over $2 billion in cash we are running the business for long term. we believe that we should focus on running the business with great quality, great offerings, and for cash and not really consider the short-term what you call the stock price. >> let's put it this way, has your company been a buyer of its own stock? i'm sure when you're deciding to raise a dividend or buy back shares, those are three separate
11:28 am
decisions. a special dividend is a one-time thing opposed to buying your own shares because you see a discount there or raising the actual yield >> look here, we have purchased 40% of our company back. now one has to be careful that you don't create a situation your stock is not liquid in the marketplace. almost there right now we're only hearing from institutions, be careful. hard for us to buy and sell your stock. so because of the fact we have purchased, repurchased 40% of our stock and we've also given very large dividends, as well. i think companies today have to balance that >> all right farooq, thanks so much for coming here. farooq kathwari, ceo of ethan allen. >> always good to be here. good to see you. let's get to dominic chu with the european close. >> u.s. markets are taking their cues from european forces, or maybe vice versa we're seeing a bit of a mixed fractional side of things, gains
11:29 am
and losses on this friday across the atlantic the german dax you can see here showing some signs of life up by half a percent the laggard here, the ftse 100 down slightly. germany with uncertainty with merkel still looking to put together a coalition government. the institute rose to another record high thanks to optimism over conditions in the next six months bank shares are generally positive over reports regulators were looking at looser rules around the treatment of bad loans. as with regard to the consumer staples side of things, companies like danone and diageo up, after it was looking to cut import tariffs over the course of the next month.
11:30 am
keep an eye on those shares, as well back to you. straight ahead, apple is expecting a blockbuster holiday quarter. more than $80 billion in sales, but without the homepod, are those numbers still realistic? we're going to talk about that quick programming note, do not miss "squawk alley" on monday we'll have an exclusive with citadel ceo and founder ken griffin here at the nyse dow's up 63 points "squk le ctiesn st momenty"onnu iju
11:31 am
11:32 am
11:33 am
hi, everybody, i'm contessa brewer here's your cnbc update at this hour president trump calling today's mosque attack in egypt, quote, horrible and cowardly in a tweet. officials report militants bogged the mosque and opened fire on worshippers. at least 235 people killed, 109 injured. new details emerging about the north korean soldier who made a daring escape last week. authorities in south korea say he's a 24-year-old guy recovering from several gunshot wounds he has several other ailments including tuberculosis and hepatitis b. president trump plans to meet with senate republicans next tuesday to discuss tax reform. that will happen at the gop lawmakers' weekly luncheon at the capitol. big tobacco will run ads on primetime tv beginning sunday, but won't glamourize smoking they are complying with an order to tell the public their
11:34 am
products are deadly and designed to be addictive. that's our update for this hour. let's get back to "squawk alley. melissa? >> thank you very much, contessa brewer apple estimating quarterly sales to surpass $84 billion offering gift cards for its annual one-day shopping event. this is the long awaited homepod is delayed until next year for more, brian white, global head of technology, walter piecheck, a wireless retail analyst. brian, i'll start off with you how important is this holiday season in particular to apple's numbers? >> well, i think holiday season is always very important it represents the december quarter about 37% of sales for the year >> will it be bigger this year >> yeah. so this year's going to be a little bit bigger. we have over 60% sequential growth, 66, normally you see about 59%. so iphone x, i think, will be a big attraction at apple stores
11:35 am
with facial recognition. i think people are intrigued by this when they go into the stores, they tend to buy other products. >> walter, in terms of the iphone x, what do you see in terms of supply? we had heard from a t-mobile executive saying the supply was better than he thought going into the season. you can read it two ways either they managed the supply better or people aren't picking it up at t-mobile stores >> i think the ceo of t-mobile was talking about getting more supply than prior years and even now you can order an iphone x and get it before the holiday period ends. i think the supply is fine, and, frankly, if you look at the isp level last quarter and how low it was, there was definitely a broadening out of the product line to some of the legacy products at lower prices i think there was a hold back for the iphone x, which should help them in terms of the fourth quarter and going into the calendar first quarter, but also the asps that apple really needs
11:36 am
to deliver some of that revenue growth that analysts are looking for. >> walt, regards to the homepod, what did your model -- what were we all looking for or expecting this quarter or season from the product and what does the delay if we're calling it that say about apple's ability to participate in this sort of assisted market? >> carl, that homepod is going to that bucket that they dropped the apple watch into, which they didn't report numbers on the apple watch. overall i think about $4.5 billion is the expectation for the december quarter, for a quarter overall you're expecting $85 billion. so whether homepod launches this quarter or next, i'm not sure this is going to move the needle for apple and, frankly, the apple watch, which many people thought has been a flop, continues to do well and drive the revenue in that segment. i'm not really that worried about that there's a long time for apple to make their play in the home, whether that's through
11:37 am
developing better siri, to using your phone with the speaker that's going to be in your living room and even the apple tv, which is also in that $4.5 billion of revenue >> how many weeks into the holiday season, brian, do you wait until you ratchet up or down expectations based on what you're seeing in the stores in terms of demand? >> well, i think this time around we're in the december quarter and, obviously, there are a lot of last-minute shoppers, so people really want to see how the holidays ship out before looking at the quarter. so it's going to be later than most quarters for sure this is typically more back end loaded because of the holidays >> at this point in time are you inclined -- sounds like you're inclined to be more bullish. you would say buy this stock even though meeting the december number is going to be all important. >> yeah, so when i look at apple here, still very cheap, 13 times x cash we have repatriation on the horizon, whether next year or two or three years down. it's going to happen eventually.
11:38 am
i also look at the asp wiggle room with this iphone x. i think there's a lot of wiggle room in the margins and asp, so i think apple has a long ways to go we have a $235 price target. >> we know every $10 in asp counts for not insignificant number of pennies per share. >> it's a huge impact, carl, but the other thing to think about is the upgrade rates, even thousand the operators are saying the iphone x is selling great, getting decent inventory, but the upgrade rates are not going to go back to the super cycle from when the iphone 6 first launched that's the really impressive thing about apple right now, you're at historically low upgrade rates. people are holding on to their iphones longer than ever that's not changing with the iphone x and yet they can still deliver this revenue growth because apple has layered on price increases the last two years. between that and the broadening of the product line you're going to see some smoothing out in
11:39 am
terms of not having these boom and bust cycles every two years or even across the four quarters of the year. >> all right walter brian, thanks so much good to see you guys when we come back, why the ceo of brookstone says why the malls are far from dead. before that, we'll get the santelli exchange. rick, what are you watching? >> you know, i'm watching the weak dollar. my last guest said it's really a weak dollar, strong euro is there a difference? i think there is we're going to talk about that and interest rates in southern europe all after the break ♪ [vo] progress is an unstoppable force. the season of audi sales event is here. audi will cover your first month's lease payment on select
11:40 am
models during the season of audi sales event.
11:41 am
looking from a fresh perspective can make all the difference. it can provide what we call an unlock: a realization that often reveals a better path forward. at wells fargo, it's our expertise in finding this kind of insight that has lead us to become one of the largest investment and wealth management firms in the country.
11:42 am
discover how we can help find your unlock. let's hop over to the cme group and get the santelli exchange good morning, rick >> good morning, carl. >> whenever you talk about foreign exchange, you have to talk about the interest rate differential, because it's all linked together, but there can be large periods of time where everything justdoesn't quite mesh the way history and economic classes say they are supposed to, and when you add in that central banks have been working overtime to muscle in and become the masters of the universe with regard to monetary policy and capital flows and the level of interest rates and in many cases the level of corporate rates, things can get out of whack if you've noticed the dollar index didn't have a good week, it's darn close to down 10% for the year when you consider we
11:43 am
have 92 handle and settle it 102. yes, there's a fudge factor there, but you get what i mean darn close to double digits in terms of net loss percentagewise for the year on the other hand, the euro currency might not be at the highs, and, of course, we want to continue to watch 120, but what we really are going to pay attention to right now is the fact the southern european economies like italy, like spain, normally when you have lots of debt, as they do, when you have banking issues, as they do, as the currency strengthens up, many get nervous the debt is going to be hard to service. just like in our country when the fed first starts talking about raising rates, the nervousness was how high would the dollar go. let's go to the whiteboard first chart looks simple, i'll make it simple black line is euro, this is over a ten-year period and as you can see on the red lines we're a bit under the 2% line for rates, because italian ten year is around 182 if you look at the foreign
11:44 am
exchange side, the euro dollars are getting close to 120 but what i'm really after in this ten-year chart is the fact that there have been very big disorientations where the correlation became very negative and you can see that here. and it's starting to develop again. to think that interest rates and the euro level dropped together makes perfect sense, but as the euro starts to pick up, doesn't seem to be happening many believe it's all because of this 120 line and it's hugely significant, so we'll monitor it the other aspect is, it's a strong euro. even though we see a weak dollar they go hand in hand, but it's proactive. this is a crb index and this does make sense. commodities are dollar denominated, whether it's oil, whether it's lots of things, gold, silver for the most part and we see the crb is at the highest level since march of this year and the dollar is weak this would make sense, this not
11:45 am
so much, so we want to pay close attention should we challenge the most recent high which is around 120.35. carl and the gang, back to you >> all right, i'll take it, thanks, rick santelli. when we come back, black friday's title fight, amazon versus best buy in a battle for low prices, deals, and traffic the results in a moment. as we head to break, we're watching brad come, reportedly considering raising the offer to buy qualcomm current offer, $70 a share wednesday they had a note saying a combined company could be worth as much as 76% more than weesy close on broadcom's price all right, "squawk alley" is back right after this. al market, the rhythm of the world. al market, but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow.
11:46 am
you set it. nasdaq. rewrite tomorrow.
11:47 am
11:48 am
fresh data from adobe analytics on mobile, representing more than 61% of online store visits. total numbers for thanksgiving, $2.8 billion, that's up 18% year on year. when it comes to electronics, it's best buy versus amazon in a fight for your dollar. deirdre bosa has the details deirdre? >> melissa, let me tell you that it is competitive out there. we've been searching for the best deals on best buy and amazon all night and all this morning, and some of the hottest
11:49 am
electronics this season, things like top of the line tvs, even amazon devices like kindles and echoes and laptops, they are priced the exact same and many cases right down to the penny. let me give you a few examples this 55-inch samsung 4khdl.e.d. tv you have to look at things like delivery advantage in this case best buy has it it will deliver it to you three days sooner than amazon will, even if you are a prime member same goes with some of the other hottest electronics gifts like a fit bit ionic. it goes for $299 on best buy's website and in store, it's the same price on amazon so, guys, if you're like me, you're wondering why in the world would people line up before the crack of dawn to shop in store and let me give you one reason best buy has an in-store deal only on playstation vrs. if you're willing to face the crowds and line up, it will cost you just $200 in the store
11:50 am
this isn't available online. on amazon it is $70 more expensive. the question is, though, is that enough to entice people into the stores and for best buy to be successful this holiday season we've got some early numbers from purchases were up 50% on thanksgiving day alone, and it's off to a good start on black friday. best buy won't give numbers until this quarter's earnings, but last week it did issue guidance, holiday guidance that was below wall street's expectations guys, back over to you. >> interesting look at that, deirdre. thanks very much sticking with retail this morning, brookstone, a defender of the in-store sales models says they are preparingfor a bright holiday season in mall retailing, and for more on the company's online and in-store strategy we're joined by the company ceo steve goldsmith who we're always happy to have here at post nine welcome back. >> thank you >> you always bring hot sellers. >> always. >> what's this year's? >> you remember last year on black friday i was here and i brought the ariana grande head
11:51 am
phones this year we've decided, to you take one. >> all right. >> we did bear, cat, devil and rabbit, but here's the best part let say your mom or dad says you can't have it at the table you can remove them and become a regular wireless head set, innovation upon social audio at brookstone continuing on and on. >> social audio. >> i can share with my friends i can broadcast out. can i keep it on my own ear and concert. have a phone call. >> it's basically like in the old days having a boom box with head phones -- with or without head phones. >> or take it off entirely. >> the ears come off. >> and they are interchangeable. you feel like a bear today, feel like had a rabbit, a devil. >> more gronk merchandise. >> yes. >> rob gronkowski of the new england patriots. >> as you know, we are all about massage, so now partnering with gronk, a deep, deep, deep massage. see if you can get it over here and really relax those muscles
11:52 am
because the holiday is a little stressful, right, you know, that carl. >> for you, too, because everybody says your place of business is a dying species. why do you insist that that's not true >> first of all, the voice of the customer has completely changed. if ten years ago the voice of the customer was i want mobility and ease, but someone had to invent it. great companies like amazon invent it had, so now, everybody, it's been invented and now the voice of the customer is i want great merchandise however i want to do it what's for retailers like us to do first, enable it, and any channels she wants and, second, make sure you have the right product, and as a product development company do that, but ten years ago it was a double whammy now that we have all the technology, it becomes the task of all about the product. >> what percent is online today versus say last year or two years ago? >> well, so, at brookstone about 30% is online, but in all our partners, whether that be our home shopping partners wlor it be bed bath & beyond, about half
11:53 am
of their sales with brookstone is online so it's really trending in the right direction but i don't look at sales as the only way to look at if. >> what about sheer square footage? i assume it's got to be strengthened. >> i think so. as customers choose to do more online shopping, i think that the footprint, the physical footprint will change, but i think everybody focuses so much just on the physical footprint the physical footprint is a great place for demonstration, a very good channel for us it will probably shrink a little bit more over the next couple of years and then it probably won't shrink any longer and making sure i enable her to get brookstones anywhere. >> a lot of physical partners have stock prices that are really beleaguered in the past year suffering from their own declines in same-store sales how does that impact you, and are you looking for new partners that might have better store traffic? >> yeah, so i -- i look at the partners like i'm a great advantage for them because i'm providing product they otherwise
11:54 am
wouldn't have for their consumers. >> but when sears has a 17% decline in same-store sales, it's that many of your customers who are each going to go and buy a great product for them what do you get out of it when their store traffic is down? >> hopefully they will buy something at brookstone versus the innovation we put in our product versus apparel or something else. >> how about our theme from others, inventory, going in with cleaner inventories. >> yes. >> discounts are not at deep. >> that's correct. >> you have the right as a shareholder to have better hopes about margins. >> yes, that's true. >> do you argue with any of those? >> my hour margins at brookstone is up. our inventory is cleaner the inventory arrived later this year on purpose and so i -- i anticipate that now we have to come through did we pick the right product. are these the right headphones and so on. also at brookstone we find her wherever she is. we find it at home shopping networks, start with hsn and florida. three in the united states and 15 around the world to introduce
11:55 am
the brookstone product and take eve online in minneapolis, a small one. tell the story slightly different than hsn if the stories are there we'll find them. >> earlier you called the customer sheen i think a lot of male-oriented products. >> yes. >> stuff for dad is the demo overwhelmingly female >> when i say she when i look at brookstone i look at it two ways the products may be roughly 50/50 by the purchases are roughly 65-35. i'm going to generally reference the 65. >> i got if. >> wow, she's got the purse strings, so to speak. >> right. >> i would imagine a lot of your sales are domestic if tax reform comes through, how much of an impact is that for you if your rate goes down to 20%? >> well, first of all, most of it is domestic, but we expanded in china this year so we opened 76 stores in china so far this year we're expanding into the uk and we'll be expanding in home shopping networks kind of around the world, but we have found great efficiencies in, woulding
11:56 am
around all of that yes, the lion's share will still be domestic. >> so a drop to 20% would mean what for you >> it will be good will be good for brookstone. >> got to come back as the season gets farther in. >> good seeing you. >> nice seeing all the toys. as we go to break, another exclusive interview to tell you about. amazon web services ceo andy jassy will join us on wednesday. wow, a lot of questions for hi do youot n want to miss that dow is up 51 points. we're back in a minute
11:57 am
11:58 am
11:59 am
it is back friday, and we spoke to macy's ceo jeff gannett earlier in the show, and he actually addressed directly the trouble overall in retail, in apparel specifically, but here's what he said about macy's apparel. >> she does want to buy apparel, and this is -- there's obviously a lot of competition for apparel, both online hand in stores, and when we get our values right and we get the right fashion for our customer, she responds well, so, again, as i said also, when you look at apparel, particularly during the fourth quarter, when it is cold outside, that really helps our overall apparel business as she comes in because she needs a coat but then she will buy other things she buys that sweater, but will
12:00 pm
also buy gifts for herself or gifts for people on her list >> yeah. macy's was up 4% earlier today, currently settling back a bit but up 3.25% all-time highs, facebook, home depot, amazon along with deere and a few others. >> the trend continues tech is strong. >> nice having you here. >> great to be here. >> let's get to "the closing bell" which starts now


info Stream Only

Uploaded by TV Archive on