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tv   Squawk Alley  CNBC  May 9, 2018 11:00am-12:00pm EDT

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the original place to invest online. good morning it's 10:00 at walmart headquarters in bentonville, arkansas, and "squawk alley" i live ♪ ♪
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♪ >> good wednesday morning. welcome to "squawk alley." i'm carl quintanilla and morgan brendan and jon fortt at the new york stock exchange. amazon web services ceo andy jassy with us on set, a lot to discuss with andy. welcome. >> thank you for having me. >> first we will do a little news of the day, stocks reversing gains after the president announced that he is pulling out of the iran nuclear deal shares of walmart slipping after confirming its biggest deal ever, agreed to aware a 77% stake in flipkart, india's largest e-commerce company for $16 billion. the rest of the company will be held by some of flipkart's existing shareholders including the co-founder tencent, tiger global and microsoft we talked to the head of flipkart's platform here on this program and here's what he predicted about the e-commerce space in india
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>> india e-commerce space is definitely heading up, it's growing rapidly, over 150% year over year. at flipkart, we currently have 50% of the market share and we've been able to hold on to the market share we've seen an average income aggressive in the market but not made any dent to our market share. we've also been in the space for the last seven years, so we understand the market really well >> for more we're joined on the phone this morning by the former walmart u.s. ceo bill simon, executive and resident at baylor university thank you for calling in, thank you for your time today. >> how are you >> doing great watching the market reaction to this deal. help viewers understand why it is so critical for walmart overseas >> you know, walmart has declared their position and is now executing the strategy, which has been to grow and
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expand e-commerce and particularly now shift in their strategy more towards asia and out of europe as you saw them exit the business over the last couple weeks and move into india. this is the move that they've been talking about and are executing it it's going to be challenging for them, but they're executing the strategy they described. >> bill, in many ways this has been sort of the worst kept secret, shares of walmart they are the laggard on the dow, down 4% in terms of the details around the deal investors are not reacting positively about it do you think it makes sense? >> yeah. no, i can understand that. you know, when amazon acquired whole foods they aceded enough value in the market to pay fort deal and walmart looks to be going in the other direction i'm sure that's not what they were hoping for. it's tough to buy -- to spend $16 billion on a business that's losing a $1.5 billion a year and
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make sense of the deal but this is the strategy they've articulated and one that they're executing. they're fairly talented group of people over there and so this -- it will take a while and i think i heard their cfo say that in the midterm and in the long term they -- it won't be until the midterm or long term before this gets profitable. that's a tough pill for investors to swallow who typically are more short-term oriented. >> bill, what's the most important thing that walmart is going to need to learn up front with this? what sort of data are they going to get, insights from having this ownership stake up front that might help them even in other areas where they want to expand >> well, access to the indian market i think has been something they've been after for a while. they've had businesses on the ground there, primarily in the cash and carry business, because of the ownership laws in india and this, you know, being -- having access to the -- what has been a fairly closed retail market in india is something
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that they've looked at for a while. that will be one aspect of it. i think they have been enamored by the digital pay capabilities that flipkart has. maybe there's some ability to take that technology to other parts of the world so they see the value in it or they wouldn't have done the transaction. but i can understand how this -- the street is reacting to it >> bill, we are just looking at a graphic of big m&a at walmart and how this deal dwarfs what they've done in e-commerce in this country what does it say about u.s. e-com strategy >> well, it dwarfs every deal they've ever done as far as i can recall the biggest deal was the purchase in the uk and jet.com probably after that, at $3 billion. i think what it's saying is that they still see a clear path outside of the u.s. where amazon is less established and they're going to try to win the battle over there >> that's going to be a verdict
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we will have to wait for over time bill, really appreciate you helping us start the hour. we'll talk to you soon, i hope bill simon. >> thank you. >> former walmart u.s. ceo and now let's bring in our guest, andy jassy who joins us here on set. a man who needs no introduction, but if you want one anyway, on the fort knox podcast with me not long ago the ceo of amazon web services, amazon's most profitable unit. great to have you here. >> thanks for having me. >> as i said earlier we've heard a lot about cloud this week. microsoft has its build developer conference, satya nadella made his pitch, google io kick off yesterday. a lot of talk about a.i. which you also talked about at reinvent conference at the end of last year and vision seems to be the lead use case on a lot of cases for bringing developers to a.i. tell investors if you will, how is a.i. going to cloud the economy which we've seen be so
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profitable and bring in so much revenue for amazon >> well, if you look at the machine learning and the artificial intelligence space it's growing like crazy and the vast majority of machine learning being done in the cloud today is being done on top of aws. look at companies like serner and cox automotive and expedia and the nfl and pinterest and zillow, lots of machine learning is being done. companies have so much data and don't have great ways of getting at that data and getting the gems and predictions that could change their customer experiences. really until we launch something called sage maker and reinvent, everyday developers and scientists it was too hard to build machine learning models. with sage maker, a manage service that allows everyday scientists and developers to easily build machine learning models and train them and tune them and then deploy them into applications so those applications can be infused with the intelligence. >> microsoft coming with its own tools at build as well
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satya nadella made the case to me that trust is going to be a key differentiator in the cloud and basically said the fact that amazon is in so many businesses aside from cloud in retail, should give some customers pause. take a listen. he was talking awfully slow but what he says there, what he says there is that because amazon and google have the ability to be on both sides of some of these transactions it should give some potential partners pause of course we see an amazon tie up with sears just this morning, so perhaps that's not an issue for everyone what's your reaction to that why potential partners should trust amazon >> the way that amazon partners with customers is very unique. i think most technology companies today are mostly competitor focused or they're product focus. >> we know what the product should do, it's great you have
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input but leave it to the experts. those strategies could work but they're not ours we are customer focused. the vast majority of what we build is driven by what our customers tell us matters to them and then the rest is by listening to the problems customers are trying to solve and venting on their behalf. so i think if you ask our enterprise customers or any of our customers i think the way we partner with them is very different. i also think because we're so long-term oriented, unlike most of these companies that are going quarter to quarter trying to make a year, the typical norm of the technology space is the sales people show up the day before a quarter to harass you to do a deal, not to be heard from again until the next time there's going to be a deal we don't think of it that way. we are trying to build a business and set a relationships that last all of us. we will always do what's right for customers and we have a belief if we do right by customers our business will fall along over the long term. >> a lot of action in the media space. you were involved with netflix early on, disney is rolling out more over-the-top services,
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expect to be heavily reliant on cloud. what are you having to build in, in ord to be ready for this surge of streaming that's happening and what's going to determine whether you guys are better or walmart -- not walmart, microsoft, or google, which has had youtube for a long time, going to be better at serving that customer? >> if you look in the media space the vast majority of media companies are using aws. netflix, despite the fact that they compete very aggressively with prime video, on the amazon side, they run everything on top of aws and have for several years. same disney and warner and fox and hbo and turner, they all run on aws so what they care about is they want the broadest selection of services, they can continue to innovate on the streaming experience for their customers, they want media services of course we acquired elemental media a couple years ago which provide the leading media services that allow you do do live or transcoding and then they want to make sure that they've got a cost structure and
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agility ability that changes the ability for them to keep innovating on the customer experience every week, every month. >> when you think of -- i'm thinking of a report yesterday that looked at autonomous vehicles and the way it's going to drive wireless data over the next few years, 40 times current levels in the view of this -- of that research firm, big bubbles that will drive cloud activity over five to ten years, come from what sectors? >> i think several machine learning for sure is one and a lot of the autonomous vehicles will be using all kinds of machine learning and artificial intelligence. another if you look at there are going to be billions of devices at the edge in our homes, offices, factories, cars, ships, planes, oil fields, agricultural field, billions of devices and they have, by definition, relatively little cpu and disks. the cloud becomes disproportionately important to them in terms of supplementing most of the big iot implementations are supplemented by aws, whether alumna, geno
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sequences hardware, john deere has a few hundred thousand tractors sending data to the aws and analytics down to the cloud and down to planters stack cast on major league baseball is an iot application running in the baseball of ballparks. connected devices is another big one. a traditional one being re-invented it's databases over the last few decades it's been a rough place for enterprises because they've had to contend with the old guard data base providers, expensive, high lock-in and also they constantly audit their customers and fine them if they find something. customers, that's why so many are moving to the open source database engines, but to get the performance on those open engines of the commercial-grade data bases are hard.
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we build amazon aurora, durable and available as the commercial grade daughters tabases. >> sounds like you see it being more industrial, more commercial and enterprise than say lenar, the alexa model home deal today. customer oriented. >> there will be tons of consumer oriented reinvention. look at what's happened. companies like airbnb. from a standing start, look at how they have changed the accommodation industry there will be invention in every imaginable area. the cloud allows you to get going with your business for less money and take lots of chances at it and it deteriorations at it un -- iterations at it the amount of innovation in the home will be staggering. >> what about opportunity in sghofts i ask because we're expecting these final guidelines for the jedi, pentagon, cloud contract any day now a, are you officially throwing your hat in the ring to bid, and
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b, given the fact that we have seen some contentious commentary without a final rfp out there, how do you expect that to play out? >> we have a se significant government business. over 3,000 government agencies worldwide use aws and most famously the intelligence community. so we are really deeply committed to the government business we will bid on the jedi rfp when it comes out it will be a competitive bid i think every major technology provider will be interested in that business. and i think that there's been a lot of noise from some of the older guard suppliers worried about losing some of that business our government, especially at this time in our government, deserve the best technology with the most capability and the most innovation and the best cost structure. that's incredibly important to our national defense and our future. >> do you think that's going to be a tighter race than maybe analysts are speculating >> i think it will be very competitive and they have been very clear from the get-go that they will pick the platform and the provider that they think gives them the best chance to do what they need to do over the
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next number of years. >> let's talk data privacy there was the big scandal between cambridge analytica and what happened with facebook's data granted you guys aren't connected to a social network, but what is aws' responsibility to make sure all of these customers who are using your platform in all kinds of ways are being responsible with their users' data? >> well our customers, our customers' data is our customers' data. full stop. they get to choose where it lives in aws doesn't move unless they choose to move it and to us, it just looks like a blob so they have the responsibility for their own applications to make sure that it's safe we have the responsibility as it runs in our infrastructure to make sure nobody else can have access to that data. our customers have lots of ways to protect themselves including being able to encrypt that data. >> also want to talk about hardware microsoft just came out with azure sphere you guys and google and others have been working more on
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customizing the infrastructure in your cloud data centers to do what you want it to do what's the next step there because, you know, microsoft announced this deal with qualcomm around a.i. and computer vision. you guys have deep lens running along the same lines how deeply is your team working on chip design and how much more should we look for from you in that space >> yeah. we have been working in these areas for a very long time and we have over time designed our own hardware we have such giant scale it makes sense to optimize that performance and cost structure and we bought a chip company in israel a few years ago, so we've been designing our own chips for a while and you can expect us to continue to do so. we continue to build interesting hardware that is interesting to customers. for instance, we had a lot of customers who wanted tomove pe da bites of data to aws but doing that over the wire is slow and expensive and they don't have the bandwidth to do that.
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we built an appliance called snowball and it allowed people to load their data into that appliance, fill it up, send it to us, it comes automatically dressed with a kindle on top of it, encrypted three different ways, and then it also has compute on it. for customers that want to actually be collecting data at the edge, they can be collecting that data, running analytics on the data as it's being collected and act on the snalgs and fill one up, send it to us, they use another snowball we will build hardware as it benefits our customers. >> i want to ask a left turn, but it's an important issue for tech and communities around tech this gentrification issue. right now in seattle this proposal for a head tax, $500 per worker, but just for rich companies, companies that look like amazon, to go to a homeless services similarly in the bay area in san francisco a lot of pushback against the impact and the higher cost of living that tech companies have had what is your responsibility?
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what is amazon as responsibility to mitigate some of these, yes, they're benefits for some people but problems and higher living costs the boom is causing? >> it's a good question. i would say the things like the head tax in seattle are super dangerous for cities to implement. what companies is going to want to start or move to or grow in a city that penalizes them for hiring full-time employees these are serious problems in all of our major cities. homelessness and education they're are a number of them they require hard, you know, hard thinking and innovative solutions. i think cities are so much better off working with the business community towards joint solutions, rather than trying to tax them if you look at amazon we have done, you know, there are 45,000 plus employees that we employ in the city we occupy 8 million square feet there. there are 24 restaurants in our space. another 8 service industries we've donated 47,000 square feet in our new building to mary's
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place which helps homeless families in transition i don't know of anyone else that's done that we've dedicated 25,000 square feet in another building to fair start which is an organization that helps people in poverty get trained and restaurant skills. we support education across all kinds of dimensions. we are involved in the community. to me the answer is to work with companies to find solutions rather than disincent job creation. >> sound likes you could use an hq2. do you have a preference >> i don't have a preference. >> any idea, any timeline when we might expect an announcement? >> what i've heard is the end the year 20 finalists and we're trying to narrow it down i expect it to be by the end of the year >> we don't get to talk to amazon a lot but one thing that's been discussed in light of the president's criticisms on twitter is how quiet the company has been in response what is the view to those tweets >> i think that all you can do if you're a business that is
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broad like we are and working on many different businesses is focus on what customers want the thing you can control is providing the great customer customer experience and that's been the thing we've focused on the last 23 years across lots of different presidents and that's the thing we will continue to focus on the next 23. >> want to go back to the cloud business for just a moment from a macro level you're already the most profitable unit in amazon. this a point you envision aws become the big fres a sales perspective as well? >> i think it's possible we have a long way to go given how large our consumer business is look at the market segments that aws addresses, infrastructure, hardware, software, and we're building services further up globally, that is trillions of dollars of market segment possibility and so i think -- >> trillions >> trillions and i think it's going to only get bigger as the basic unit of compute is coming down with the
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cloud. i think we could become the biggest business in awi. i expect our business to grow as well. >> what's the biggest constraint to growth right now? is it something about the science of computing or is it -- i don't know, real estate, something else >> i think it's inertia. >> what's that mean? >> i think that you have -- even though we have a $22 billion revenue run rate business growing 49% year over year, so pretty big business, we're still at the early stages of the meat of enterprise and public sector adoption in the u.s outside they're 12 to 36 months behind depending on the industry or the country that means the vast majority of all this infrastructure still lives on premises. enterprises have to -- there's work to do to move from having your infrastructure on premises and aws and cloud. >> scary for >> and different skills and so it's moving at an incredibly fast clip which is why our business has grown so much, but there still are a lot of enterprises that are just
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getting started moving to the cloud. >> a couple weeksago all of a sudden jeff bezos started tweeting a lot more, making pancakes, celebrities, dogs. was there some internal e-mail that went out that said all right, everybody, tweet about interesting stuff. >> what's he doing >> i don't know. >> i will say that jeff is a fine cook and he enjoys cooking and so when i saw the pancake tweet and video, i wasn't surprised because he enjoys cooking and likes cooking breakfast. >> yeah. hot wings? >> does he like hot wings or cook hot wings >> you got a hot wing thing at amazon well i'm a buffalo wing fan. in fact, i was part of a group that started a buffalo wing eating club when i first got to amazon 21 years ago called tatanka and reinvent which is our annual event we have an eating contest of the biggest wing eaters in a 60 minute period yes, i like my wings >> you guys at amazon always
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about speed. andy, great to have you with us. >> thank you for having me i appreciate it, guys. >> when we come back, disney and the deal what ceo bob iger told julia boorstin about the likelihood of a fox acquisition. the shares down 2% today later an exclusive with the ceo of go daddy, a company that stock went public 3 years ago, at $20, near $70 more "squawk alleycongp. ayitus" mi u a brave man, mr. stevens. your testimony will save lives. mr. stevens? this is your new name. this is your new house. and a perfectly inconspicuous suv. you must become invisible. [hero] i'll take my chances.
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welcome back to "squawk on the street." shares of disney lower despite an earnings beat bob iger sat down with julia boorstin after the company reported yesterday evening julia joins us now with the details. julia. >> morgan, with disney's theme parks and movie studio driving results above expectations, questions about comcast's interest in topping disney's bid for fox and disney's digital strategy were front and center ceo bob iger wouldn't speculate on comcast, just saying that he's confident the deal will go through while they'll benefit from fox's assets disney is not dependent on fox for its direct to consumer services espn plus and disney app which are building their content libraries.
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>> we continue to buy more in fact, we announced an acquisition of a ufc and there will be a number of ufc events, ultimate fighting championship, on the espn plus app and then the disney app was meant to include disney, pixar, marvel and star wars, lucas film and that's not dependent at all on the fox acquisition >> iger wouldn't say how many people have subscribed to espn plus so far but did say it's off to a strong start. thanks to growing fees from new digital bundles, iger said he's optimistic digital media growth will compensate for traditional declines which are moderating. >> we believe that you're going to continue to see real growth in digital platforms and continued erosion on the traditional side i think ultimately the new business will eclipse the older business i think it will happen sooner than most predicted and we're
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going into this in a big way. >> we'll hear about fox's digital strategy and how its assets could fit in with a buyer when it reports earnings after belt this afternoon. back over to you >> all right julia, big news there. thank you very much, julia boorstin on disney another earnings mover, shares of go daddy in the green after a second quarter earnings beat due to new customer additions. joining us this morning scott wagner the ceo of go daddy we were talking with andy jassy about you. good morning >> good morning. thanks for having me >> this is really getting interesting now. one year performance on the stock is closing in on 76% you got revenue up 29% we mentioned the partnership with aws what is driving all this >> no one particular thing i think it's the promise of godaddy and what we do, getting ideas, growing starting and thriving around the world. our international expansion and the expansion of our product portfolio, extending a domain name into things like websites,
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social media, security services, it's a combination of global growth and our product portfolio that's driving our top line and ultimately driving the stock price. >> how much is the health of small and medium business tied to your trajectory right now, the economy is good for a lot of different kinds of companies but seems like there are potentially two forces, the health of smb and the need to transition into digital. >> for us the need to transition to digital overwhelms economic health i mean if you think today, gosh, half of small businesses in our organization still don't have an active on-line presence and so for us being so early in an idea's life cycle and so mission critical, the single most important thing for your idea, whether it's a business or even something like a church, is actually the quality of your on-line presence for us the continued adoption
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and evolution of on-line presence is the driver of the business in some ways it's pretty insulated from the economic cycle. >> scott, that's a pretty amazing stat that half of small businesses don't have a web presence are you going out and actively recruiting some of those small businesses to come on and use your site, and become users? >> well, for us, the nice thing is with our brand, you know, the single biggest driver of customers is referral. you know, we don't have a sales force. customers come to godaddy and they sign up and start to build our products and services and the way that we keep growing, adding to customers are for the most part are existing customers telling friends and family about what a great experience it is at godaddy and our marketing efforts in the world hopefully complement that and customers keep coming and showing up. >> to what degree have tax cuts, your effective tax rate, helped
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on cash flow at least and i wonder, i imagine you probably do business with a lot of individuals who are s-corp related. is that changing their view about the amount of money they're able to spend on their e-commerce presence. >> interesting you know, i think that the health health of small business is, obviously, fantastic it's a driver of entrepreneurialism and economic health not only around the united states but frankly around the world. i think any amount of discretionary dollars showing up to small organizations is going in to some form of their on-line presence small businesses are realizing how they both serve their customers and communicate through on-line, and find new customers the best way to do it is indirectly. some of the increased cash flow showing up in small businesses is turning into consideration nor how their business can look
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better on-line. >> what's the role of mobile today for today's godaddy customer we've seen smart phone sales kind of top off but mobile usage, pretty strong how much is mobile a driver of where your customers are looking to make sales, looking to engage with customers, maybe looking to change their digital approach? >> that's a great question if you think about today and you're looking at a small business, what mobile really has done is create more places than a small business has to show up and communicate. meaning for the first 15 years, call it of the internet, effectively you had to have a site that got searched by google and that was being on-line and now in a mobile and social world having a restaurant means you need to be on yelp and instagram and facebook so it's a proliferation of places that you not only have to
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be and look great and for us that's an opportunity. go central which is our website building, really on-line presence platform, you not only can build a great site but also connect that site content into social media and for our customers that's solving a huge pain point which is boy, they have to have similar content looking great, not in one place but in some cases 6, 10, 12 places and that's the problem that we're helping them solve. >> appreciate your time. interesting stuff. stock reflecting the quarter today. please come back soon. >> thanks. thanks a bunch jassy shows up i want to be invited for pancakes >> or wings, i guess. >> yes. >> wings or pancakes thanks bye. >> when we come back, the ceo of postmates will join us on a day when e-commerce is front and center with walmart announcing its biggest acquisition ever the dow back into positive
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on-line,. welcome back that time, let's get to seema moody back at hq with the european close. >> stocks rising in europe's first trading session since president trump announced the united states is pulling out of the iranian nuclear deal the oil sector is leading the way in a big way as brent hits three-year highs, bp, royal dutch shell and statoil among the gainers with repsol and total in the green europe is currently -- buys about one third of iran's oil export this decision from president trump puts european oil majors
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in a somewhat tricky position if they continue to buy oil from iran, they risk alienating partners in the u.s. experts say it would weaken trump's attempt to put economic pressure on iran let's stick with the story as we look at oil prices jump, that's outweighing on shares of airlines including discount carriers, ryanair and easy jet iag, british france, rounding out the laggards air bus in focus, shares moving lower after the u.s. said licenses to sell airliners to iran will be revoked in december of 2016 airbus agreed to sell 100 jets to iran air worth about $19 billion. now, three other stocks in focus today, vodafone rising after agreeing to acquire some of europe's assets from liberty global for about $22 billion and then there's conglomerate siemens better than expected
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results. burberry down after the belgium investment group sold a 6.6% stake in the high-end fashion retailer as the firm looks to diversify its portfolio. bad news, down 6%. back to you. >> seema, thank you. at hq. >> when we come back the food delivery company postmates, that company has a partnership with walmart and he will join us next here at post nine and taking a look at the major averages, narrow trading range today but all the major averages are in the green. fractionally best performer in the dow, ge. we'll be right back. ♪ feel that? that's the beat of global markets, the rhythm of the world. 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. you set it.
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good morning once again, everybody. i'm sue herera your cnbc news update at this hour three suicide bombers striking two police stations in kabul killing at least five people and injuring 16 more the islamic state group claimed the first attack while the taliban took responsibility for the second the leaders of japan, china and south korea holding their first three-way summit in 2 1/2 years. the three leaders confirmed their shared aim of full denuclearization of the korean peninsula and vowed to cooperate closely to promote peace and
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stability in that region. russian president vladimir putin welcoming israeli prime minister net ya lu to the kremlin. the two discussing military coordination amid new strikes in syria. syria says israel struck a military outpost near damascus netanyahu made no mention of the strikes. guatemala will move its embassy in israel from jerusalem to tel aviv on may 16th, two days after the u.s. embassy makes a similar move paraguay also announcing it will move its embassy to jerusalem by the end of may you are up to date that's the news update back downtown to you guys on "squawk alley. back to you. >> thank you sue herera at hq. walmart make a move lower, saying it will buy flipkart tore $16 billion. the shares are down 3.5% the move marks an investment by walmart in not just a huge international market but also a way to tackle the challenges of
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last mile. so joining us here at post nine in a cnbc exclusive is bastian lehmann the founder and ceo of on demand delivery company postmates. thank you for joining us today. >> thanks for having me. >> you partner with walmart on some deliveries here in the u.s. looking at this deal i realize it's an international deal but what's your take >> it's a great deal for walmart. we like flipkart very innovative. india is an extremely important market for the global economy. and i think walmart did a good job here either securing a very large stake or buying the company. we don't know this right now so well. >> and walmart just recently announced it's going to be ending its partnership with [ inaudible ]. is that a business you're looking to take over in the u.s. >> we started working with walmart and we're happy with the program so far they utilize our network there is 160,000 postmateses that do deliveries in the u.s. and walmart realized they can
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offer on demand delivery and we're happy to partner with them. >> we talked to the head of a competitor door dash, raised half a billion dollars, you have raised about a quarter billion dollars i believe. it seems like there's this big gear up of spending on the last mile is that happening? are you still raising and what's going to determine with all this money floating around who wins >> local commerce in the u.s. is a massive market and very fragmented and underserved most of the transactions that happen in local commerce are still happening off-line and that market has grown 30 to 40% year over year you will see companies being created, billion dollars companies that don't exist today in a few years from now and we believe we're in a good position to fight for that local consumer, to increase the share of wallet that consumers spend through postmates. >> when you have competition like uber eats, grub hub, door dash, instacart, paer in ra doing in-house deliveries for
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food, there's not room for everybody? >> no. i believe there is room for everybody at this stage of the market there will be consolidation happening at some point. i believe that's a few years out. right now you see the trend of startups been around for a while getting the traction they deserve and you have companies that have been around for a longer time finally catching up to consumer key mand i think that's very exciting snims unemployment rate below 4% transportation logistics, a lot of demand there. how are you recruiting and bringing more employees and more people on board to deliver these products >> on the postmates platform our fleet earned over $200 million in income last year. the average per hour income is $18.23 that's 153% above minimum wage so i'm very excited about our unemployment rate and we offer a great alternative to people in this country that feel like the traditional employment is not for them and look for more flex
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snoobl ibility. >> and your expectation for the wage pressures later in the year, how much worse is it going to get >> i can only speak what we do at postmates, but we have since we started the company increased the hourly earnings of our fleet and if you think about the structure, the company is named after the people that dot deliveries so we care great deal about our fleet and we work hard to make sure that they can earn the most >> before we let you go, quickly, we're expecting winners of a new drone program expected to be announced later today by the u.s. how far away are we from autonomous delivery? >> depending on who you ask, between five and ten years you know, at postmates we have a team of around 50 people working on autonomous vehicles these will be site class vehicles that operate on the sidewalks or bike lanes and operating them right now in a semi autonomous way. >> thank you for joining us here at post nine the ceo of postmates thank you. >> thank you
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>> as we go to break, take a look at two of the big earners, earnings movers today. trip adviser leading the s&p for a while after reporting a nice beat web traffic helping bolster those results up 22% match, though, has had some difficult price action intraday, the dating website operator saying facebook's dating feature will not have an impact. we will talk to the ceo of the parent company joey leven tomorrow here on "squawk alley." dow up 1 point
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i'm scott wapner here's what's coming up top of the hour on "the halftime report." we're debating the move in energy stocks. are they just getting started? if so, what does that mean for the markets? plus, our call of the day is surging double digits today. joe terranova owns it. question now is should you and two unusual activity plays from the najarians we'll reveal where options players are placing their bets today. it's all at noon, and that means we're less than ten minutes away >> can't wait. except for this great show going on thanks, scott. another check on the dow it is about flat walmart weighing on the index particularly down almost 4%. "squawk alley" will be right back [whistling] hello. give me an hour in tanning room 3. cheers! that's confident.
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but it's not kayak confident. kayak searches hundreds of travel sites to help me plan the best trip. so i'm more than confident. forgot me goggles. kayak. search one and done.
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dow session high was up 107. obviously off the initial highs. mike santoli joins us on set to talk about an interesting session. you have the s&p hanging above the 50-day, even with oil at $71. ten-year right at 3% >> right, a lot of these markets kind of hovering a what seem
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like decision points if you had a market that wasn't moving much at all, you would want to see the sectors leading that are leading energy, industrials, financials, tech to a lesser degree. that's been the case for the last two days. it's a decent message to the markets. even though you see really a stalemate because you have the consumer staples, health care as a drag, and on the dow,trusting, you mentioned walmart losing ground based on this deal, disney also on a little bit of the deal concern that's why the vix is at 14 right now. the market seems comfortable with the idea that the recent lows are maybe a floor for a while. and yet not a lot of energy to push it to the upper range >> you mentioned that the ten-year treasury yield touched 3% we come back off that slightly at what point does that become an issue for equities? right now, they're hanging in. >> it's not clear there's a magic trigger point. i do think that right now they're rising yields are rising largely with oil. obviously, the math of that is you hit the inflation target
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easier to meet if oil prices are up i do think that's not a great thing if you're going up purely on inflation, but it's helping the banks. you could sort of -- equities can make their peace with treasury yields under 3.5%, 3% >> we're meawaiting a presidenti a cabinet meeting. esaid he appreciates north korea's help in releasing the detainees. china has been helpful let's listen to the president. >> mr. president, where's the summit going to take place >> we're going to announce that in three days. within three days. >> within three days >> working arrangements. >> everyone thinks so, but i would never say it you know what i want to do i want to get it finished. the prize i want is victory for the world.
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not for even here. i want victory for the world because that's what we're talking about. so that's the only prize i want. [ inaudible question ] >> everything can be scuttled. everything can be scuttled a lot of things could happen a lot of good things could happen, a lot of bad things could happen i believe we have both sides want to negotiate a deal i think it's going to be a very successful deal. we have a really good shot at making it successful but lots of things can happen. and of course, you'll be the first to know about it if it does i think we have a really good chance to make a graeat deal for the world. thank you very much. >> what do you do if iran starts to up their nuclear program again? >> iran will find out. they'll find out i don't think they should do that i would advise iran not to start their nuclear program. i would advise them strongly if they do, there will be very severe consequence
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okay thank you very much. thank you. thank you. thank you. >> short series of question and answers with the president at the cabinet meeting. ruling out the dmz as the site of that planned summit with kim. joking briefly about the nobel prize, saying the prize he wants is to get it finished. eamon javers watching all this at the white house >> yeah, carl, that's right. the president answering a question that the white house staff wasn't willing to answer yesterday, which is what happens if iran restarts its nuclear program as a result of the president pulling out of the iran nuclear deal that the president there saying iran will find out there will be consequences for iran if they do that not specifying what those consequences would be specifically but clearly putting iran on notice here that the administration does not think just because it is withdrawing from the nuclear agreement that iran has a green light to go ahead and rebuild its nuke laer program. the president also saying he's
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going to have those talks on a new nuclear deal with north korea. he's going to announce that within three days, where and when that will be. no indication exactly what locations are under consideration, but the president has said there are multiple locations being considered right now. we'll also see the president this evening, late this evening, welcoming back the three americans detained in north korea who have now apparently been released to the secretary of state, mike pompeo, and they're on their way back now. the president plans to meet them when they arrive here in the washington region this evening, carl >> eamon, how much reaction have we gotten from others in washington to that detainee release, which clearly is something the president was gunning for and which has some significance diplomatically? >> we have seen from reaction from capitol hill where some senators are saying these negotiations with north korea really couldn't have happened, couldn't have begun if it wasn't for this release of detainees.
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this is the predicate for that larger conversation. if kim jong-un wants to have a meeting with the president of the united states, the deck husband to be cleared on this one first. clearly, now they have been. we'll wait and see where this all heads, but mike pompeo telling reporters that he believes those detainees were in good health, good condition, they were able to walk up the stairs of the airplane on their own powers that seems to be an encouraging sign, jon. >> eamon, thanks for that. dow up 18. let's get to the judge and the half all right, welcome to "the halftime report. i'm scott wapner we'll keep our eyes on washington and the white house for this moment, our top trade is the energy renewal. what the sector's resurgence means to your money and whether higher oil is really good for stocks with us for the hour today, joe terranova, steve weiss, the brothers najariujaajarian are h so is kerry firestone.

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