What's on the horizon for financial markets? At PJIM, it's a question that over 1,400 investment professionals relentlessly research in pursuit of your long-term goals. Specialised across asset classes, but united in collaboration, our teams provide global and local expertise. Our investments shape tomorrow, today. Pursue your tomorrow with PJIM, a leading global asset manager. Market moving insight and analysis join Jim Kramer, David Faber, and me, Carl Kaitenia on the opening bell hour of CNBC Squawk on the Street. Good Tuesday morning, welcome to Squawk on the Street. I'm Carl Kaitenia with Jim Kramer, David Faber's back and post-night of the New York Stock Exchange. Holiday shortened week, but tech, looking for some fresh footing with both Apple and Nvidia. Up 2-3% pre-market, Nasdaq is looking for a sixth weekly gain, and of course, PCE Friday. A roadmap begins with Minneapolis Fed President Kush Kari telling CNBC he is in no rush to cut rates, adding he needs to see "many more months" of positive inflation data before making the move. Plus, some new numbers are showing that Apple iPhone sales jumped as much as 52% in China for the month of April. The stock is also on track to open and positive territory for the first time this year. And Elon Musk raising the stakes in the AI Wars, his company XAI receiving $6 billion. That's the latest round of funding. It does value back company at some 24 billion. Speaking to which, let's talk about this tech rally following the fresh record closing highs for the Nasdaq and NDX on Friday, Jim. This open AI thing is going to feed right into that flywheel. Yes, it's a great way to look at it because when you see the evaluation, what you say is that's a confirmation again of what happened last week. There are a bunch of notes today. And boy, there was an Anil some Frank Holland show this morning talking about a $10 trillion valuation of-- I saw you give him a shout out this morning. Well, I just-- I think that it was a-- It wasn't a completely absurd valuation. It was kind of the ineluctible mode. You can't really take them on. The index-- the AI is going so quickly that perhaps this is the biggest story ever. Now, that's even bigger, I think, than aggressive than even Jensen. One, they said. So what we have is people just starting AI. We know we like Musk. He's got evaluation. I thought maybe I think we'd go actually test a little bit now. And there's no-- let's just say there's no governor on what people can say last week on AI. I mean, to your point, Musk raises-- and I've been aware of this, at least from a couple of people who've been on presentations that were made a while back for Musk's XAI-- raises to $6 billion. Where do you think that's going? My understanding is they're going to be building as much as a million square foot day data center in Tennessee that's going to have-- and again, this-- now, I'm hearing the second hand. But how many-- you tell me how many H100s are going to be in there, or blackwalls are going to be in there? Well, it's just you say-- So most of the money being raised here is going to end up in where else? Yes. In the video. And now, we know that Musk left that, and then he's come back. When you talk to NVIDIA, you don't get about their AI business. What you get is that they're developing autonomous machines that aren't really-- they don't think of them as cars. And then you layer this in, well, this would be part of a autonomous machine. So I'm confused, David. I'm confused about how much of this new company would be used by-- by Tesla. I think you're right to be somewhat confused, and I don't have the answer for you in that way. I think it's a separate-- the AI efforts at Tesla in terms of self-driving and XAI. And in fact, I think the-- the union here would be more closely-- X, Twitter-- the old Twitter-- Oh, my. --and this because you can use the data set from Twitter, which is real-time and is very valuable, potentially, for a large language model. So that may be more where you see-- obviously he owns all X, so it's a private company can do whatever he wants with it. So it may be there that there is more opportunity for his efforts, again, in AI, which, of course, are competing against the much larger still that we know about, obviously, OpenAI, and then you go on from there in terms of everybody else's, whether it's meta, whether it's Microsoft with OpenAI and its own. We'll see what Apple comes up with. Right. Something. And obviously Alphabet, which was the leader here so long ago with DeepMind and continues to be right in the race. A really cynical person could say, had there been no issue involving his pay package, that maybe this would be within Tesla? We're going to get to the pay package, actually, in a minute, because Glass Lewis this morning has, you know, the somewhat influential proxy advisory firm has said, don't vote in favor that vote's coming up on June 13th, but we'll talk about that in a bit as well. It's interesting. It's an interesting question you raised, Jim. But to go back to your point, Karl, I feel, no, I just feel like that what's happened is if it's AI, whether it be Dell, as a way to have the AIP sit, okay, whether it be Apple, where I think you can say, you know what, people are saying, listen, it's just a matter of time before they have AI, in the meantime, they pick up in China, or you don't find anyone expressing any skepticism. It's interesting, and that's why I mentioned Frank Collins' guest, because, and I apologize I didn't know her name, but there was no skepticism on a $10 trillion valuation. 10 trillion. Well, I mean, that Microsoft is, Microsoft doesn't know when you're that. No, no. But it's not, I guess it's not inconceivable, Jim, as hard as it seems to imagine. I can remember when Apple's market value crossed a trillion, and that seemed as though it was a number that we would never see again, and here we are with any number of companies far in excess of that, and obviously Apple now back above three, right? But I thought that when people, I'd come in this morning, and the people would say, okay, listen, whoa, Nelly, Nvidia's a fantastic company, but you know what, we have to have some sense that it could run out here, I'm a believer in the hire, but I've been a believer with Nvidia for since about the 30s, and you know, I still, I like it, I never sell this, but I thought that there'd be some real guard viewing. Sure. B of A today points out it was up 9% on Thursday, up 3% on Friday, up another 3 today. B of A by the way is the street high at 1320, Jim, and I see Meleus, Ben writes it, so I know you'd love to listen to, say these adjusted operating margins in the near 70% range. Well, the phrase, a company's margin is another company's opportunity isn't lost on us, but we don't see anyone challenging their margin in a major way for two years. I got to the car, I started reading that, and I said, wow, that was going to be my rap Ben's in my head, Ben's in my head right now, Ben writes this, he's in it. What's he saying, Jim? What he's just saying? Well, welcome back, David. Thank you. Well, it's nice to see you. I appreciate the fact that you guys missed me. I watched some, you know, I still like them. Why did someone say that? When did you? Well, you were imitating me. Oh, I mean, you're in my head, huh? My usual. You were doing my usual. No. I was trying. So I felt like you missed me even though you were. I did miss. Yeah. I was, by the way, guys, on this subject, I was at a couple of conferences actually over the last couple of weeks, and all anybody really wants to talk about is AI. And the impact it's going to have. Yeah, but these were broader conversations in many ways about the impact more broadly. And not just in terms of what we talk about so often, the business impact, but also the societal impact. This thing is coming so fast, and it's unclear to me, certainly, and many of the people, at least I've heard speak about it recently, that people are fully prepared for what is coming. Okay. Well, and the fact that we are going to have something that exceeds human intelligence at some point, and there's plenty of arguments around this, and then what is that going to really mean for humanity? Well, I'll tell you, I think that also what does it mean for professionalism? This morning, I was thinking, "Okay, here's the wireless thing possible. We had a GameStop. They issued 900 million dollars to stop." I go to chat, GPT, the most recent version, the four, and I say, "Is it possible for a company to offer stock and then immediately buy back that stock?" And it has an answer that it would be like what I would get from Paul White's. I mean, it's just an unbelievably thorough answer, which is that, yes, the 34 Act allows it. As a matter of fact, there's a safe harbor which allows them to buy stock back right now. Yeah. And I'm only thinking that cost, that would have cost me maybe $20,000. And there it is. And there it is. Yeah, we've talked about it, the creativity, knowledge workers, any number of things. It's going to be potentially very destabilizing. Well, destabilizing, the productivity gains that you just laid out are almost, they're apocryphal. I was like, "How could I even know that now? Is it possible that it's wrong?" Well, it's possible. Anybody's wrong. But I thought that that was, I was going to come out here and just say it. But then I said, "No, I ought to just admit that I've cribbed it from chat." Well, your chat GPT was the most, it's so damn thorough. It's incredible. And I encourage everybody to watch that presentation from Mira Morati a couple of weeks back where they introduced 4.0 and, of course, they're now in Scarlett Johansson's not very happy about it. No. I mean, it's staggering to just watch that thing in real time in terms of what it can do and how it does it. No, I just, I find myself thinking, "Okay, these are the odd questions that chat knows the answer to that I might have to spend a huge amount of money finding the answer to." And now I don't. Yeah. But Jim, for now, we're still here and I'm still able to do my job and I got a little news this morning as well that we're going to bring you on in the world of activism. That's substantive? Yeah. And I haven't been replaced yet by a bot. Can I guess? No, you can't guess. I'm going to do it right now. Elliot, of course, the biggest player in activism, $65 billion hedge fund, best known, course, for activism, has made up $2.5 billion investment in Texas Instruments. No. Yeah. So we're going to come to improve its free cash flow by adopting a less rigid plan for capital expenditure. That's so smart. They always say, "I've got it in the plan. The plan is the plan." And a very valid check. Letter, Elliot proposes Texas Instruments introduce what it calls dynamic capacity management, a strategy that would allow the company to achieve free cash flow, Elliot says, of as much as $9 a share by $2,026. That would be about 40% above the current consensus of analysts who follow what is the world's largest maker of analog semiconductors. Now, Elliot believes Texas Instruments rigid, and they use this word in the letter, rigid inherence to a capital expenditure plan that was put in place in 2022, has eviscerated shareholder returns by greatly reducing a metric by which TI has always asked to be judged, namely, free cash flow. Adding the reduction of free cash flow was 640 a share in 2022. It's running at about what expected to be a buck 83 a share this year. Elliot maintains that TI is alienated investors who might otherwise gravitate to what is a very significant position in serving the automotive and industrial complexes with its analog chips. Now, stock price Elliot insists has suffered as a result. It does trail his peer group, at least according to Elliot's numbers, by substantial margins over the last two, four, six, and ten-year periods. The focus of Elliot's letter is on that 2022 capital expenditure plan, which called for TI to ramp its CapEx spending to as much as $5 billion a year from 2023 through 2026, bringing that spending to as much as 23% of revenues from what had been CapEx spending far below that previously, somewhere around 5% of revenues. Now, that allocation of capital rearals out in the addition of capacity that will allow the company to almost double its current annual revenues, so it would have enough capacity to support as much as $30 billion in revenues. The problem Elliot maintains is that a reversal in the cycle of demand for its chips, since the plan was put in place, will result in capacity levels that are 50% above consensus revenue expectations in both 2026 and as far out as 2030. So Elliot suggests the company either communicate more forcefully why it believes such an increasing capacity is justified or a move to a more dynamic approach to CapEx in which it would potentially build these new fabrication facilities, but actually be more deliberate about equipping them because that's where the real cost comes in, putting all the stuff inside. And they say that, at least in their opinion, would allow for a more precise response to market demand. So guys, we'll see what the response is from TI. I would also go on to just say that the letter itself from Elliot is not particularly hostile in any way. It's incredibly complimentary of TI, incredible business the company has had, and really only briefly on page 11 does it take to task the board saying that they should have been more mindful of prudent capital allocation policies and that they hope that they, in fact, will be in the future. So it doesn't appear that we're setting up here for any sort of a board fight in the near term or Elliot looking to try to push management out in any way. They are simply introducing this idea of, hey, maybe you can do a better job. Either communicating why you feel like you have to spend all this money, or perhaps starting in, let's say, 2026, start cutting back significantly on it so you can get to a much higher free cash flow number. Well, I've got to tell you that when you're on a Texas Instruments conference call for the quarter, I don't want to say it's belligerent. I would say it basically says we don't have to answer to you. We have our own rule. We have our own game. Don't throw us off our game. And this was very, it rattled a lot of people during the period where every single one of the auto companies couldn't get any large form factor, which it would have been Texas and so they had to go to Taiwan. Right. And what disturbed me was that during a period when they really needed their chips, they just said, listen, this is our plan. We're not going to throw ourselves off our plan. Now I think, David, what could happen here is that it could get negative because of the doctrinaire nature of Texas Instruments. And I think they're rather unwillingness to ever be even their strategy. They, you know, you're hitting on the key points, I think, Jim, in the sense of, and it's unclear, I believe, frankly, from Elliot's perspective, perhaps, as to how far they're going to be able to get here in terms of will they get a willing audience? Yeah. Wow. And I know a number of analysts have actually felt similarly in the sense of, you know what, you guys have a 15-year plan. That's great. It's an over at Bernstein, for example, but I can't necessarily tell people to buy your stock when you're talking out that long out. Yeah. And it's, again, it is one of where you can ask them questions and their answer is basically, pound sand. This is how it goes. Not vicious, but at the same time, I'm very grateful that I never have to be on one of their calls. Well, you know, Elliot doesn't typically go away easily. No. This company's worth so much more than it's selling for. We'll watch that. We'll talk a little more tech as well between Apple and this China news today. Take a look at the pre-market. We'll get to some other news on sports betting, PayPal, the memes, of course, got a new target on Netflix and some moves on the cruise lines when we come right back. Let's get straight to the point. You want to grow your portfolio to fight rising costs of inflation or pay off your debt or anything standing in the way of you and financial freedom, right? Yahoo Finance, our sponsor today, can help. For more than 25 years, Yahoo Finance has been helping great investors like you. Whether you're a seasoned investor or just looking for tips, Yahoo Finance makes it super easy by putting all the tools and data you need in one spot. Yahoo Finance takes a holistic look at the financial news cycle, including breaking news, original editorial perspectives, analyst ratings, independent research, customizable charts, and more. You can securely link your brokerage accounts for a unified view of your wealth, including 401K and other investments. That's how Yahoo Finance gives you insights and helps you take a look at your wealth in its entirety. That big picture perspective is what great investors need. For comprehensive financial news and analysis, visit the brand behind every great investor, yahoofinance.com, the number one financial destination, yahoofinance.com. Much stronger than forecast. Most people thought that we'd be in a recession toward the end of last year that didn't happen and said we had very strong growth, U.S. consumers have remained remarkably resilient, the housing market has remained resilient, so I'm not seeing the need to hurry and do rate cuts. I think we should take our time and get it right. Meantime, we are going to get to PCE Friday, Jim, and if it comes in line, would be the lowest in about a year. Well, I do think there's this dichotomy that's brewing, which is that we're starting to win, we're starting to win before and it fooled us, versus a very simple, let's get out of this whole rate cut talk and just say, you know what, we had a good economy. And we're fine. Why do we have to risk the economy overheating? Right now it's not. You know, when we have this debate on TV, it does nobody any good. I think it's just much better to be able to say, listen, this is when unemployment goes higher and the economy slows down, we will take action. But right now, why? And I think it's a very common sense school coach. I really liked it. I thought it was very smart this morning. And so what, we're going to just hang around four and a half percent for a while. Yeah. For a long time. So, until things break down, I mean, he's saying don't use a timetable. We want to use timetable on TV. Now, immediately after he said there was a very good manager, I know him for 30 years, we said, oh, cowboy, there's two cuts. There's one, some timbers went, no, he's not saying that at all. He's saying, look, here's the game plan. And the game plan is not going to change until something changes in employment or something that makes it so that we actually have problems. And we don't have problems. So why do anything? I liked it. I thought it made a lot of sense. Meantime, B of A with a great chart, Jim, looking at how the best time for equities is when you have a decelerating GDP and re-accelerating EPS. And with 97 percent in, we got almost 6 percent EPS growth. It was, it is a house in time. And we just don't want to believe it because of all the problems it receives. But they're not influencing our ones. We'll talk to some more geopolitics as well after an eventful weekend, of course. We'll get Kramer's mad dash, count down to the opening bell. One more look here at the pre-market as we start off a holiday shortened week. Don't go anywhere. Norman, we need to pause this surgery. What, doctor? 'Cause Xfinity Mobile just got even better. Now you're automatically connected to Wi-Fi speeds up to a gig while you're on the go. Plus, Xfinity Internet customers can buy one unlimited line and get one free for a year. And we'll see you next week. Alright, let's get to a mad dash before we have an opening bell first trading session. But it is a Tuesday, don't forget. Yes, yes. Cruises. Yeah, look, I had Norwegian Cruising last week and they tell a good story. I mean, they're all booked up. It hasn't really meant anything to anybody. And then, all of a sudden this morning, we have a couple firms come out and say, you got to buy them. Melius, Missu Ho, Missu, says, listen, you must buy Norwegian Cruises. Leaving the No Wake Zone upgrade to buy, there's a host of positive notes about Viking. And David, what's so interesting about this is that this is where the epicenter of COVID. Everyone has completely forgotten about that, which is incredible because people understand the bargain of Cruising. And it's finally resonating. These guys, now a lot of them, if people felt that it took down too much debt during. Well, that was going to be my question. What does the capital structure of these companies look like, given what they had to do to stay alive during the pandemic? They still have a huge amount of debt, and you would say, listen, there's too many turns. They need to pay a lot down. And I would say Norwegian Cruises has a payment this year that they have no problem making. And this one is the cheapest one relative to debt. So it is an exciting company because they have this worldwide. It's not Norwegian. But Carnival is probably my least favorite. Royal had been my favorite, but Norwegian's got this management that is telling a great story without the stock moving yet. And to your point, Viking is now a new entrant. Yes. That's a public company. But people like Viking. And Viking is everyone when you're in the industry. They all say Viking is very, very good company. You know, no kids, no gambling. I mean, it's the so-called adult one. But I think that these have room to run, and I think that Norwegians are very good coke. I really do. I love them last week, Carl. I was like shocked the next day when it wasn't hot. And not to mention, we said, "We've got a new record for travel on Friday." Oh, my. People are not. That's not it. That's not it. And why? Why do you say it? You say, "When you see the two tiers of the world." Or two tiers of America, which is that there are people who are saving and trying to make do. And the people who are still spending, what you're trying to do is, are they spending within their means or not? And that with the people who are spending not within their means are still people who either lost someone during COVID or realized that maybe they're leading their lives wrong. And that's so existential. It's very hard to factor into earnings per share. Meantime here at The Big Board this morning, it is T. Rowe Price celebrating the fourth anniversary of its active ETFs at the NASDAQ. It is Microsoft's Asian employee resource group celebrating Asian American Native Hawaiian Pacific Islander month. I don't know if Jim if you saw Jensen pitch at Taiwan Heritage Day when the A's played the Astros. I watch it multiple times because it's starting to annoy me. I mean, David, I mean, we're not Jensen. That's what it's about. We're not Jensen. We're not DaVinci. We're not... Look at this. Look at this. David, I remember when you tossed the ball. I mean... Don't please don't remind me. Please. No. Okay. Well, again, apparently through a strike. Well, what else would it do? Thank you. That was a bad memory. Jensen could fit the line. I still can't... It still keeps me up at night sometimes. It would be in that... And when Jensen develops the robot that can pitch a perfect game, then it's really enough. I mean... The athletics may be one of the few teams that's worse than the Mets, though, right? I don't even know what they're... I'm not sure. Wow. Where are they even moving? Are they moving to Vegas? Where are they going? We lost the second game to the Giants last night. It was perfect. Please. You got the best... You got the best record in the base. We're forehead of Atlanta. Yeah. And they just lost... I mean, I think they lost the cue, right? They lost that number. Yeah. Jensen... I mean, it's just been a great time for that competition. And then he'll be into Taiwan. I think he might be already as the Congressional delegation goes. But, Jim... Well, Carl, you got a throw out of what it's pitched now. I mean, look, we got... I'm okay. I'm okay. I'm okay. I'll watch you guys. Jim, speaking of which, sports betting, this Illinois sports betting tax... Out of nowhere, suddenly they want a much bigger take. And I didn't even think you could get in and then they could change that. But I guess when your state is probably one of the worst-rated states, like... And everything's game. But that is why flutter and Jeff Kings are going down. And I think a lot of people are saying, "Well, wait a second. You got New York really high take, the Illinois still less than New York. Maybe we've got to rethink how much money the states are making off the gambling." Now, this is something... Candly, I've liked Jeff Kings for a very long time. I did not see this coming. The Illinois tax rate increased. BTIG has a very good place. Peace on it. Wow. I mean, New York 51% tax rate was considered to be the onerous and Illinois obviously less. But this is an industry where now I wonder whether California just doesn't have it yet. California goes, "Listen, let's do 60%." I mean, holy cow, next to you know we're going to have... It's going to be like the... They're going to do like the US government. What do you use on Jeff Kings knows that it's got the best app. That's the... What? What do you do? What are you doing? I'm looking through my Tesla pay package file because I want to talk about that. I'm looking at shares of Tesla which are down 2.7%. We're getting closer to that vote. Remember there's two votes. There's one on Redomaciling in Texas. That requires 50.1% of shareholders in favor, period. So if they don't get people to show up so to speak at the polls to vote, that's a problem for them. So one requires a lot of participation. The other, you know, you take out, it's a majority vote of whatever is voted. Obviously, Musk is not able to vote. This is on the pay package, the 2018 pay package. Why were we mentioning this morning and why is this stock potentially down a bit here? Because one of these proxy advisory firms, in this case, Glass Lewis, now we haven't heard from some of the others. ISS, of course, usually is the most influential to the extent these firms have influence. And they say, no, we are against it. Remember this is a pay package, it's options. It was granted, it was approved by 73% of shareholders. That is not affiliated, the unaffiliated shares. And it was thrown out by the Delaware court. They are now putting it back to the shareholders. And it's an important vote because there are some who believe, or at least question, well, what's Musk going to do if this thing gets voted down? What will the company then have to do or what will it do in order to make sure that they keep him happy, given he's a pretty important employee. Now, why have someone voted yes? Would they now vote? No. I don't know. I mean, it's a good question, Jim. We're talking about roughly $45 billion worth of stock when he exercises the options. By the way, an important point here, most CEOs are still compensated with RSUs. That's restricted stock. So they get it. You know, it may be lower higher. In this case, it was options, which means they may never have been in the money. It might have been a big zero. Of course, given the move in the stock price from 18 to even the current, it's not anywhere near zero. It's the biggest pay package anybody's ever heard of. $45 billion or so in shares, it's going to be deluded. And Glass Lewis for its part simply says, you know, they -- I'm trying to find my underlines here. They don't believe that it is justified, in part because of that dilution. And they simply don't think that -- and they say that that award, the size of it is concerning. That said, Jim, and it does come in far above any kind of dilution we've ever seen associated with other grants made to chief executives, okay? It could be as much as 8.7% dilution. That said, the company has a detailed presentation on their website at this point from the board talking about everything they did and why they did it and saying Elon's required to hold the shares for five years after he exercises the options and they believe his award is fully aligned with the interest of shareholders. And many would say, yeah, he delivered. He delivered. Why shouldn't he get his money? I totally agree. I mean, look, it was an option. It could have gone out worthless. This is one of those, hey, Elon, heads we win, tails you lose. I don't understand why anyone would think that he didn't have everything at risk here. What was he going to be paid if it didn't go up? There you go. I mean, that is crazy. Nothing. But don't you wish every executive, I mean, the average, look, the guy on Boeing, Carl, what's he pulling down? 30. How's that going? The guy. You're talking about Dave Calhoun? Well, I was trying to, you know, just kind of make the point, you know, like, you know, like you guys in Dallas, trying to be like, how are the horses? He did inherit a mess to be fair to Dave. True, but I'm saying that in America, if you're a CEO, you pretty much started 30. Yes. What CEO makes less than 30? I need to know. A CEO is not being paid enough, clearly. Well, what CEO does to make more than the first 20,000 people who work for the company? That's it. I won't. Remember in 1980 when Reagan was, when Reagan was president, the CEOs didn't make that much more than this. No. Like they made like 400 grand. Only a hundred times the average worker. Yeah. Now it's like. Yeah. If they gave away half their salary to the workers. And in the media business, in the media business, it's even more. I mean, they pay the CFO 30 million. You can't, you can't find a CFO CFO media business. I am. Yeah. You want to detail exactly who's paid like that? Well, I'm just, I'm just sort of putting it out there because there's been so much value created in the media business that these guys are all well-deserving. Oh, okay. They all don't move as you, but they kind of tend to one reverse split. I'm coming slowly, but surely to the end of my time here it seems. No. No, not slowly. Not slowly. That's the big problem you have. Although Jim, I mean, and David, worst Memorial Day box office, in almost three decades if you strip out 20 and 21 as Garfield and Furiosa is about all that the studios had to offer on an important weekend. Yeah. I mean, I, I was with someone in a Ben Stutter who watched a full guy. He streamed it. He streamed it. I mean, I spent $50 trying to watch with my wife. I went to that. I went to see that in the movie theater. I liked it. I liked it too. It was great. And Gosling is, you know, it's a movie star. Well, but I just think that Oppenheimer looks like a distant past. We'll see. I mean, there was the strike and there is an emphasis on quality over quantity. By the way, Mahaney over at Evercourt today takes Netflix from 650 to 700 as they do some work on this, this sun setting of one of the tiers. Yes. It's interesting that Apple Plus puts out things that are quite good. It means nothing because Apple's so big, right? Nothing. But Nvidia could issue going with the wind and Wizard of Oz and it wouldn't mean Jack if it was backed in the, what, 30, not most of them. I mean, there is just nothing that, explain, you know, the big, the mega caps, it doesn't matter what they do. But the way, if you're in a movie studio, it was, it's like, remember when Universal was, um, independent and they had things like, uh, close encounters and people were taken from 38. Jaws is a good one for Universal. Jaws was a good one. Yeah, you could. Actually, Sumner, um, my old friend Sumner Redstone, when he, you know, they had the movie company, he would, he would get a look at the movies before, right? As a result of being the exhibitor. And then he'd go out and buy the stocks. What do you thought it was? I didn't really. Like, did he buy a head of Godfather? So when he told me, he put a head of Godfather too. I don't know what he bought at Adam, but I remember it now, he would buy it. Yes. He would be like, that was really good. Because you could actually make a, make a, you know, it actually mattered because there were so many of these publicly traded companies to some extent where the next movie was an important one. Wow. It kind of does. By the way, uh, Mary Poppins for Disney. Mary Poppins for Disney. In fact, 1966 was nothing more important. It's $30 million at the box office back in '66. I liked it. I want to see it ready. I like to see it. Right. Right. I mean, and yeah, Disney shares were absolutely moving on that. In fact, Warren Buffett was looking at buying them at that very point as a result of his view that it wasn't only reflecting the value of Mary Poppins. That's funny because Nelson Peltz felt the same way in '85. Not really moving, uh, shares of, uh, IMAX, but Jim A.M.C. was up, what, five pre-market? Well, that's in mean stock because the mean people don't realize that they're just being, you, they're useful idiots to keep this company alive. I, I never liked that term. What do you term that people are sending Nvidia up another 5%? We're talking about it now approaching $2.8 trillion in market value, and I just want to keep in mind. So that would exceed everything other than Apple and Microsoft in terms of market value. Oh? Or Nvidia. Right? Near $2.8 trillion. Well, David, if you're going to take over the world, you should get a little more higher valuation. Yeah, I guess. Only $7 trillion to go, pretty much. He even doesn't mean this morning I was listening to some blackwell, David. It's kind of like plastics. Yes. Blackwell. Blackwell. And then, by the way, Melius has the next version. I mean, there's just, there's just, I remember when Jensen was, he was musing about something and I was trying to get him kind of pin him down. Well, there's a 20-year plan here because it started 20 years ago. I mean, it's not like he woke up and said, let's do this. No. In 2004, he had this plan. There's no shortage of capital going towards any startup that's made up of former Nvidia engineers who say that they're going to be able to do something that competes, right? Well, look, look. This company's going to have so much capital. Did he work? You know, when I threw out the first ball, I started at 20 feet and 30 feet and 40 feet and 50 feet and then 60 feet so that I threw a strike. Did he just naturally throw a strike? First of all, you did not throw from 60 feet. I saw the video. You were nowhere near 60 feet. I'm the idiot who tried to throw from the mount. Oh. Okay. Listen to him. Another useful idiot. I threw him in the shot. Oppenheimer today, Jim. Nvidia now worth more than meta Tesla, Netflix, AMD, Intel, and IBM put together. Oh, my God. Just like Babe Ruth. Better year. I mean, no, look, that quarter was not initially greeted with anything other than, wow, a typical Nvidia beat. And then as people looked at the substance of the quarter, they realized how much there's no one closer and that anyone who is close is just involved with the easier part, the inference, not the training. And then people started thinking maybe it's got software then. It's a platform. And next thing you know, we don't know any company that's able to make what they're doing. David, I know that there are companies that are supposed to be nipping at them, but Jensen made it very clear that Amazon, Google, whatever they're doing is great. He's happy with that. And watch Dell, because Dell is the implementer. Yeah. Dell is the implementer. Stock doesn't quit. Oh, come on, 52. Dell's up another. Yeah. Well, I say it's up another 4% as well. There it is. Yeah. But they also have the AIPC, which, which by the way, Nvidia is in. Don't forget. Don't count Michael Dell out, man. Well, a lot of roads lead to Michael Dell. He was in the front row of the, when they had the conference. He is. And I didn't see him. What else there? He's still one of the most important people in business technology in this country. Humble is noticed. There seeks no one. No. No. He has a buyover at Loop today, Jim. We're not going to get H.P. later in the week, along with the slew, like specialty retail. H.P. has to tell a very specific story about how the partnership, it's a partnership with Microsoft. It's not just that they are a dumb machine that Microsoft has taken over. And Ricky Elors has to say we have better AI. Now Dell has a huge AI franchise, so it's really going to be very competitive. Jim, when it comes to earnings, we're also getting sales for us. Aren't we? Yeah. So the stock has just been a drag. It's just been one way? I have a question for you. This HubSpot, this company, this sales force. Now there have been many reports about HubSpot being in conversations with Google. My understanding is absolutely true. All stock potential deal from Alphabet to acquire HubSpot. But my question to you on it is, would Salesforce have interest in HubSpot? Because there is some sense that it's somewhat competitive with them in a certain area and perhaps they'd be taking a look. It would be great to have the small, medium-sized business owner, one roof, but it feels like to me, Adobe Canva, which is that you've got the less developed Canva and then you merge it with the more developed Adobe. It's a terrific thing, but the government didn't like it. If Google, if Alphabet moves in here, that explains this endless drip in Salesforce, endless. This sort of is tied to the chatter we're getting about why software is the weak spot in tech, Snow, Workday, Palo Alto. What happened last week? I have to tell you, I went over Workday's quarter. I didn't think it was nearly as bad as people felt. Maybe it was not as well told, but the business is not bad. What happened is they have human capital business and the financial business, they didn't get enough financial. This is incredible. But you're absolutely right. Software is no longer eating everything. I find, by the way, Palo Alto, cybersecurity coming back after what people thought was a weak quarter judging by billings. And we've talked about the impenetrable nature of the metrics that they give every quarter? Yes. Oh, come on, down to what kind of days today them, Workday was a huge at 5 a.m. What happened? What kind of negative people now, they just came to work and just said, you know what, it allows you, we can't? Yeah, the S&P is now flat. By the way, interesting, Jim. I mean, Texas Instruments, which we reported on, Elliott, taking that two and a half billion dollar stake. Typically, by the way, it's not just stock. They often use swaps, but ultimately in economics, they're two and a half billion dollars. They're saying, hey, you can do a lot to improve your free cash flow. Stock's doing nothing. Absolutely nothing. It's flat. Are you serious? Yeah. Just. Okay. Well, I mean, but it made me in part because you said how Texas Instruments, not interested. They're like, yeah, fine, keep your opinion to yourself. Elliott can buy more Elliott, Elliott has never been known to say, eh, I don't want to talk. Let's just go away. No. I just think Texas Instruments deserves to be hired just because their business is finally humming. They had very, very little inventory was the call. That's what drove the stock up from that little low was they see, listen, the inventories finally burned off, and that drove the stock much higher. It is a great company. It's just an uncommunicative company that does have very rigid rules in a world where rigidity has been a fault, not a positive. And that was the word used in the letter, 13 pages of the rigid, yeah, in terms of their capital allocation, in terms of their CapEx plan to spend $5 billion. Last year, this year and next year, you're at, and as much as $30 billion to build capacity that Elliott says is going to far exceed the revenue opportunity given the marketplace, but Texans, you know, they basically say, listen, we'd rather be two years early than two months late. Well, they got that inventory low. Look, I'm low to criticize a company. It's a story company to sell very, very well, and did not fall prey to Intel problems. They're not like Intel. The lightest weight on the down now, Intel. Really? As we go to break, check out bonds today, a busy day. We got Kashkari on the tape, Lisa cooked this afternoon, conference board in about 12 minutes, and two auctions, a two and a five at 11.30 and 1 p.m. Eastern time. Stay with us. It'll be another busy week of retail earnings. And check out Deckers. We talked about their quarter last week with Jim. Today, truest goes to buy Jim. It's not just the stock, but Deckers versus Nike over five years, they just went different directions. That and wow. They're saying that Nike is a shared owner. It was quite devastating. Wow. Pretty amazing. Oh, God. The last half deck game. Oh, God. Oh, God. His king. Well, get stopped trading with Jim in just a moment. Don't go away. It's time for Jim and stop trading. Well, it was good to do Nvidia, but enough Airbnb, no from way Bush, upgrading from hold to buy. This is really important. A lot of people are down on Airbnb, and they have a story with him and down, but that's because a few people feel saturation, they're looking at travel. Mary, I didn't have that good a quarter. The film was okay. Hi, had people like. But what I liked about this is that you cut the Olympics, so you have an event. You have the World Cup. You have so much going on, and it's just an inexpensive way to go. I think this note's very good. They waited until the stock was down, and it's very well timed on a long-term company. And on Brian Chesky, who keeps surprising, I urge people to go to the site and look at these dream vacations. The icon. Oh, my God. No category. My daughter, we're going away. That, if you looked at this, and it's like a dream come true vacation, no pricing on it. But Brian is so creative, and this was on the place where X-Men were made. I said, "No, that's like in Westchester." I'm not going to Westchester. Westchester. Westchester. That's not a vacation. No. Yeah. That's work. Yeah. You'd be calling me every day. Hey, Jim, what do you think of Texas Instruments? No matter where you are, I call you every day. It doesn't really matter. You can't get away from me. You can't get away from me. Our partners are fresh, and I go to Westchester. Yeah. You go to Kyoto, I go to Westchester. Tonight, Jim, you'll have Kava to kick around before things get a little busier. Yeah, but I got Cloudflaring. It's very important because we're seeing price competition in cyber. I mean, look at Z scale are today, downgraded. And this is the one bastion where everyone said, "Listen, there's so much business. You do not need to worry about competition, and that is proving untrue. The crowd strike has been renewed from competition." Yeah. Cars, Walmart, Amazon target, and fast food are where these discounts are showing up fast. Well, I mean, I read somewhere that we didn't. You know, the big Mac Friday die coasters was kind of $9 or $9 or $9. Nine dollars. Texas Roadhouse got a steak dinner for $10.99 because they're early. Nearly burned $5. Well, I got a large fry from McDonald's recently. It was $5. $5. That's because you used DoorDash to bring the fly in. No, I did it at the counter. It was driving. It was on the highway. Interesting. Five bucks. Five bucks for a fries. I have a big refresh from my name. Okay. We'll see you tonight, Jim. All right. Dad, buddy, 6 p.m. Dows down $1.44 to start this Tuesday. Don't go away. You've been listening to the opening bell on CNBC's Squawk on the Street. All opinions expressed by the Squawk on the Street participants are solely their opinions and do not reflect the opinions of CNBC, NBC, Universal, or their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet, or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information Squawk on the Street participants consider reliable, but neither CNBC nor its affiliates and/or subsidiaries warrant its completeness or accuracy and it should not be relied upon as such. To view the full Squawk on the Street disclaimer, please visit cnbc.com/squawkonthestreetdisclaimer. Norman, we need to pause this surgery. What, doctor? Because Xfinity Mobile just got even better. Now you're automatically connected to Wi-Fi speeds up to a gig while you're on the go. Plus, Xfinity Internet customers can buy one unlimited line and get one free for a year. Visit XfinityMobile.com to learn more. Offer N621. Restrictions apply. Xfinity Internet service and two new limited lines require. Reduce speeds up to 30 gigabytes at usage per line. Data threshold Tiberi. Actual Wi-Fi speeds very not guaranteed. [MUSIC PLAYING]
