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tv   Tech Check  CNBC  December 1, 2022 11:00am-12:00pm EST

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national defense forum we're speaking with industry ceos, senior government officials. there will many big interviews over the coming days including northroom grumman ceo, kathy warden the b-21 bomber. that's going to happen during this hour tomorrow, and we're going to check in with palmer luckyey, and many others that's it. >> looking forward to that that's going to do it for us on "squawk on the street. time to check in with "tech check. >> good thursday morning welcome to "tech check." i'm deirdre bosa in san francisco with jon fortt in new york today, a ton of earnings movers to get to. marc benioff is alone at the helm of salesforce investors warming up to snowflake, and okta gets a boost, and sam bankman-fried and mark zuckerberg talking at the book deal conference
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we have all the highlights, and cloud week continues we're joined by the ceos of azure and pure storage >> let's kick it off with salesforce that internet giant falling this morning. after the announcement the co-ceo bret taylor is going to leave the company at the end of january after just being promoted exactly a year ago. taylor said in a statement, the move was to get back to his, quote, entrepreneurial roots marc benioff is going to retake the full reins at thas point here's what he told jim cramer on "mad money" last night. >> it's a gut punch, and you know, running a company, and i have been doing this now for 25 years, you look for the best people in the world to bring them in. and the hardest part is when they tell you that they want to leave. and that's where we are with bret bret is leaving at the end of
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the year >> let's bring in frank holland. part of this story has to be the remaining performance obligations over there at salesforce indicating a slowdown in 2023. part of this whole story we're seeing play out in enterprise overall where for every company that's a little different but pockets of weakness or at least question about how much demand there's going to be in an uncertain economy. >> absolutely. demand is the question across the board when it comes to cloud. we saw salesforce issue lower than expected rpo, again, often seen as an insight into demand going forward. then on top of that, marc benioff in the call and in the discussion with cramer, he laid out there's a lot of headwinds, ceos across all industries are slowing un, maybe stopping spend when it comes to i.t. and marketing. even when he spoke to cramer, he mentioned he's been through some economic crises before, some economic slowdowns before, but this whole currency thing
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blindsided him he said last year we were setting out our guidance we had no idea the dollar would make those moves and he admitted me was a bit stumped by it >> the quarterly results and outlook is one thing, but the big story was bret taylor. he's been there for six years plus and this was a guy seen as an agent of change, someone when was going to push for organic growth and investment, where benioff's style has been big aczikzs which has diluted shareholders with taylor not there, how much of this is investor concern that benioff won't have that change agent anymor who else at salesforce can play that role. >> to be clear, the shock was for everybody across the board dan ives believed the decline in the stock was related to bret taylor leaving i was at dream force a few months ago in san francisco, and bret taylor really seemed integrated into the culture of salesforce and the whole community.
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what they do out there is unique and he seemed to be a part of it a good rapport with investors, with analysts and with everybody there. i had a chance to speak with him a little bit there, and he was trying to take it all in he trying to enjoy that first in person dream force looking forward, who is that change agent bret taylor said he wanted to get back to his entrepreneurial roots. the ceo of their service cloud, who has a very similar background to bret taylor, she's also a founder of heresy systems, now part of salesforce, so that could be somebody he could turn to with similar background and just that similar entrepreneurial background that bret taylor has. >> speaking of bret taylor, spoke with him just about a year ago around the time leading up to dream force '21, which was largely remote he talked about the importance of values and why he joined salesforce in the first place. take a listen. >> reached out and made this
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case, but it was just the wrong timing we had just raised our series b. the sky is the limit, and mark, if you have ever met him, is a charming sales person, and convinced us, and the price tag was, you know, motivational as well >> and that's when he sold quip to salesforce in the first place. saying yeah, the price tag was motivational, but it was really benioff leading with this talk about values clearly, bret wants to go back to the entrepreneurial part, and hey, when the economy is shaky, if you have some money, that's a good time to start something it's also a good time to incubate things in large companies. maybe benioff ends up leaning on the folks over at slack, clara, to help do that as well. >> that's definitely a possibility. but i think something a lot of analysts and people z spoken to me about, the fact they have also integrated slack. that's not an entrepreneurp opportunity but a challenge that
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bret taylor was looking for a challenge he could have taken on inside of salesforce and on top of that, something that's a bit confusing about the report, rpo was a bit disappointing but they raised guidance. a question about demand, where money is coming. a deals taking longer to close or are they not coming one thing about bret taylor, co-ceo of salesforce, but also on the twitter board a pretty prominent person in the world of tech, but marc benioff is like a planet with its own gravity. if you're around marc benioff, people are attracted to him. he has a spotlight on him pretty much everywhere he goes. >> a force of nature and was on the twitter board, taylor. jon, let me throw something out to you taylor wants to return to his entrepreneurial roots. he was chair of twitter. he defeated elon musk. maybe he won his respect too could it be possible that maybe he goes to twitter is that a crazy idea >> yes no, it's not possible.
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>> jon is not willing to have fun with this at all he shut it down immediately. >> bret taylor is not going to have fun with that i don't think that's going to happen >> he might be, yeah, so far aafrom that now, and thankful to be frank holland, thank you very much let's turn to ftx. sam bankman-fried covering a lot of ground at "the new york times" book summit claiming he's down to $100,000 and one credit card. have a listen. >> i mean, look, i have had a bad month. there was no person who was chiefly in charge of positional risk of customers on ftx this was a specific crash on assets associated with alameda research rather than all assets. i didn't ever try to commit fraud on anyone. i was excited about the prospects of ftx a month ago i substantially underestimated
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what the scale of a market crash could look like, and what the speed of it could look like. >> here to help us break it all down, let's bring in kate rooney who was watching with your popcorn like all of us i mean, a part of me can't help but feel like there's got to be some method in this madness here he's just incriminating himself. he's talking too much, obviously, there's been a lot of discussion he's going against everything his lawyers are advising him, but is it possible he has inkind of new age management team because he's painting himself as someone who has mismanaged, who is incom incompetent, when really it's malfeasance and misuse of customer deposits at the core here >> that was one of the takeaways, he tried to deflect any idea this was muliss, premeditated he knowingly commingled funds and tried to blame it on sloppiness and maybe immaturity and the idea he was a new ceo, he was distracted, there was so much else going on he talked about some of the regrets, but it seems strategic
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in the way he's trying to avoid culpability in the idea that he had intent to defraud investors. i don't know that we got that answer in a straight way from him. >> this is very different from the sam bankman-fried we saw in those direct messages with the verge. it's very different from the sam bankman-fried we heard from when he was speaking so confidently about how his businesses were structured so you have spoken to him before does this sound genuinely like the narrative follows through from what he believed before and what he is saying now? >> that vox conversation was really eye opening because his public persona and what he had said to us on the record >> vox, yes. >> consistently really aligned with how he was approaching the interview with andrew and the idea that he didn't know some of this was going on. we asked him directly about
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alameda and ftx at the time. he sort of avoided that question and even when andrew asked him directly about that, he said he didn't know. or he didn't realize how big their margin position was, and he really was the ceo as the new ceo put it, a fiefdom, he said, and he was the one controlling it he should have known this in hindsight. the vox conversation opened up a new window into how he thought about some of these things andrew asked him about effective altruism and some of the virtue signaling he admitted to and he called it corporate bs that he had to play along with i don't know that andrew or any of us would have known to ask the question or question the altruism thing if it were not for those conversations with someone he said he thought was a friend and didn't realize that was being published. that's really the only window we have gotten into how he probably realistically thinks about this. >> which seems to underline this idea that quite simply, sbf is a con man. even those comments that he's down to $100,000
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he cashed out $300 million from last year's vc raise he took out a billion dollar loan from alameda research can't believe anything he says here >> that's what novogratz made a great point earlier, the idea that some point he will be prosecuted, and he's out there on this media tour he's been really trying to make excuses for a lot of what happened here. but he said at the end of the day, there will be prosecution and andrew asked him at the end, are you lying? did you lie in this interview? and he said, i was as truthful as i am knowledgeable to be, and i don't know of times when i lied he's still really tap danning around that. i think that's one of the big questions here did he know, and was he lying in some of his answers there. >> what he's essentially doing is providing prosecutors a lot of material. more to come, i'm sure, in the coming days and weeks. kate, thanks so much >> yeah. meanwhile, elon musk, not the only one taking issue with apple's app store. mark zuckerberg also spoke
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critically of apple's policies at "the new york times" deal book summit saying, quote, apple has sort of singled themselves out as the only company that is trying to control unilaterally what apps get on a device. i don't think that's a sustainable or a good place to be those comments come after meta's ad business has taken a huge hit this year thanks to apple's updated privacy changes. zuckerberg also addressed a range of issues from metaverse skeptics to tiktok competition at the summit. sounds like he needs to take a walk with tim cook julia joins us to break it all down >> i love the walk with tim cook reference. i thing what's most interesting here from an investment standpoint is the signaling that mark zuckerberg did that they are not going to be overspending on the metaverse and they are focused on what is still their bread and butter, which is social media and the ad business i want to.out a quote that zuckerberg said. over the long term, they're pushing the same direction,
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mainly into the metaverse, but it's going to be efficiency and displace and rigor and operating in a tighter environment acknowledging they're not going to be overspending they're going to be disciplined there. that's the key thing, and also trying to reassure over the next three to five years, not just over the next ten years, they will be seeing notable improvements in that metaverse technology to make it more appealing to consumers so jon, i'm curious what you thought of that. i know you're a metaverse skeptic. is this a pivot or just near term reassurance >> i say show me the money they're spending 10s of billions of dollars they said to investors they're going to spend tens of billions of dollars on the metaverse in the near term. saying they're going to be disciplined, i don't know how you do that. >> he can say all these things, but do we buy it he's got to put his money where his mouth is or take his money away from where his mouth is he said he's social media first. he named the company meta and
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he's spending tens of billions how much stock should we put into this as this sort of to make nice with investors >> well, i think it is definitely a signaling to investors and also noting the major layoffs they have done so i think that is putting his money where his mouth is i think the other thing that is interesting is he talked about the success of reels reels is the short form video format that competes with tiktok he said it's doing better than it may seem like, and of course, he did very carefully raise some concerns about tiktok's chinese ownership. not quite saying that tiktok shares its data with the chinese government, but indicating that some companies that are based in other countries, they do share their data with their parent companies and the government it was really interesting to hear from zuckerberg about this, to hear from tiktok's ceo talking about how they're mitigating those concerns. but there's no doubt that tiktok has been a major force
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competitive force that has challenged meta and mark zuckerberg in a way that he never could have anticipated a couple years ago >> and tricky balance there too because he almost needs tiktok as a competitor to allay antitrust concerns great rundown, thank you up next, spot week continues. the ceos of azure, vm, and pure storage are with us. we're back in two. at fidelity, your dedicated advisor will help you create a comprehensive wealth plan for your full financial picture. with the right balance of risk and reward. so you can enjoy more of...this. this is the planning effect.
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welcome back let's get a check on snowflake the stock reversing early losses after a top and bottom line beat in q3. the initial drop due to product revenue guidance that came in light. the ceo joined "mad money" last night and addressed the soft outlook. >> the guidance is the guidance, and you know, you always have to wait and see how it plays out. we think these numbers are formidable in any reasonable context. obviously, you know the sentiment in the market is stressed out and people react very strongly. and that's understood. but we live in the real world. and you know, we just go, you know, one day at a time, one
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quarter at a time. >> company's revenue was up 67% year over year, but that growth was lower than the 83% increase last quarter shares are down more than 55% in 2022 jon, the guidance is the guidance >> yeah. and the stock is up today in the trade so far let's turn now toone of the biggest names in the cloud, that is microsoft azure, its cloud platform has been a potent force, but last quarter saw lower than expected revenue growth amy hood pointed to moderating consumption, higher energy costed hitting azure's bottom line they face stiff competition, regulatory scrutiny. join us, executive environment of the cloud and ai, scott guthrie. great to have you. i want to start on this kind of consumption trend we see i keep hearing from executives,
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leaders in enterprise software, customers want to break down their needs into the smallest possible components and spread them over time and pay as they go even more than before. are you seeing that? and how does it affect your plans? >> first off, thank you for having me on the show. it's great to be here this week you know, i think to your point there, customers are looking to optimize their i.t and we think with the microsoft cloud, we're really helping them do that. we saw strong growth, continue to see strong growth with the microsoft cloud. last quarter, we grew azure 42% year over year in constant currency to your point, that's driven by customer usage of our consumption base services. >> break down for me also what you're seeing in small and medium sized customers we just saw that snowflake saw some weakness there for what it sells at the same time, though, we talked to intuit yesterday.
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they specialize in small and medium business. for the back office tools, those sort of revenue driving and business running cloud tools that they have they continue to see strength. what are those smaller customers really using and finding essential during this period >> i think there's obviously going to be some economic uncertainty in 2023. but every organization needs to find ways to drive productivity amongst their employees and continue to transform their businesses while at the same time cutting costs and part of what we're trying to do with the microsoft cloud through the breadth and depth of what we offer is help them do that we're in lots of different categories, both sas and consumptive based and we make it easy for them to use that separately and combining them together to be able to optimize end to end processes at the end of the day, use the cloud as really a lever they can
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pull to optimize around productivity and drive their transformation >> scott, good morning it's deirdre are there other ways in which you can help them, such as eat costs yourself earlier this week, we heard from the aws chief who said he's trying to keep costs down for his customers by doing things like eating the higher energy prices are you doing the same, and how might that weigh on margins going forward? >> well, certainly, we're optimized around at scale, and so take energy prices in europe. on our scale, we're able to make sure we have the right supply chain, we have the right long term energy contracts, and we're very focused on how do we make sure our customers are successful key can help them navigate higher fuel prices and energy costs inside europe through our cloud and through the scale at which we're able to provide it that's something that i think is a real value prop for customers. the other thing i think we're really focused on how is do we
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enable them to get outcomes faster with more certainty and part of the breadth and depth of what we offer enables them to have more confidence that they can add a security solution which is top of mind or drive the business outcome faster >> and how much of that, scott, means you have got to roll out more industry specific purpose specific apps on top of the platform that you're offering to customers? earlier this week, we saw aws roll out new data management tools, some supply chain focus services built on their platform what are your goals industry specific and task specific in a time where customers want that shorter time to value? >> over the last two years we have focused on microsoft for industry that's offerings we provide and also importantly, how do we bring in partners and other software vendors within those industries and compose them and integrate them with the microsoft cloud. we have seen this as a real
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differentiator for us. and it allowed us, for example, in retail to go to retail not just with a horizontal cloud but with a whole bunch of existing solutions optimized for retail that they can take advantage of immediately. you're going to continue to see us drive that forward, both with our own first party products and so for example, nuance was an acquisition we closed earlier this year that is particularly strong in health care. and used also in the back end of many other companies but then again, also with partners >> well, finally, tell me what your plan is during this period, are you accelerating custom semi-conductor development for the cloud? are you leaning into that? again, talking earlier this week, he was saying the custom silicone allows them to help customers on cost for really specific workloads i know you made some announcements on your plans for that as well how is that going to progress and how much are you leaning
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into that over the next year >> we're continuing to lean in both in terms of whether it's hardware, silken, network fiber. there's a lot of optimizations that at our scale we're able to now introduce and invest in that really provide customer value. and so, for example, in september, we launched our arm based vm offerings on azure. so they're now generally available for customers to use again, that allows them to take advantage of better power savings, better performance cost curves and realize real economic value and lower i.t. costs and you'll continue to see us invest in hardware and silicon with our cloud going forward. >> we'll continue to watch that. scott guthrie, thank you for joining us >> thanks for having me. >> the ceo of vmware is with us, the stock aerary outperformer. positive on the year look at okta, issuing upbeat
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revenue guidance for its full fiscal year. read more about the quarter on we're back in just a moment. [newscast audio] hello, world. or is it goodbye? you know, it seems like hope and trust are in short supply. [clap] now, as businesses we can blame and shame. or [whistles]... we can make a change. [clap] we can make work, work for our communities. create more equal opportunities. [clap] maybe, just maybe, get a bit more unity. ♪ let's have less cancellation and more conversation. prioritize conservation. and... empower future generations! [clap]
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so you can enjoy more of...this. this is the planning effect.
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check," everyone i'm contessa brewer. u.s. manufacturing activity in november contracted for the first time in 2 1/2 years. that's according to the institute for supply management. the good news on inflation, factories paid les for raw materials for the second straight month hurricane ian and other natural disasters have caused about $115 billion in insured losses so far this year, according to insurance company swiss rhee that's well above the 10-year average of about $81 billion shares of costco are down about 6%
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the warehouse retailer reported a more than 10% slump in e-commerce sales for november. online sales have been a bright spot for costco during the pandemic >> treasury secretaryi iansecren says she practiced her signature. printing is set to begin next week yellen is of course the first woman to serve as treasury secretary and she told cbs host stephen colbert she wanted to avoid her prescessors whose signatures were widely considered to be illegible we wouldn't want that. >> she could go the bob dylan route. >> which is? >> to not actually sign it yourself we don't want that either. all right, contessa, thank you >> turning now to cost cuts and layoffs in tech. doordash the latest company to slash its head count kristina partsinevelos has more on companies tightening their belts. >> we have seen tech layoffs
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have more than doubled from october to november. that one month, which makes us wonder, could it be an indicator of what's to come in the labor market theysy nope, info tech kaechs account for 26% of the s&p market, but the tech labor footprint is less than 9%. i use that 9% number loosely there's even lower numbers of the total employment and not large enough to cause a meaningful slowdown. as janet yellen put it, tech has faced some nord factors. >> in a slower economy, declining ad revenue, and of course, they benefitted massively from the boom in technology during the pandemic >> what's left now are leaner companies. analysts found uber has seen the greatest growth in employee productivity over the past three years because it cut jobs early and increased prices while snap is down 77% year to date,
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managed to grow its revenue per employee year over year in q3 after announcing a 20% head cut back in august you compare that to meta which doubled its head count from the end of 2019 to q3 of this year now, it's cutting staff after posting its first ever year over year revenue decline in the second quarter of 2022 demonstrating that growth like you mentioned at all costs will no longer cut it today >> yeah. what concerns me here, so doordash in 2021, more than doubled its workforce from i forget exactly what the numbers are, a little under 4,000 to more than 8,000. now they're cutting about 15%, which is nice, but they're still a lot bigger and i guess the signal is they feel like they need to be bigger. they're still growing, but we have got this move to consumption based pricing. companies being concerned about how much growth there's going to be in '23. i wonder, could there be more cuts if q4 doesn't turn out to
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be as nice as many hope, and not just in tech >> two points. one, the first is doordash, a lot of tech companies, janet yellen said yesterday, andy jassy saying they don't regret hiring because there was such a boom in the pandemic but to the second point, if twitter is successful, they're cutting fifty% of the workforce, it they successfully come out of this, doesn't it show the inefficiencies across the board, because if they can do it, why shouldn't everyone else? >> perhaps, and they have that billion dollar debt bill to pay which helps the cause for wanting to cut thank you. let's dive back into our cloud week coverage. no surprise, the software sector has takeb a big hit this year. shares of vmware are holding on to gains up more than 4% on the year 7% for the month after shareholders approved its $61 billion takeover from chip giant broadcom
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joining us for more on the company, the ceo ragu raghuram tell me how you're seeing customer demand shift. talking more about moves toward consumption based models how is vmware weathering that? >> yeah, so this has been something that we have been doing or seeing our customers do for the last couple years and we're well under way in vmware's own shift in our business model from largely a license based business model to something that is today a combination of license and consumption, increasingly more compsontion and subscription going forward navigating the change very carefully, and we have been doing it in a constructive fashion. overall, i would say customers continue to spend on what they see as a high priority for them.
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of course, the monetization of their businesses turning them into more digital businesses, investing in cloud, investing in new application buildout, security, so on and so forth, the areas we have traditionally served them well on. >> talk about the multicloud model. it may seem almost counterintuitive to some walk our audience through the tradeoffs and the benefits of going this route >> so like you said, it might be kou counterintuitive to some here's what we see in our customer base. roughly 75% of our customers are using two public clouds and they're using their traditional data centers and building private clouds they're also modmodernizing the edge if they're in manufacturing and other industries the reason they're doing it is exactly what you said, companies need to find the right place to
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put the right application, the right business applications so they can optimally adjust their spend. at the same time, dealing with the business services in the best manner possible they have all these choices so they're trying to maximize spending their money on these choices in a wise way so they mazmize their own business ou output what that leads to is you have your i.t. infrastructure and applications spread out over a couple different clouds and premise and that becomes the multi-cloud complexity and they turn to us and companies like us to solve this multi-cloud complexity that's what we see we actually call this being cloud smart. it used to be companies were cloud first. now they're saying cloud smart, which is let's use all of these various clouds for what they're good at. >> so customers at the same time need to be confident that the cost of managing multicloud isn't going to move higher, but
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that is a concern that we have heard over the last few months since broadcom's plan acquisition of vmware. i know you can't talk about that, but the ceo of broadcomhas been quite public. i wonder if you can respond to what he said in terms of not rising costs are you confident that costs won't become higher for a lot of your customers after this acquisition if it does go through? >> yeah, you heard it from him himself. and he published blogs to this effect saying he sees nothing fundamentally wrong with vmware's pricing, and therefore, he doesn't see a need to change prices but going back to your cloud comment, the point that you raise is cloud costs are going up for customers that is totally true one of our best selling offerings is an offering that enables customers to optimize their cloud spend regardless of which cloud they're in, and we see what you're talking about all the time with customers
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because initially in the rush to go to the cloud, they did not aptmize what they are to do. now we're helping them optimize it >> right so on the question of increasing profitability, cutting costs, where do you guys have room to do that? where are you in terms of hiring next year? >> we're being prudent in our hiring even this year. i would say starting roughly second quarter of this year, we started slowing down our hiring. we still do hiring in a very judicious fashion, but we did slow down our hiring so we're on a trajectory that we feel comfortable about going into next year. >> raghu, thank you for being with us today. talk to you again soon >> thank you so much >> and meanwhile, at cnbc, a big week of pro talks continues this afternoon. today, a new way to trade with the pros it's real trades, real access, and real money on the line join us at 3:00 p.m. for a new cnbc experience called the tick.
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welcome back
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as you saw, the nasdaq turning positive the senate ag committee holding a hearing on the ftx collapse. cnbc's senior congressional correspondent ylan mui has the highlights >> well, deirdre, there is new urnl aenls from both lawmakers and from regulators to write new rules to protect customers as well as to find out what happened inside of ftx they want to make sure that there are protections for consumers as well as new rules for digital assets cftc chairman said that his agency currently lacks the authority to police bad actors before they strike he said that's why legislation is needed from congress to give him authority over the spot market for digital assets, particularly to give him a window into what happened into ftx. he also defended his own meetings and interactions with sam bankman-fried. he said he met with bankman-fried ten times over the past 14 months, but that all of
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those discussions were around ftx's application to function as a clearing-house now, there has been bipartisan legislation from the senate ag committee that they say would have prevented ftx from occurring, but there are this is not a power grab by the cftc in order to gain authority over the spot market for commodities. he said this is a way to fill gaps, protect consumers, and prevent another ftx from happening again. guys >> thank you and we are going to check back in with washington in just a bit. again, in a few minutes, president biden hosting a joint conference with french president emmanuel macron. kayla tausche will monitor and bring us any highlights.
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"tech check" is back after this. go. go green. go wind turbines. go gorgeous reliable grid. go emerson software. go science people. go breakthrough meds and safe science. go space age welds for super silent cars. go big. or go home. from software that delivers new cures at warp speed, to technology that makes clean energy reliable, emerson innovation helps make the world healthier, safer, smarter and more sustainable. go boldly. emerson.
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let's get a gut check on sirius xm, one of the rare stocks in the red. it's down about .7% on a double downgrade from citi, taking the stock from a buy rating to a
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sell rating. the analyst saying once liberty which owns majority stake in sirius xm creates liberty live nation next year, they expect sirius's share count to decline and leverage to increase prompting citi to drop its target price from $7 to $6 for the stock. now, in parallel, they believe that share exchange if it does happen, then shares of sirius xm's common stock value increases. he said it remains his favorite stock within the coverage universe you see liberty media xlsma, those shares are also down .9% today. "tech check" will be back in just a minute. ♪♪ i don't accept this. i can't do this anymore. impossible odds, save the world. i'm done. what do you have for me? a new way to transform our agency. strategy to execution. oh, looks my laces have come undone. a business card? yes, for ey. tech expertise? $2.5 billion invested.
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shares of pure storage are higher after poste shares of pure storage are higher the company also issuing guidance saying on the earnings call the company's core strategy is what's going to lead them to take market share from the competition. pure storage ceo joins us now to discuss. good to see you. >> good to see you, john >> unusual how you're talking about even leaning into sales and marketing in a very targeted way during this period why are you doing it, and to what kind of customer? >> well, quite frankly we're a market share follower in this $50 billion market we're still a relatively small
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player but the newest on the block with frankly the best technology, and we provide a lot of benefits to customers including lower operating costs, lower energy utilization, better footprint and better performance at the end of the day. so which customers we're increasingly selling into large enterprise across the board, not just their primary storage but now increasingly into their hard dick state what's called the second tier hard disc area how becoming very much open to the economics and the better performance of flash technology so it's a very exciting time for us >> so zeroing in on what you just said about operating costs and energy utilization about how
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they are eating some of that cost for their customers are you in effect selling to the providers so that they can lower their operating costs and increase margin over time? >> well, this is the opportunity. in fact, just this past quarter we have seen numerous customers especially in europe choose us specifically because we reduce their overall power requirements up to 10x whenthy replace. the data bits out there especially the hyperscalers are still hard disk based. now the economics and the energy footprint of flash are just too good to ignore >> is there an opportunity for mna or do you plan to do so
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organically? >> we're blessed with lots of organic opportunities. that being said there are key bits of technology outside in the world we'd like to take advantage of there's some opportunities for i think smaller type tuck in acquisitions for us. >> how much head shift do you expect to see during this period and coming out of it i believe you said on this call you're going to be hiring more net overseas in part because of the cost value you see in talent and i wonder as so many companies are starting to cut domestic work forces does the high cost of talent here actually get reflected in where talent gets hired in the up swing? >> we're blessed with a great talent here in the u.s. as well
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as worldwide we started just a few years ago having 100% of our talent here in the west coast. the focus on overseas hiring and once we get to a good competitive balance we'll continuing growing in both locations. that being said the reason we're still growing in rnd but also in sales is because we're growing as a company even in this environment. as i said we operate in a very large market we're still a relatively small player and we have a lot of growth ahead of us >> that said you said i believe yougist have a couple quarters visibility into demand after this one what do you see as the most important signposts, data points you'll be looking at indicating to you how things are going to fare toward the back half of
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calendar 23? >> we're in the final innings of '22 when we're in the middle of our planning for next year clearly we're going to want to be agile as we go into that year because it's a little bit difficult to predict what the second half of '23 will look like while we're going to bring on some head count we're going to stay very agile. we're very focused on making sure we drive good operational discipline in our organization i want to improve the metrics we have whether it's in sales or marketing or operating costs or rnd activity and we want to keep up flexibility so our plan is to continue to be operationally disciplined but also to invest in our growth >> all right, ceo of pure storage, that stock up 2.5% after earnings thanks for being with us >> well, thank you take care. >> and if you missed any part of
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the show don't forget to follow and subscribe to our podcast listen anytime, anywhere, wherever you download podcasts tech check is back in just a moment announcer: derek jeter ...or plan? maybe... it's because in dreams, you can do anything. in dreams... you can hold your entire world in the palm of your hand. and turn time inside out... again and again. and you can do it all with your eyes wide open. and i'm going to tell you about exciting medicare advantage plans that can provide broad coverage and still may save you money on monthly premiums and prescription drugs. with original medicare you are covered for hospital stays and doctor office visits but you have to meet a deductible for each, and then you're still responsible for 20% of the
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one more thing elon musk posting he met with tim cook and got a tour of apple hq those threats about the app store barring twitter just a misunderstanding according to musk he says cook confirmed apple never considered the platform's removal. john, i don't know where we go from here, though, because musk was complaining about the 15, 30% take that apple would be taking if he wants to create the everything app, that's going to be a big chunk of revenue he very much needs going forward. >> is it a big chunk, though i mean, i don't know naz i can tell tim cook managed to squash this whole thing without tweeting a thing he took him for a walk everybody just go for a walk >> just go for a walk. there's a nice pond in coopertino at the same time reported this was before he was going to
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washington so perhaps measure on a little bit for him to quash this >> perhaps and as we head toward noon do want to note a lot of earnings to watch for after the bell. we're going to be tracking all of those for now that does it for tech check. let's get to the judge and the half all right, john, thank you very much. i'm scott wapner front and center this hour cleared for take off and back to the gate what today's reversal says about that big move in stocks yesterday and whether that end of year rally is really possible now. we'll debate that with the investment committee also on set with us today is brian bellsky. 12:00 noon in the east it is a down day salesforce obviously a big weight you've got the s&p 500 regaining 4,000. that's the highest level since


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