Dan Nathan (3:17)

Yeah, great chart packet there. You know what I mean about some of the things, the concentration, I think to some degree today in his note, I think is the daily spark just in general of the, of the top 10 names in the NASDAQ. But the other thing, and this is what you're talking about, I think it was on Friday or so. You know, we're seeing Capex which is exploding and we see like you just showed that tweet by all the major CEOs. And it seems like this is the sort of thing that at any point could drop off. If you see the adoption of some of these products or you don't see an acceleration in one, one way or the other. And you know, I'll just go back to what I think is a really important point. OpenAI is this customer of Nvidia and now it's in customer of Broadcom. I think that was one of the reasons why Thursday afternoon when the stock really took off in the aftermarket, despite what looked like a good beaten raise, but not an excellent beaten raise, is that now they have a new $10 billion customer. This is Open Air, and they're going to be doing custom silicon. And the Open Air is a huge customer of, you know, Nvidia. And that's the story as it's broadening out right there. But OpenAI is expected to lose $115 billion through the end of 2029. The information reported that. So we think about just those massive of losses at some point. If you don't have the adoption, if you don't have the Revenue that is going to justify that sort of spend that will get pulled back. It's just that simple. And there's a lot of folks in that ecosystem that the stocks have pulled forward a lot of that expected performance one way or another.

Melissa Lee (4:45)

Is it early? I mean I know that you know people will say oh no, the trade, it's been intact for three years or more even. But isn't it early in terms of the ways company can actually adopt and use and see the results?

Timothy Seymour (4:57)

I think it is. The question is where are we in the Capex in the build up period? Certainly for the broader industrial space and for, for kind of traditional C suite operational evolution and where that means margin accretion for the rest of the S and P. I think we're very, very early and I think part of the reason someone like Mehta has outperformed here even on some level, you can make an argument most of the other chip players other than Nvidia is because in fact they are seeing the benefit right now in, in their core business and the acceleration and the margin profile. Back to Broadcom. Part of the story here, I think this was part of the conversation we had on Friday and to remind which is that that Broadcom truly by name is not just purely semiconductor chip in the form of large language model and all that has been at least driving a lot of the Nvidia. It is, it is in wireless. It really is part of a data center play and that's part of why I think the sense was at least for the market that wanted some rotation into a more expensive company by the way that's part of the sustainability. But I think we are early and I think I know it was, you know wherever we all were on that day of deep sea was that January. I forget when that was last week but. But it was something that was profound because that was the moment we questioned whether all this Capex made sense. And until we know otherwise we do know that it's at least 500 billion from the hyperscalers they alone, let alone everybody else. So you know again I think there are different winners and losers along the road at different periods here but the market right now and we'll get to this and my final point is that I think this is the last couple of days it's all about the Fed.

Dan Nathan (6:30)

Yeah. About interest rates but that's point Tim on the I, I mean Friday was a great split screen. You had broadcom that gained $150 billion in market cap or actually more because of this huge order that they had relative to capex on the flip side of it, if the next trade before we get to the rest of the S and P and what they are going to do to monetize whatever spend or the uptake that they're going to have for AI tools. Salesforce was down 10% or something at one point because they are not able to articulate how their customers are using this technology. Right. And so when I think about, you know, CRM has a $240 billion market cap that's almost equivalent to what Broadcom has gained in the last week or so. And so if you are going to start to see companies that are going to accrue that value or see an uptake from their customers, it should be in this application layer and that is Salesforce. And they're getting it, I think think from productivity within their own company but they're not getting their customers to spend or to pay up from their existing services.

Melissa Lee (7:29)

Mike, where do you fall on this?

Mike Koh (7:31)

I mean the four largest hyperscalers are more than tripling their CapEx between 2023 and the end of 2026. And I think the point that Dan is making because OpenAI's losses, I mean obviously they haven't figured out a way to monetize all of this. The four biggest hyperscalers are profitable but their revenues aren't growing as fast as their capex spend. So we can't expect that to be sustainable. You know, I look, it's a very good time to be in that space. That much is clear. A lot more money is going to be spent. That is also very clear. But the pace of growth is going to have to slow sooner or later.

Melissa Lee (8:06)

You mentioned the Fed and I think that's a key point in terms of lower rates. And we were at 4.07% or so on the 10 year yield. I spoke to Dan Niles earlier on the exchange today and he basically said we're in an era of easy money. I mean the Fed is easing and so yeah, keep investing.

Timothy Seymour (8:22)

And so you know, the higher growth companies, especially the ones with less profitability, the ones where you're discounting farther out in the future, I mean lower rates, this is a bonanza and financial conditions I think are, are wild. And I don't, you know, that's a little scary but it's not necessarily time to, to pull back. And again I think if you just get back to where, I mean like a salesforce and getting into like the haves and the have nots in the trade, Salesforce has been A have not. For five years, Oracle has been a have. And yet Oracle is spending a lot of money on the low margin trades. They're growing revenues, big deal. So the market is rewarding, I think the incremental growth. And again back to Broadcom, the fact is that 60% growth in AI was exceeded and then they drop in the new customer and then it's a broader play. So I'm not going to, you know, don't fight the Fed, don't fight necessarily some of these trends here in terms of the spend, but in terms of at least where we have it. And I'll say this, I know I've said this 50 times, here's 51. The sovereign trade has only begun. Think of all the countries around the world that are so slow to actually build out and the kind of capex and the support they're going to need on the private sector. And that private sector, a lot of it's in, in Silicon Valley or other parts that have a similar address to all the companies that we're talking about right now. So I think we are early and I think the, the, the valuation dynamic is, is important. But as we've said many times, valuation is not going to knock these stocks down. Tech companies are like commodity companies. You don't buy them when they're cheap, you buy them when they're expensive.

Dan Nathan (9:54)

Yeah, well, I think I could take the other argument about sovereignty right here. You saw what happened last week with China, with India, with Russia. I mean, the list goes on and on. I mean, I think that whatever that forum was, or they put that committee together, I mean that is like 35, 40% of the world's population. So if we're starting to see this sort of fracture between, let's say the east and the west, and we're going to have a bipolar world. And if you think about the belt and road that China has instituted for the last 20 years, they're going to have a digital belt and road. I mean, that's happening right now. So the opportunity for a lot of our companies that are very innovative here, make no mistake about it, to have access, let's say, to the Chinese markets. We don't have any digital companies in China. Just think of all these massive, you know, tech companies that we have. I mean, yeah, we have Apple and you know, Microsoft has had a huge issue with technology transfer and all those sorts of things for years. So there's a scenario where sovereign AI does not play out for the companies here that are building these sorts of chips. Look, what's going on with these export bans that we have, you know, within. You could take both sides of it. But there is a chance that Huawei is innovating at a pace, that they're going to be a great competitor to some of the chip makers that we have. So I think geopolitics has a potential to play a big role as a huge.

Timothy Seymour (11:06)

I mean, and that's why the China trade is really important and China's it's different place. I mean, the Russian economy is the size of Cleveland. I mean, I don't care about Russia, I don't really care about India here and I care about US Companies that have continued to dominate global tech and I think are going to continue to dominate and I'm sure China is going to be an adversary. I'm sure they're driving a wedge. But that's part of the story that I think around the biggest tech companies in the world. Why we have been concerned about Apple and China. We have concerned at least about a couple other players, but a lot of the other guys aren't even really counting China outside of Nvidia and Apple. So we'll see.

Melissa Lee (11:38)

Well, investors still closely watching the Apple event, how and how Apple incorporates AI into its newest devices at tomorrow's big event. Craig Moffitt is partner and senior managing director at Moffitt Nathanson. He's got a neutral rating on Apple upgrading it from a sell rating last Thursday. So incrementally, I guess, less bearish on the name. Craig, it's always great to speak with you.

Craig Moffett (11:57)

Good to see you, Melissa.

Melissa Lee (11:58)

I feel like we're counting down. We had a countdown clock on CNBC earlier, you know, 20 hours to this event. But I almost feel like this is the most inconsequential Apple iPhone launch in a long time because it doesn't have. It's so ordinary, it's so pedestrian in terms of new hardware upgrades, you know, new, new camera, better battery, thinner. You know, of course it's got, I mean, it's going to have a new phone, it's got to be thinner, it's got to have a better battery, it's got to have a better camera.

Craig Moffett (12:25)

Yeah, absolutely right. And in fact, the fact that you were able to just recite that litany of what we're going to see tomorrow tells you that we already know what we're see tomorrow. So it's almost impossible for this to be a meaningful event for the stock tomorrow. We know what we're going to see. We're going to see a thinner iPhone that'll be probably more expensive. It's also not clear that people are going to want the thinner iPhone because coming with a thinner iPhone is less battery life. And I'm not sure people are going to be all that eager to make that trade off. So at the end of the day, as you said, it's just not a terribly consequential day for Apple.

Melissa Lee (13:04)

At the same time, Craig, what is factored into the valuation, which is granted, you know, I guess you can look at it as expensive for 10, for a 10% revenue grower. You know, the P, E is more expensive than a meta. It's not Alphabet or a lot of.

Craig Moffett (13:20)

It's not close to a 10% revenue grower.

Melissa Lee (13:23)

Okay, so not even, even worse. But you make my point there, Craig. I mean, what is factored in here? Is it enough that there is a normal upgrade cycle, that people like me with an iPhone 11 will upgrade the phone because I have to. It's got a cracked screen. Or do we have to have that super cycle? Is that what is priced in?

Craig Moffett (13:41)

That's what's priced in, Melissa. And that's exactly the problem. Look, I love Apple as much as everybody loves Apple. I'm a devout Apple user. The products are great. I sometimes hear this strawman argument when I'm posed as being hyper bearish. And by the way, I'm not particularly bearish. I just, I just think the stock is, is somewhat overvalued. But, but I keep hearing people say, you're crazy. No one's going to switch from Apple to. To Android. And of course they're not going to switch from Apple to Android. That's not the point. The point is unless you get faster revenue and earnings growth, the stock at 31 or 33 times earnings right now is too expensive. And ultimately it's going to underperform over the long term because other things will grow faster. Even the rest of The S&P 500 is going to grow faster. So what was priced in, and especially by the way, the PEG ratio at Apple compared to the rest of the Mag 7 is moonshot.

Melissa Lee (14:43)

Right?

Craig Moffett (14:43)

So, so what was priced in a year ago, when everybody got all jazzed about the worldwide Developer conference was a super cycle. And that depended on people taking the promised AI Apple intelligence and needing better hardware in order to run it that requires that it runs on the phone. What we're, what we're getting closer to finding out is that Apple's going to do really well in AI probably. But more likely, if it's by partnership, it's not going to run on the phone as likely as it is running in the cloud. And while that's great for consumers, it probably doesn't drive a supercycle. So you're left with a great company with a great consumer franchise. But as you said with people upgrading on a normal pace of upgrades rather than a super cycle, that's probably not good enough for what's priced into the stock.

Dan Nathan (15:37)

So Craig, we just talked about the hyperscalers and the amount of capital that they are spending right now and what is be to going it expected over the next five years or so. There's some estimates that like in 2029 alone there's going to be $1 trillion to spend and you know, you think about that right now 25% of sales for those major companies they are spending on the build out right now Apple I think it's low single digits. So as an analyst and you look at that and based on what you just said about their inability to probably have this sort of technology on their phones, is this been a massive, massive misstep on their phone front and is it the sort of thing that will keep them in the penalty box for a long time?

Craig Moffett (16:15)

Well you can see it both ways. I mean, right one of the things that was appealing about Apple for a while was they weren't spending the same kind of capex and therefore you have a good free cash flow story. I do think that you know, and Tim Cook has essentially said so that we're going to have more CapEx and they're going to have to invest more aggressively in going forward on AI and so will it start to look like Metta and the kinds of, of chatgpt types of, of numbers? Of course not. But it is likely to be substantially more spending than what we've seen in the past. You know, I don't know is that enough to really make it an AI growth story? I'm not sure it's, it's certainly not going to be in that league. But the people who have said Apple's really well positioned to, for consumers to, to get their AI on Apple devices are absolutely right. I mean it is again it's just, it's just a question of what's priced in stock.

Melissa Lee (17:18)

Craig, always great to speak with you. Thanks so much.

John Rutledge (17:21)

My pleasure.

Craig Moffett (17:21)

Good to see you Melissa.

Melissa Lee (17:23)

All right Mike, Options market options flow. Mostly bullish here on Apple.

Mike Koh (17:28)

Yeah, I mean it was mostly bullish today we did see calls out facing puts by a little bit more than 2 to 1. You know I will point out There were a couple institutional prints but most of this flow is, is really retail and going into the event and people will still have an opportunity of course because it's going to be an intraday announcement. So there is that. It's end of week activity that we're seeing the two 40s to 42 and a half and 245 calls all expiring this coming Friday that are seeing the most activity. Those two 40s traded about 80,000 contracts or so at about 2 bucks a contract. But I think to everybody's point here, I mean they would essentially exhaust all of their free cash flow to catch up on the capex side to say Amazon. So they have a lot of work to do and their top line growth is about 4 1/2 percent.

Timothy Seymour (18:13)

2,4245. Those are key levels on the stock much point out from the options market. They're important for the stock because that's really where you get to, you know, back to more or less kind of this key resistance level that I think you get through. It should be noted Apple's outperformed the S and P since late May, early June. And I realize, you know, I'm picking some spots here. A lot of that has to do with the China overhang and some of that. But that's kind of my point even is that Apple starts to outperform as you. All the stuff that's priced in, that's bad, that's not happening. We know that. The fact is the Google antitrust dynamic revealed a couple of things. First of all, defaults are allowed. And so therefore that 20 billion payment remains. The exclusivity is not allowed. Which means that Apple every year plays gatekeeper and can renegotiate every year. None of that's in the stock price. If you can't, I mean, this is where I'll save the righteousness. I just. It's what we've all been saying tonight. Apple is the gatekeeper in terms of how people are using AI. That's most people are the small screen. The same thing we were saying about the small screen when it was time to do everything else on the small screen. So sitting back, it's not what we wanted for Apple as shareholders. But it doesn't mean that 95% margins aren't theirs for the, the taking on tech.

Dan Nathan (19:25)

Yeah, well the one thing I'll just say if there's no iPhone Supercycle, right then you have to go back to services and services going forward is going to be driven by AI on the phone. If that is in the cloud, then that's the thing that is not particularly difficult to replicate if you are any other phone maker. And so that is an issue in China where they are losing market share right now. Right. And so when you think about how the Chinese operate, operate on phones like this for services, Apple Service revenue grew 13% last quarter. It's 24, 25% of their total revenue. I don't think that sort of growth in a higher margin business. Right. Is the sort of thing that justifies probably the multiple it is right here. So to me if it's not a growth business then it doesn't deserve to trade at a growth multiple. And so I don't know, I think it's really a wait and see. You know we were saying that last year 2024 WWDC, this is going to be a 2025 story if they could ever fix out Apple intelligence. It really feels like it's a second half 2026 story right now.

Melissa Lee (20:25)

Well, shares of Amsterdam based AI cloud company Nebby is surging after saying it has inked a nearly $20 billion infrastructure deal with Microsoft. Shares of Nebulous already up 130% this year before the news Shares of Microsoft at last check. Not really moving on this but obviously Nebby is a smaller company of the two. Meantime coming up a check on the China trade. The group on the move with tech leading the charge. The names in the green despite some disappointing data out of the mainland. Plus Robinhood and App Love insurgent on news of their S and P inclusion. What the addition will mean for names in the long run when fast money returns back into.

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Melissa Lee (21:41)

Welcome back to Fast Money. Shares of Tesla down about a percent today after new data after new data showed the EV makers US market share dropped to its lowest level since 2017. According to Reuters. The company, which once owned more than 80% of the country's EV market, held less than 40% in August. The drop comes as rivals roll out new models and Tesla focuses on Other businesses like robo taxis and humanoid robots. GM, for one, has increased its share in EVs. Tim. I mean, I don't know if you see this as a huge deal because the most the market valuation of Tesla is not in vehicles and most of.

Timothy Seymour (22:17)

The market share of GM is in ice cars and, or at least, you know, I don't know what to make out of it other than this is exactly where we said it was going to be. And if you value these things as auto companies, they're both, both mismarked. GM is wildly cheap, Tesla is even more wildly expensive. And, and I. The argument for Tesla Bulls continues to be it's all these other businesses that continue to not happen. So there's no question BMW is making a superior luxury, at least as you get into the EV space. There's no question the mass market that Tesla has created, it hasn't really created. That said, Tesla has been by far the leader. Is by far the leader. I'm just not buying the stock. I, you know, I tip my hat to what they've done in the EV space.

Dan Nathan (23:07)

Yeah, do you tip your hat to what they've done in the Optimus space, in the robots or the, you know, the taxi? I mean, we don't know. Right. So the $1.1 trillion market cap company, and I think what's interesting here is that the Tesla Bulls now agree with the Tesla Bears is that the best days for their EV business are behind them. Right. And it really is all about these new technologies, which is why you are starting to hear the potential for Tesla to buy xi. Right. We know that they want to invest in it. We also know this proposed plan for compensation for Elon Musk is like, okay, he could make $1 trillion if he doubles the market cap. Well, how do you do that? It's a bit of a shell game.

Melissa Lee (23:43)

He's also got to deliver robots and robotaxis and commercialization, so.

Dan Nathan (23:46)

So he's going to make the case right now why XI deserves to be part of this company. The problem is they are losing $1 billion a month in Xi. What would shareholders like? They'd have to be crazy to agree to that sort of thing. And why buy the cow when you get the milk for free? One of the reasons why is, I think he wants to heard that before.

Timothy Seymour (24:05)

By the way, that expression. There was a time. There was a time.

Dan Nathan (24:09)

Yeah. But my point is, is like he could have access to xi's technology, you know, I mean, like, you know, and not that they, they could just like, but look at how this company has operated for years and years. They bought SolarCity years ago when that thing was not doing particularly well. So to me, this is going to be a big mash up and it's going to be one of those things that it's going to be really hard to tell what is driving the valuation. But make no mistake about it, their EV business is kaput.

Melissa Lee (24:31)

All right, let's get to Robin. To each his opinion, right? Robinhood app Lovin both soaring to record highs today on news. They'll be joining the S and P later this month. Both stocks of already solid returns this year. But will inclusion in the benchmark keep those gains coming? Mike, what kind of activity have you seen on either of these?

Mike Koh (24:49)

A lot of activity. I mean, there was a big pick up in the options volume of both of these names. Unsurprisingly, I will say this was a happy surprise for us. We happen to have fairly big positions at both of them. So that was, that was good news. Somewhat unexpected, I would say. But look, I mean, you know, what's going to happen is this is essentially going to get absorbed and, and then it's just going to be back to whether or not you have to like the companies. I think Robinhood's really been doing a great job with their business, Applovin. I haven't followed it quite as closely, but I will say that, you know, once you get inclusion, then that sort of one trick pony is over. So I think we've probably got about three days of catch up going on and then it's going to be, you know, back to fundamentals.

Melissa Lee (25:33)

All right, coming up, descending Summit shares plunging as the Biopharma stock hits a snag with its lung cancer drug. Study the results from around the world what it means for the stock's next move. You're watching Fast Money live from the NASDAQ marketsite in Times Square. Back right after this.

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Melissa Lee (26:58)

Welcome back to Fast Money. Shares of Summit Therapeutics plunging more than 25% after results from its lung cancer drug showed differing results for US and China patients. CNBC's Angelica Peoples has got more on this. Angelica.

Angelica Peoples (27:11)

Hey, Melissa. Well, as you know, the debate all along here has been whether Summit's lung cancer drug would look as impressive outside of China. And those doubts are just getting louder with these results that we saw over the weekend. Remember that Summit made the big splash last year after it said that its drug beat Merckx Keytruda in a head to head study, but that was conducted exclusively in China. And that of course, though sparked a ton of excitement for both Summit's drug and others like it that go after the same target as Keytruda plus the same target as Roche's Avastin. But the fresh data that we saw from this global phase three trial casting doubts on the prospects for the drug overseas, particularly here in the U.S. so let's get through it. Simmons Drug Plus Chemo cut the risk of tumor progression by 45% in China, but only by 33% in Western countries. And the drug did not show that it could keep people alive much longer than chemo alone. And that's something that the FDA will want to see in order to approve the drug. Now Summit did suggest that the overall survival benefit was improving over time, but lyric analysts saying that they believe it's unlikely the FDA will grant approval based on these results, nor that Summit will partner the drug at the substantial valuation expected by investors. So a lot of disappointment here.

Melissa Lee (28:24)

Melissa Angelica, how does this sort of impute on some of the other companies that were hoping to do a lot of research and trials in China as they are licensing drugs from China, buying molecules in China. How does that sort of change the landscape with these results being so disparate in terms of the results in Asian patients and non Asian patients?

Angelica Peoples (28:44)

I do think there are certainly questions about whether this is a class effect. Is this something, you know, just a mechanism that's not really going to live up to the hype? Or is this specific to the Summit data? Because remember, it's a little bit wonky here where they had to start they had this trial ongoing in China and so those patients were receiving the drug much longer and Then they started recruiting patients in western countries, including the U.S. so the question is, is it a data problem? Is it just, you know, will these results get better over time or is it a class problem? You did see some weakness today in Biontech, of course, that's another company that's working on this. And so I think there are some questions, but certainly companies are going forward.

Melissa Lee (29:24)

Angelica, thanks. Angelica Peebles. Michael, what you see in Summit today a lot.

Mike Koh (29:30)

I mean look, typically when you have these pre revenue biotech companies, there's a lot of people who are speculating in the options and a lot of people had been we saw a big roll down and out. That's not a good thing. Typically that's when somebody who previously made a sizable upside bet has to go further out in time and then reduce their call strikes if it leave. But they only went out about a week on a 9,000 lot. Everything else, the next five top options volumes were all on the flip side. So it seems like a lot of the speculation that had been bullish has turned pretty bearish now.

Timothy Seymour (30:03)

And if you're following Mike's advice on the options side or at least looking at the options market as the way to play, not only does that seem sensible, but it's pretty clear here that the bottom line is the company is going to continue to follow the western kind of data points view, patients view and that they're going to continue to go along the same line they've been going along and that if there's, you know, there could be opportunity in an outcome like this that probably is best played in a risk managed way.

Melissa Lee (30:28)

All right, another reminder here. Fast Money Live is coming back. A special Trading the Holidays live event happening right here at the NASDAQ on December 11th. Scan the QR code on your screen or head to cnbc.com/fast money to get your tickets. New York during the holidays. A front row seat to Fast Money Live. We are trading 2026 in December. I'm disappointed, Tim, that you didn't get a hat.

Timothy Seymour (30:49)

I think just the same way that Santa magically makes stuff appear, I believe this hat could still appear before I stop talking some point. All right, well, imagine me putting on this great furry red hat and just how exciting it's going to be trading the holidays. I bet it's going to be a white Christmas that, I mean there's going to be so much cheer in the room. Magical Dan's going to be.

Dan Nathan (31:08)

I have a great idea. Maybe Sandy's listener, Mary. I mean, what if we roll out our acronyms for 2026 or something like how come I gave the best money?

Melissa Lee (31:19)

All right, I'm on our thinking.

Timothy Seymour (31:20)

Big gift, big fun.

Melissa Lee (31:22)

Coming up, the China trade in the green, the tech names on the move and what disappointing export data means for the next move out of the mainland. Do not go anywhere. Fast money's back into. Welcome back to Fast Money. Stocks kicking off the week in the green as investors brace for more inflation data. The Dow jumping more than 100 points. The S&P up 2.10 of a percent, and the Nasdaq climbing nearly half a percent, closing at a record high. Gold also hitting a record today. The precious metal now up nearly 40% this year, while China's big tech stocks also higher, with names like Baidu, Alibaba and ev maker Xpeng leading the way. The move comes even as the world's second largest economy said it shipped 33% less to the US in August than in July. Total growth, export growth dropped to its slowest pace in six months. For more on what this means for China's top names, let's bring in Safana, chief investment strategist and honorary professor at the Chinese Academy of Sciences, John Rutledge. John, great to see you.

John Rutledge (32:23)

Great to see you. Melissa, how are you?

Melissa Lee (32:25)

Good. The headline looks dire, but at the same time, you look underneath and they are exporting a bunch to other countries. Southeast Asia, to Europe and elsewhere. So how do you interpret this?

John Rutledge (32:38)

We know actually, Melissa, the trade surplus is up. It's up 4% year over year, but it's less than July. But it's still up and only to the US is down 33%. If you look at the other parts of the world, you've got, you know, 20s and 30s on Europe and Asia and in Africa. So what's happening is whoever imposes the tariff, the other guy can still sell to everybody else in the world. So you're a minority player. We're a small piece of trade. That means that the export, the tariffs hurt us a lot more than they hurt them.

Melissa Lee (33:16)

Yep. And so you have that. And then also you have this rally which you're showing on your screen, you know, in Chinese stocks. And do you think that this puts into jeopardy any sort of stimulus that we might have been expecting from the Chinese government?

John Rutledge (33:30)

No, I think, you know, they've got, they've got GDP this year so far, 5.3, which they'd like to see a little bit more. It's running a little lower than that right now. I think you're going to see some stimulus because right now export prices are falling, producer prices, CPI is falling, and they still have the real estate problems to work through. So I think you're going to see a lot more stimulus out of China. But of course they've got all these friends in the global south now that they can sell things to. Solar panels especially is where they dominate. And electric vehicles right behind it. And also steel exports are up. So China is doing a lot better than I'm sure Mr. Trump would like them to be doing right now.

Timothy Seymour (34:10)

Hey John, it's Tim. Thanks for joining us. I guess my question to you is on the governance side, I think there are a bunch of institutional and retail investors in this country that are fearful to invest in China, not just because of C suite governance dynamics, but also even geopolitics. Geopolitics between the US and China. Many fearing that the US government might ban many of these Chinese companies that are traded in ADR land. But certainly structural dynamics are just about owning the underlying. Any thoughts on this? You don't need to be a trader per se, but having a view on just how important the, the functionable trading markets for these names continues and how important that might be for the Chinese government as much as the U.S. government.

John Rutledge (34:50)

Sure. You know, I think that investing outside your own native environment is very risky because you just don't really know what, what you're doing. It's good to invest in a place that has rule of law and judges in long black robes, neither one of which they have in China. President Xi could wake up one morning with a stomachache and impose some kind of a rule on Alibaba like he did for Jack Ma some years ago, and wreck your investment. So I normally advise non specialists to stay away from foreign assets and we certainly have plenty of choices here in the US But Alibaba right now, for somebody like me who spent a lot of time in China, is very interesting. New chip cloud data centers, a lot of things going for them these days. And so I think it's interesting for someone who's not a tourist, hey John.

Dan Nathan (35:38)

Back to that export data. Is it likely that they can kind of sustain this ability to export to places other than the US And I guess like what sort of leverage does it give the Chinese at this point? Because we spent a lot of time talking about rare earths, you know, a few months ago, and that seemed to change the tenor of the conversation. I'm just curious. This export data seemed pretty surprising.

John Rutledge (36:01)

Yeah, it is. Well, it's surprising both the US side, how low, but also the Other parts of the world so high a good bit of what is being exported from China will then bounce back into the US from someplace else. Trying to stop trade with tariffs is like trying to hold back the ocean tide with your hands. You know, it just the goods flow right around you. But I do think that, I do think that you're going to see the data continue to be weak overall for trade and China still to be struggling growth. But again, they're not in an emergency situation here and they'll be, they will have been glad to see these numbers come out.

Melissa Lee (36:39)

John, great to see you. Thanks.

John Rutledge (36:41)

Great to see you, Melissa.

Melissa Lee (36:43)

John Rutledge. So what do you make of this run in Chinese stocks?

Timothy Seymour (36:46)

I think it's going higher and, and I look at the levels on the stocks you're, you're pushing up against both November of 24 levels where these stocks got up to and then March of 24. Whether you're looking at thought about, whether you're looking at Baidu, whether you're looking at the K web and John makes some great points. I mean I'll just say I think most U.S. investors as someone that runs an international ETF where Bob is actually the largest position, I think U.S. investors are underweight international and I think you can invest in the U.S. in companies that are traded here in ADR form IDO, my ETF owns only those companies. And this isn't about being a sales pitch. This is the point is I think people have been underweight and scared to invest in a lot of these markets. Whereas part of the reason for Alibaba is that no longer do we feel that the government has them under their thumb. This is a world class tech company where Ali Cloud is probably as exciting of a play as we're putting into a lot of the Mag 7 here. But I, I think international investing also in a lower rates environment and also where the dollar is going weaker is a place that people need to be.

Melissa Lee (37:43)

Coming up, hunger pains for shares of Kava, Sweetgreen and Chipotle. The fast casual restaurant names continue their decline. What just weighing on the stocks and can they get their bite back? That's when he's back into welcome back to Fast Money. Fast casual restaurant stocks continuing their decline today. Kava, Chipotle, Sweetgreen all hitting their lows of the year. Sweetgreen is now down nearly 75% in 2025. The company is under pressure as consumers seem to lose their appetite for eating out or at least for eating out at these price points. So we were just discussing how much like a kava bowl cost, which is like 17 to 20 bucks.

Dan Nathan (38:25)

And I obviously eat a lot of salads, so this is something that is near and clear to my heart. I like when you look at the way that these stocks have sold off, it is truly astounding. But make no mistake about it. I mean, these companies are losing a lot of money. And if you think that they actually had a corner of the. The quick. What is this? Fast serve, quick serve, whatever.

Melissa Lee (38:43)

Whatever this category is, it's like expensive.

Dan Nathan (38:46)

This was the zeitgeist, though, in this space. Right. And you can't like get rid of these sorts of stocks. So to me, they're probably getting close to pretty interesting, especially if you could ever see some sort of turn in those same store sales or the profitability levels. But right now they like sadly, it looks no touch. But if you want to close your eyes and just take a shot, definitely in the sweet green, it could be kind of interesting here.

Melissa Lee (39:06)

Mike, you were like shaking your head vigorously, so I'm not really sure where you fall on this discussion.

Timothy Seymour (39:12)

A good salad.

Mike Koh (39:13)

Well, I should eat more salads like Dan. And he looks good for having done it. I'd look a lot better if I did. Look, Sweet greens is not profitable. It has not been profitable. I mean, it did trade 10 times its average daily put volume. That doesn't surprise me. Chipotle, on the other hand, that is profitable and it has always traded at a multiple that was kind of hard to get your arms around, but now it's starting to close in on, you know, just over 30 times forward. I think it gets down to that level. That one begins to look a little attractive to me.

Melissa Lee (39:41)

Chipotle does feel different from the other two in terms of their history of execution and customer loyalty.

Timothy Seymour (39:47)

But it feels different from the other two right now. If I'm channeling my inner Carter right now, that's not a chart you're buying. You don't need to buy it. And this stock's been halved from really the beginning of the year. It's trades at a 25% discount to its five year. That's the whole reason probably not to buy it. I don't know. I. As someone that missed it on the way up, I'm hoping to maybe get it someplace lower.

Melissa Lee (40:10)

And do not miss Jim's exclusive interview with the co founder and CEO of Cava at the top of the hour on Mad Money right here on cnbc. Meantime, coming up on fast, how cybersecurity company Gen Digital hopes its recent Acquisition of Money lion will make finance more personal for consumers and help them take control of their money. The CEO will join us next. More Fast Money welcome back to Fast Money. Gen Digital shares rising more than a percent after hosting its analyst day here at the Nasdaq MarketSite. The company recently closing a $1 billion deal to acquire Moneyline, combining that company's consumer finance tools with Gen Digital's credit and identity protection portfolio, which includes Norton and Lifelong. For more, Gen Digital CEO Vincent Polette joins us here on set. Vincent, great to have you with us. We're familiar with Money lion and we're familiar with the other brands. How do you make the case for them being together?

Vincent Polette (41:06)

It's fantastic. Today we had the first opportunity to explain to investor how Gen Digital family of trusted brand like Lifelog that tracks your financials, track your credit score, monitor any deviations, financial fraud, bringing that together with moneylion that helps you then manage and grow your financials. And so we now provide our consumers kind of an end to end along the financial journey from building up your credit, leveraging your credit for whatever financial products you want and then ultimately protecting your asset that you acquired. And now we're able to provide this kind of new category called secure financial wellness for our consumers.

Melissa Lee (41:43)

So this is all about cross selling.

Vincent Polette (41:45)

It's all about increasing the value to the customer and increasing the number of products. If you want that we sell to our consumer but we sell it also into a membership kind of you get into the platform and then you can access higher level of services depending on your financial needs.

Dan Nathan (41:59)

To give us a sense you had this analysis day, you know you're a company that you have brands that you own that a lot of consumers are very familiar with. And the same thing on the money line standpoint. What were some of the questions that you were getting about? Like Mel just asked you about the cross selling opportunities but like how are investors, how are analysts thinking about this combination?

Vincent Polette (42:18)

I think we really have two set of investors. Do those who are familiar with the fintech marketplace and the other one that is familiar with cybersecurity. And as we bring it together we had to explain what Secure Financial Wellness means. And if you look at today consumer average consumer have seven to eight products, consumer seven to eight financial products, half of them comes outside of their primary banks, shopping on Internet platform, etc. And we bring with gen the trust, the confidence that you can really select what you what you need. And then Moneylion brings a marketplace that has over 1300 partners offering very different financial products to Those consumers that are on our platform.

Timothy Seymour (42:58)

So then how do you think about growth and how do you think about where the combination of these assets, these synergies, this cross selling does, does it create, you know, is there a hockey stick out there? Is there? How do you see your business especially because these are trusted brands at a time when if anything cybersecurity especially I'd say on the individual level all we do is talk about the enterprise but I think individuals are as aware as anyone.

Vincent Polette (43:20)

That's absolutely something that's not really well known by all investors that when we talk about security, it's 99% of an enterprise. We're solely focused on the consumers. You know, the threat landscape is evolving rapidly. A lot of the old malware are now evolving is full scams and new financial assets and what matter for you online is addressed. On the other side we have another transformation happening. More and more consumers are shopping for financial product differently outside of their primary bank in an open ecosystem. I think bringing together for us is positioning GEN into a faster growing markets and trying to leverage those two transformation and evolving threat landscape and an evolving digital financial landscape.

Melissa Lee (43:58)

So let's say five years. How do you see your consumer in terms of what the overlap of products are? Will all your consumers be, you know, customers touching all these points of your business or will you have separate lifelong customers? Separate Moneyline, like what? How do you see the breakout?

Vincent Polette (44:14)

Great question. And Money lion developed like they have had 10 years of developing what we call a white label architecture. The technology, probably the best in the fintech environment is able to be embedded into everybody's platform. And so we're going to embed it Moneyline financial architecture into each one of our brands, Norton, Lifelock, Avast and be able to provide this helpful decision making on the financial side at the right moment of the customer journey. I think following the brand customer journey or the consumer customer journey is a very important factor in today's world in digital finance.

Melissa Lee (44:47)

Vincent, thanks so much for joining us. We appreciate it.

Vincent Polette (44:49)

Absolutely.

Melissa Lee (44:50)

Of Gen Digital. So GN by the way is the ticker in case you wonder.

Dan Nathan (44:55)

I have a relationship with Moneyline and I've got to know them and like it's interesting to get to know more about this combination. But when I look at Gen I say to myself this a company that's doing double digit earnings growth and is trading about 12 times earnings. So in a market where folks are really okay with paying up for fintech companies, we've seen some crazy multiples. That looks pretty interesting to me.

Melissa Lee (45:15)

Up next, final trades. It's time for the final trade. Michael Coe.

Mike Koh (45:28)

Michael yeah, I still like Robin Hood, but if you want to get a little yield out of it, think about selling some upside coverage calls.

Timothy Seymour (45:34)

Timothy yeah, I like this breakout in China tech. I think Baba is the way you're most confident right now.

Melissa Lee (45:40)

Dan Nathan I hate when you go.

Dan Nathan (45:42)

Me Daniel I usually know that 10 digital story is kind of interesting. Double digit earnings growth 80 83% gross margin is a generalization.

Melissa Lee (45:51)

All right, thank you for watching Fast Money. See you tomorrow on the exchange at 1. Mad money with Jim Cramer starts right now.

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