← CNBC's "Fast Money"
CNBC's "Fast Money"
Netflix Reports Results… And GM In OverDrive After Earnings 10/21/25
00:43:58
Netflix on the move after reporting results. The headlines from the company conference call, and how the success of ‘KPop Demon Hunters’ is boosting bingeing. Plus shares of GM surging to its highest level since its ‘09 bankruptcy after topping Wall St. estimates this morning. The guidance they’re giving, and how our traders are handling the stock from here. Fast Money Disclaimer
Loading summary
Transcript129 lines
- [00:00]
A
A rich life isn't a straight line to a destination on the horizon. Sometimes it takes an unexpected turn with detours, new possibilities and even another passenger or three. And with 100 years of navigating ups and downs, you can count on Edward Jones to help guide you through it all. Because life is a winding path made rich by the people you walk it with. Let's find your rich together. Edward Jones Member, SIPC and now a.
- [00:32]
B
Next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding. And International Sleep Day is tomorrow. Luckily, ATT 5G lets you deal with any issues with ease. So the pillows will get delivered and everyone can sleep soundly, especially you. AT&T5G requires a compatible plan and device. Coverage not available everywhere. Learn more@att.com 5G Network.
- [01:04]
A
Live in the NASDAQ markets in the heart of New York City's Times Square, this is fast money. Here's what's on tap tonight. Netflix gets chilled, shares dropping sharply after its latest earnings numbers. We'll dig into the details and get all the details on the streaming landscape. And GM revs up the automaker shares at their highest since emerging from bankruptcy 15 years ago. What's behind the move? And is there more room to run? Plus, Gold's record rally. It's a brick wall. Alphabet shares drop on a new challenge from Open Air and Halliburton in rally mode. What had the oil services stock jumping today? I'm Melissa Lee, come to you live from Studio B at the nasdaq. On the desk tonight, Steve Rosso, Karen Feinerman, Bono and Ice and Guy Adami. We start off with an earnings alert on Netflix shares sinking down about 5% after earnings came in well below estimates, though revenues were in line with Wall Street's expectations. The conference call kicked off in just the last hour. Julia Warson joins us with the details here. Julia?
- [01:57]
C
Well, Melissa, a lot of enthusiastic comments about the impact of K Pop demon hunters, but shares are falling on disappointing EPS and margins due to an ongoing dispute with Brazilian tax authorities, which the company says they do not expect to materially impact future results. Now Netflix focusing in its letter to shareholders and on the call on Healthy Engagement, its highest quarterly share of viewing in the US And UK and saying that Netflix recorded its best ad sales quarter ever, saying they're on track to double ads revenue this year. They're also bullish about AI in the face of concerns about copyright infringement and infringement on intellectual property rights, saying, quote, we believe generative AI presents a significant opportunity for us to deliver benefits to our members, creators and businesses. Going on to say we're empowering creators with a broad set of Gen AI tools to help them achieve their visions. In letter to shareholders noting how happy Gilmore 2 in a series used gen AI, they also say Gen is enabling them to test more impactful ad formats and interactive ads they say are coming.
- [03:04]
A
Melissa Julie, I'm curious. In the shareholder letter that was released about half an hour ago or so, they have a chart of Netflix share of TV time and in it it says linear, which is obviously a bucket that's static and declining. And all other streaming, I'm wondering, does all other streaming include YouTube? And then what is the other which is the smallest part of the piece?
- [03:27]
C
Well, I'll have to go take a look at that. But I think what Netflix is trying to do in that graphic is show that is still early days, their share of market share. As they look at the market for the entirety of all streaming, which yes, does include YouTube, is still relatively small and they see so much more room left to grow. What's essential here is now that they have an ad supported tier, they're able to compete with some of these players that are free like YouTube, and so it enables them to reach a much broader audience. And that's why they no longer report subscribers. They're focused on engagement and how engagement can drive ad revenue. So I'll have to pull up that chart, but I'll tell you, it means that Netflix believes they have a lot of room to grow.
- [04:08]
A
And then in terms of the issue of having enough inventory for that ad supported tier, has that been resolved? Are we getting any indication as to the status of that?
- [04:18]
C
Well, definitely seems like this is a turning point. Greg Peters, co CEO on the call just moments ago said they always said when it came to ads they would be in approaching it as a crawl walk run and now they think they're in the walk phase and they're very much making a ton of progress, they say, and getting more inventory. And part of that is partnering with the likes of Amazon. They have a partnership with Amazon ads that's going to be launching in the fourth quarter and they have their own tools to make it easier for advertisers to buy and target ads. So they're working on it and it sounds like they're making progress.
- [04:54]
A
All right, Julia, keep us posted on this call Julia Boorstin for us on Netflix again, down about 5%. If it was really that Brazilian tax dispute which is not going to impact future results, Guy, you would think the markets would look through that.
- [05:06]
D
Yeah.
- [05:06]
A
And yet the stock is stubbornly down 5% couple first of all I thought.
- [05:10]
D
The stock would rally after earnings. That didn't happen. But you're right. If it was just that the market would look through. As a matter of fact, I'm reading if you back out the Brazilian tax. I've been in Brazil a couple of times by the way.
- [05:21]
E
Yes, but I have any taxes.
- [05:22]
D
I did not. But I don't think I'm allowed back in the with all that said. Yeah. If they will look past and said okay, you know what we actually beat earnings, beat revenue, it's okay. I think this might be the problem. If you start to look at the margins, you're starting to see a deterioration margins even in the guide. If the United States is saturated the international market, the margins are not going to be as robust as and then there's rumors out there of them potentially buying more than Warner Brothers Discovery, which leads to the question, at least for me, you know, maybe this growth story is slowing out now. They need to start to grow by acquisition. I don't know if that's true, but I think that's what the market is sniffing out. 11:50 though is a recent low. A couple of times it's a huge level.
- [06:01]
F
So there's a lot to like here. The valuation is the problem. Right. Going in. So I am long. I think that when you talked about with ad sales with Julia I think is really central. So if they're in the walk stage to me that's good. They have more to go. They did talk about linear in that chart that you cited. There's linear and linear they say is sort of theirs for the taking. It's others for the take, you know, taking as well. But the momentum here I think is tremendous. I the guide actually the margin depression in the guide I think has some residual tax in it and I don't think of them as particularly great at guiding and so I think this is kind of thing you really need to listen to the call and things could change. So a lot to like here except it is not cheap by any stretch but I do think they're in the pole position for sure staying long.
- [06:57]
E
Do you remember when we used to talk about infringement on AI or copyright when that was going to be a big deal and then we never talked about it. They seem to be dancing around it thinking it's not going to be a big deal again. What happens if it's a huge deal? What happens if it's a big headwind for them? I mean, just think about what that could mean for Netflix.
- [07:16]
F
Well, when I hear them talk about, I think of some of it as I will help them generate content easier, cheaper, faster, all of that machine learning. And I hear that as that's going to help us engage our viewers in the and show them exactly what they want to see to increase their engagement and therefore all the other things that go with it. I'm not sure to the point that you're making about copyright.
- [07:39]
E
Yeah, I don't think people are paying enough attention. I love the advertising numbers. I love that they doubled them. I don't know, it's coming from a lower base. That's number one. Number two, if you really look at momentum, they don't give out their sub numbers anymore because it's a mature company. If it's a mature company, then they're out of that, you know, out of control. Steam on growth side, I would rather be a seller. I think you could break a thousand. I think you get down to that 850 level in Netflix. But let me, let me, let me just preface this. I thought they were running out of steam originally before they broke out above the 850 level. So I think that this is just really long in the tooth. I'd rather be a seller than a buyer here.
- [08:19]
B
I want to hone in on this tax issue. So yes, I think they deserve credit for their ad tier and what they've been able to do there. Steve, your point about sub growth, I think that does point to what the overall growth picture is and where they are in terms of being a mature company. But 300 basis points of margin on the Brazilian tax issue, fine. Even if I am, to put that aside, where is the incremental growth to your point going to come from? It's likely going to come from international, which means one, your content spin is likely higher and it means your content focus is likely higher, meaning that it's, it's, it's probably less applicable from region to region, which means you're, whether it's AI or whether it's your traditional content generation, you're going to have to find and tailor that content to each individual region. And who's to say that there won't be continued tax issues in any of those other domiciles? So like, I think that's generally what's coming up and what the concern Is I can, I can get with you in terms of saying, okay, perhaps this Brazilian tax issue is a one off, but what if there's going to be a Canadian tax issue and an Indian tax issue?
- [09:15]
A
It could be a U.S. tax issue.
- [09:16]
B
Exactly.
- [09:17]
F
Let me just push back on half of what you said. I do think the, you know, the US is that that's the highest, best, you know, customer that you want. But I do think that they can make content cheaper outside of the US and so I think that they could have some margin, you know, keep their margin there.
- [09:36]
A
In terms of the valuation 47 times forward, it's priced like a growth stock. And so the question is, are you paying? Are you getting the growth that you're paying?
- [09:46]
D
See, that's the problem because when it is a growth stock, nobody cares about the valuation. When things start to slow deteriorate, margins start to deteriorate, the first thing people look at is the valuation. Karen brought it up. She's right to. You know, I don't know if it gets the levels that Steve talked about, but just in terms of sort of pen to paper type of thing, you look at the prior all time high was in February of this year before we went lower in April. Like everything else was like 10:25, 10:30, you know, that's where it seems to be headed based on sort of the price action in the aftermarket and based on basically being right here at support now. And now the people will start to focus on the valuation that you led your question with. It's never been cheap. It looks more expensive when things are slowing down.
- [10:25]
A
And just a quick, you know, as a Netflix shareholder, Karen, how would you feel about them reaching for wbd? Either all of it or parts.
- [10:33]
F
I don't know what to make of that. So that's a question mark. I mean they've been very good at choosing things right. I think they've been good stewards of money. So I think we'll give them, we'll give them the benefit of the doubt.
- [10:46]
E
And their content creation has been the cheapest. So that throws in a huge wrench if you're thinking about they're the ones that can create content the cheapest out of the whole spectrum of content providers. Then they buy something like, like Warner Brothers. That really puts into question everything that you've, you've bought the stock on as far as content. Sorry.
- [11:07]
A
We'll keep you posted on the Netflix call, which is ongoing. Meantime, shares of regional bank Western alliance higher in extended trading. After that company's results last week, it had disclosed potentially fraudulent loans in its portfolio. CNBC's Houston had has got more on what we're hearing tonight.
- [11:21]
C
Hugh?
- [11:23]
B
Hey Melissa. That's right. So reading the release you'd be hard pressed to realize that this is the bank at the heart of that one day regional bank sell off last week. So Western alliance beat on both the top and bottom lines with EPS of $2.28 on revenue of 938 million. Asset Quality the bank appeared to actually improve with criticized loans and the ratio of non performing loans falling from last quarter. Now as a reminder, Western alliance had exposure to both Cantra Group and First brands. Those two soured loans. There is no mention of the first brand's exposure but the company has said that they won't face any losses on that. Regarding the Cantra Group, Western CEO saying in this release that they still expect the collateral will cover any losses. However they reserved for $30 million. And that's got to be the most interesting thing about this report. Analysts will surely want to dig into that further on on the conference call tomorrow guys.
- [12:14]
A
All right Hugh, thank you. Hugh sun and we thought this along with Zions would be the heart of a potential, you know, other regional bank crisis. And here we are. It looks better than fear, better than feared.
- [12:25]
D
And this is to me this is sort of a knee jerk reaction on a stock that's only going lower for the last couple of months. Go longer term. You see what I'm saying now again, are we rerating these banks based on where they've been historically? Their tangible book I'm looking at it's 50, I'm rounding up, it's $59. You want to give them one and a half times. Well you can do the math. It gets us maybe to I don't know, $90 stock. Ish. Do you want to pay up though for that? That's the thing. You know, are we in this new paradigm where people are willing to pay up or should these things be trading in a one and a quarter times price to tangible book? That's what I think makes the most sense.
- [12:56]
A
I mean are we behind the worries about credit quality, about the exposure of regional banks at this point with this earnings report?
- [13:04]
E
No, I don't think so. You go, you going to get to guys point, you're going to get one offs and then they'll sell off the space and then they'll buy them back aggressively day. So you're going to miss out on that volatility in a good way. But for me the money center banks is where you should be. Not that they're immune to it, but it's going to be less likely that they have an issue.
- [13:22]
A
What do you think?
- [13:23]
F
I think that this sort of panic frenzy at the moment is over. Yeah, I think. Right. We have, you know, two credits that had very, very big impact out of millions of credits. Right. So I think, you know, when you get to a bank and you get scared, then this is a levered institution by its DNA. People get scared and sell. I understand that it's still well, well, well below where it was before that. And the amount of penalty on the stock for the amount of loan loss is significant. So I think this momentary panic now, if the economy slows. Yes, that's trouble for all banks. I agree. I find safety in the, in the model of the big money center banks. You've got a lot of other things going on. Can we talk about Capital One for.
- [14:06]
A
A second or is that a later thing? No, no, let's do it.
- [14:09]
F
It looked like there's a lot to like in the credit profile there. So that's another thing people have been concerned about and you would think Capital One would be in the weeds as much as anybody. And I think it looked pretty good.
- [14:21]
B
Yeah, I'm with Karen. I think the fears are a swatch for the time being. The real question is what risk are you taking on for the investment? And so listen, I think if you want to park cash, you probably are going to park them in the money center banks. I think if you're looking for much more of a trading vehicle, a short term type of beta play, I think the regionals offer, you know, a better opportunity to do that. But with that said, again, you have to understand that you are likely going to have to trade around this volatility and be willing to exit a position when you even get a sniff of the cockroaches that Jamie, that Jamie Dimon mentioned. Because whether or not it's justified or not, whether or not you can back into it, into a finite quantity, you are going to get that volatility within this, within, within this sector.
- [15:04]
A
Meanwhile, recently red hot gold pulling back in a big way today. Prices settling down nearly 6% for their worst day since 2013. April to be specific. The precious metal hit its 49th record of the year just yesterday and even with today's pullback is up 56% this year. We're just back to I think last Monday, basically the gold miner ETF down more than 9%, its worst day since 2020. So what about this hiccup the gold.
- [15:27]
D
Mining makes sense 100% in terms of being twice as bad as the underlying commodity. We've seen that before because people are now terrified that the gold move is over. We had talked about recently, you know the RSI is where historic levels north of 90%. I mean the overbought conditions again were historic for on a number of different metrics. So this was coming at some point now I thought it was coming in the form of an equity market sell off where all risk assets would go lower. That obviously is not the case today. So something else was going on. I'm not exactly sure if maybe people got out of gold into bitcoin. I will say it again, this is not over by any stretch. This is a healthy pause and a move that I think will continue over the months to come.
- [16:07]
E
Yeah, I agree with that. HSBC and Goldman Sachs still have a $4600 to $5000 price range or price target for gold in 2026. I think it will go higher. But think about where we are seasonality wise. First of all, everything a guy said we ran up, probably should take a stutter step back. November, December, positive months for the equity market, pretty bullish months. Maybe, just maybe people want to get out of that and get into equities. Maybe they want to get out of that and get it to bitcoin as guy said. So there's a host of things to do with it. I think that eventually if it holds 4030800 you're going to rip back to 5000 probably in the next year.
- [16:48]
B
I wouldn't get too far from gold. But the truth of the matter is like we, we talk about this being a store of value and a place where you park cash when you have looming concerns about either the US economy or general politics globally. And the speculative nature that we see in all these other high growth, high beta pockets of the market found itself creeping into the gold market. And so naturally you're going to have some pullbacks and some sideways trading. So I think Carter called the top almost to the date. I think that's great. I think you continue to monitor the technicals but again I don't think this is a situation where you should dip completely out of gold. But I would look at perhaps when you reengage allocating some to copper and some to gold.
- [17:29]
A
Silver also same thing.
- [17:31]
D
I mean now people and Carter had his charts showing that silver basically topped out exactly where it did historically. And then he showed it adjusted for inflation nowhere near where it was on a historical basis. But if gold moves the way it did. Silver is going to move the same way and probably twice as bad, which is the move. We saw it all. In retrospect, it all makes sense. I didn't think it was happening today. I don't know what the trigger was, but here we are.
- [17:53]
A
Coming up even more after hours action, the details out of Texas Instruments and the latest numbers from the quarter. Plus a browser battle brewing. How OpenAI is gearing up to take on Google Chrome and the impact it could have on how you search the web. Do not go anywhere. Fast Money's back in tune.
- [18:13]
E
This is Fast Money with Melissa Lee.
- [18:17]
B
Right here on CNBC.
- [18:23]
E
This is a 30 second ad. In just 30 seconds there are likely to be an average of over 30,000 cyber threats to all businesses. Since I've been talking, more than 10,000 likely just happened. Hey, cyber threats don't wait and neither should you. With advanced security solutions, Comcast Business can help keep your network and data secure and your business reliably up and running. Get threat ready with Comcast Business. Learn how@comcastbusiness.com Cybersecurity.
- [18:55]
B
It's Cybersecurity Awareness Month and LifeLock is here with tips to help protect your identity, use strong passwords, set up multi factor authentication and report phishing scams. And for comprehensive identity protection, LifeLock is your best choice. LifeLock alerts you to suspicious uses of your personal information and also fixes identity theft, guaranteed or your money back. Stay smart, stay safe and stay protected with a 30 day free trial at lifelock.com Specialoffer terms apply. Smarter by CP CNBC Make It Career and Income Boosting Online courses to help you be smarter and more successful.
- [19:31]
E
Get the newest course now.
- [19:32]
B
How to communicate using AI. Go to CNBCMakeIt.com courses special offer ends.
- [19:37]
A
October 28th welcome back to Fast Money OpenAI announcing its new Atlas web browser powered by ChatGPT. Today the platform directly competes with Google's Chrome and Perplexity's Comet. News of the launch and shares of Google parent Alphabet down nearly 5% at its lows. Mackenzie Segalis got more on this. Hey Mac.
- [19:58]
G
Hey Mel. So this is all about OpenAI trying to take control of how we use the Internet. Atlas is their new AI powered browser where ChatGPT helps you interact with the web in real time. Not just answer questions, but plan trips, compare products, even draft email replies directly inside of Gmail. Now for paid users, there's agent mode where ChatGPT actually takes actions through for you, opening tabs, clicking through sites and completing multi Step tasks. The product lead for ChatGPT Search says the real power of Atlas is in memory. It gets more helpful the more that you use it. Now this browser strategy also translates to more behavioral data for OpenAI. What users search, click, compare and then ultimately abandon. And that could power better models and even enterprise products. Google had this advantage with Chrome. Now OpenAI wants that edge. So Atlas, it's really all about directly challenging Google on both Chrome and search. And while perplexity hasn't made much of a dent In Google's dominance, OpenAI has massive user reach.800 million weekly actives, in fact. And so if Atlas sticks, it threatens Google's lock in and puts pressure on the ad model underneath it.
- [21:07]
A
Mel Mac, thank you. Mackenzie Segalos. Karen, I'm wondering what you make of it. I mean, Google's already incorporated Gemini into Chrome, so that's been out for a while. And right when I saw a 5% decline intraday. The assumption behind the 5% drop intraday would be that what Open Air is offering is better.
- [21:27]
F
I don't know that it's better. I think it's more of a dent in this, you know, fortress, that share of.
- [21:33]
B
Right.
- [21:33]
A
It's share to lose.
- [21:35]
F
Right. And so, you know, so Google were just talking about Netflix. If you back out, if you back out, YouTube as equal to Netflix, let's say. So that takes you from three trillion down to like two and a half billion. You have Google Cloud in there. I'm not really sure what to have that so to and change trillion. The idea that we're just talking in trillions now so easily is kind of amazing. But that's not a crazy multiple. But I, you know, I'm concerned, as a longtime Google shareholder, I am concerned. I think they can absolutely compete. I think they're in a great position. But that doesn't mean that some share isn't eroded away.
- [22:12]
D
Valuations always been compelling. I mean, it's like the stock has been trading that horribly. I mean, if you look at the recent move, I mean it's had a pretty decent move from the last quarter earnings when everybody was concerned. They sort of assuaged some of the concerns about search they report on the 29th. I mean, I think you continue to buy weakness in Google.
- [22:29]
B
Yeah, I tend to agree. I think Karen makes a good point in terms of, listen, this is a looming threat, but I think the fact that they are now using this agentic feature alongside traditional search to me removes some of my risk about traditional search going extinct, if you will. So I again, I do think that they're going to have to do a little bit more in terms of plugging in Gemini because clearly that hasn't led to the recapture of market share that that one had. But again I still think, and Steve and I were talking about this early, I like using the LLMs alongside traditional search and I still want to see the citations. I still actually want my hands on the, on the data set that is being marketed to me. And until I see a real disruption to like that ad fortress that they have, I tend to be in the camp of buying dips.
- [23:19]
E
You said that it's theirs to lose their market share to lose and I agree with that and that's why, that's why I'm just really kind of hesitant to jump in here. I think that the reason why the stock has ran is because they didn't have to, they weren't forced to break up. So that was a huge amount of tailwind for them. You said there's competitors, there's a massive amount of competition with very, very deep pockets and they're the wolf at the top of the hill. I know everyone hates when I use that analogy, right. That wolf at the top of the hill is never as hungry as the wolf climbing up the hill. Guy knows that saying, right?
- [23:52]
D
I like wolves.
- [23:54]
E
So for me I think that this would be a poor time. It's a great value stock.
- [23:59]
A
Uh huh.
- [24:00]
E
But I don't think I'm going to get a real bang for my buck. As far as a growthy stock.
- [24:05]
A
It's not necessarily value anymore.
- [24:08]
F
Well I mean it's not expensive but it's not expensive. And if you back out some of the other parts I do think the search is, is in the value territory.
- [24:15]
B
How many fronts can open a battle on? I mean we assume that this is like some mature company that's got it all sorted out. Again we've already spoken to their need to continue to raise, their need to actually be profitable do it.
- [24:27]
A
Everybody's opening up their wallets to them.
- [24:29]
B
I mean how much is micro stumbling.
- [24:31]
A
Over each other deals?
- [24:32]
B
I agree. I just feel like they are spread quite thin. They're fighting on quite a few fronts and until I see some actual follow.
- [24:39]
E
Through I'm asking how long they could do it for.
- [24:42]
B
Well ask open, ask Gemini.
- [24:46]
A
Coming out more after hours action to bring you shares of Texas Instruments on the move after reporting results and numbers from the quarter next. Next you're watching Fast Money live from the NASDAQ market site in Times Square. Back right after this.
- [25:13]
B
It's Cybersecurity Awareness Month and Lifelock is here with tips to help protect your identity. Use strong passwords, set up multi factor authentication and report phishing scams. And for comprehensive identity protection, Lifelock is your best choice. Lifelock alerts you to suspicious uses of your personal information and also fixes identity theft, guaranteed or your money back. Stay smart, stay safe and stay protected with a 30 day free trial at lifelock.com Specialoffer terms apply smarter by CNBC Make It Career and income boosting online courses to help you be smarter and more successful. Get the newest course now how to communicate using AI. Go to CNBC make it.com/courses Special offer.
- [25:55]
E
Ends October 28th.
- [26:00]
A
Welcome back to Fast Money. We've got an earnings alert on Texas Instruments chipmaker down on mixed Q3 results a week fourth quarter guide Christina Parsonevolis has been locked in on the conference call. She joins us now on this 8% decline.
- [26:12]
H
Christina yeah, really, Texas Instruments missed the mark not only on margins and but also guidance. And that's why you're seeing that 8% decline. Gross margins really just came in at 57%. They remain under pressure still well below where they were just three years ago at 70% and of course slightly lower than street estimates at 57.7. Management has really just been building up inventory, expanding, expanding factory capacity and just this is all happening while the analog recovery just essentially fails to materialize. The real disappointment, though, is the fourth quarter guide. The revenue outlook came in with an unusually wide range and mostly missed expectations. And when it's wide, that signals that maybe management doesn't understand when demand is coming back. On the earnings call, the CEO said the semiconductor recovery is continuing but, quote, at a slower pace than prior upturns with automotive. He said the recovery has been shallow and that the business is now back to where it used to be. So that's a little bit of good news given they were quite negative just in September. The weak guide, though, really just confirmed confirms what investors fear. The analog recovery just keeps stalling or as the CEO said on the call, one of the, quote, more moderate recoveries that they've ever seen in the history of the firm.
- [27:18]
A
So they mentioned automotive specifically as an as an end market. Are there other end markets in particular that have failed to come back to where they once were?
- [27:27]
H
They were speaking a lot about industrials, but the industrial market, but that's actually started to improve. And I was surprised because the CFO just in mid September said that the auto market was taking longer to recover. But then today they definitely shift their tone. That's because the stock price has dropped over 10 and a half percent just since her comments or his comments are in September. So they were trying to change the tone, but it seems like overall recovery is weaker.
- [27:51]
D
Yeah, you know, Christine, they talked about this. I think it was last quarter, two quarters ago. They said there will come a time when things start to decelerate and this fourth quarter guide might be that time. And it's hard because once that turns, it doesn't necessarily turn back on a dime. So I think this reaction in the stock makes sense. I mean, does that seem like something that. This is a definitely different company than in video and some of the other semis that we talk about.
- [28:15]
H
This is a cyclical company. Here's a perfect example of what we know about chip companies. And Texas Instruments is very relevant because it's in every single product that isn't related to AI. And so here we're seeing a slow recovery in everything else that it doesn't touch.
- [28:28]
A
Right. Christina, thank you. Christina, parts nebulous. What do you do with this? I was joking around with our producer Kavitha back at headquarters today. I was saying, you know, Texas Instruments stocks can be down on earnings, the end markets can be weak. Automotive is going to be okay and they miss. And here we are. It's like the same story again and again.
- [28:48]
E
Well, I think Christine hit it on the head where it's a semiconductor. There is a boom bust situation when you come to a cyclical name like this. But none of the other space reacts the same way because it's AI driven. So this is actually the way a semiconductor probably should trade. But it's been in a declining trend line since July and the stock still looks weak to me.
- [29:11]
A
So is this idiosyncratic to Texas Instruments or is this a statement on the broader economy? Since you're shaking your statement on the.
- [29:18]
D
Broader economy, why I asked the question. I mean, this is historically it's. Christina just said it. It's a highly sensitive cyclical industry that has not been trading that way for quite some time, Texas Instruments notwithstanding. So the question you have to ask, okay, if we're starting to see it around the edges with Texan, at what point we're going to start to see with some of these names that are not trading like cyclical stocks.
- [29:38]
B
Yeah. I think, you know, roughly 70% of their makeup is autos and industrials. And so for me it really just calls into question the whole broadening trade and the whole cyclical rebound months and the cyclical rebound rather and the whole industrial rally. And so you know as every time we get too far removed from the Mag 7 the growth, the air related, the AI adjacent names, you get a report like this that really just reinforces the fact that what is it a half of of GDP thus far through the year is really coming from AI and Capex spin. And so again I understand the need to kind of broaden out but I would just against kind of getting too far away from what has worked thus far. And I would definitely pause on feeling the need to catch a knife on this one.
- [30:25]
F
It looked like also personal electronics missed a little bit which is sort of a broad, you know a lot of things. Mobile phone PCs, calculators, the reverse polish notation on the I don't know whatever the HP12C they have the Texas instrument one that's still have it.
- [30:43]
D
Yeah, I have.
- [30:44]
F
So that yes this is general talking about the economy being weak. That's abroad home theater, things like that.
- [30:50]
A
Yeah. Coming up, GM in overdrive shares putting the pedal to the metal after the automaker's latest results. The guidance giving the stock a joyride next. Best money's back into. Welcome back to FAST money. Let's get a check on our stocks. Close out the day. The Dow jumping more than 200 points and closing at a fresh record high for the first time since October 3rd. The S&P 500 virtually unchanged look up 3.1000 of a percent. And the NASDAQ with a small loss down about 2.10 of a percent. Shares of Novo Nordisk down about 2% today after a board shake up. Several directors stepping down from their positions after clashing with the Novo Nordisk foundation, the firm's controlling shareholder on the future structure of the board. Novo Stock is down 36% this year so far. And elevance Health lower despite beating estimates this morning. The health insurer flagging higher costs in its Medicaid business. That stock down 5% in 2025. And some more after hours movers. Shares of Mattel falling after missing EPS and revenue estimates. Intuitive Surgical jumping after topping expectations on the top and bottom line. And we're watching shares of lvmh Reuters reporting the luxury retailers exploring a sale of its 50% stake in Rihanna's Fenty Beauty brand. Karen, there are a couple of names in your portfolio that you might care to comment on.
- [32:16]
F
Well, lvmh, I guess I'll go on that one. I don't think Fenty brand is great for Rihanna. I don't think it's going to really move the needle for lvmh. But I do think we are starting to see tiniest bit of green shoots there. So I like that. As you know, it does have exposure to the market in that those wealthy clients who have market exposure, we want a good market for them. So I'm staying long. It has really been a painful tour of duty being long this, this stock for this long.
- [32:50]
A
Meantime, shares of General Motors revving up after beating quarterly estimates. The automaker also raising its full year guidance, sending shares up nearly 15%, hitting their highest level since GM emerged from bankruptcy in 2009. For more, let's bring in Phil LeBeau. Phil?
- [33:05]
I
Melissa, this was the second best day in terms of a single day gain four shares of general Motors since they came out of bankruptcy back in 2009. You set the table for it. It was a trifecta of good news for General Motors investors. First of all, they beat the street by a wide margin in terms of the third quarter. Then they turn around and they raised their guidance for the full year to 975 to $10. Going into today, the street was at 947. And then on the conference call they said that they expect to be even more profitable next year than they were this year. Now let's be clear. The tariffs that have been in place since April, they did take a bite out of the bottom line at GM. The North American margin, 6.2% in the third quarter. It was 9.7% last year. But there are some tailwinds that General Motors has in its favor right now. The average transaction price in the third quarter for GM, $51,000. The industry right now is about $50,000. So they're above the industry average transaction price. Their North American share, it's up to 17%. And then finally you've got them with their US production. They outline plans to further increase it over the next couple of years. They understand where the market is at and it's headed towards more internal combustion engine vehicles built in the United States. And GM is mitigating the tariff costs. All of those are factors behind the better than expected numbers. Today I'm going to show you GM versus Ford over the last two years. Why am I showing you this? Because historically you'll hear people say, well, they always trade in tandem. GM and Ford trade in tandem. Oh no, they don't. They may directionally at times go together, but right now GM clearly easily outperforming Ford over the next two years. We get Ford results after the bell on Thursday.
- [34:51]
B
Melissa?
- [34:53]
A
Yep. And it's stunning to think that that market share number. Phil, that gain was specifically in ICE vehicles, Correct?
- [35:01]
I
Yes, yes. I mean it certainly helped that they had a strong quarter when it comes to EVs but their EV sales a drop in the bucket relative to their ice sales.
- [35:11]
A
Yeah. Phil, thank you, Phil LeBeau. Piper had a note out after the results saying, you know, we got it wrong. We've had a neutral on the stock for a long time but now we actually think that we could see ebit margins between 8 and 10% I'm sure in part thanks to this higher average transaction price of $51,000.
- [35:31]
F
Yes, but there's so much to like here except that I don't own the stock but they don't need to give that credit kind of bullish guidance for next year that they did. Right. It's very easy to just say hey, we're in a, you know, fluid situation with tariffs and whatnot and so we're going to just, we'll guide as we get closer. But so why go out on a limb at all unless you have a lot of confidence?
- [35:50]
E
Yeah, I think both car companies, Ford and GM are, they're getting the tariff relief plus they don't have the EV mandates. Ford lost 12 billion on EVs. GM didn't lose anywhere near that. That total. This could be a great year for Ford as a catch up trade.
- [36:07]
A
Hmm.
- [36:08]
D
We have said, I heard what Phil said about most people, you know, conflate or look at the same. We've talked about it for a long time on this as the GM is just running better company right now in a better stock and it's proving to be the case. I hear what Steve is saying. I don't necessarily agree but I'll tell you this. I mean when you start to look at some of the numbers operating profit beat by 11%. That's a significant number in the environment that we find ourselves in. And the same way people look at valuation when things are going lower, it's the same way people going to start to look at valuation when things are going better and say wait a second, it's just too cheap here to your.
- [36:43]
B
Point about the EV mandate and I think perhaps that is going to be somewhat fluid going forward. But we got to trade with the current environment that we have on top of the EV manage. You also have a rollback of the whole need for them to be purchasing emission credits which I think again is directly impactful to bottom line. So I think the table is just somewhat set for them. Clearly the street was wrong myself included in terms of what the expectations were. But I do think it's, it's both operationally and also understanding what the legislative backdrop is and for, and for them to be able to perform within that environment.
- [37:13]
A
Coming up, we're keeping an eye on Netflix after hours. The company's conference call just wrapping up the headlines from that and how K pop demon hunters help boost the binge more fast Money into. Welcome back to Fast Money. Another check on Netflix. After earnings, the stock is down six and a quarter percent. LightShed Partners Rich Greenfield joins us fresh from the earnings call with more. Why is it down, Rich?
- [37:44]
J
I mean, look, investors wanted faster growth. I mean there was like a tax issue this quarter, but like, look, I think there was just the whisper was that they were going to have even faster growth in Q4. I mean, they're growing revenues in the mid to high teens. They're growing earnings 30%. Like this thing is just an execution story. They don't, you know, generally blow things out anymore. It's just a solid executor that grinds higher over time. I mean, the stock was at this level 12 days ago. Melissa. So like, I don't think there's any panic or any collapse here. I think in reality, the only real focus that investors have, you know, post call is actually not about the earnings. Post call, the only discussion is what was with the answer on M and A? Like, are they a bidder for Warner Brothers for the studio and streaming? Are they not? Obviously, you know, we all listened to your David Faber report earlier that they were amongst the interested parties. And so everyone's just trying to figure out like who's bidding, what's the reality that anything happens and is it good or bad?
- [38:41]
A
So let's say Netflix is amongst the bidders. How can you see this make sense for a Netflix investor? Netflix shareholder, Would they want to buy all of it? Would they want to buy pieces of it? I mean, what would be your fantasy? Netflix, WBD tie up?
- [38:56]
J
Look, the fantasy would be you wouldn't even really want HBO because it's still a network. It's still tied into Amazon channels. It's tied into Charter and Comcast and DirecTV. What you'd really want is just the IP trove of Warner Brothers. Like if you could literally just extract the Warner Brothers asset, that would be the piece that I'm sure is most interesting to Netflix. I think. You know, hbo. I mean, it's funny. Like you think about that Albanian army comment that Jeff Buchus made so many years ago, Melissa, where he Joked that the Albanian army is not going to take over the world. And the thought that, you know, Netflix could actually buy HBO and Warner Brothers is obviously sort of ironic when you think about it. But look, there is no doubt they love ip. They've never made a huge IP acquisition. They, you know, they've bought the Ronald Dahl library, they've bought little things, but they've never made a, this would be a, you know, 50, $60 billion acquisition of the Warner Brothers studio and HBO. That's a massive transaction for Netflix. And you have to wonder like, you know, does that, is that really the best use of capital for the company? And look, we know there's competition and so they're going to face competition from lots of parties, from this. Netflix generally in these battles doesn't win. You know, you look at sports rights bidding, they generally don't get sucked in and overpay in the middle of those battles. And so they're certainly not the only bidder here. I believe Comcast would have a lot of interest. Obviously. We know Paramount has a tremendous amount of interest. So even if they're interested, which I don't deny that there could be interest, it's hard to see how they walk away the winner given their price discipline that they've always exhibited.
- [40:40]
F
Rich, it's Karen, thanks for being on. So can you talk to me about the ad sales and how you see that evolving from here?
- [40:49]
J
Look, they're still very early in their journey. I mean, it's growing, it's doubling. But I mean, these are, in the scheme of Netflix, Karen, like these are still small numbers they need to bring on. You know, they're still early in bringing on advertisers, getting more customers or more subscribers, I should say, onto the ad tier. You know, this is a multibillion dollar business. But you know, when you compare it to the scale of other companies in the ad space, I mean, they're dwarfed by the Metas and the Googles, let alone, you know, companies like Disney, you know, and Paramount, even cbs. And so they're growing rapidly. You know, the ad tier has certainly, I mean, think about what happened. I mean, if we just go back in time, the reason they launched advertising, remember, is they missed and revenue growth was sub 10%. And they were like, how do we start growing again? And it was a combination of launching the ad tier and introducing the restrictions on password sharing. And those two things have driven the company from high single digit revenue growth back into the high teens. So they've succeeded in restoring rapid growth to this company. Growing earnings, you know, at 30% plus this year. And so there is really good growth dynamics that's been restarted. But they are just scratching the surface. Their ad experience is actually relatively unexciting. Ads on Netflix look like ads on tv. I think that's the opportunity to make it a very different experience over the next few years.
- [42:14]
A
Rich, in this era where there's so much M and A going on, potentially the sands are really shifting. Could you cobble together like Frankenstein of streaming platform from all these different pieces that would be a true competitor to Netflix or at least, least maybe eat into some of that growth that Netflix is is banking on?
- [42:35]
J
It all depends on, you know, putting content studios together. I don't think solves the problem. I mean, you know, look, Paramount is obviously interested in buying Warner Brothers. They think this will help them. I don't doubt that there is value to owning the assets. The reality is in Hollywood, Netflix has shown Money talks Paramount in just the last six weeks. Melissa has shown they got the ufc. They took it away from espn. They took the Duffer brothers away from Netflix. They won a highly contested bidding war for a 24 is Nicole Kidman series. Like, everything you want in Hollywood and in sports is available if you're willing to overpay for it and outbid everybody else. And so if David Ellison and the Ellison family has more money than everyone else, I don't actually know why you need to buy anything. I think you can sort of execute the Netflix playbook of just take everything you want by overpaying, outbidding everybody else and leveraging your financial position.
- [43:34]
A
Rich, pleasure talking. Thank you. Rich greenfield, netflix down 6% coming up, some big moves from oil services to consumer staples and defense. How this morning's results move the stocks and how our traders are navigating the action. More fast money into.
- [43:51]
B
The.
- [43:57]
A
Breaking news on Alphabet and Anthropic. Let's get to Mackenzie Sagalis for the latest Mac.
- [44:03]
G
Hey, Mel. So Anthropic is in early talks with Google on a new cloud deal potentially worth tens of billions of dollars in compute. That's according to Bloomberg. So far, Amazon has been its main infrastructure provider and its largest backer, investing around $8 billion into the company. Google has put in about $3 billion and has supported Anthropic's multi cloud strategy. I reached out to both companies, haven't heard back yet. I will say this, Google was down all day because of that OpenAI web browser. But those shares bouncing higher in the after hours up more than 3% now. Mel.
- [44:33]
A
All right. Mac. Thank you. Mackenzie Segalos. Meantime, Halliburton shares seeing their best day since April after the oilfield services company announced a partnership with Volta Grid to power data centers. It also said international revenue would rise in Q4 and that cost cutting efforts would save $400 million for the year. Karen?
- [44:51]
J
Yes.
- [44:51]
F
So this is somewhere in my acronym in the oih. It's a big for energy. Thank you, thank you. I knew that it's in the oih, but so there was a lot to like here on the blocking and tackling of just their business and running it more efficiently. All of that was good revenue. Good. There was a lot to like. But I think what really got the stock going in an environment that is terrible for servicers because the price of oil is so low is the Volta Grid which talked about. So this is I think now sort of becoming a little bit of a backdoor data center play. Volta Grid has a big Oracle and open Air connection and also Halliburton will be there will be doing their international distributed energy. So I like it.
- [45:39]
A
Up next, final trades, final trade time.
- [45:49]
E
Steve Ford's got some tailwinds here.
- [45:51]
A
Karen.
- [45:51]
H
Yes.
- [45:52]
F
You know I always say if it's good enough for the F block, then it's good enough for the final trade. So I'm going with Halliburton.
- [45:58]
B
I think banks and Capital One have kind of given use early indication. I think MasterCard trades into the print.
- [46:04]
D
In the state of South Carolina, Gail Ford is celebrating a birthday. Happy birthday from all of us here at the NASDAQ and Fast Money Gilead.
- [46:13]
A
Thank you for watching. Fast Madam. Money starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, 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 the Fast Money 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 Fast Money disclaimer, please visit cnbc.com fastmoneydisclaimer It's Cybersecurity Awareness.
- [47:03]
B
Month and LifeLock is here with tips to help protect your identity, Use strong passwords, set up multi factor authentication and report phishing scams. And for comprehensive identity protection, LifeLock is your best choice Lifelock alerts you to suspicious uses of your personal information and also fixes identity theft. Guaranteed or or your money back. Stay smart, stay safe and stay protected with a 30 day free trial@lifelock.com Special offer terms apply.