Trump Tariffs Reinstated… And Retail Earnings Filter In 5/29/25

Summary

CNBC's "Fast Money" Episode Summary – May 29, 2025 Host: Melissa Lee

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1. Reinstatement of Trump's Tariffs

Overview:
The episode delves into the latest developments surrounding President Trump's tariff policies. A federal appeals court has temporarily reinstated tariffs that were previously struck down by a lower court, allowing them to remain in effect until June 5, 2025. This decision has significant implications for ongoing trade negotiations and the broader economic landscape.

Key Discussions:

• Court Ruling and Implications:
  Megan Casella explains, "The Court of Appeals for the Federal Circuit granted an emergency stay, allowing the tariffs to remain in place temporarily" (00:31).

• Administration's Stance:
  Megan Casella highlights the administration's resilience, stating, "They are very much clear-eyed about the fact that they have other options if this one does not move forward" (03:22).

• Future of Tariffs:
  The conversation touches upon potential pathways the administration might pursue, including Section 232 and Section 301 tariffs, each with its own set of limitations and timelines (04:43).

• Market Reaction:
  Despite the uncertainty, Dan Nathan observes, "The market sort of hung in there as well as it did" (05:38), indicating a resilient but cautious investor sentiment.

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2. Impact on the Markets

Overview:
The reinstatement of tariffs amidst economic uncertainties has added another layer of complexity to the markets. Panelists discuss how this development influences investor confidence and market dynamics.

Key Discussions:

• Increased Uncertainty:
  Karen Feiderman notes, "This is something that I think is going to stay pretty volatile if you have the courts going back and forth" (06:03).

• Consumer Spending:
  Despite challenges like tariffs and job uncertainties, Melissa Lee points out, "the consumer is still spending," suggesting underlying economic strength (00:43).

• Market Resilience:
  Tim Seymour remarks, "It's almost as if markets don't seem to care about tariffs," highlighting a possible disconnect between policy changes and market reactions (07:45).

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3. Retail Earnings Highlights

Overview:
The episode reviews the latest earnings reports from major retail companies, analyzing their performance in the context of current economic conditions and tariff impacts.

Key Companies Discussed:

• Dell Technologies:
  Christina Parts Nevelis shares, "Dell is projecting a massive $7 billion in AI server shipments this quarter" (22:17). Despite this, the company maintains a conservative full-year revenue outlook due to lagging PC refresh cycles.

• Costco Wholesale:
  Megan Casella highlights, "Comparable sales rose about 8%, and e-commerce sales jumped about 16%" (31:05). Costco's strategy includes rushing shipments ahead of tariffs and diversifying sourcing for its private label products.

• Gap Inc. and American Eagle:
  Both companies experienced mixed results, with Gap reaffirming its full-year guidance despite missing revenue expectations, and American Eagle missing revenue targets, leading to stock declines (30:15).

• Best Buy:
  Melissa Lee reports, "Shares of Best Buy getting hit after results this morning down more than 7%," due to profit outlook cuts stemming from tariffs (30:15).

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4. Boeing's Production Plans

Overview:
Boeing made headlines with its CEO Kelly Ortberg outlining ambitious plans to ramp up 737 Max production amidst ongoing safety concerns and regulatory challenges.

Key Discussions:

• Production Goals:
  Kelly Ortberg stated, "I hope to have 737 Max production hit 47 planes a month by the end of the year" (27:33).

• Market Reaction:
  These announcements contributed to Boeing's stock reaching a 16-month high, reflecting investor confidence in the company's turnaround efforts (27:33).

• Customer Confidence:
  Southwest Airlines CEO Bob Jordan expressed optimism, noting improvements in 737 Max quality and the desire for increased deliveries (27:33).

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5. Trade Relations with China

Overview:
The episode features insights from CNBC senior correspondent Eunice Yun, who provides an on-the-ground perspective of the strained US-China trade relations and its impact on global markets.

Key Discussions:

• Trade Tensions Escalate:
  Eunice Yun explains, "China has been taking steps that really seem to be threatening the possibility of having a greater trade negotiation" (12:25). This includes restricting chip design software sales and pausing exports for Chinese planemakers.

• Chinese Retaliation:
  Eunice Yun highlights potential Chinese retaliatory actions, such as export controls on rare earths and legal actions against US chip curbs, adding to the uncertainty (15:53).

• Consumer Sentiment in China:
  Despite economic weaknesses, Chinese consumers show signs of resistance against US brands, influenced by online narratives and economic concerns (14:24).

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6. Tesla and Elon Musk Developments

Overview:
Elon Musk's strategic shifts have significant implications for Tesla's stock performance and competitive positioning in the electric vehicle (EV) market.

Key Discussions:

• Musk's Focus on Tesla:
  Melissa Lee reports, "Elon Musk announcing his time at Doge is coming to an end, raising hopes of Tesla investors" (41:00).

• Stock Performance:
  Despite positive developments, Tesla shares remain volatile, down over 11% for the year, reflecting investor apprehensions about broader market conditions (41:35).

• Competitive Landscape:
  Panelists discuss the intensifying competition in the EV space, emphasizing that challenges to Tesla's share price are more industry-specific rather than stemming from Musk's management style (42:19).

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7. Starbucks Downgrade

Overview:
Starbucks faces scrutiny as analysts downgrade the company's outlook, citing rising labor costs and increased competition.

Key Discussions:

• Analyst Downgrade:
  Megan Casella mentions, "Shares of Starbucks getting roasted after a downgrade at TD Cowan" (44:27). The downgrade reflects concerns over labor investments affecting profitability.

• Consumer Perception:
  Proprietary survey data indicates consumers view Starbucks as overpriced, impacting the company's value proposition (45:00).

• Market Impact:
  The downgrade has led to a nearly 8% decline in Starbucks stock for the year, signaling potential investor caution (44:27).

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8. Final Trades and Recommendations

Overview:
In the closing segment, panelists share their final stock trades and investment recommendations based on the day's discussions and market insights.

Key Recommendations:

• Nike (NKE):
  Tim Seymour advocates for buying Nike, emphasizing its resilience amid market fluctuations (40:24).

• Wal-Mart (WMT) vs. Costco (COST):
  Guy Adami expresses a preference for Wal-Mart over Costco due to valuation concerns but acknowledges the strengths of both retailers (33:26).

• Abercrombie & Fitch (A&F):
  Despite recent volatility, Guy Adami views Abercrombie as undervalued with a strong balance sheet, recommending it as a buy (39:30).

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Conclusion

The May 29, 2025 episode of CNBC's "Fast Money" covered significant ground, from the reinstatement of Trump's tariffs and their market implications to detailed analyses of retail earnings and corporate strategies amidst economic uncertainties. The discussions underscored the delicate balance investors must navigate in a landscape marked by policy shifts, global trade tensions, and evolving consumer behaviors. Panelists provided actionable insights and stock recommendations, emphasizing the importance of adaptability and informed decision-making in today's volatile markets.

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Notable Quotes:

• Megan Casella:
  "The court said that until June 5, they're giving the plaintiffs some time to respond here." (01:51)

• Dan Nathan:
  "It adds another level of uncertainty to an already uncertain environment." (05:38)

• Karen Feiderman:
  "The administration has been adamant all day today that they say they've been hearing from foreign countries that trade negotiations continue to be ongoing." (04:43)

• Stephen Yalof (Tanger CEO):
  "Customers want more diversity of product when they come and shop in our centers." (34:51)

• Kelly Ortberg (Boeing CEO):
  "We will resume deliveries to China next month." (27:33)

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Note: All timestamps refer to the podcast's runtime for easy reference.

Transcript

[Melissa Lee]

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[Tim Seymour]

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[Melissa Lee]

And charts into one screen because better trading starts with finding what you need fast. Available for [e-mail] TradingDashboard Investing involves risk.

[Tim Seymour]

Including risk of loss.

[Melissa Lee]

Fidelity Brokerage Services, LLC Member NYSE SIPC Live from the NASDAQ Marketsite in the heart of New York City's Times Square, this is Fast money. Here's what's on tap tonight. Where's the rally? Nvidia jumping after a solid earnings report, but strength in the world's biggest semi shares doing little to boost the broader market. What does this tell us about the state of stocks and hanging in there? Despite all the tariffs, the price hikes and the uncertainty over jobs, the consumer is still spending. The CEO of Tanger will be here to take us inside the numbers. Plus, for all of our results out of Dell and Marvell Technology, Boeing gets a bounce as 737max production starts ramping up. And a latte issues for start. Oh boy, that was a quote. What has one Wall street firm downgrading coffee chain? I'm Melissa Lee, coming to you live from Studio B at the nasdaq. On the desk tonight, Tim Seymour, Karen Feiderman, Dan Nathan and Ghai Adami. We start off with the latest turn in President Trump's tariff policy. A federal appeals court temporarily pausing a lower court decision that struck down the levies last night, allowing them to go back into effect for now. Megan Casella has all the latest in this back and forth. Megan?

[Megan Casella]

Hey, Melissa. A huge back and forth on the trade front today, starting with that ruling overnight, of course, from the Court of International Trade, saying the president did not have the authority to impose most of the tariffs we've seen. So but the latest, as you just laid out, is that the Court of Appeals for the Federal Circuit did side with the administration, granting their request for an emergency stay, at least temporarily. So the court said that until June 5, they're giving the plaintiffs some time to respond here. So a week from today. In the meantime, that means all tariffs that were in question here can remain in place. The administration had argued they would have to have this sort of stay, this sort of immediate relief. Otherwise it would undercut ongoing trade negotiations and ongoing geopolitical conversations as well. The plaintiffs are already out, counsel for the plaintiffs, I should say already out with a statement saying they view this as merely a procedural step and that they are confident that the Federal Circuit will ultimately deny the government's motion. That would mean that tariffs then are on pause if the court then does not move forward with the longer term stay. Now the White House, this is a win for them, at least temporarily. But they're also seeming unbowed here. They are very much clear eyed about the fact that they have other options if this one does not move forward. Take a listen here to Peter Navarro, the trade adviser, talking with reporters just in the last hour or so.

[Tim Seymour]

The court told us they didn't all but tell us. They told us go do it another way. So you can assume that even if we lose, we will do it another way.

[Megan Casella]

Melissa, I'll leave you with this. We know that There are still seven ongoing Section 232 trade negotiations on things like copper lumber, semiconductors and critical minerals. All of those can lead to widespread tariffs. And there are a number of other statutes the administration is looking at as well. So this is certainly not the end of the road on the tariffs front, even if ultimately the court does rule against the administration.

[Melissa Lee]

Megan, as you mentioned, there are a lot of other routes the administration can take. Section 122, section 301, section 338. This all takes time, though. What happens to all of the the deadlines set in place for negotiations?

[Megan Casella]

For now, they're holding in place. The administration has been adamant all day today that they say they've been hearing from foreign countries that trade negotiations continue to be ongoing. So they say for now the timeline holds with all of its various deadlines as it already was. But you are right that it takes time. Things like section 122, I would look at that as potentially the first next step if they have to do it. There are limits with that. They can only be up to 15%. Tariffs can only last for 150 days. But they're more about the trade deficit deficit. The court even said they thought that was applicable here. So I would expect that's the first place the administration looks if they want to move quickly. If these AIPA tariffs, the ones now in question, don't ultimately move forward 15%.

[Melissa Lee]

That really changes the dynamics in terms of who has an upper hand.

[Megan Casella]

Yes, and that's a huge point to make I think the biggest thing here is while, yes, there is still so much uncertainty and countries really might still be likely to come to the table because they want that certainty. They still want to strike a deal. We're in a different place if we're no LONGER Looking at 145% China tariffs, for example, 15% in the near term would be quite a different world. That doesn't mean we don't ultimately get higher. Things like section 301 were used in the first term to impose pretty hefty tariffs against China, although not quite to the level we've been talking about recently. So they could still get there. But it means it's a longer timeline. It also, though means there's a lot of uncertainty and potentially a patchwork of tariffs in the medium term.

[Melissa Lee]

Megan, thank you. Megan Casella joining us from the White House. It almost seems worse in terms of the uncertainty over companies and their ability to make decisions in the markets to digest what this means for forecasts.

[Dan Nathan]

I think that's right. I was surprised the market sort of hung in there as well as it did at one point last night. The S and P futures up, I think over 80 handles some of it on Nvidia. Absolutely. Most of it on the back of that court ruling. And then at one point we went negative today, seemingly discounting what we're just talking about closed up on the day. So maybe it's just an in video day. But to your point, I think what this just does is adds another level of uncertainty to an already uncertain environment.

[Karen Feiderman]

Yeah. And you know, the one thing I just say is like the reaction to that taco trade thing. It kind of probably emboldens him a little bit. Right. So you have this back and forth between the market kind of calling you out on some narrative. And you know, listen, the narrative didn't need an acronym. This is something that a lot of market participants were talking about the timing of the rollbacks. Right. The threat was something like take it to the bank. Didn't they happen a handful of times on like Sunday nights and this sort of thing? And so they were really focused on the stock market. But when this president is challenged like that, he usually kind of doubles down, at least if we're looking at the playbook from the first administration. And like, so this is something that I think is going to stay pretty volatile if you have the courts going back and forth and you have him and his administration. We just heard Navarro. They're going to find ways to get around it one way or another. And I think to your point about corporates, you know, we keep hearing this. We saw Best Buy today, We've seen some other retailers talk about this. They're not taking big whacks at their guidance, but they're signaling to some degree that this is going to continue until they have more clarity.

[Guy Adami]

So we always think about the market hates uncertainty above all else. Even above bad news. Bad news with some certainty around it. I think the market can digest, maybe reevaluate and then move forward. This, as you're saying, this level of uncertainty to me seems ratcheted up materially, at least for the next, I don't know, a couple of weeks or longer. So I was sort of surprised I guess to your point, you know, in video for sure that's helpful, but because what do you do? Why are all negotiations, are they going to continue right now? Or what would you do if you're the eu? Do you wait and see? Let's just see how it goes.

[Melissa Lee]

Worst case scenario, do section 122 get 15% for five months or however long at 150 days. How bad is that? I mean it changes the dynamics completely. In terms of the need to come to a deal, I would say.

[Tim Seymour]

I just thought today was such a strange day. You know, we have a negative GDP print on top of that, we had a great seven year auction in the one place where we're kind of concerned. We reinstated the delayed tariffs. I mean like the whole thing is so wild and yet markets, it's almost as if markets don't seem to care about tariffs. In fact, you know, guy says this all the time. I totally agree. Market is a lot more about the debt market and, but we walked into today with markets that had rallied back from Independence Day. We, we had the, we had the tariffs, you know, pulled back, we had a court ruling. We've had a forestallment of that. I mean like it's, it's, it. I mean ultimately again the market has told you we don't care so much about tariffs. But of course then we had a handful of GDP of data prints today, including GDP where really look, the trade data in the GDP number was worse than expected. We have initially initial claims which are a leading indicator for unemployment, which were higher again this week you had pending home sales of existing homes that are their worst number in two and a half years. So, so no, the markets are saying I don't care about tariffs. And today was kind of that weird day where tariffs don't exist anymore. But maybe they might. But the market's back to where it was, but the data, the sentiment, the dynamics, and I think this is what you're all talking about in terms of uncertainty. Tell you that there has been an impact and we'll see where we go.

[Melissa Lee]

And the data, I mean, I would, I would think that it would be even more cloudy in that, you know, with this window, it enables companies to bring in inventory right now in this small window where tariffs are sort of, you know, it knows what they are.

[Guy Adami]

Personal consumption also was a big, a big miss today. But I mean maybe that was, if you think it was going on during April, that was a very dismissed sort of kind of, I guess, I mean there was a volatile time with sentiment really taking a hit.

[Karen Feiderman]

Yeah, just say this on the earnings front, you know, we're getting obviously late in the season or earnings season, you get a lot of these retailers and so that, you know, commentary is a lot different than when we started earnings season with the banks, you know, and it seems like we came out of that week or so where a lot of these banks weren't talking about a weak consumer. And you know, then we got into the, the meat of some of these other, you know, in tech, I think generally they were better than most people expected. A lot of that had to do with the sentiment. When you have this sort of volatility that we had in almost every risk asset, you know, in April, you kind of get a little bit, I don't know what you call it, but like you're offsides a little bit. And then when you start hearing things where expectations are not that high, you end up feeling a lot better. I think we're on a little bit of a high where we just didn't have enough guide down to make people feel like that we're going into a very rocky period until we get to some of these deadlines, whether it's the 90 days after China and the like. So again, I think that sets up for disappointment now. It's like back then we were discounting some worst case scenarios. Now we're just discounting the fate. And Tim says this all the time. The pain trade feels higher, but sometimes when that's the feeling, you don't often get it, get it that way.

[Melissa Lee]

Or maybe Nvidia was the example of the company that despite all odds, despite being really handcuffed when it came to doing business in China, it still performed. It found the revenue someplace else and it beat the street. And maybe that is the tale that a lot of other investors are hoping they can impute on other companies. As we go through this trade.

[Dan Nathan]

We talked about it last night. I mean the quarter was to me it was especially in the form of the margins. We talked about that. It was very good for them, but it's not unlike what we saw back in January. We had a great quarter. The stock made an all time high back then. Technically it broke down the next day and then it really never looked back over the ensuing months. So today's price action wasn't nearly as bad as what we saw a few months ago. But I don't think it was particularly great either. I mean we open around the highs, we closed around the lows. It's something to watch over the next couple of trading sessions.

[Tim Seymour]

Yeah. So as you talked about, you guys did a great job last night as you do talking about the video numbers. I mean demand, there's no question, there's no let up. So back to your market comment, Mel. I mean I look at semiconductors leading the S and P today as they should have after that Nvidia not by a lot, but but market leadership right now, if you need the market to go higher is okay and it's okay. And it's the triple cues, it's the Nasdaq which is leading the S and P. And again, these aren't runaway number and there are plenty of folks out there And Carter says this all the time and he's right that the NASDAQ hasn't made a relative high against the S and P since all the way back to last July. Having said that, it's really gotten off the mat and it's right up against some resistance levels that could see it. I mean that chart from from February to now on a relative basis to the S and P looks pretty good.

[Melissa Lee]

All right, well, for more on the mood in China surrounding tariffs and trade, let's turn to CNBC senior correspondent Eunice Yun who is in Beijing. Eunice, great to have you with us at this early hour in Beijing time. What is the move there? Because it does seem to be a lot of highs and lows when it comes to the relationship between President Trump and President Xi.

[Eunice Yun]

Yeah, I think that there's a lot of concern here that the trade truce might not hold because each side has been taking steps that really seem to be threatening the possibility of having a greater trade negotiation and for these issues to be resolved. For example, on the US Side, the Trump administration at least there are several reports now is moving on restricting chip design software sales to China and pausing exports for Chinese planemaker comac. And then on top of that it announced plans to what they described as aggressively revoking visas for Chinese students. And that move prompted a very angry response here, as you can imagine, by the Chinese. On the Chinese side, though, they aren't cooperating either. They have yet to remove the export controls for rare earths, which was something that was dictated in the Geneva statement today. They called them international common practice. They are also threatening legal action against those who enforce the US's new chip curbs. They called those bullying. And then also they lodged a protest about the US plans to pull student visas. That was seen as a step that is right in the negotiating playbook of Beijing to kind of throw in a lot of different unrelated issues to the matter at hand. So in this case, trade, in order to gain leverage themselves in those larger negotiations. And then on top of that, of course, is something that you guys were talking about, and that is the US Court rulings and what that means for President Trump's authority to be able to have that leverage of the tariffs. So all points to a whole lot more uncertainty, guys.

[Melissa Lee]

Eunice, a few weeks back, I believe you're talking about the reaction, social media of the Chinese people to President Trump in the United States. And I'm wondering if that is, is as strong as ever and if Chinese consumers are themselves deciding not to patronize US brands.

[Eunice Yun]

There is some of that. And definitely on social media, you do see the Beijing narrative, of course, this is a censored media environment. So you do see this Beijing narrative that China has to stand up, really playing with the public. There have been several nicknames of President Trump as a comrade nation builder, of course, the nation being China. There have also been several memes online of Americans kind of hunching over iPhone assembly lines. So there's, there's a lot of that discussion going on. But I think that at the end of the day, one of the big problems is that the economy is quite weak. People are worried about these trade issues and the tariffs. They're concerned generally because they see the property here, the financial issues that people are having, the bad job market, all of that is something that's kind of playing into the sentiment here and the concerns about what all of this means.

[Melissa Lee]

For the economy, does that make you think the government, they're more willing to take extreme action in terms of retaliation against US companies? I mean, so far, the responses that you outlined are very polite responses that are acceptable sort of in the realms of just normal diplomacy. But there are ways. You know, they can detain executives, they can inspect factories at will, they can shut down factories for inspections, all sorts of these softer ways that they can sort of exert their influence and control.

[Eunice Yun]

Yeah, absolutely. I mean, we've already seen some of that, at least on a minor level where they were going after individual companies. It hasn't happened yet in a broader sense, but it's something that's there. And I think that, you know, there's also been a lot of discussion here as to whether or not the Chinese would take the first step and maybe retaliate with other tariffs. But actually that's not as harmful. Even though it is harmful to the economy. It's not really as harmful like more broadly. So you could see that the Chinese, if they were to choose to retaliate, would do something that would be less harmful for their economy and that could include going after individual companies, American companies in a bigger way.

[Melissa Lee]

All right, Eunice, great to see you. Thank you so much. Eunice Yoon joining us live from Beijing. Tremendous. Eunice is one of a kind. I'm she's winning award in terms of the China trade in the dynamics now. I mean, things are a little different.

[Dan Nathan]

No, I mean I read something and again this is just anecdotal, but will President Trump decide to delist Chinese? I don't even know if they have the power to do that, but that's being thrown out there. So what does it mean to the stocks that we talk about all the time, the Alibaba's? I don't think it's going to happen, but it's out there. What does it mean to names like Apple who have clearly had a bullseye on their back now for years seemingly impervious to it, but now it's seemingly having some impact. So I do think this is something we should talk about more.

[Karen Feiderman]

Yeah. In light of what we saw yesterday and again the pushback towards this kind of retrenchment from the threats. I mean, you know, the question is leverage. Right. And at the end of the day I don't think we have a ton of leverage. You know, I think the Chinese and this is to your question to Eunice, like might they sit back. They're already trying to stimulate the consumer. Right. And stimulate consumption over there. They've been trying to stimulate their economy for a while. We know that it's weak, but the idea that they're going to actually make some big broad stroke sort of deal in the next, what do we have 60 days or something like that is not particularly, particularly likely. And so, you know, at the end of the day for them to kind of Kind of wait it out and see what happens, you know, the courts and all this other stuff. And, you know, if they do start targeting our individual companies, I think, you know, what they've done with Nvidia, or at least what Trump has done with Nvidia and what he's done with Apple and possibly Tesla now that Elon's leaving the government, who knows? I mean, those are pressure points. You know, they're pressure points within their economy because they also employ a lot of people. But they're pressure points over here for some of the biggest companies in our country. And I just don't think we have as much leverage, at least as the administration is projecting.

[Tim Seymour]

If you ask those four companies off the record, how they feel about policy on China, I mean, they're not, they're not going to be thrilled. Even though pushing back on China is, is a bipartisan issue in this country. And yes, it is time to make that market more fair. By the way, delisting Alibaba is only going to hurt U.S. investors. Okay, let's just be clear. This is one of the most liquid stocks in Hong Kong. The stock is going to trade just fine. It's going to freeze up people that own it in ETFs and people that own it in their retail trading accounts. So I also just think that, you know, being. Because the other side of this is getting indignant that China is stimulating their by supporting manufacturing. I mean, there's been a lot of rhetoric that over the last week that that's something that isn't, isn't, isn't good being a good trade partner, when in fact, this is what China does, that's.

[Melissa Lee]

What the US Does. I mean, we support manufacturing.

[Tim Seymour]

That is, it's a manufacturing economy. What else are they going to do?

[Melissa Lee]

We're trying to protect U.S. steel to protect manufacturing jobs.

[Guy Adami]

Right. We're trying to create tax incentives that allow for incentives and depreciating them more quickly and. Yeah, but they do. I mean, China does have this government situation where they don't really need to care exactly what the people think.

[Karen Feiderman]

Well, and they're focused on consumption. Right. So they have a 40% savings rate over there. We have a 4% savings rate here. Right. So we are consumers. Right. And so when Secretary Besant says, or Treasury Secretary Besant says, you know, the American dream is not flat screen TVs. Well, it is. I mean, like that's what we want and that's what we buy. And they just don't do that now. They pile it into a bunch of crappy real estate that's going to zero. But that's also part of this whole thing too. But the idea that we can force this them to increase consumption and take.

[Tim Seymour]

More of our export trying to force.

[Guy Adami]

Their own consumption though.

[Karen Feiderman]

Well, I mean. No, I know. I mean but my point is it's like it's not likely to change. Not likely to change in 90 days and not likely to change in.

[Tim Seymour]

We're talking about decades of bad demographics too. I mean it's not easily reversed. And that's policy issue.

[Melissa Lee]

Coming up, a lot of earnings action to bring you Dell, Marvell, Costco and more reporting results tonight. The details from those quarters ahead. Plus Boeing's big day, the CEO weighing in on mass production in China deliveries, the comments he made that investors flying high don't go anywhere. Fast Money's back into it.

[Karen Feiderman]

This is Fast MONEY with Melissa Lee right here on CNBC.

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Welcome back to Fast Money and Earnings Alert on Dell. Shares off their after hours highs after mixed quarter. The company did though give a better than expected revenue outlook. CNBC's Christina Parts Nevillis is here with the details.

[Christina Parts Nevelis]

Christina still Going on. The guide really puts them in sharp contrast to competitors like HP Inc. Which recently cut its guidance, recently being yesterday. The real story here though is Dell's AI servers. Dell is projecting a massive $7 billion in AI server shipments this quarter ahead of their own expectation and they say clears nearly half of their $14 billion year to date backlog. They're right in the wave of demand from major players like Elon Musk, Musk's X AI and Core Weave who need these high powered servers for their data centers. But here's where it gets a little bit interesting. Despite the bullish quarter outlook for Q2, Dell is keeping their full year revenue guidance unchanged. That seems conservative given in the momentum, but management says the PC refresh cycle is still lagging behind historical patterns and the consumer market remains tough. They're only expecting low to mid single digit growth in their client business. The AI server business also is unpredictable by nature. These are complex scheduled deliveries that depend on customer building out data centers with specialized cooling infrastructure. It's just, it's difficult to build. Lastly, they did say guidance includes everything they know about tariffs. So I just found that discrepancy a little interesting. I reached out to Dell, asked them about that and that was literally the question they got twice, at least twice on the call.

[Melissa Lee]

So just to be clear, the quarter that they just reported, they came in a little bit ahead on revenue. Correct. And so they're keeping revenue guys. So basically for the rest of the year it's going to be lower than expected.

[Christina Parts Nevelis]

So the Q2 guide, much higher. So for total they're shipping over $9 billion and they're expecting 15 billion for the year, which really just leaves about 3 billion in the subsequent Q3, Q4. Right. So you're really seeing this uptick in shipments. On the call it was asked who are you shipping to? Is it coreweave, which is the assumption. And they said they wouldn't talk about customers at all and give details about that, but that would be the assumption. They also said too they did see a little bit of demand pull forward for, you know, the fear of the tariffs.

[Melissa Lee]

This is a relief for you, is it?

[Guy Adami]

Yes. Right, yeah. After hp, I mean, even though it's a slightly bigger part of their revenue, it is a much smaller margin business that HPQ like, you know, the client versus the infrastructure, which is much more important. Much bigger margins, but still a little miss on the margins. I think though that I'm not so put off by that guidance. I never understand, particularly in an environment like this, this why do you need to go out on a limb at all for guidance? So the demand is still there unless it was just pulled forward. But I believe that it will be. I think video is telling us it's there.

[Melissa Lee]

Right.

[Guy Adami]

And they need to improve the margins a little bit. And I think with these scale bigger the margins will get, will get bigger.

[Melissa Lee]

The gains in the after hours are getting smaller here guys.

[Dan Nathan]

You got to, you got to believe their full quarter guide because to Christina's point, I mean this quarter wasn't great. Karen just said margin margins, operating margin 7.1%. The street was closer to 8% which is not good. So you got to believe them when they say, you know, they raised EPS guidance for the full year and they slightly raised revenue guidance for the full year. So you got to believe they have some clarity that nobody else seems to have. Right.

[Karen Feiderman]

Well, they keep guiding down and then kind of coming in line with their guide. I mean that's what they did last quarter. You think about like their servers. Their servers, it's like 15% of their sales. Right. So if you think about the PCs, people have been waiting for this upgrade cycle for like AI PCs fees. It's not coming. I mean it's not coming anytime soon. That's not like a good way to play this generative AI trend. And so here's a company that keeps giving weak guidance. They come in line with it and it's not that impressive. So the stock is at a big run. I just don't think you chase it.

[Tim Seymour]

I thought they gave themselves a lot of room to pull back by saying based upon the tariff environment so far, I mean they added that onto the end. Also the, the CEO pointed out that some of the deflationary impact of some of the cost inputs is fascinating because that's not necessarily what I would have expected to hear here.

[Melissa Lee]

Christina. Thank you Christina. Parts nebulous stock is up half a percent right now. Coming up, Boeing gets a bounce. How the planemaker is cranking up 737 max production. And what one airline CEO is saying about quality, that is next. Plus Costco, Gap, Alta and American Eagle all on the move after reporting the details and the numbers from those quarters ahead. You're watching Fast Money live from the Nasdaq MarketSite in times Square. Back right after this.

[Karen Feiderman]

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[Melissa Lee]

One of your assistant's assistants switch you.

[Karen Feiderman]

To Mint Mobile today. I'm told it's super easy to [e-mail].

[Megan Casella]

Switch upfront payment of $45 for 3 month plan equivalent to $15 per month required intro rate first 3 months only then full price plan options available, taxes and fees extra fee full terms@mint mo.

[Melissa Lee]

Welcome back to FAST Money. Shares of Boeing seeing a bounce today. CEO Kelly Ortberg speaking at the Bernstein Strategic Decisions Conference saying he hopes to have 737 Max production hit 47 planes a month by the end of the year. That as the company works with regulators to get itself back on track from a series of safety issues. Ortberg also saying Boeing will resume deliveries to China next month. Southwest Air Southwest Airlines CEO Bob Jordan also giving the company a vote of confidence, highlighting that that the quality of the 737 Max is getting better even if deliveries have been slower than he hoped. Boeing actually hitting a 16 month high in today's session.

[Tim Seymour]

Tim being banned. Bland carved. Yeah. So it's B and carbon good and carb. So it's a legit B. It's a little as opposed to like fugazi. I think the dynamic in terms of moving the share price to me is around 737 and it's around free cash flow. One leads to the other also. But, but the fact that you're getting anecdotal comments from an important client in Southwest Air who also really wants to get as many of these things as they can. I mean they also pointed out almost in the same breath that we need more of these planes. We're not getting them fast enough. But by the way, the ones we're getting are in pretty good shape, which is what we need to hear. I think you're long this name and I think you're long this name for the next few years.

[Guy Adami]

Scott Kirby also this morning on Squawk Box talking about him thinking think feeling like Boeing's really sort of gotten their act together. And Tim talks about all the times the cash flow story and when you start to get your deliveries much higher, that cash flow spigot can come on, which has not been on. And I agree it's, it's early on in the Boeing turnaround.

[Dan Nathan]

What is that thing you say when it goes from really bleep to just.

[Tim Seymour]

Bleep when you make the most money?

[Dan Nathan]

And that's, and I think that's where we still are. I think 235. I mean, we've been saying this stock could trade into the 230s. And fundamentally nothing can change other than the stock price.

[Melissa Lee]

Price.

[Tim Seymour]

What's ever stopped you from going the full potty mouth? I mean, I don't do that family show, but I feel like, I feel like, yeah, of course they're not.

[Melissa Lee]

Yeah, well, yours are not. They're old enough to know yours might be. They might be.

[Tim Seymour]

Probably. Are they?

[Melissa Lee]

Probably. Adami said.

[Karen Feiderman]

But I'm not.

[Guy Adami]

The margins, the margins are much higher, Mommy.

[Tim Seymour]

Yeah.

[Melissa Lee]

All right. Coming up, more retail earnings on the radar. Costco, Gap, Ulta and American Eagle all just reporting the details from those quarters and what one outlet mall CEO sees in store for the consumer when Fast Money returns.

[Megan Casella]

Missed a moment of fast.

[Karen Feiderman]

Catch us anytime on the Go Follow the Fast Money podcast. We're back right after this.

[Melissa Lee]

Welcome back to Fast money. Stocks closing higher today and pacing for weekly gains. The Dow up more than 100 points. The S&P and Nasdaq both up 4/10 of a percent. Shares of Best Buy getting hit after results this morning down more than 7%. The company cutting its profit outlook due to tariffs and saying it's already hiked some prices. And some other retailers on the move after hours. Ulta Beauty higher after beating top and bottom line estimates and raising earnings. And same store sales guidance. American Eagle lower after missing revenue expectations. And Gap dropping despite a strong earnings beat. The company's reaffirming full year guidance which does not include the impact of tariffs. More on that when Jim Cramer speaks exclusively with Gap CEO Richard Dixon on Mad Money Tonight. Well, Costco is also out with results. Shares just turning lower. The company beat on the top of the bottom lines. The conference call just about 30 minutes in. Melissa Rupko has been listening in. Melissa, what's the latest?

[Megan Casella]

Hey, Melissa. So I heard a little bit more about the quarter and the company beat quarterly earnings just as a reminder. And it also posted revenue that was roughly in line with the quarter. Comparable sales rose about 8%. E commerce sales jumped about 16% excluding gas and foreign exchange. And on the call, the warehouse club talked about some of the advantages it has, it's outperformed the S&P 500 with share gains of 10% so far this year. It has a potential edge in tariffs because it's known for attracting value driven shoppers. On the company's earnings call, CEO Ron Vacris said Costco's looked for ways to reduce tariff costs, that it rushed in a bunch of shipments ahead of tariffs. It also has been trying to source more of its private label products, Kirkland Signature from regions where they are sold. And he said that it's turning it's diverting more of its products to places that are not as affected by higher tariffs. So for example, instead of bringing them into the U.S. u.S. It can bring them to other markets. Even with the tariffs, Vaccras says Costco has lowered the price of some items and those include eggs, butter and olive oil. Melissa?

[Melissa Lee]

All right, Melissa. Thank you Melissa. Repco, it's been seen for a long time as one that can avoid tariffs that can manage its portfolio of products. Also interesting from the call they're talking about Kirkland Signature products outpacing the overall sales growth so very strong in terms of their private label brand here.

[Tim Seymour]

Tim, I think you know and the the operating margin expansion was actually better than expected and I think that's something to be happy about. But, but look, I don't know Costco's multiple is just so tough for me. I haven't owned it so maybe this is is scornful on my part because I haven't been in this trade but I'd rather be in Walmart.

[Dan Nathan]

Hard to wrap your head around about. I mean right here it's probably 50 times next year's numbers ish either side of But Tim's right to bring up operating margins which are better than expected. They operate really well. They're getting basically rewarded for that operation in terms of the valuation. But if you don't crush when you're trading at 50 times you're going to sell off a little bit. But I don't think you run that far away from Costco.

[Melissa Lee]

I mean the argument for Walmart is the argument for Costco. It's sort of the same demo, higher income demographic, they've got the membership revenue. These are people who come back time and time again.

[Guy Adami]

Yes, although Walmart is now on sale relative to Costco.

[Tim Seymour]

Yeah.

[Guy Adami]

And has been for a while but that multiple is demanding as Guy would say Walmart as well. But I'm long Wal Mart and also sad that I haven't owned Costco for years and it's always been, oh, it's too expensive. And that was the wrong move for years.

[Karen Feiderman]

Obviously, great American retailer Wal Mart is too. And I think Walmart probably learned a lesson a little bit about like kind of telegraphing what they're going to do with prices based on the, you know, the uncertainty around tariffs. And, you know, Costco probably took a beat on that. And, you know, some of the things that they're saying are a lot more constructive than they were three months ago when they reported, I don't know if you guys remember, stock Gap down, you know, a few percent and closed down 6%. That's a massive move for a stock like this. So again, you know, I think they're probably being a bit more careful and you might see increased conservatism about what folks are going to say about how they're managing tariffs in front of, you know, this administration that seems a little bit vindictive.

[Melissa Lee]

Well, for more on the state of the consumer, Stephen Yala, CEO of Outlet mall operator Tanger, joins us here in house at the NASDAQ Marketsite. Stephen, great to have you with us. Welcome to FAST money. Thank you. Costco on this call was just saying that the consumer is more choiceful. Are you finding that the consumers who go to a Tanger outlet, they are more choiceful as well?

[Stephen Yalof]

For sure. And we were talking about the value consumer as well. And that's really what you get when you come and shop at one of our shopping centers. It's brands you love, great pricing every day. I think that's what the consumer is looking for.

[Melissa Lee]

What have you noticed in terms of any sort of traffic changes between April to maybe.

[Stephen Yalof]

Well, interestingly, when tariffs were first announced in the beginning of April, our traffic began to build and continues to build. So our traffic in April and May outpaced last year's traffic by close to 5%.

[Melissa Lee]

How do you view the market in terms of expansion and where you expand and how you expand in this environment?

[Stephen Yalof]

Well, you know, right now it's really more of an acquisition market than it is a new development market market. And we built a shopping center in Nashville and we're purchasing assets currently at almost 50% of the cost of the replacement cost. So those trade we're making those trades right now.

[Guy Adami]

So one thing I always wonder about is consumer sentiment versus what the consumer actually does. So we get these numbers today, consumer sentiment well below and you're talking about April is really good. How often do you get a divergence between consumer sentiment and what the consumer is actually spending?

[Stephen Yalof]

Well, you Know, it's interesting, in March we saw our traffic picked up, but the sales were down. And then in April, our sales and traffic began to track one another. So, you know, expectation wise, you know, I think one of the things that we're doing, particularly as a reaction to tariffs, is with all the uncertainty in the market, we're encouraging a number of our retailers, particularly those in fact, with back to school product, to start thinking about pulling back to school up a little bit sooner. We're going to start our back to school sale.

[Tim Seymour]

Hold on a second. We haven't even gotten out, so you.

[Stephen Yalof]

You got to be very thoughtful regard to the geographies because they are out in certain parts of the country.

[Guy Adami]

Right.

[Stephen Yalof]

But not in others. And we're mindful of that. But the point is that if there is a consumer that wants to make purchases that's concerned that price pricing may be higher in the back half of the year, that product may be more scarce in the back half of the year. If they want to get the things they want, right now is a good time. And with part partners, whether it's Nike, Adidas, some of the partners in our shopping centers, we're working with them to start that promotion a lot sooner.

[Tim Seymour]

Stephen, I go to your Riverhead outlet all the time. It's everything I need. And you can run the gamut in there, though, even though it is value with great brands, there are within that skew. I mean, there are certain parts of discretionary spend that aren't doing so well. And we talk about the athleisure and the footwear space. What can you see with your clients? You don't need to name any names, but. But if you looked at the stocks, you know, Deckers just had a really tough print, even though there's a line outside of that store whenever I drive by it. So, you know, help us understand what's in your lot and who's doing well as far as you can tell.

[Stephen Yalof]

Yeah, well, first of all, we're diversifying the mix in those centers. So, you know, I mean, we just added Shake Shack. So Shake Shack's coming soon.

[Tim Seymour]

Right on. That's good.

[Stephen Yalof]

And the reason why that's an important part of the story is because we understand that consumer is really shopping a little bit more locally now. So that local consumer wants more diversity of product when they come and shop in our centers. And, you know, you hit the nail on the head from footwear to apparel to hard goods. Hard goods stores seem to be continue to be doing well, particularly out in Riverhead. We got A great collection of them as far as footwear is concerned. You know, even though Nike might have reported a couple of bad quarters, we still see lines and people lining up to get Nike because it's brand at great pricing. And that's just a really important part of the story. We keep on, you know, hammering on that messaging. But it's critically important. People aren't looking for commodities at the best price when they shop with us, looking for the things they want at the best possible price. And we deliver that every day, every day on sale. We deliver that every day. So I think that's really important. Variety of offering plus great value encourages the customers to come, they stay longer when they're there and they buy more things, build bigger baskets.

[Dan Nathan]

And you talked about that on the first quarter earnings on May 1, I think thought I looked at the quarter, I thought it was really good. And then 10 days later you said, you know what, it's so good we're going to authorize a $200 million stock repurchase plan. So I think that's you saying we just think our stock is too cheap here. Do you want to speak about that?

[Stephen Yalof]

Well, we do. I mean, you know, our stock in the last several months got up as high as 36.50. We were able to sell some stock at ATM at that pricing, some forward stock stock. We've got about $70 million worth of forward equity that we can draw from. Like I said, we're in acquisition mode right now and we're looking to buy assets. That being said, at $30, I guess we crossed over 30 today. But at $30, yeah, I think the stock is extraordinarily cheap and I think it's a great deal. So if there's investors out there that are looking to buy a great stock, I think that's what we're selling.

[Melissa Lee]

Steven, thank you for coming back. I appreciate it.

[Stephen Yalof]

My pleasure.

[Melissa Lee]

Come back, Stephen. Yellow.

[Stephen Yalof]

Great.

[Melissa Lee]

Yesterday your final trade was XRT Sell.

[Karen Feiderman]

Listen, I know we talked about Abercrombie yesterday and it might have been like a one off situation. Stock gapped up by 25%, closed on the low of the day. It filled in the entire gap today. And so it just tells me a little bit about where investors are in some of these names. They're just not acting particularly well, even on better than expected results. And so it's just not a place I want to be. Given all the, the uncertainty, given what we've talked about for the last 44 minutes, it doesn't lead me to want to go Buy retailers.

[Guy Adami]

So it didn't feel. It definitely did do well today. I think it was on the sentiment news like a bunch of other retailers filled in half the gap or so. I actually bought some more today because to me this valuation. Abercrombie, Abercrombie is, it's just too cheap for what's happening in their business. Great balance sheet.

[Dan Nathan]

And Hollister, I think Tanger is getting caught up in sort of people's concern about to dance. But it's different. This is like an operational play in just they're just operating better. And if you go back and actually look at the quarter, I think you'll come to the same conclusion.

[Tim Seymour]

I agree with Dan and I also agree though there's a lot of these brands in discretionary. I mean Nike to me is a buy here. You, you've, you've ridden through so many dynamics that are company specific. But I also just think the cyclicality of that business is such that, you know, this is the one I want that has sold off on, on those others. You can sell them.

[Melissa Lee]

Coming up, Musk clocking back in what the CEO stepping away from Doge could mean for Tesla stock and how EV complex competition is faring amid all the changes. The details when Fast Money returns. Welcome back to Fast Money. Elon Musk announcing last night that his time at Doge is coming to an end, raising hopes of test of Tesla investors that he will once again focus his attention on the EV maker. Musk's post coming amid reports the company is targeting June 12 to launch its long awaited robot taxi in Austin. Tesla shares were up slightly today but are down more than 11% this year. It's interesting, I mean if he is going to go back to sleeping on the factory floors and being 100% laser focused on his companies and stepping away from politics because he has done enough to use his own words, that's probably a good thing.

[Dan Nathan]

Agreed. But is this recent run up anticipation.

[Melissa Lee]

Of him and now it's sort of.

[Dan Nathan]

And now that news is out. I will tell you we talked about this. This level is this textbook 50% retracement of the all time high we saw post election and that to 20 low that we talked about being support. So I think you sell the stock.

[Melissa Lee]

Here you're watching over today.

[Guy Adami]

I was, I just thought okay, why is Uber down so much? Maybe it was somewhat of this, this consumer sentiment. But was it this Tesla announcement which has been out there for a long time now. We often could say all right, he said which lift as well but okay, now it's, you know, two weeks away or less than two weeks away. I kind of think it is going to happen on a small scale.

[Melissa Lee]

Right.

[Guy Adami]

So I don't know why, but that to me is a dumb reason to sell Uber today.

[Tim Seymour]

Also, which factory floor is he sleeping on? I mean, there's like 16 companies that he's running, so. Not 16. That's hyperbole. But no, I think ultimately though, that's not. The challenges around Tesla's share price I don't believe are from the CEO's office. I mean, I think there are some industry specific. I think they're where we are with competition. I think, I think they are where we are with what's going on in the auto space.

[Karen Feiderman]

You know, it's interesting, $1.1 trillion market cap and if you think that this is a lot of it tied to optimists and then self driving, well, you go over and look at Google, right? And they have Waymo. And so you tell me what is being you know, considered for the valuation within there? They got like 60 billion. Yeah, it's nothing. I mean, like my point is, and they're so far ahead of them and I say to myself, I just don't get. Listen, we get it. It's just divorced from fundamentals all the time.

[Tim Seymour]

Time.

[Karen Feiderman]

The fundamentals of the auto business could not be worse. They've been in a price war for three years and they're actually worse than they ever have been. And when you see BYD cutting prices up to, I don't know, 34% on 22 models of cars. These guys have four models of cars. They have two models that do 90% of their sales. And I just don't see them coming out of this when you have 10% auto gross margins. And you know, the other thing is him sleeping on the factory floors is probably not helping because the brand degradation that he has caused for this brand is a bit of the problem. And I don't think more of him is better for sales.

[Melissa Lee]

All right, coming up, decaf call on Wall street, why analysts aren't feeling the jolt from Starbucks lately and why they see risks to Brian Nichols turnaround plans. That is next. More fast and too. Welcome back to Fast Money. Shares of Starbucks getting roasted after a downgrade at TD Cowan. The firm lowering its rating on the coffee chain to a hold from a buy saying labor investments will eat into profit. Analysts further warning that normalization of same store sales could be delayed by increased competition, weaker value perception and a potential recession. After rallying to start the year Starbucks stock is now down nearly 8% in 2025. There are a lot a issues here with Starbucks.

[Dan Nathan]

Didn't just do that.

[Melissa Lee]

No, no it was all the analysts. The analysts in this report because that.

[Dan Nathan]

Sounds like something our CR crack Stafford. Right.

[Melissa Lee]

But that actually totally cheesy.

[Dan Nathan]

There are latte issues that we have been pointing out for. I was shocked that the stock did as well as it did. From the time he was announced in August into December stock went up 50%. Now it actually sort of makes sense but 72 has been support a couple times. Bad tape gets you to 72 in Starbucks.

[Tim Seymour]

I think Andrew Charles at Cowan is is going with a latte moving pieces. So yeah it does seem to be probably but this is a much harder turnaround than I think anyone could have expected possibly. Brian Niccol My plea is can we continue? Can we brew coffee again? These machines that make like basically one at a time is not brewed coffee. The reason I went to Starbucks 30 years ago or 40 years ago whenever it was for the first time was because they had like that strong kind of smoky coffee and whatever.

[Melissa Lee]

Wait, so the machines are like the machines here at the nasdaq. It grinds the beans and makes the coffee.

[Tim Seymour]

It does it all one cup at a time but it's not brewing coffee and it doesn't taste like the old coffee. More, you know, more, you know and it costs.

[Melissa Lee]

Well that was part of it. They were saying proprietary survey data indicate that people think that it's not a good value proposition. It's too expensive for what it is.

[Tim Seymour]

If they brew the coffee. I, you know, I've continued to show I'll pay almost anything but you pay anyway.

[Melissa Lee]

So yeah, it's a great brand.

[Tim Seymour]

I guess what I'm saying is it's a great brand and I, I think it's, it's getting better.

[Melissa Lee]

Up next, final trades, final trade time.

[Tim Seymour]

Tim, you can find Nike in the Tanger out and mall and I think you could find Nike on the move higher.

[Melissa Lee]

Aaron.

[Guy Adami]

Yes. A and F My final trade yesterday little early obviously I like it again.

[Melissa Lee]

Bought some what more Dan?

[Karen Feiderman]

Yeah, I think Dell is a six.

[Dan Nathan]

Know what you couldn't find yesterday? Fans in the seats at sh.

[Tim Seymour]

What are you talking about? We're going 36,000 fans skt money starts right now. Our team.

[Melissa Lee]

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