Tech Earnings Drive the Rally 7/31/25

Summary

Halftime Report: Tech Earnings Drive the Rally (July 31, 2025) Hosted by CNBC's Frank Holland (in place of Scott Wapner)

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Introduction In this episode of CNBC's Halftime Report, host Frank Holland leads a comprehensive discussion on the recent surge in the stock market driven primarily by robust tech earnings. The panel includes esteemed guests Josh Brown, Jenny Herring, Bill Baruch, and Malcolm Etheridge, who delve into the implications of strong performances from tech giants like Microsoft and Meta, and explore the potential impacts on other major players such as Apple and Amazon.

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Market Overview The episode kicks off with a brief market update:

• S&P 500: Achieved a new all-time high, up approximately 0.5%.
• Nasdaq: Nearly 1% increase, also reaching a fresh peak.
• Dow Jones: Remained relatively flat with a slight upward movement.

Frank Holland sets the stage by highlighting the significant role tech earnings are playing in uplifting the broader market indices, positioning the discussion towards the decision-making strategies investors might consider amidst this rally.

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Microsoft Earnings and Strategy Timestamp: [01:59]

Josh Brown provides an in-depth analysis of Microsoft's exceptional performance:

• Cloud Revenue: Up by 23%, with Azure revenues growing 34% year-over-year.
• AI Integration: Copilot apps surpassing 100 million monthly active users, and over 800 million users leveraging AI across Microsoft products.
• Capital Expenditure (CapEx): Microsoft is guiding to allocate nearly 40% of its revenue towards CapEx next year, marking a significant increase from previous years.

Notable Quote:
Josh Brown remarks, "The demand just seems endless. These companies are living in their own world." [01:59]

Malcolm Etheridge concurs, emphasizing the stock’s potential for growth due to sustained high CapEx and strong execution: “As long as Microsoft continues to outperform, there's no reason to expect that the trade is going to go the other way.” [04:51]

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Meta's Stellar Performance and Concerns Timestamp: [06:05]

Jenny Herring discusses Meta’s impressive gains, noting that both Microsoft and Meta are up about 50% from their April lows. She addresses Meta’s CapEx guidance, which only raised the bottom end to $2 billion, signaling controlled spending amidst aggressive growth.

Notable Quote:
Jenny states, "We're constantly saying should we trim? Is CapEx getting too aggressive? So far, so good." [06:23]

However, Jenny expresses concerns over Meta’s high valuation: “It's just getting rich. Trading at 27 times forward earnings.” [07:15]

Scott Wapner adds perspective on Microsoft’s valuation: “Microsoft is... embedded in the AI supply chain... it's a name they have to own.” [07:33]

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Nvidia’s Security Concerns and Market Reaction Timestamp: [09:34]

Christina Partsinevelos reports on Nvidia's recent meeting with Beijing officials regarding national security risks associated with their H20 GPUs. Nvidia reassures that there are no backdoors in their chips, aiming to alleviate Chinese concerns about potential remote shutdowns.

Notable Quote:
Nvidia clarifies, “Nvidia does not have backdoors in our chips that would give anyone a remote way to access or control them.” [10:22]

Josh Brown, as an Nvidia shareholder, remains optimistic: “Nvidia has a really good track record of getting around these kind of thorny issues.” [10:43]

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Apple’s Position Amidst Tech Giants' Boom Timestamp: [19:24]

The discussion shifts to Apple, highlighting its subdued CapEx strategy compared to its peers. Steve Kovach from Apple addresses the company's cautious approach towards AI investments and tariff impacts.

Notable Quote:
Steve Kovach indicates uncertainty surrounding future AI strategies and tariff-induced costs: “We’re looking at whether Apple will increase prices or absorb the costs.” [17:55]

Malcolm Etheridge analyzes Apple's financials, noting modest earnings growth and minimal CapEx: “Apple seems to be a no-growth business, yet we’re valuing the stock for its stability.” [19:49]

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Amazon’s Earnings and AI Potential Timestamp: [24:40]

Josh Brown presents a positive outlook on Amazon, emphasizing the performance of Amazon Web Services (AWS) and its pivotal role in AI services.

Notable Quote:
Josh states, “AWS has a backlog of $189 billion... positioned to deliver AI services to more customers than anyone else.” [25:00]

He also highlights Amazon’s attractive valuation: “36 times earnings, the lowest multiple since the company went public.” [25:00]

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Interview with JP Morgan’s Jamie Dimon Timestamp: [29:39]

Leslie Picker interviews Jamie Dimon, discussing:

• Fed's Interest Rates: Dimon anticipates rate cuts if inflation continues to decline.
• Tariff Policies: Acknowledges improvements in tariff strategies and their impacts on exports.
• Private Credit: Dimon expresses cautious optimism, recognizing both opportunities and potential risks in the private credit market.

Notable Quote:
Dimon remarks, “I'm cautious about when people provide credit. It isn't, you know, I'm just cautious about when people provide credit.” [30:35]

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Capital Markets and IPO Pipeline Timestamp: [33:51]

Jenny Herring reflects on the resurgence of tech IPOs, with a particular focus on Figma's hot debut:

• Figma’s IPO: Priced at $33, with opening trades expected between $100-$105, indicating more than a tripling of the offer price.
• Market Sentiment: Jenny likens the current IPO frenzy to the late 1990s, emphasizing the positive impact on market accessibility and investor opportunities.

Notable Quote:
Jenny states, “It's a wonderful market that really allows everyone to have access to great companies.” [34:59]

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Commodity Market Insights: Copper Timestamp: [44:20]

Scott Wapner and Jenny Herring analyze the recent downturn in copper prices:

• Copper Cathode: Down over 20%, attributed to exemptions impacting raw material costs.
• Investment Strategy: Scott mentions being out of copper in his commodity fund but anticipates potential upside in the second half of the year.
• Freeport-McMoRan: Jenny suggests investing in Freeport, which showed resilience amidst the downturn.

Notable Quote:
Scott Wapner notes, “This opens the door for quite a bit of upside in the second half of the year.” [44:20]

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Final Trades and Closing Remarks Timestamp: [45:38]

The panel wraps up with final investment moves:

• Dominion Energy: Discussed in relation to increased CapEx from data center expansion.
• Agnico Eagle Mines: Reported strong earnings, highlighting divergent performance from gold.
• Ethan Allen: Issued a special dividend following good earnings.

Notable Quote:
Jenny Herring highlights Ethan Allen’s performance: “Ethan Allen, good earnings yesterday. Good enough to issue a special dividend.” [46:06]

Frank Holland concludes the episode by emphasizing the ongoing opportunities and strategic moves in the current market environment, inviting listeners to stay tuned for more insights.

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Conclusion This episode of Halftime Report provides a detailed exploration of the tech-driven market rally, examining the performances and strategies of leading companies. The panel offers valuable insights into investment strategies amidst robust AI investments and CapEx expenditures, while also addressing potential vulnerabilities and broader market implications. From the stellar growth of Microsoft and Meta to the cautious stance of Apple and the burgeoning opportunities in private credit highlighted by Jamie Dimon, listeners gain a multifaceted understanding of the current financial landscape.

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Note: All quotes are attributed to their respective speakers with corresponding timestamps for reference.

Transcript

[Frank Holland]

Fidelity Trading Dashboard brings live data, news and charts into one screen so you can build and place trades. Better start for [e-mail] TradingDashboard Investing involves risk, including risk of loss. Fidelity Brokerage Services, LLC Member Nyse SIPC.

[Unknown]

On WhatsApp, your personal messages stay private between you and whoever you send them to. So things like the passport numbers for your honeymoon stay between you and your fiance and that video call for your gran's 80th stays in the family. Even your streaming password stays between you and your college roommates who still ask for it every week in your group chat. Because on WhatsApp, your personal messages are yours. No one else can see or hear them, not even us. WhatsApp message privately.

[Scott Wapner]

I'm Scott Wapner and.

[Unknown]

You'Re listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 1212 Eastern. Listen in.

[Frank Holland]

Thank you, Sarah and David. Welcome to the Halftime Report. I am Frank Holland in for the judge Scott Wapner. The record is front and center as tech earnings drive stocks to fresh all time highs. Microsoft and Meta delivering in a very big way as we now turn our attention to Apple and Amazon. So what's riding on these high profile reports and is it time to double down on the tech trade or make a different move? The investment committee's right here ready to debate that and much more. Joining me for the hour we got Josh Brown, Jenny Herring, Bill Baruch and Malcolm Etheridge, full desk here at Post 9. But first we check the markets. As we mentioned, the S and P and the Nasdaq hitting a new all time highs. The Dow pretty flat muted up just very fractionally. The S and P up about a half a percent. The NASDAQ up nearly 1%. And with that I turn to you, Josh Brown. What do we do from here? What do you make of this rally that we're seeing obviously today fueled by big tech earnings, very strong reports from Microsoft and Metta. Also just giving a lot more optimism when it comes to the broader AI trade.

[Unknown]

This is one of the strangest times I can ever remember in my 25, 28 years, whatever it is, of doing this. And every one of us every morning should wake up and say thank God for the Capex story because it is literally the only story in town. We learned this week that GDP growth in the first half of this year is only one and a half percent. Not terrible. But last year at this time it was two and a half percent. And then when you look at the components of what's happening in gdp, there are tariff impacts. Those impacts are not positive. FYI, if you aren't sure, but the amount is spent, spending on it is just so through the roof that it's overshadowing everything. And last night is such a great case in point. You look at the numbers from Metta, you look at the numbers from Microsoft and then you look at the commentary from management and it's like these companies are living in their own world. Given what's needed in this cycle, number one, they're executing, but number two, the demand just seems endless. I pulled out a couple of things that the desk can discuss that I thought were really notable on Microsoft. Cloud was up 23%. Unbelievable at this stage in the game to still be putting up numbers like that. Azure revenue growth was 34% higher than the same quarter last year. Copilot apps have now surpassed 100 million monthly active users. Microsoft says over 800 million monthly active users utilizing their AI across all of the various products. These numbers are obviously absurd. It's the fastest rate of growth for anything that they've launched. On the enterprise side, even LinkedIn had 9% revenue increase. And then the guide for CapEx, they're now guiding to over. They're now guiding to a number almost 40% of, of. Of revenue of revenue for next year just, just in pure capex. And to put that in perspective, it's like a double or a triple over a couple of years ago, depending on when you want to put the starting point. So when you're seeing something like that from the second largest market cap in the S&P 500, you're seeing the resulting move after the close and we could do better later. And then you look at everything else that's happening with all different mainstream related stocks, many of which are hitting 52 week lows. It's just incredible how stark the difference is between companies involved in AI capex and companies that aren't.

[Frank Holland]

All right, why don't we continue talking about Microsoft? Malcolm, I'm coming over to you. You're a Microsoft shareholder, obviously shares are a big Josh at some of the highlights. I want to go on that CapEx number. He was just talking about $30 billion for the current quarter. A 50% increase year over year. Also the 100 million users of Copilot. What does that make you think about this stock? Do you feel like it still has more room to run? Obviously there's a lot of price targets increases out there as well.

[Malcolm Etheridge]

Yeah, I think the stock still has more Room to run because it's unlikely, it probably goes without saying, but as long as we keep getting these record beating earnings numbers out of these mega cap tech companies, they continue to make these large announcements at earnings about future guide. Right. It's obvious the cloud cover for continuing to spend this way is delivering quarter after quarter. So for Microsoft, it doesn't really scare me necessarily for them to say we're going to double down on what we're going to spend. We were, if you think back to January, we were questioning whether it made sense for Microsoft to be talking about spending $80 billion on future investments in AI. And then they came out and effectively said if we extrapolated across the next four quarters, 30 billion a quarter, we're probably talking 120 now. And the street rewarded them instead of being fearful the way we were back in January and February when Deepsea hit the scene and everyone said, oh my God, they're wasting so much money. Why would they keep investing this way? And so I think as long as Microsoft and others continue to manage to outperform, there's no reason to expect that the trade is going to go the other way. But the moment that it looks like there's a chink in that armor, we have to imagine that trade unravels very quickly.

[Frank Holland]

All right, want to switch gears over to Metta as well. One of the other big gainers today, by the way. Microsoft and Meta both up about 50% from their April lows. Jenny, you own this company. I thought it was interesting they only raised the bottom end of their Capex. Capex guidance. It was $2 billion. So obviously a big jump on the bottom end, but only a raise from the bottom. And were you surprised by that? I want to get your take on the report.

[Jenny Herring]

No, we weren't really surprised. So we've owned this for nine years now and we paid 116. It's up 600% the number. It's one of these things that we're constantly saying should we trim? Right. Is Capex getting too aggressive? Are they spending too much? Is their fiscal discipline, fiscal lack of discipline starting to creep back in? And so far so good. So one of the reasons we haven't trimmed is we very much expected this quarter quarter we expected good numbers but where we sit today is that it's finally kind of expensive trading at 27 and a half times. For the past two years I've been saying why do we own matter of all the mag sevens? Because, you know, it's the only one we own. Why? Well, it was trading at 20 times and had 20% plus earnings growth. Now it's got high teens to low 20% earnings growth ahead, trading at 27 times the free cash flow yields down to 2%. And that's a function of all that Capex spending in addition to everything else that they're doing. So it's just getting rich.

[Frank Holland]

I think it's something that we think it's getting rich. You have it at 27 and a half. I think our system has it about 29. But I'm looking at Microsoft, you know, basically 36.

[Jenny Herring]

Bill, you're soft.

[Frank Holland]

No, I'm just going to build to Microsoft. Is Microsoft too expensive? It trades at about 36 times forward earnings. Jenny saying 27 and a half, 28 too expensive.

[Scott Wapner]

Well, Microsoft is. They've embedded themselves up and down the AI supply chain from data centers to implementation to software. I think right now it's really tough to sit there and say evaluation matters as a reason to be in or out of the stock. One of the things I'm looking at is where is Microsoft relative to the queues? And it is not even at a record high of its relative to the queues. So it still has room to go today. It kind of closed in on it when it opened up higher. Maybe some of the capex spend is the reason why it gave up some of its gains. But I think what we're seeing here being an arms race. They have to spend. They're embedded in the up and down the supply chain and I think it's a name they have to own. We own it. I mean, just a touch under the benchmark, but it's, it's been a staple in our portfolios.

[Frank Holland]

Really quick, Josh, I want to come back to Jenny for a second. So you're concerned about their spend. It sounds like you're saying they're spending a lot. Actually, some analysts came out with notes today, hsbc, one of them saying maybe they're not spending enough because maybe if they spend more, they can try to monetize WhatsApp, perhaps turn into customer engagement in some countries. If you've ever been overseas, when you try to do customer service, you do it through WhatsApp. So any thought that maybe they're not thinking big enough when it comes to AI at this point?

[Jenny Herring]

Here's the thing, nobody knows the answer to that. And anyone who pretends they do is just blowing smoke. Nobody knows who's whether we're spending enough or not enough. And only time will tell on that. We know that they're spending A lot. And so for us, where we have a very strict discipline, which in our growth strategy needs to be a 5% or better free cash flow yield, like it always brings us back to valuation. And I will always, you know, always say, even when things get crazy, like valuation matters, it acts as a safety net. So, so, Frank, maybe they're not spending enough. Maybe they're spending too much. Nobody knows.

[Frank Holland]

Really quick, I want to go to Figma right now. Just had its first trade not too long ago, I believe, trading between 95 and 100. Right now we're taking a look. Yes, right now between 95 and 100 offering was at 33. So obviously big upside from there. Again, awaiting Figma's first trade. It could be between 95 and 100 indicated right now. And with that, we also want to go to a news alert. We have our Christina parts and Evolis at the Nasdaq. Christina?

[Christina Partsinevelos]

Well, according to China's cyberspace administration, Nvidia met with Beijing officials just today regarding potential national security risks with the particular H20 graphic processing units GPUs that were being sent to China. Washington just not too long ago allowed Nvidia to resume the sale of these chips to China, reversing an effective ban. The reason why I'm bringing this up right now is because you have China looking at security risks around these chips. And now Nvidia has provided me with a new statement saying, quote, cybersecurity is critically important to us. Nvidia does not have backdoors in our chips that would give anyone a remote way to access or control them. That was the concern for China. If these chips end up over there, that possibly Nvidia could shut them down remotely. And so Nvidia is denying that, saying that there's no backdoors within them.

[Frank Holland]

Guys with that, looking at our shares of Nvidia right now, up just about 1% or Christina parts and novelists, thank you for that news alert. Josh, I'm going to come over to you. You're an Nvidia shareholder. Were you concerned about, I mean, only a couple of hours to be concerned about it. The news broke overnight. We concerned this might be an issue for Nvidia. Maybe some of the pop that we saw after they could sell some of those gains might be lost if they weren't allowed to sell in China anymore.

[Unknown]

It's always a concern. And of course, like in a perfect world, Nvidia finds a way to work with China that does not threaten the national security position of the United States or risk the ire of one side of the aisle or the other in Congress. It's very tricky to be this size as a business, to be this global and to be this important to literally the global communications and Internet infrastructure and not run up against various political issues from time to time. But I think as a long term shareholder here, the smart play has always been to just say whatever the right thing to do is. Jensen will ultimately figure it out. It's been the story for, I don't know, the 11 years I'm in the stock. I don't see why that will change. I have no edge on what's going to happen with the age 20. I just think that the company has a really good track record of getting around these kind of thorny issues. I just want to go back to my Meta for one second because I think there are two things here that are really interesting and the first one of those is the sheer scale of the user base. They're telling US now that 3.4 billion people with a B are regular users of Meta products every day. So whether it's WhatsApp or it's Instagram, these numbers are unheard of in the history of humanity. And so from that perspective, maybe the stock is too cheap. How many companies can you think of that command that size of the overall human population on the planet and have the ability to market to them in a highly specialized way that literally no other company that exists can do? It's a really special situation. I'm not sure why we would expect it to sell at a market multiple given that power. There are 8 billion people on Earth and 40% of them are being reached by this company every day, most of them multiple times per day. I don't know what should that be? Should that be a 20, a 20 multiple?

[Scott Wapner]

I would say that to impressions served up 11% year over year, average price per ad up 9% year over year. And you got a stock that is literally breaking out to all time highs and you now have a defined floor at 740 that previous all time high. I'm not saying you need to chase it today, but if it comes back in, there is a weld of find support. And as you talked about, the numbers are phenomenal here. There's a reason why you have basically a $2 trillion stock that is up more than 10% in a single day.

[Jenny Herring]

So can I just riff off of Josh? So Josh, when you were talking like in your opening comment, you said and the stocks, which is meta 2 are overshadowing everything. And then when you say overshadowing and then 3.2 billion users. One of the things that I'm starting to worry about is is it really overshadowing or is the AI and Metta play actually sucking the life out of everything else? And that's what I worry about is are all the investment dollars and all the investors going to the metas versus the kind of the rest of the economy is all really Good question. This is something.

[Scott Wapner]

The top talent going there too.

[Jenny Herring]

Everything's going there. And it's an interesting thing from like a more existential thought, which is how does it work when half the world, half the world is using meta's products and they're getting all the dollars?

[Unknown]

Meaning what aren't they using?

[Jenny Herring]

No, not really. Just. Just like how do you invest in that environment when all the dollars.

[Frank Holland]

You mean all the investor dollars or the ad dollars?

[Jenny Herring]

Everything. Okay, investor dollars.

[Unknown]

Well, the ad dollars though are coming from. Are coming from every other sector of the economy that needs to advertise somewhere.

[Jenny Herring]

But let me give you an example. So like here's a doozy in my portfolio, Whirlpool, right? And you and I was reading an exc expert report the other day and it's saying like, look, Whirlpool isn't investing in their technology as much as they should. Of course they're not. Investor dollars feed into the companies that then use that to invest in technology.

[Unknown]

All the dollars you don't want.

[Jenny Herring]

Bathtubs, I would say would be actually fine with what.

[Unknown]

But I think you raise a good, I think you raise a good point because you and I, by the way, happy birthday today.

[Jenny Herring]

Thank you. No, no, Tuesday.

[Unknown]

It's Tuesday.

[Jenny Herring]

Okay.

[Unknown]

For the viewers.

[Jenny Herring]

Thank you.

[Unknown]

Jenny's 30th birthday is to be going coming up.

[Jenny Herring]

That's right.

[Unknown]

You and I lived through the first version of this in 98, 99, where the investor class basically said, I really don't want to hear about anything that's not related to the Internet. It's not that there aren't opportunities. It's a, it's a game where you say to yourself, yeah, but other investors aren't going to come and buy this stock from me. Higher. Because they only want to buy one thing. It's not healthy. We get to that point. And I think the top five market cap stocks now all AI Spoiler alert. I think they're equal to the market cap of the bottom 430s and P500 names. That's absurd. And, and the problem is it was absurd when they were equal to the bottom Half of the S&P5.

[Jenny Herring]

What happens to the bottom half of the s and P500 if all the investor dollars, all the attention.

[Frank Holland]

Isn'T the question is this, it's just a bubble. Whether it's just speculation, investor bubble, confidence bubble. In fact, Wolf came out with a note titled all time highs, all time worries, basically saying the seas are potentially being sown for a bubble to form or at least for a run hot economy over the next 12 months. And Josh, if you don't mind, your earnings are there. But we were, we were talking about this before and Malcolm, want to get you to win. You were also talking about some of the other companies that we used to see as bellwethers are doing very poorly. A UPS and Nike. And we're not paying attention to that because we're so focused on this trade.

[Unknown]

Give me a chart of UPS is the worst chart in the Dow Jones. So this is a quote unquote bellwether of the quote unquote real economy. Guys, give me like 10 years, please. Five years. Something five to five.

[Frank Holland]

It's not doing good today either. So I mean, I think it proves.

[Unknown]

The point is this stock goes down every year. It's like, it's like one of the most obvious things to bet against. I wouldn't blame AI for this not working. But my point is nobody seems to care. Chipotle is a falling knife. Nike has been horrible. Starbucks, Starbucks horrible. And these are, these are companies where when they used to report, we would be like, ooh, the health of the consumer, forget it, nobody cares.

[Scott Wapner]

I think we've got a.

[Unknown]

They keep going lower and I keeps bailing out the rest of the stock market.

[Scott Wapner]

I think we've got a glimpse of what the market kind of wants to do right now. And a pullback would be very healthy. I think it gives, you know, a little bit of sort of refresh. And after the Fed yesterday, you saw the odds of rate cuts get, get pushed all the way out. You know, there was a 60% chance that they were to cut twice this year. Now it's 40. There was a 67% chance they were to cut 25 basis points in September and that's now something like 40. The dollar has been rallying. There's a big short position, the dollar that's unwinding right now. That brings pressure to asset classes. You saw the S and P literally closed near the lows, came off the lows probably because no one wanted to be short or people wanted to make sure they were positioned ahead of Microsoft. The meta earnings and then you had two companies, a 2 trillion, what a 4 trillion basically, you know, report with great reports and move the entire market up 1%. The entire S&P.

[Frank Holland]

To your point, the dollar is actually having its best on pace for its best months in September of 2022. So you are seeing a bit of a reversal in that trend, the year to date trend. And speaking of reports that could be market movers or inflection point points, Apple, one of the names reporting after the bell today. We got Steve Kobach out at Apple HQ ahead of that critical print. A lot of eyes on this, a lot of expectations for Apple to maybe clarify its AI strategy.

[Steve Kovach]

Steve yeah, we'll get to air in a second here, Frank, but first let's talk about tariffs because that is another big thing that's been weighing down on the stock all year long. Why it's been underperforming most of this max 7 peers. We know there's going to be a $900 million impact from tariffs in this June quarter, but everyone wants to know what that looks like for the next rest of the year. Rather, we heard the mitigation efforts from Apple last time that they're going to focus more on bringing iPhones from India to the United States which has that lower tariff rate still not enough to fulfill all the demand in the United States. We're still going to get iPhones from China at that higher tariff rate. So what do margins look like moving forward? We're going to look at the guidance for that on the call and whether or not, excuse me, that tells us there might be a price increase with those next iPhones that come at the end of this quarter that we're in right now or if Apple's just going to go ahead and eat those costs. So those are a couple of things to look out for. And then on the air front like you guys have been talking about all segment now, the enormous spending from the peers, Microsoft on pace to spend $120 billion in capital expenditure. For just one example. We have not seen Apple come anywhere close to that. We know they had those big delays for their artificial intelligence products. They say it's going to come next year. And we're going to hear a lot of questions, I assume on that earnings call for Tim Cook and the rest of his team, why they're not spending so much and what makes them confident that they have a good AI strategy and team in place to compete with these peers who are moving so quickly.

[Frank Holland]

Frank, our Steve Kovach at Apple Apple hq, you can have the numbers after the bell. Steve, great to see you as always. Following some of Steve's comments about Apple after the bell I'm going to go over to you Josh, you're an Apple shareholder. Is this a tense moment for Apple shareholders? I mean especially after these blowout reports from Metta, blowout reports from Microsoft, blowout reports from Alphabet. Is there potentially an inflection point for this stock? Take a serious downturn just on disappointment.

[Unknown]

I don't think this time, I mean anything could happen. I just thought my bet would not be a serious disappointment in the shareholder base is already disappointed and they've been disappointed for a long time now. The last quarter Apple reported with cash flow growth in the double digits on a year over year basis was all the way back in Q1, 2024. Here are the numbers over the last five quarters and this is why it's hard for them to disappoint. Negative 1.5% Positive 0.46% Positive 3.6% Positive 4.1% Positive 6.1% that's EBIT growth year over year. These are not great numbers for a mag 7. The thing is this is the only gigantic company that is almost adamant about not raising capex. Full capex spend this year is supposed to be $11 billion. For Apple it's literally pocket chains. You're talking about a company with hundreds of billions of dollars at their disposal to do whatever they want with. And what they seem to want to do is a buyback tiny dividend, just business as usual in the midst of all of their competitors going absolutely crazy. 20% of revenue, 30% of revenue. Microsoft almost 40% of revenue. And Apple's not doing it. And so if you want to be a Contrarian in the Max 7 if you want to pick the one company that doesn't believe they need to act like this, buy Apple. And from a disappointment standpoint no one's expecting anything. It's a no growth business. We all get it and yet we're valuing the stock here anyway because of the stability.

[Scott Wapner]

You said it. No one's expecting anything here. And that's the kind of thing I like. Now I'm not sitting here and adding Apple right now we're really well underweight Apple in our portfolios. We've had a weighted three and a half percent in our portfolio. I want to buy Apple. I'm thinking that listen they underwhelm but a lot of the negativity is priced in actually today it is making a new low against the, against the NASDAQ on a relative basis against the qs, the lowest it's been relative to the Q since the summer of 2020. I would like to see Apple 195, 190 range. I would probably get. I will double my position and get it up to. Get it up to.

[Frank Holland]

If it falls down, when it falls down in that. Malcolm, want to come to you. By the way, can we show a year to date chart of Apple right now you were talking about stocks that are potentially falling. Nice. If you look at the year to date chart of Apple, it's down double digits year to date. Malcolm, I'm going to come to you. Are we sure this isn't the next one falling? Knife Steve Kovac Hit on some of the tariff impacts, just some other issues with the company innovating when it comes to artificial intelligence. When you look at this chart, are you seeing signs of a turnaround coming in the near or the even medium term?

[Malcolm Etheridge]

Yeah, I think rather than listening to this earnings and finding out how many fewer iPhones they sold in the past quarter versus the previous one, what really is going to matter for Apple shareholders in the near term is that any day now a judge is going to deliver a rule on whether Google gets to keep paying them to be the dominant search engine on their platform. And that's what's really going to matter because just that one payment alone represents something like 10% of Apple's earnings. So that going away probably does get you into the 190s range, into the price target that a lot of folks like me have been looking to add additional shares of Apple to their portfolio. But to me, if I'm Apple and I really want to free ride on what the momentum is right now, I'm not necessarily chasing AI. I'm looking at what's been happening in stablecoins and fintech and looking at the fact that 2 billion people are walking around right now with my devices in their pocket and maybe figuring out a way to tap into some of the money they've spent on things like Apple Pay later and others to add in those additional fintech features, that would just be a thing to bridge that gap until people are really ready to upgrade for those AI features. Because if you were able to really tap into the Apple wallet a little bit more, that goes to the services revenue and that buys you time for people to stop questioning whether they should continue to hold their shares.

[Frank Holland]

I understand the thesis on a possible new line of business, but go back to the Alphabet part so they lose. I think it's $20 billion in annual revenue if the judge rules against them and the stock falls down to 195. And that makes the company more attractive, Bill, because you were doing a lot of nodding over there. What makes the company more attractive after they lose $20 billion in annual revenue.

[Scott Wapner]

Once the moose is baked in. I mean right now you're, they're already pricing pricing in not growing revenues to the extent that they have in the past. I mean a lot of the negativity is being priced in and I come from the school of if all the sellers have already sold, who's left to sell? So I think a lot of that's really been baked in and if they lose that revenue, the market's going to react. That could get us to 190 maybe a little bit lower real quick but I'm looking at 190, 195 on a technical basis. There's a nice little uptrend that it's hanging. If it trades lower here, it's got to get down in that range. Negative news on top of that could be it exacerbate the downside. But I'm stick with my guns and I would look to be a buyer of Apple.

[Frank Holland]

We also have Amazon reporting after the bell. Josh, you own this one obviously the number one cloud player after blowout cloud results for both Alphabet and from Microsoft. It seems like there's a lot on the line when it comes to us and being able to not only meet the expectations but exceed them.

[Unknown]

Yeah, we wrote this up as part of our best stocks in the market series at CNBC Pro this morning. I own the stock. It's on our list. This is still below its February high. So if you go back to February 4th, the company was two days away from reporting earnings at a record high 242 per share reported that number. The market didn't like the guidance. It was a good report, but the stock fell 4% and then we got into the whole tariff trade war stuff right into the teeth of liberation day and this stock was in a massive drawdown. What's happened to since April see 25% recovery in the share price almost back to those February highs, not quite through. What we wrote today is that if tonight's report shows they've been executing, which I think they have, you will see a new record high for the stock finally after it spent the last, I don't know, five, six months, sort of like in a, in a, in a purgatory. I think the big number here is going to come out of Amazon Web services businesses as it always does. The most exciting part of the story to me is the backlog of $189 billion, which I think is really the part of the Amazon story that should put it in the same conversation. We talk about Microsoft and Azure. It's a gigantic business. AI is going to be supremely important here. They are positioned to deliver AI service services to more customers than anyone else other than Microsoft. And I don't think that that's really in the stock's price right now. What's interesting, last thing, 36 times earnings, the lowest multiple you've ever been able to pay for Amazon's earnings since the company came public. Literally, it has never been so I understand it's not growing as fast as it did 10 years ago. We all get that. But you have never ever had the ability to buy it at this valuation.

[Frank Holland]

Guys, we got to leave the conversation there. Amazon shares up over 2% ahead of earnings. Coming up next, CNBC's exclusive sit down with JP Morgan's Jamie Dimon. Our Leslie Picker is standing by with the highlights from her interview coming up right after this break. Stay with us.

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[Frank Holland]

And welcome back to halftime. We're awaiting the first trades from Figma. Remember, the IPO was priced at 33 a share. Right now it's indicated it looked like it was going to trade between 100 and 105 a share. The numbers, they just keep climbing. It was moved up quite a few bucks as we just last checked, but right now looking like it was going to make the first trade at about 100 to 105, again priced at 33 a share. Let's now move over to our Leslie Picker, who joins our joins us fresh off our exclusive sit down with JP Morgan CEO Jamie Dimon. Leslie?

[Christina Partsinevelos]

Hey, Frank. Yeah, we covered a lot of ground with Jamie Dimon here in Charlotte. I asked him about President Trump's latest attacks on Fed Chair Powell.

[I]

I think Jay Powell is a professional. I think independence is important. I think actually independence keeps interest rates lower. If you actually look through the history of interest rates a little bit and just lowering short term rates doesn't necessarily have the effect you want on 10 year rates. And we should be a little cautious. The president gets a chance to pick a new Fed chair in like eight months from now. So I think they're kind of doing the right thing.

[Christina Partsinevelos]

Dimon added that given the macro environment, he thinks that the Fed will cut rates soon.

[I]

The economy's, you know, it's been chugging along. We've been in that soft landing now for four or five years. You know, inflation still hasn't hit 2%, two and a half or 2 7. Now we look at it. And I think, you know, if inflation comes down, the economy continues to, well, they'll probably reduce rates shortly.

[Christina Partsinevelos]

I also asked him about the news that he's had several meetings in recent months with President Trump after years of tensions between the two. Dimon said it's his job to make the country better and help, noting that both they and the administration, quote, reach out all the time and on the cusp of the tariff deadline, Dimon said they've been, quote, greatly moderated and that people can deal with 15%.

[I]

We started tariffs, we didn't know what they're going to be. And now we kind of know. And they're, they're more moderate and thoughtful and more carefully done and hopefully they'll help some companies export, you know, maybe some people move manufacturing back here. So, you know, so far so good.

[Christina Partsinevelos]

We also spoke about private credit, which he describes as having both pros and cons.

[I]

I'm not against private credit. I do think there are issues in it, you know, that will rear themselves one day. I would say the issues in credit in general reel themselves one day. It isn't, you know, I'm just cautious about when people provide credit.

[Christina Partsinevelos]

Diamond said the firm is doing private credit to give their customers choices.

[Frank Holland]

Frank, Leslie Picker live in Charlotte. Leslie, great interview. Thank you very much. I want to get the desk reaction. Josh, I'm going to start with you. What did you make of what he said specifically about private credit?

[Unknown]

Look, this is a business that the mainstream, systemically important banks were pulled away from as a result of regulation a generation ago. The question now is whether or not that still makes sense. And in the meanwhile, the banks are not waiting, not watching this whole parade go by and not trying to do anything about it. So they're going to originate some of these loans. They'll sit in the middle of some of this stuff. Maybe they'll be on the servicing side. And now their wealth management clients are being pushed into a lot of private credit firms that are being run elsewhere. And so they're raking in fees as a result of that. They're finding a way to get involved in this market because it's a really big market and there's a lot of potential here. Do I worry about it? Yeah, I worry about everything. So this is just like one more thing on the list where people are maybe putting on a lot of leverage or taking more risk than they otherwise would because of how safe this asset class has now been deemed the bill.

[Frank Holland]

Oh, sorry, go ahead.

[Malcolm Etheridge]

I'm just thinking the question is, does it belong in places like a 401k? Right. If we're talking about a, if we're talking about a market where potentially folks could get wiped out as that stuff makes its way from the super top tier, ultra high net worth investor who now needs liquidity. And so we're coming on down the food chain. It's making its way in the 401ks which is most people's largest liquid asset set. I have concerns there about the illiquidity where it started making its way to average.

[Scott Wapner]

It's very, it's very saturated. But I mean they're making money on it. They're making money on trading. I mean the volatility has been big, but, but even with low volatility, these companies are making more money on, on trading. I think that's big. And then the M and A mergers and acquisitions. I mean, Figma going public. These, these, these IPOs, this credit, this stuff is actually going to really be a tailwind I think in the second.

[Frank Holland]

Half of the year. I mean really today is really the stories about the capital markets. By the way, still looking at figma, we're going to show it right here. I believe now it's indicated to open at 105 to 110. So again, it keeps moving up. Just want to get your take, Jenny, just on the capital markets. The idea of the IPO pipeline opening back up again. This is one of the bigger tech IPOs in recent months.

[Jenny Herring]

I just wrote Josh a note that it smells like 1998, which by the way, I love that smell, you know, but it's been a long time, right, since you saw priced at 30, opening at 105. I think it's good for the market. I think, I think the more money and the more companies that come into the private public markets, the better. One of the things that Jamie Dimon wrote about in his annual shareholder letter was how there used to be. I'm going to get these numbers all wrong. There used to be what, like 9,000, you know, all these numbers. There used to be like 9,000 or 8,000 publicly traded companies. It's a fraction of that. This is a wonderful market that really allows everyone to have access to. So the more IPOs, the more access people have to great companies, companies. Can I riff one thing on the private credit? You know, it's a really nice way to get private credit. One of the companies that I own, the name is 6th Street Specialty lending and they reported earnings last night. Fantastic earnings. Supported the dividend, paid a special dividend too. But there are publicly traded companies that invest in private credit. You can just buy those. You don't need structured products or wrapped up, you know, fund of funds to get them. There is a whole bunch of publicly traded companies that transact in private credit. And it is a, it is a great space to be in.

[Frank Holland]

We have to move on. But to your point, Jamie Dimon said we years ago, we had 8,000 public companies down. We're down to 4,000 what it is. And he says, you know, some of the regulations have been onerous, stopping a lot of these private companies from entering the public markets, obviously not impacting Figma. Big showing here at the New York Stock Exchange. Again, the IPO priced at 33 a share indicated to open right now between 105 and 110. All right. With that, let's get to our headlines with Kate Rogers. Hey, Kate.

[Christina Partsinevelos]

Hi, Frank. Community members and New York City police officers streamed into the Bronx today to attend the funeral of one of their own. The services for Didarul Islam are in the same neighborhood where the Bangladeshi immigrant lived with his pregnant wife and two children. He was killed earlier this week in the mass shooting at a Park Avenue office building in Manhattan. President Trump is expected to sign an executive order today that would bring back presidential fitness tests to America's schools. The test was replaced in 2013 by the presidential Presidential Youth Fitness Program, which shifted the focus to a less competitive lifelong fitness model. The order also reestablishes the President's Council on Sports, Fitness and Nutrition, which will be chaired by golfer Bryson DeChambeau. And former Vice President Kamala Harris will release a book in September on her 107 day presidential run. It was the shortest campaign in modern history. The publisher declined to say if the book will discuss former President Joe Biden's fitness for office. Frank, back over to you.

[Frank Holland]

Kate. Thank you very much. R.K. rogers. All right. Coming up here on Halftime, Josh Brown is buying the pullback in one stock that's having its second worst day on record. Look at this chart. We're going to reveal our mystery chart coming up right after the break. More halftime after this.

[Unknown]

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[Frank Holland]

A key July jobs report is trade uncertainty impacting the economy and the labor market.

[Unknown]

What the data could mean for future rate cuts.

[Frank Holland]

Employment numbers and analysis squawk box tomorrow, 8:30 Eastern and streaming on CNBC.

[Unknown]

Plus.

[Frank Holland]

And welcome back to the halftime. We got some committee moves. Josh, you're buying some more Shake Shack.

[Unknown]

Yeah, they reported a great quarter. The problem is the stock's up 100% going into the print from the April low is literally 72 and ran to almost 150. So today it's giving back some. But when you actually look at the numbers, they were really fantastic. And Rob lynch is doing everything that this company brought him in to do. Earnings were $0.44 per share which beat the analyst consensus. Revenue was $356.5 million. That was above consensus. That's up 12.6% year over year. Same shack sales were up almost 2% year over year. System wide sales up almost 14%. And restaurant level profit, which I think is one of the key numbers for a company like this hit 82.2 million which represented almost 24% of of shack sales. They say shack, not store. But the key thing here is the expansion plans are well underway. Margins are improving both at the corporate level and at the store level. And everything that they laid out as their goals when Rob came into the company. They're either on schedule or ahead of schedule. And as a result of that, I'm going to remain a long term shareholder. Anytime a Stock comes down 19% for no reason for me I have to add. So that's what I did this morning. It's already looking like a smart decision.

[Frank Holland]

All right, Shake Shack shares pulling back about 13 and a half percent right now. Malcolm, going to come over to you. A stock that's actually down year to date. PayPal and you're selling right here.

[Malcolm Etheridge]

Yeah, they had a decent earnings stocks off what, 20% or something year to date at this point. I initially bought it just on the expectation that Alex Kriss after. Yeah, I think he was in the job for about a year already when I bought the stock and I figured he'd figure out a way to squeeze some juice out of the Venmo product. It's very rare that a company manages to jump from proper noun to a verb. And Venmo, Venmo is in that rarefied air. But they just haven't really figured out a way to do that. Everything's been focused on like click to pay and branded checkout and that just doesn't really excite me as a shareholder. There's a number of other fintechs that I could own, I do own. And so I just decided it's probably time to pull the plug here. Spend those dollars elsewhere.

[Unknown]

Just can't get people to pay for Venmo is the bottom. Like they try to do pay by Venmo where the vendor like the E commerce site they would pay them something. There's very little uptake on it and peer to peer, nobody's going to pay for that. Gazelle is free.

[Malcolm Etheridge]

Call it Venmo AI and then we'll start to.

[Frank Holland]

We got one more committee move to get to very quickly. Bill, you're trying to play some of these trade deals with Chenille.

[Scott Wapner]

Yes. Here. So you have a trade deal with the eu and we, we sold Schneer a couple months ago kind of with a lot of uncertainty surrounding what was happening around the April tariff announcement. We have a trade deal with the EU And Trump is really aligning these deals with investments in the US as well as energy. And if we're going to start to see energy being the EU committing to energy, there's no one really in a better place right now than it comes to somebody that's exporting lng. And these terminals take years to really implement. So I think what we're also seeing is sanctions on, on Russia. We're going to really see a need for LNG imports from the US into the eu. I think Cheniere is very well positioned for that.

[Frank Holland]

All right, Cheniere shares up just about one and a half percent right now. All right, coming up next, Mike Santol, he's going to join us as we await Figma's first trade. Take a look. A lot of action here on the floor. It's looking like it's going to open up at between 105 and 100. Remember, it was priced at 33. You can hear a lot of buzz behind us. Mike Santoli coming up right after this. Stay with us. And we are back on Halftime. We're waiting Figma's big open here at the New York Stock Exchange. Our Mike Santoli's at the trading post 5. We're awaiting those first trades. Mike?

[J]

Yeah, Frank. The the indicated opening price continues to scale higher. We're now at 105 to 110. That's more than a tripling of the offer price of $33 per share from last night. It was reported at 40 to 1 oversubscribe number. Obviously it's getting to be a bit of a bidding frenzy. About an hour and a half ago, the indication started at 65 to 70. So obviously people are kind of feeding on itself this idea. This is going to be a blockbuster ipo, the market cap at this point. Price, let's say we're open up around here, be over $60 billion. So this is for a company that's been at about a $1 billion revenue run rate for this year. Maybe it gets to a billion and a half next year. Growing very fast, 50%. It's collaborative design tools for, you know, for various websites and apps and things like that. So obviously this is one of the big ones. We've seen some of these feeding frenzies happen on day one of IPOs, but a scarcity of hot ones. This is one of them, Frank.

[Frank Holland]

Yeah, certainly is one of the hotter ones we've seen in recent days. Again, indicated opens between 105 and 110. As you mentioned, it was priced at 33. This is a company that was actually an acquisition target at one time. I believe with Adobe obviously a lot of investor interest. You've seen IPOs like this in recent years. What's your expectations once it hits the public market? Is the hype build up and then it just keeps going or do you see a different, you know, I mean.

[J]

It could completely go either way but in this instance, instance it usually is the case that you're going to basically have a lot of demand get cleared at the opening price.

[Frank Holland]

Right.

[J]

It's a pretty good size ipo. Now it's not like a massive float or anything like that. So maybe it'll feed on itself for a while. You're going to have to wait and get some updated results. We only have first quarter numbers from this company but we'll see. Look, this is a market that we've seen is susceptible to getting capital captivated by individual AI related or just retail trader favorites. And maybe this is going to get into that mix. So you know, look at the way Circle traded, you know, massive one day pop and then it's had some time coming in since then.

[Frank Holland]

Our Mike Santoli over there at post 5 tracking figma right before its first trade. Right now indicated to open at 105 to 110. Again priced at 33. Mike, thank you. All right, coming up next on Halftime, Copper on track to post its worst day ever. We're going to trade it with the committee. Halftime's back right after this. Welcome back to Halftime where I believe we're seeing big miss first straight based on the reaction of the crowd right now. Are Mike Santoli's over at post five? Oh, not yet. Okay, just some excitement. I just got told not happening yet. But a brief burst of excitement right now still indicated to open up between 105 and 110 price to 33. Now we want to turn our attention over to copper tracking for its worst day ever. Bill, your commodities trader, how are you playing this?

[Scott Wapner]

Well this was the copper cathode was exempt and so when that was exempt that was, that's what really goes in as a raw material to, to create the high grade copper that we use industrial or Everyday sort of use. Now, when that was exempt, this thing just has been bludgeons down more than 20%. Luckily, you know, in the, in the CTA, the commodity fund that I run, we were out of copper, we were out of platinum coming into this. I think there's a lot of opportunity in the second half of the year. I'm actually telling my investors and our commodity fund that, that I was sending some emails out last night that this opens the door for quite a bit of upside in the second half of the year. I just don't know where to pick the bottom here. We maybe around number $4 in copper. So that's something here I think maybe we could expect to see.

[Frank Holland]

Jenny?

[Jenny Herring]

Yeah. If you want to play it from the equity side, we're in Freeport and it's really interesting because Freeport was down 9% yesterday. It's actually up 3% today with investors saying like, hey, this stuff's going to settle out. It's probably not going to end up down 20% in the long run. Tariffs will get sorted out. It doesn't make sense to bludgeon copper the way it does. This is a huge demand, huge demand material and there's no end in sight.

[Unknown]

So if you want it on Freeport, we own Freeport.

[Frank Holland]

We've got in the conversation there. Guys, stay with us. Final trades are coming up. We're going to be right back after this. And we are back on halftime with final trades. Malcolm, you're up first.

[Malcolm Etheridge]

Yeah, I'm going. Dominion Energy, we've been talking all show about increased capex from all the hyperscalers. That also means additional chips to build out data centers. But that's got to flow to things like energy and cooling.

[Scott Wapner]

Bill Agnico mines, they reported a beat. They also almost doubled their free cash flow from the previous quarter. And what we're seeing here is a divergent divergence from the weakness in gold. And so I think gold's come back the second half of the year and that opens the door for some really good strength here.

[Frank Holland]

Jenny.

[Jenny Herring]

Ethan Allen, good earnings yesterday. Good enough to issue a special dividend of 25 cents.

[Unknown]

And Josh, shake Shack staying long.

[Frank Holland]

That's it. We got 10 more seconds. Got anything else?

[Unknown]

Super long.

[Frank Holland]

All right, that's going to do it for halftime. The exchange with Dr. John Ford starts right now. You've been listening to CNBC's Halftime Report, the podcast you can always catch us live weekdays at 12 Eastern only on CNBC.

[Unknown]

All opinions expressed by the Halftime Report 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 or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Halftime Report 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 Halftime Report disclaimer, please visit cnbc.com halftime reportdisclaimer@ Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn more at Capella Eduardo.