The State of Stocks: Noise vs. Reality 1/21/26

Summary

Halftime Report: The State of Stocks — Noise vs. Reality

CNBC | January 21, 2026 | Host: Scott Wapner | Featured Guest: Cathie Wood (ARK Invest), with Joe Terranova, Shannon Sokosha, Stephen Weiss, Malcolm Mettridge

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Main Theme & Purpose

This episode centers on distinguishing “noise versus reality” in the current stock market. The panel examines how political rhetoric, policy headlines, and market volatility are driving investor sentiment, with an emphasis on how to cut through media “noise” and focus on actionable fundamentals. Special guest Cathie Wood shares ARK Invest’s big themes for 2026, discussing tech, AI, and crypto, while panelists debate sector rotations, “buy the dip” tactics, and opportunities amidst uncertainty.

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Key Discussion Points & Insights

1. Current Market Action: Stocks and the President’s Statement

• Host Scott Wapner sets the stage (01:00–04:00), noting the market’s reaction to President Trump’s Davos declaration that he “will not use force in Greenland” amidst recent volatility.
  • Wapner: “This is exactly… what we discussed yesterday, the market’s up, noise versus reality, bark versus bite… people are looking to buy the dips because they see the larger environment as being good for stocks.”
• Joe Terranova highlights outperformance in small caps, energy, and health care, but signals ongoing caution:
  • Joe Terranova (02:31): “I still don’t think we have the all clear as it relates to treasuries… yields are not moving lower significantly.”

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2. Noise vs. Reality: Thematic Strategies

• Shannon Sokosha suggests investors are adapting to constant “noise,” highlighting the need to focus on fundamentals amidst policy fatigue and shifting headlines:
  • Shannon Sokosha (04:01): “There may be sectors, industries, specific companies beset in a short-term way by some announcements… Most importantly, go back to economic and earnings fundamentals and where companies are positioned for 2026.”
• Malcolm Mettridge predicts more tactical opportunities as policy shocks create “dips” worth buying:
  • Malcolm Mettridge (06:10): “Analysts expect earnings growth is 8% this quarter and double digits for the rest of this year. That tells me we should have a pretty strong setup for stocks.”
• Continued focus on buying dips rather than “chasing rips” as the market navigates election-year volatility.

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3. Volatility Ahead: Panel Debates Risks and Setups

• Stephen Weiss warns that overconfidence and political instability are likely to fuel more volatility:
  • Weiss (07:39): “Everybody’s stacked up on one side of the boat… Whenever that happens to this degree, you can’t find anybody that’s negative. It makes things kind of wobbly.”
  • Remains cautious, preferring to wait for “real pain” before putting cash to work (08:48).
• Panel debate: Will investor skepticism about White House pronouncements increase? Will volatility offer buy opportunities or reasons to step back?
  • Weiss (09:57): “People are going to be less reliant on what [Trump] says… focus at this point is permanent compounders that will help me get through this.”
• Sokosha flags market “sanity” as capital rotates away from AI “high flyers” to small caps, international markets, and value.

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4. Sector Deep-Dive: Software vs. Semiconductors

• Tech and Software: After a rough start, software stocks are debated as value opportunities or “falling knives.”
  • Joe Terranova (13:44): “Beyond Datadog and Okta, in software it is literally catching a falling knife right now.”
  • Malcolm Mettridge defends adding to ServiceNow: “This one’s probably reached peak pessimism… ServiceNow’s moat is strong… this looks like a great place to build a position.” (15:11)
• Semiconductors have been outperforming, with panelists discussing the “extreme” divergence between chips and software (16:09–17:03).
• Stephen Weiss cautions against generalizing from top investment firms’ bullish software calls:
  • Weiss (17:56): “If you go to their website, it says the world’s largest software investment firm. So they’ve got a bias.”

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5. Stock-Specific Moves

• Netflix: Weiss details selling half his position, citing uncertainty from a major pending deal:
  • Weiss (19:58): “Here’s what the market’s presenting… I’d rather raise cash now… Netflix wins if it loses this deal—they don’t need it.”
• Tesla & AI: Discussion of Tesla’s sideways action and potential for “robotaxi” business as a breakout catalyst.
• Bitcoin & Crypto: Debated as a risk asset vs. a true safe haven. Recent volatility is tied to structural market events (see Cathie Wood segment below).

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6. Cathie Wood Interview — ARK Invest’s 2026 Big Ideas

(Segment begins at 23:54)

Macro & Market Outlook

• Wood describes the U.S. economy as a “coiled spring”:
  • Cathie Wood (24:25): “We think that… thanks to tax cuts, big refunds… big investment cycle ahead… deregulation, lower interest rates, lower inflation… Goldilocks.”
• She expects strong market performance even if earnings multiples compress, citing history of bull markets during periods of lower multiples:
  • Wood (25:38): “We saw it in the 90s… big multiple compression and the market did extremely well.”

AI & Hyperscalers

• AI is listed as ARK’s top theme, but ARK has limited exposure to “hyperscalers”:
  • Wood (26:41): “Shareholders in hyperscalers got used to huge cash flow and cash position… but now, with AI and a new FTC, we see huge capital spending, returns on invested capital coming down.”
  • ARK’s preference is for “lesser-known, pure-play future winners” outside the Mag 6.
• On reducing Nvidia exposure:
  • Wood (29:34): “Did we regret selling Nvidia? What did we put that cash into? Palantir, Coinbase… We think GPUs are going to face more competition. Hyperscalers are developing their own chips. ASICs will take share.”
  • AMD and Broadcom seen as better-positioned chip winners for the AI era (31:44–32:31).

Tesla

• Tesla remains ARK’s top holding (10% weight), with Wood pointing to the coming of “robotaxis” as a major inflection:
  • Wood (32:39): “Robotaxis, recurring revenue—software as a service model with 85% margins… profound change.”

Crypto & Bitcoin

• ARK prefers pure plays like its own ARKB ETF and Coinbase; deliberate avoidance of Michael Saylor's MicroStrategy strategy.
• On bitcoin volatility and path ahead:
  • Wood (35:36): “A flash crash at Binance triggered massive auto deleveraging… We think that’s played through. We may test 80–90k, but it will be the shallowest four-year cycle decline in Bitcoin’s history.”
  • Bitcoin is “both a risk-on asset and ultimately a risk-off asset,” increasingly uncorrelated from gold (38:14).

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Notable Quotes & Memorable Moments

• Scott Wapner (03:19):
  “If you focused on the reality and not the noise, you did well. If you bought the noise, you did well… Are we at another one of those periods?”
• Stephen Weiss (07:39):
  “Whenever that happens to this degree, you can’t find anybody that’s negative. It makes things kind of wobbly because nobody’s on the other side.”
• Cathie Wood (AI/hyperscalers, 26:41):
  “Shareholders in the last cycle who got used to huge cash flow… will be shocked now with AI and new FTC.”
• Cathie Wood (Tesla, 32:39):
  “Robotaxis—recurring revenue model, software as a service kind of model, 85% margins… profound.”
• Cathie Wood (Bitcoin cycles, 35:36):
  “We may test this 80 to 90,000 [range] on Bitcoin but… it will be the shallowest four-year cycle decline in Bitcoin’s history.”

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Timestamps for Major Segments

• Market Noise vs. Reality Panel: 01:00–10:54
• Rotation & Sector Divergence Discussion: 10:54–21:07
• Software/Semis Deep Dive: 13:44–19:15
• Netflix & Company Specifics: 19:32–21:37
• Cathie Wood Interview: 23:54–40:10
  • Macro outlook: 24:05–25:38
  • AI/Tech: 26:09–32:31
  • Bitcoin/Crypto: 33:42–40:10
• Quickfire Final Trades: 48:56–49:30

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Overall Tone & Takeaways

• The panel is cautiously optimistic but wary of volatility, advising patience and tactical buying on dips rather than chasing rallies.
• Focus on company fundamentals and economic momentum (“reality”) versus getting caught up in the day-to-day headlines (“noise”).
• Cathie Wood’s big ideas remain pure-play tech and disruption, but with significant skepticism toward hyperscalers’ capital spending; emphasis on AI, next-gen chips, Tesla’s long-term optionality, and Bitcoin’s maturation.
• Sector rotations (into small cap, international, value) and software/semiconductor divergence are key market drivers for 2026’s opening weeks.

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For Listeners Who Missed the Episode

This episode equips investors to see through election-year market noise, offers practical strategies for navigating volatility, and delivers Cathie Wood’s vision of where exponential growth and disruption are likely to unfold in tech and crypto—flagging both risks and opportunities as the market landscape continues to shift in 2026.

Transcript

[Edward Jones Narrator]

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[Jennifer of Coolidge]

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[Shannon Sokosha]

They accept Discover at Renaissance Fairs.

[Jennifer of Coolidge]

Yeah, they do here. Discover is accepted at the places I love to shop. Get it with the times.

[Edward Jones Narrator]

With the times.

[Jennifer of Coolidge]

You're playing the loot. Yeah. And it sounds pretty good, right?

[Scott Wapner]

Discover is accepted at 99% of places that take credit cards nationwide. Based on the February 2025 Nielsen report. I'm Scott Wapner, and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. All right, Carl, thanks so much. Welcome to the Halftime Report. I'm Scott Walker. Front and center this hour, the bounce in stocks today. The president says he will not use force in Greenland. We will discuss and debate the best strategies right now with the investment committee. Joining me for the hour today, Joe Terranova, Shannon Sokosha, Stephen Weiss, Malcolm Methridge. We will check the markets. We are green. Yes, we are. We're off the best levels, though, so we've come back a little bit. But we definitely did move higher when the president said during his Davos speech, quote, I won't use force in Greenland. I should remind everybody that in just about an hour, CNBC's Joe Kernan sits down with President Trump. You'll hear that later in the afternoon. And given what is happening on so many different fronts, it is such an incredible time to be able to sit down with the president of the United States as we are. This is exactly, though, Joe. I feel like what we discussed yesterday, the market's up, noise versus reality, bark versus bite, bluster versus actual policy. People are looking to buy the dips because they still see the larger environment, the one that the president spoke about as being good for stocks, tactical opportunity.

[Joe Terranova]

Certainly for small caps, energy, health care, the areas of the market that have been performing so far, year to date. We'll dig deeper into this later in the show. Software down once again in a tape that is moving higher. So there are still things to be concerned about. I still don't think we have the all clear as it relates to treasury.

[Scott Wapner]

Yields which are down, which are, you know, one and a half basis points.

[Joe Terranova]

For 10, a 10 year. So 10 year got up to 4.3. Was it 4.279. That's, that's not really yields moving lower significantly. So yesterday there was tactical opportunity. You absolutely have to take advantage of a day when you're down greater than 1%. The market has subsequently rallied off of that. I think the areas of the market that you focus on tactically are what has been working. Don't bottom feed.

[Scott Wapner]

Okay. So Shan, noise over noise versus reality. That's been really the market that we've lived in for the better part of the last year because there's been a lot of noise at times. But the reality was that the S and P clocked a pretty good year in 2025. And the point that Joe Kernan made yesterday that I cited on our program, and again he's going to sit down with President Trump, is that if you focused on the reality and not the noise, you did well. If you bought the noise, you did well. Because stocks have been unsettled at times of noise. Are we at another one of those periods?

[Shannon Sokosha]

We think so. I think the, the reality is, and we talked a little bit about this last week, Scott, that there's a bit of fatigue in terms of policy. And I think that investors, if we similar announcements that we've received over the last couple of weeks, we would have had probably a greater drawdown in the S&P 500 this time last year. And again, it's sort of the 48 hour rule. I think if you look at, for instance, the 10% cap on credit cards now that's being pushed to more of a legislative agenda item that's going to be much more difficult to get through Congress. So therefore you could see that as an opportunity to potentially invest against that. You look at the, you know, what happened in Venezuela, Joe talked about. We've seen some, some energy strength that's outside of any expectations of short increases in supply of oil. That's more of a long term trend in terms of the opportunity from a valuation perspective in energy. You look at technology to, to Joe's point, this dispersion, this rotation, this has been in place for some time. And so I think what you need to do, Scott, is you need to take a step back, understand that there may be sectors, industries, specific companies in some cases that are beset in a short term way by some of these announcements, the implementation, the execution of this type of announcement in 2020, you know, quite different in many cases from what was being proposed. And I think most importantly you go back to economic fundamentals, earnings fundamentals and where these companies are positioned for 2026. And I think that's where you can come in, getting some comfort in buying the names that you think are positioned for that reacceleration.

[Scott Wapner]

I feel like Malcolm Tony Pascarello at Goldman Sachs has really had a knack for focusing on the fundamentals above everything else. In which his latest note I think goes there. He surveys the environment, not naive to the challenges obviously that exist exist and says quote, us equities should be supported by a macro outlook that's inherently favorable. Yet risk reward remains tricky until we see better levels in the doing. I suspect the tactics of navigation this year will favor the buying of dips as distinct from the chasing of rips.

[Malcolm Mettridge]

Yeah.

[Scott Wapner]

What do you think?

[Malcolm Mettridge]

I think we're likely to get a lot more more of these dips this year. Right. We're heading toward a midterm election where we're probably going to see the President get a little more aggressive in making sure that he enacts the last few pieces of his political agenda before potentially congress gets up to the balance in Congress gets upset. And so we're probably going to get a lot more of these like existential shocks over the 48 hour cycle like Shannon was talking about, which probably create a number of opportunities for investors who have been looking at specific names, not sectors or the entire market, but specific names that have been beaten down or thrown out with the entire bath order gives you those buying opportunities throughout the entire year. But analysts expectations for earnings growth is 8% this, this quarter we're coming into and then double digits for the rest of this year. That underneath the surface tells me that we should have a pretty strong setup for stocks.

[Scott Wapner]

Let me just test tease something out too that in the next block of the show, Cathie Wood of Ark Invest is going to join us. She is out with her 20, 2026 outlook and the biggest themes that she likes. And she's going to join us first on today and unveil that for all of you. And that's coming up soon. I want to make sure that we mention that. All right. Weiss Pascarello equity should be supported by a macro outlook that's inherently favorable. Just rip up the sheet of all of the other stuff that's around and just focus on what he's talking about because that's what a lot of people are focused on. Right. The backdrop.

[Stephen Weiss]

Well, I said this last week that's what everybody's saying, whether you hear it's the best equity market I've ever seen for investing. Because you got monetary policy coming our way, you've got, you know, pro business initiatives coming out of Washington. And it seems like everybody's stacked up on one side of the boat and that makes things kind of wobbly because nobody's on the other side. So whenever that happens to this degree, you can't find anybody that's negative. So I think that is going. Your point? Create ongoing volatility. Plus, my concern is that the absolute craziness, instability, looniness, whatever you want to say coming out of D.C. may be pushing investors to their wit's end and say, I can't deal with this volatility. So I'm just going to step back, I'm going to take it easy and I'm going to wait for some real dips to buy.

[Scott Wapner]

I know, but the people who did that. Liberation Day.

[Stephen Weiss]

Yeah.

[Scott Wapner]

Might have missed out on the back side of it. Every opportunity really over the last year. Deepseek, that and so many others have been buys.

[Stephen Weiss]

Not not only last year, the last 10 years for sure. It's always been a V shaped recovery. So the question is, so I've raised some cash, talk about it later. And it's not a day like yesterday where I'm running to put it to work. It's a day when there's true. Because that was nothing down two and a half in the nasdaq. Painful. Painful to me, painful. Anybody has money in the market, but that's not real pain. So look, so I'm waiting. I'm not raising cash. A lot of places, only little cash. And I'm waiting for more of a sell off because I do think we're at the point where, where something real could happen.

[Scott Wapner]

Let's put you this way. Do you think I don't ask this rhetorically.

[Stephen Weiss]

Right.

[Scott Wapner]

I promise.

[Stephen Weiss]

Okay.

[Scott Wapner]

Do you think the president on the stage in Davos today would have made it clear to the world essentially who he's speaking to, I will not use force in Greenland. Okay. Or we will not use force in Greenland. Greenland. You think that was said today because of the market activity yesterday and the uneasiness in the bond market and rates going up?

[Stephen Weiss]

Absolutely. And let me ask you a question. Do you think you can believe one thing he says or that he holds a position and maintains?

[Scott Wapner]

I think on something as serious as using force to take a territory.

[Stephen Weiss]

I'll give you that, because I don't think it was ever a Possibility. Right. I think that was just bluster trying to get people to take. My point is that you're going to see a lot more volatility. Volatility is not always going to be like yesterday where you have a V shaped recovery. That remains to be seen by the way, if the averages which continue to trade down hold the gains and whether yesterday was actually a good buying opportunity.

[Scott Wapner]

Or not, the stock market to fall apart heading into the midterms. You think he wants the economy to fall apart? I know what you know. The answers are no. Which is kind of my point about the overall all noise versus that's not the question.

[Stephen Weiss]

What I'm saying is that people are going to be less reliant on what he says because everything changes and that what's going to be more of a focus at this point is what are the permanent compounders that are going to help me get through this. And so to me, that's going to take down the valuations of some of the stocks that have been the ultimate high flyers and bring some sanity back to market. I don't think it's a bad thing, by the way, but I'm just saying that he will come out if the, if the market, if the, if GDP was down 5% he would come out and say GDP is better than it's ever been, it's better than anywhere in the world. People are going to stop believing that line of garbage.

[Shannon Sokosha]

I think the sanity is already coming back into the market. We've seen the rotation to small cap, we've seen the rotation to ex us, we've seen the rotation to emerging markets. Some of the sanity around the high flyers that are specific civic AI enablement trades has already started to come off of the market. And so I think that in, in response, I do think that they're taking some of this news, they're determining how it impacts underlying companies. But I think more importantly there is a sense that the underlying economic momentum is, has not only broadened the equity market but it's also created a foundation where there is likely to be continued earnings growth. The other thing, Scott, is I think that, you know Steve, you sort of started to touch on this, the bond market. Joe mentioned this. I do think the Trump administration is worried about volatility in the bond market. That was really what created, I think that more of the, more of the impact, the negative impact to his platform last year in terms of things like affordability. I think long end of the curve volatility is something that the administration is certainly watching regardless of day to day 2% declines in the S&P 500.

[Scott Wapner]

Talking about specific stocks, Tech is rebounding today at least a bit. Bit, not, not much. Nasdaq's not doing much again today. In fact it's flat for the most part as we speak and what was a pretty, I don't know, decent looking rebound is all but dissipated as you see on the chart right there. Tech's down three and a half percent year to date. A lot of stuff on the mega caps today. You've got Amazon with their largest ever store. Wall Street Journal reporting that Microsoft's target goes down to 620 from 640. Reiterated outperform Rothschild and Redburn, they cut Microsoft and Amazon and Oracle targets today. By the way, Oracle's down a bunch today. Worth watching. A lot of talk about software continued rough start of the year. Joe, you're watching this very closely. Orlando Bravo tells the FTSE that a huge buying opportunity exists within the software sell off. Brad Gerstner said:2 weeks ago Now's the time to go sniffing in software.

[Joe Terranova]

I think everyone sees the same thing in software just in terms of the names that I hold. Where am I seeing the best momentum? Obviously I've been tactical in approaching trades with Twilio. Bought that yesterday. I think today I'm down a little bit on a trading 119. Otherwise Okta cybersecurity that appears as though it has a little bit of a bottoming formation. Datadog is another name that you could look at but beyond that in software it is literally catching a falling knife right now. And the other side of that right now speculators and hedge funds that are playing that negative correlation trade between software and semi they're getting paid. On the semi side they're getting paid owning their applied material, the LAM Research, the KLA Corporation corpse and all of those semi names. So predicting when the mean reversion is ultimately going to show up. I am not able to do that. I don't think very many people are. If you have the ability to ride out what we're seeing in front of us right now, congratulations. But I don't know about going in there and buying falling knives in some of the names that just don't appear to have any bounce like Oracle.

[Scott Wapner]

So let's go there Malcolm, because service now is pacing for its sixth straight down day. It hit a 52 week low yesterday. Joe owns the name. Maybe he's speaking directly about a stock that Malcolm just bought more of. Are you catching a falling knife? What's the deal here?

[Malcolm Mettridge]

Let's debate this apparently so. So I'm willing to go out on a limb and say this one's probably reached peak pessimism. I think the service now it's down with 40% I think from its one year over the last year. It's also not the new 52 week low. I think that this one probably starts to separate itself from the rest of the pack for a couple of reasons. One, the moat around it is that a lot of CTOs and CISOs are not going to be willing to introduce new AI startups that are supposedly going to disrupt the data space with these different companies that they've been building out in Silicon Valley the last couple of years. And then separately from that, ServiceNow has been questionable as relates to their valuation for a couple of years. It's the reason a lot of folks didn't want to touch it. But their earnings are growing, their free cash flow is growing, which means it's probably growing into its valuation and starting to look more attractive from a technical basis too. So to me this looks like a great place to be building a position in this.

[Scott Wapner]

By the way, I think it was Adam Parker yesterday on Closing Bell we had this conversation about software and semis that on both ends of that spectrum and maybe we can show it as we usually do with the SMH versus the igv, chips versus Software, the divergence that's happened, that it's starting to look a little extreme on both ends.

[Joe Terranova]

It's been extreme for the better part of the last 60 days.

[Scott Wapner]

Well, at some point there's reverse but.

[Joe Terranova]

There'S a very clear trade that is going on right now in the community and it's a negative correlation trade and there right now they're pressing the gas pedal on it and the direction towards semis. I don't disagree with anything that Malcolm's saying. He's looking at it from a fundamental perspective and I think over the long term, Bill McDermott and the management team at ServiceNow, they will execute, they will recover. Their balance sheet is in great shape. Agreed. Their revenue's growing at a rate that we look at is very appealing.

[Malcolm Mettridge]

But it's 10x revenues in the last year.

[Joe Terranova]

Absolutely. But you're looking at it through a lens that Steve is looking at me and he knows I just look at it through a different lens. I'm looking at it through the lens of momentum and sometimes momentum may be a lagging indicator, but we'll probably in this name at some point step to the sidelines and when the momentum reappears Once again it without question is one of the quality software names that you could own for sure.

[Stephen Weiss]

You know there was an article I think was in the journal that talked about how people with absolutely no training in coding are now able to build through AI their own software applications to.

[Scott Wapner]

Be able to vibe coding.

[Malcolm Mettridge]

But if you're the CTO of a Forza 500 company, are you going to stake your entire career on that?

[Stephen Weiss]

Well, I will tell you that the investment banks are that they're building their own software applications and I will tell you that lots of other companies are as well where they're building their own software.

[Scott Wapner]

Not all software companies are going to be.

[Stephen Weiss]

And that's true, that's true. But let me, let me say this about Bravo, Orlando Bravo, brilliant, brilliant firm. Thomas Bravo. But if you go to their website it says the world's largest software investment firm. So they've got a bias, it's a natural bias. But I would say be careful of what you hear from people saying now's the time.

[Scott Wapner]

Now I think selectively they also do quite well like oh it's a great.

[Stephen Weiss]

Firm, it's a great firm.

[Scott Wapner]

We look at some of their same thing as Vista Equity Group with Robert Smith. I mean they're the two premier players within that space. By the way the great majority of software companies are private companies to begin with. If you look at the larger space anyway that's basically every industry but they've been, they've been geniuses at identifying where the real value is within disrupted parts of that universe.

[Stephen Weiss]

And I'm not being negative on them, you know, I respect them. We don't typically invest in large funds but I've looked at some of their co investment deals. I know the firm very well, they are excellent. What they do, I'm saying is that take it with a grain of salt what they're saying now we heard the same conversation a year ago. Now's the time to buy software because it's under pressure then I'm not saying it's not but I don't think you buy the whole group. I'm more in the well no one's.

[Scott Wapner]

Suggesting that you buy the whole cyber.

[Joe Terranova]

Security to me will bottom first.

[Stephen Weiss]

Except you know, I'm stick with Microsoft. It's, it's been a mistake for a year, it's done nothing, it's down. I'm sticking with it because it's still the operating system for most of the world's computer.

[Scott Wapner]

Let's move and talk about Netflix too which is, I really think it's An a block story, 52 week low as we look at shares down more than four and a half percent today. So you sold half of your position. Why? Why now? Presumably you're going to tell me. Because the stock is in no man's land until we figure out what happens with the deal, which was the case before the numbers hit.

[Stephen Weiss]

So, so when something, and I thought about this quite a bit, obviously I missed the point to sell it, which is when they first got involved in this. Right. And some others on the desk did it shortly.

[Scott Wapner]

Josh, I think sold 85% of it the day the deal was. At least the offer, the day the initial offer was announced.

[Stephen Weiss]

So I think it's important to be very open minded as an investor. Now I either say I missed it or I can say, okay, here's what the market's presenting to me now. What do I want to do now? Do I want to continue to bemoan the fact that I made a mistake not selling it later, or do I say, hey, I want to raise some cash because this stock maybe bounces to 90, but it's going to be stuck there for a while. So I'd rather raise cash now and keep that when I see a real market dump. So that's why I did, I did half of it. Maybe I'll do the other half, I don't know. But I still like it on a long term basis and I, I'm not happy they're buying it. As I said before, I'd rather have Paramount buy it and then get crushed into the debt load. And that way, you know, Netflix, we have like content cheaper.

[Scott Wapner]

But Netflix wins if it loses this particular deal.

[Stephen Weiss]

Yeah, yeah, I think they would if they win and they win if they lose. They don't win by as great a margin if they buy this. I just don't know why they need it. You're paying 100 billion, close to 100 billion for an asset where you put that directly into content, right. Instead of, and that's five years worth of content according to what they're saying of 20 billion a year and be.

[Scott Wapner]

Way ahead of the game.

[Stephen Weiss]

So, and then take out a head.

[Scott Wapner]

You can develop the kind of content that they think they're able to acquire.

[Stephen Weiss]

They have that right. Which have a record of.

[Malcolm Mettridge]

Netflix has a YouTube problem. Right. They have to focus on developing original content in order to compete. The reason they got unique unseated by YouTube in the first place is because the appetite has shifted to original content. So 25% of all viewership of YouTube now is on actual TV sets. That's a problem for Netflix and that's the problem they have to focus on.

[Stephen Weiss]

You have more than one streaming company And I think YouTube and Netflix, you both have, you know, but I just think Paramount is going to be crushed if they buy it.

[Scott Wapner]

All right, we are going to take a break and we come back with our halftime headliner today, Ark Invest CEO Cathie Wood. She is standing by with her big ideas for 2026. We'll talk to her about that. We'll get her take on the markets and we're back in two.

[Malcolm Mettridge]

Before we had ATT Business Wireless coverage, our delivery GPS wasn't the most reliable. Once our driver had to do a 14 point turn to get back on route.

[Stephen Weiss]

A 14 point turn.

[Malcolm Mettridge]

An influencer even livestream the whole thing.

[Jennifer of Coolidge]

Not good for business.

[Malcolm Mettridge]

Now with AT&T business Wireless, routes are updating on the fly and deliveries are on time. And the influencer did get us 53 new followers though.

[Scott Wapner]

AT&T business Wireless Connecting changes everything.

[Edward Jones Narrator]

At Capella University, we believe accessible education can make a difference. That's why we offer scholarship opportunities to all eligible students. Un futuro diferente estan mas cerca de lo que cres con Capella University. Learn more at capella.edu what made you.

[Jennifer of Coolidge]

Confident that you could do something that.

[Edward Jones Narrator]

Hadn'T been done before? I have no fear of failure. Trailblazing women, changing the game.

[Jennifer of Coolidge]

One of my favorite pieces of advice, think about what your boss's boss needs.

[Shannon Sokosha]

Leadership can look in many, many different forms.

[Edward Jones Narrator]

It really does come down to just trusting yourself. Life is short and you just gotta.

[Jennifer of Coolidge]

Think big to accomplish big things.

[Edward Jones Narrator]

Julia Boorstin hosts CNBC Changemakers and Power Players. New episodes every Tuesday. Wherever you get your podcasts.

[Scott Wapner]

ARK Invest Cathie Wood is releasing her big ideas for 2026 today and is here first to share them along with her thoughts on the markets. It's great to welcome you back to Halftime. Kathy, nice to see you.

[Jennifer of Coolidge]

Scott, great to see you. Thank you so much.

[Scott Wapner]

So I've read through your outlook in which you lay out some specific themes that you like. But let me just ask you, you call the US Economy a coiled spring for many reasons. I'm wondering how you think that translates into what the markets may do this year.

[Jennifer of Coolidge]

Yes, well, we think that we've been through a rolling recession. We've seen it in housing, manufacturing, small business, consumer sentiment, and that thanks to tax cuts, big refunds this first quarter, but corporate tax cuts as well. So big investment cycle ahead as well. As deregulation, which I think is highly underestimated in terms of its, its impact and lower interest rates and lower inflation. Sounds like Goldilocks that that is all going to play out this year and be very good for the financial markets.

[Scott Wapner]

You know, I thought it was interesting in reading your outlook when you talk about multiples which are at great debate I think right now whether 22 times is too rich for stocks, whether you will get multiple compression but earnings are going to be strong enough that it's not going to matter if you want to use that word to the market. You in fact do think that multiples will compress because of productivity gains, but that stocks are still going to return double digits this year and that some of the best bull markets have happened in times of multiple compression. Is that correct?

[Jennifer of Coolidge]

That is correct. We've, we saw it in the 90s, big multiple compression and the market did extremely well. We saw it in the early 2000s and even Ark in 2017 and 18 our multiple multiples compressed significantly and we outperformed the markets significantly in 2017. A big up market. But even in 2018 that was a down market and we were up, which many people people didn't expect.

[Scott Wapner]

It's curious to me, I think that of your five themes for 2026, AI is at the top of the list. But you do not own any large positions in any of the Hyperscalers. You have 1%, 1% positions in METTA and Nvidia and Amazon. And we can get into Nvidia specifically in a moment because there are things I want to ask you about that. But why is that? If AI is such a big theme of yours, why don't you have bigger stakes in any of the so called hyperscalers?

[Jennifer of Coolidge]

Right. So one of the reasons is we think the shareholder base of those companies is changing and will and will continue to change because shareholders in the last cycle who got used to huge cash flow and cash position building very little M and A because FTSE had shut down M and A. All of that is changing with AI now, now and with a new ftc. So we're seeing huge capital spending and returns on invested capital probably coming down for a while. And the shareholder base in those companies has really has really stayed with them because returns on invested capital had been moving up. I think this is a bit of a shock to their system and as you know, we are very focused on, you know, more pure play future winners. I'm not saying the Max six won't win. In many ways they will, but they certainly Any company that, that is in the broad based benchmarks and has risen to the top has, has gotten there because of past performance and a certain DNA that worked during the last 20 years or so. We think there's so much disruption happening now, technologically enabled disruption, some that will benefit, some that will not benefit the Mag 6. So we are much more focused on, you know, the, the companies that are not as well known, but are going to benefit enormously from, from the year ahead and the years ahead. And I will say last year, the market starting to broaden out, away from the Mag 6, we outperform. We're in the top 5%, I think four of our five, four of the top five ETFs by Morningstar and even for the last three years, we're in the top 5%. So I think the market is beginning to understand what we've been trying to say for, for a long time now.

[Scott Wapner]

You know, it sounds to me like you're suggesting that you think that several of the hyperscalers are simply spending too much and that the return on that invested capital is going to be lower than maybe some investors think. Now, if they are spending too much, they're spending it on chips from Nvidia, which you have a much smaller position today than you had just a few years ago. Do you regret selling as much of Nvidia as you did, which by most accounts cost you more than a billion dollars?

[Jennifer of Coolidge]

So that's taking a look at what that sale did. All other things equal. But what did we put that cash into? We put it into companies like Palantir, which I think since that time has done better than Nvidia, like Coinbase, which was under SEC attack at the time. Very opportunistic. And so was it even Stephen? I don't, I don't know, probably not 100%, but I think we landed on some of the names that were really going to take off based on again, what the new news was going to be. And we do think if you look at our big ideas, you'll see one section where we show that GPUs generally are going to come up against the competition, more competition in and of themselves. We're seeing the hyperscalers moving towards developing their own chips. We're seeing more specialized chips. Certainly Tesla is moving in that direction and we think Asics are going to take share from GPUs. So, you know, I don't regret it. You'll see in our top 10 in ARKK, out of recognition that we believe this AI cycle is still in early days, AMD is in our top 10. And of course the shocking thing there is, it's, it's, it's doing very well in GPUs, especially for small language models relative to Nvidia. That is not as well in large language models. But the shocking thing there also is that it's taken huge share from intel, up to 40% of the CPU market right now, which, you know, I grew up as it was fighting for 10, 15%. So. And then the other thing with AMD is much less memory required with AMD's chips, just the way they've constructed them. So again, there are lots of puts and takes here.

[Scott Wapner]

Yeah, Broadcom too, right? You like Broadcom today more than Nvidia. Is that, is that fair to say?

[Jennifer of Coolidge]

Well, Broadcom is a smaller position in the portfolio and you're right, we've started building it and it is because it will probably be one of the prime beneficiaries of the shift from GPUs to ASICs. Now, over time I have steered away from Broadcom because it has been a consolidator. I'm not as an investor personally not attracted to growth, growth by acquisition. And Broadcom has been acquisition prone. We do think though that the, the ASIC world is going to grow fast enough where it won't need to make acquisitions in the future.

[Scott Wapner]

Tesla is your largest holding. 10% waiting. The stock's done nothing over the past 12 months. Why?

[Jennifer of Coolidge]

Well, I do think there's a bit of a tug of war between the bulls and the bears. That's always the case. It has been, if you look at it from a basing point of view, it's been in a base, very, it's a wide base, but for about five years and I remember, I think it was on your show, Scott, one time I made the point that, wow, this has been a very long base. I think back then it was six years. Now we've had five years. We're at the top, near the top of that range. And we do think Robotaxis are going to break it out. We think that as more analysts do the modeling and see that we're now talking about a company with 15% gross margins. But Robotaxis, recurring revenue model, software as a service kind of model, 85% margins for that kind of business.

[Shannon Sokosha]

Business.

[Jennifer of Coolidge]

We think that more and more analysts are going to understand how profound this model is going to change.

[Scott Wapner]

Can we talk about Bitcoin? You mentioned Coinbase, of course, is a sizable holding, almost 5% of the innovation fund. The ARKK ETF. I thought it was interesting that you do not own at least what I can tell any of Michael Saylor's strategy. And I'm curious why, if you're such a big believer in bitcoin and you're a big believer in the blockchain and crypto in general, why don't you own it?

[Jennifer of Coolidge]

Well, what we do own where we can is ARC B which is our own bitcoin spot. Bitcoin etf we cannot for reasons having to do with relationship to. 10 years ago Basically they were saying no bitcoin, no crypto. We're hoping that that changes over time. So we'd much prefer to be with the pure plays here and we do think there's a role for Dax. In fact we've been saying for quite some time that the role of professional money management, asset management management is going to change as we move into the decentralized finance world. And we own Bit mine for example because we do think Tom Lee and team are going to exemplify the new kind of asset manager strategy is more confined. I mean they can play, they can create almost any yield curve with their preferreds and so forth but in terms of playing defy, we'd probably go for different fat dance.

[Scott Wapner]

What do you make of all the volatility in bitcoin and where do you think it's going from here?

[Jennifer of Coolidge]

Yeah, I think that a lot of people maybe do not know much about or understand what happened on 10 10, October 10th. There was something called a flash crash. It had to do with a software glitch at Binance and it caused auto deleveraging and that was a shock that hit the system that has been reverberating as overleveraged entities are trying to get themselves straight. We think that is playing in itself through. In fact we think it has played its way through by some estimates $28 billion of damage in that auto deleveraging cycle. I think we're through that. I know there's a lot of fear about the four year cycle. We didn't have much of an upcycle by bitcoin standards. So we think we're pretty well through the down cycle here. We may test in this 80 to 90,000 range on Bitcoin but we do think that the test will be successful. It will be the shallowest four year cycle decline in Bitcoin's short history. And then we're off again. We think this is three revolutions in one. A global monetary system, rules based, competing against fiat currency. To be sure it is A technology revolution. And it is the leader of a new asset class which surprisingly, and I put it in my New Year's letter, Bitcoin and gold are not correlated with one another. Even though everyone calls Bitcoin digital gold, there's a.14 correlation between the two over the last full market cycle.

[Scott Wapner]

I guess I would respond to that by suggesting. Okay, if I agree with you on that. Bitcoin, or at least gold is proving itself to be a safe haven asset, I think it's fair to say. Whereas Bitcoin, which you suggest is growing in its role as a safe haven asset, doesn't seem to be much of one considering. Well, it's now, it's going to be, it's seven straight down days. And if ever there was going to be a rush to safe haven assets over the last couple of days, wouldn't this be it where Bitcoin would be getting a boost from concerns over more tariffs and Greenland and an upset market? And it's not.

[Jennifer of Coolidge]

Yeah. So if you take from the end of the equity bear market in 22 to today, I put this in the letter as well. Gold has appreciated or it had appreciated at that time by 165, 170%. Bitcoin had appreciated by 360%. So it had done a lot of work coming out of the bear market as a risk on asset. We get institutions now moving into Bitcoin, Bitcoin, starting with the spot Bitcoin ETFs and we have a whole new investor who basically is told as it is being introduced to this new asset class, there's a four year cycle out there. And so I think what has happened is we didn't have the big up move around the, the ETFs that many expected. And we have institutions, Bitcoin's biding their time just trying to understand the asset class, trying to understand this four year cycle and trying to understand if they're going to be caught in a 75% down round. We don't think they are, but they certainly are doing their homework, which is great. And we think Bitcoin is both a risk on asset and ultimately a risk off asset. Especially if you're looking for a hedge against inflation. It's mathematically metered to go up now 0.85% per year and that's a lower growth rate than, than gold. But it's also a hedge against deflation because in periods like 0809 there's not the counterparty risk Bitcoin, that transparent network that we saw in the banking system back then.

[Scott Wapner]

Kathy, thank you so much for your time today. We'll see you soon.

[Jennifer of Coolidge]

Thank you, Scott.

[Scott Wapner]

Thank you so much of Ark Invest. Coming up ETF Edge Dom Chu is standing by. When we come back, The new year brings new health goals and wealth goals.

[Malcolm Mettridge]

Protecting your identity is an important step. Info is in endless places that could.

[Scott Wapner]

Expose you to identity theft, leading to lost funds. LifeLock monitors millions of data points per second.

[Malcolm Mettridge]

If your identity is stolen, our restoration.

[Scott Wapner]

Specialists will fix it, guaranteed, or your money back. Resolve to make identity, health and wealth.

[Malcolm Mettridge]

Part of your New year's goals. With LifeLock, save up to 40% your first year.

[Scott Wapner]

Visit LifeLock.com SpecialOffer terms apply at Capella University.

[Edward Jones Narrator]

We believe accessible education can make a difference. That's why we offer scholarship opportunities to all eligible students. Un futuro diferente estam mass serca de lo que cres con Capella University. Learn more at capella. Edu what made you confident that you.

[Jennifer of Coolidge]

Could do something that hadn't been done before?

[Shannon Sokosha]

I have no fear of failure.

[Edward Jones Narrator]

Trailblazing women, changing the game One of.

[Jennifer of Coolidge]

My favorite pieces of advice? Think about what your boss's boss needs.

[Shannon Sokosha]

Leadership can look in many, many different forms.

[Edward Jones Narrator]

It really does come down to just trusting yourself. Life is short and you just got.

[Jennifer of Coolidge]

To think big to accomplish big things.

[Edward Jones Narrator]

Julia Boorstin hosts CNBC Changemakers and Power Players. New episodes every Tuesday. Wherever you get your podcasts, I'm Courtney Reagan with your CNBC News Update. Ukrainian President Vladimir Zelinsky is planning to meet with President Trump in Davos tomorrow. That's according to Axios, which says the meeting will take place shortly before the White House on convoys. Steve Whitcoff and Jared Kushner head to Moscow for another meeting with Vladimir Putin. Just a reminder, President Trump will be sitting down with Joe Kern in that interview coming up this afternoon on cnbc. The Trump administration acknowledged for the first time in a court filing that members of Elon Musk's DOGE service accessed and shared Social Security data without telling agency officials. The Washington Post first reported the filing. The disclosure comes month after a whistleblower raised concerns over the security of America's personal information. The agency previously denied the whistleblower allegations. Michelle Tafoya, most recently an NFL sideline reporter for NBC Sports who became a conservative media pundit, announced today she's running for the open Senate seat in Minnesota as a Republican. Tafoya joins a crowded field looking to replace the one retiring one term retiring Democrat Tina Smith. Halftime is back right after this.

[Scott Wapner]

Welcome back to the Halftime Report. I'm Dominic Chu with today's ETF Edge. As equity markets whipsaw around trade and Greenland headlines, the bond market has taken a different path. So joining me now is Jerome Schneider, the head of short term portfolio management over at Pimco. Jerome, it's an interesting move here. What do you make of some of the bond reactions that we are seeing to some of these geopolitical headlines?

[Stephen Weiss]

Headlines?

[Jerome Schneider]

Well, the geopolitical headlines are obviously taking the narrative right now from both not only geopolitical risks which are beginning to emanate in different ways, but also fiscal policies and monetary policies which are creating differentiated markets around the world. Japan versus the United States, UK versus Australia. There's places that present not only different types of risks than we've seen for the past decade, but also interesting rewards. And for a fixed income investor, it's a very fertile landscape to be in at this point in time.

[Scott Wapner]

Jerome, Pimco has been also a pioneer and when it comes to managing both equity and bond portfolios together as a hybrid, you recently launched an ETF product this past week that does that again in ETF format. What exactly are you guys trying to do here?

[Jerome Schneider]

Yeah, with the launch of our Pimco stocks plus active bond ETF splits, we're really looking to bring together a proven approach which we've done at pimco for almost 40 years, bring together passive equities, in this case bringing together passive equity exposure to the S&P 500 and combining that with our active PIMCO fixed income ETF suite and we think over time we've seen that active ETF specifically in the fixed income market have an advantage in creating excess returns over those over Those S&P 500 type of indexed index composition. So putting these passive equities with the active approaches simply allows a clientele in the ETF segment to availability, but to a proven approach which avails them a fixed income based alpha as opposed to just simply generating alpha from picking stocks which is not necessarily a proven track record over time in the equity landscape.

[Scott Wapner]

All right, stocks and bonds in an ETF format together. We're going to continue this conversation over at ETF edge.cnbc.com Jerome is going to be joined by Matt Bartolini, the global head of research over at State Street Investment Management. We'll send things back over to you, Scott. All right, Dom, appreciate you. Thank you. Dom Chu, thank you. More committee moves are coming up next. We have some moves to get to. You bought more xpi, Joe. That is One of your favorite early year trades.

[Joe Terranova]

Do more of what is working. And clearly in the fourth quarter healthcare emerged beyond the XPI. Two names to watch. ResMed Insight. Those are both having really strong momentum. You see positions being built.

[Scott Wapner]

You bought more the oi.

[Stephen Weiss]

Yes.

[Joe Terranova]

Energy, both natural gas, crude oil. I think you're seeing a reversal in positioning, a very dramatic reversal in positioning from where the marketplace was short, comfortably short for the better part of 2025. Established a position in OI building upon it. Baker Hughes, Schlumberger, other names you can buy.

[Scott Wapner]

What you think of what Cathie Wood had to say, particularly about the hyperscalers. The idea that the return on invested capital may be less and then less and less compared to what they're spending and that is perhaps one of the reasons and main ones why she only has 1% positions in some of the hyperscalers.

[Shannon Sokosha]

I mean I think that's realistic in terms of in terms of the amount of capital that's been put in place. I also think that it's about hyperscalers not necessarily being measured. Scott. On return on invested capital historically. So I think the challenge is going to be and that's only going to materialize if you see that investment outside of technology. That's when you're going to get that Ric. And that could be two, three, four years from now.

[Scott Wapner]

Yeah. What do you think of what you say?

[Stephen Weiss]

I mean the answer is we don't know. But what I can tell you what I do know is nobody's going to catch they would to invest in hyperscalers. They're going to her for find out the next generation.

[Scott Wapner]

No, I understand that but I think that's like an. So what?

[Stephen Weiss]

Like I don't know what you mean by so. I answered your question. I said she could be.

[Scott Wapner]

I mean if you're discrediting, if you're going to. If. Are you trying to discredit her opinion on it?

[Stephen Weiss]

Not at all. I'm just saying that she's smart, she's a business person and she knows they're not coming to to her invest in that.

[Scott Wapner]

No, but. But like Thoma Bravo. No, but she had a lot. But she had a large position in Nvidia.

[Stephen Weiss]

Yeah.

[Scott Wapner]

She no longer does.

[Stephen Weiss]

Right.

[Scott Wapner]

She only has 1% positions. I think I said in Amazon and Meta, I think was was the other one. That's a statement. That's a statement from somebody who runs an innovation fund.

[Stephen Weiss]

Exactly. Consistent with what I'm saying is that she was early to Nvidia and when it ran it's you know, the path. Then she got out. So she's looking for the next undiscovered names or and she said that name just aren't that well trafficked in. So that's why you go to her.

[Malcolm Mettridge]

Malcolm, for the market's sake. Near term, I hope she's wrong because this earnings season, profits of the Mag 7 are expected to grow about 20%. The other S&P493, it's like a quarter of that. The expectation at least. So we do need those companies to deliver solid earnings the way they have been.

[Stephen Weiss]

I'm not looking for innovation from the hyperscales. I'm looking for cloud growth from all the massive data in AI going to US and the others.

[Scott Wapner]

I get it.

[Stephen Weiss]

All right.

[Scott Wapner]

Finals are next. All right. Coming up on cnbc, another reminder, Joe Kernan's interview with President Trump at the World Economic Economic Forum in Davos. We'll certainly be showing you that at 3 o' clock on closing bell and getting reaction from our panel to what the president has to say to Joe, Dan Greenhouse and Stephanie Link, Anchor Crawford, among others, will join me. And I'll see you at 3 o'. Clock. Let's do some final trades. Malcolm, what do you got?

[Malcolm Mettridge]

I'm going IBM annually recurring revenues growing double digits. Earnings next week should be Good. All right.

[Scott Wapner]

Mr. Weiss, Ali, Bob, I think the.

[Stephen Weiss]

Momentum is returned to and they'll execute well.

[Scott Wapner]

Okay. Health care. Who's that, Shan?

[Shannon Sokosha]

That's me. Specifically interested in health care given some of the improvement in MLR expectations for the managed care companies and potentially some additional clarity around Medicare Advantage.

[Scott Wapner]

All right. And Joe Ternov Financial name, New holdings.

[Joe Terranova]

This is digital banking in Latin America breaking out. We own in the etf.

[Scott Wapner]

All right, so the market is trying to rally back yesterday a bad day. The Dow right now is good for one half of 1%. As you see, the S&P 500 did have 6900 back. It's up one about a half a percent as well. There is the NASDAQ above 23,000. And I'll see you at 3:00'. Clock. You've been listening to CNBC's Halftime Race report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.

[Edward Jones Narrator]

All opinions expressed by the halftime report participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion. Such opinions are based upon information the half time 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 the New.

[Scott Wapner]

Year brings new health goals and wealth goals.

[Malcolm Mettridge]

Protecting your identity is an important step. Your info is in endless places that.

[Scott Wapner]

Could expose you to identity theft, leading to lost funds. LifeLock monitors millions of data points per second.

[Malcolm Mettridge]

If your identity is stolen, our restoration.

[Scott Wapner]

Specialists will fix it, guaranteed, or your money back. Resolve to make identity, health and wealth.

[Malcolm Mettridge]

Part of your New year's goals with LifeLock. Save up to 40% your first year.

[Scott Wapner]

Visit LifeLock.com SpecialOffer terms apply.