Fast Food Economy & America’s AI Regulation 2/12/26

Summary

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Squawk Pod: "Fast Food Economy & America’s AI Regulation"

Date: February 12, 2026
Host: CNBC (Kelly Evans, Brian Sullivan, Steve Liesman)
Notable Guests: Patrick Doyle (Restaurant Brands), Alex Boris (NY State Assembly)

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Episode Overview

This episode explores two dominant themes shaping the American economic and regulatory landscape: the evolving fast food economy under persistent inflation, and the rising urgency for effective AI policy and regulation. CNBC anchors Kelly Evans, Brian Sullivan, and Steve Liesman guide a lively discussion, drawing on breaking news, prominent interviews with industry figures, and the latest congressional debates, notably around tariffs and AI policy. The episode features in-depth interviews with Patrick Doyle, chairman of Restaurant Brands (Burger King, Tim Hortons, Popeyes), and Alex Boris, assemblyman and congressional candidate with a tech background at Palantir.

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Market & Economic Recap

Treasury Yields & Deficit Talk

• Stable, Range-bound Yields: Treasury yields have been stuck in a range; Fed cuts aren't moving longer-term rates as expected. (02:56)
  • Steve Liesman: “It’s boring after a while this ten year thing, right. It just looks like it’s going to be a story and then it comes back.”
• Deficit Concerns: Discussions on federal budget deficit, with differing numbers between the administration and the CBO (Congressional Budget Office), partly due to calendar vs. fiscal year accounting. (04:06)
  • Kelly Evans: “It’s going to be hard for this [yield] level to come down while we’re talking about deficits that are $3 trillion.”
  • Steve Liesman: “The big beautiful bill goes the wrong way on the deficit, immigration goes the wrong way. The only thing that goes the right way are the tariffs.”

Labor Market Analysis

• Strong jobs report, but skepticism on the robustness and sector concentration of job growth.
  • Brian Sullivan: “Jobs number yesterday was double the expectation... but it’s all health care, it doesn’t really count. Does it count?”
  • Steve Liesman: “It absolutely does count... Health care and social assistance has been the number one sector. It’s a little dangerous... but I’m giving this jobs number a pass.” (05:16)

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Fast Food Economy in Focus

Shrinkflation & Value Meals (07:10–08:49)

• Rising Fast Food Costs: Discussion of fast food meal inflation and consumer scrutiny of value.
  • Kelly Evans: “A McDonald’s chicken nugget value meal used to cost $10 after the inflationary thing a couple of years ago. Which brings us into their earnings.” (07:13)
• Shrinkflation Humor: Brian recalls social media post questioning if burgers are shrinking or his key is getting larger.
  • Brian Sullivan: “Is there any shrinkflation in there as well?... Maybe my key or my hands are getting larger in my old age.” (08:30)
  • Steve Liesman: “Once you call it a Quarter Pounder, you’re a little locked in.” (09:04)

Tariffs and Congressional Pushback (09:13–14:27)

• House Rebukes Canada Tariffs: House votes to revoke Trump-era tariffs on Canada; rare bipartisan move ahead of Senate debate.
  • Emily Wilkins: “Trump has already threatened retaliation… any Republican that votes against tariffs will seriously suffer the consequences come election time.” (10:52)
• Institutional Power Dynamics: Discussion on the difficulty of clawing back executive powers, especially around emergency tariff authority.
  • Steve Liesman: “Congress is learning a lesson here—when it provides authority to the president… Clawing it back is very, very difficult.” (13:33)

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Interview Highlights

Patrick Doyle, Executive Chairman, Restaurant Brands International

[Interview Segment: 20:59–26:21]

• Bifurcated Consumer Landscape:
  • Patrick Doyle: “If it’s a household income over 75,000, it’s positive. If it’s under, they’re still being a little conservative about how they spend.” (21:29)
  • Steve Liesman: “Are you seeing it more the case now, this bifurcation, than it usually is?”
    Doyle: “No, much more. Certainly in the last year, year and a half, that’s a relatively new thing.” (22:11)
• Value Proposition vs. Product Experience:
  • Brian Sullivan: “There’s this debate about value versus money, right? What do people feel?”
  • Doyle: “We’ve been very consistent with the value… What we’re focused on is giving better value by having better food, better service, renovating our restaurants.” (22:59)
• AI’s Influence on Restaurants:
  • Steve Liesman: “AI is going to have an influence on your business?”
  • Doyle: “You’re going to see almost everything. You’re going to see labor, scheduling, you’re going to have cues about what’s selling well, what you need to make more of... It’s going to have a very big impact.” (25:23)
  • On bottom line: “If we get more growth, if our franchisees are making more money… We promised the market 8% operating income growth. We’ve done that three years in a row.” (25:40)
• Memorable Moment:
  • Steve Liesman asks for AI example; Doyle says: “You’re going to see almost everything.” (25:23)
  • Liesman jokes about wishing for better AI ordering kiosks. (25:54)

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Tech Stocks & Supply Chain

Hardware Cost Pressures & Cyclical Tech Recovery

• Cisco Earnings: Despite positive results, margin concerns and memory costs drive an 8% stock drop.
  • Brian Sullivan: “Cisco was one of the last of the old tech giants to finally reach its new highs.” (15:32)
  • Steve Liesman: “There’s a cool new box—they have that’s going to use an Nvidia chip and help chips talk to each other faster.” (16:35)
• Apple & Memory Costs: Potential iPhone price hikes due to memory price inflation. (16:56)
• Corning's Quiet Success: Role in fiber optics and smartphone glass, with light regional banter. (17:18–18:10)

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AI Regulation: National Policy Debate

Interview with Alex Boris, NY Assemblyman & Congressional Candidate

[Interview Segment: 28:46–36:14]

• Boris’s Mission: Bring “guardrails” to AI development and deployment.
  • Alex Boris: “I want to give Americans a say in AI. Most Americans are pro innovation and pro AI, but they think there need to be some guardrails. And it’s moving incredibly quickly.” (29:29)
• His Eight-Point Plan:
  • Focus areas: Kids’ exposure & chatbots, workplace impacts, deepfake threats, democratizing research access, and public trust.
  • Boris: “It’s an eight point plan focused on making sure that AI benefits the many and not just the few.” (29:56)
  • On NY’s $400M Empire AI cluster: “We should be doing that same thing and investing in the capacity at the federal level as well.” (31:10)
• Pushback from Tech Billionaires:
  • Super PACs backed by Greg Brockman (OpenAI), Joe Lonsdale (Palantir), and Andreessen Horowitz funded opposition to his legislation and campaign. (28:46, 29:29)
  • Boris: “The opposition is trying to keep power concentrated and make sure that the American people can’t put standards on it.” (32:09)
• Balancing Regulation & Innovation:
  • Kelly Evans asks: How to ensure you don’t “hamper innovation” ([30:30]), Boris responds with nuance and technical fixes like privacy-preserving age verification (33:10).
  • Boris: “You could require every single company to scan every license… But there are good technical advances that have been made.” (33:10)
• Why Now? The AI Acceleration Imperative:
  • Brian Sullivan: “AI is doubling in compute capacity every year… Is now the time? If we don’t do this now, we might not get the chance.” (34:24)
  • Boris: “Every seven months, AI is doubling the capacity… Recently it’s going closer to four months.” (34:27)
• America vs. Europe, Trust as a Differentiator:
  • Steve Liesman: “Why regulate if it risks our lead over Europe?” (34:40)
  • Boris: “The market actually currently is undervaluing trustworthiness of AI. The AI that will win in the long term will be trustworthy AI.” (34:54)
  • Notable quote: “If you’re in Europe, why do you want to use American AI? People want there to be verification. They want to know that the AI has been tested.” (34:54)

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Notable Quotes & Memorable Moments

• Steve Liesman, on jobs data:
  “It absolutely does count. Health care and social assistance has been the number one sector. It’s a little dangerous… but I’m giving this jobs number a pass.” (05:16)
• Brian Sullivan, on shrinkflation:
  “Is there any shrinkflation in there as well?... Maybe my key or my hands are getting larger in my old age.” (08:30)
• Patrick Doyle, on consumer trends:
  “If it’s a household income over 75,000, it’s positive. If it’s under, they’re still being a little conservative about how they spend.” (21:29)
• Emily Wilkins, on tariffs power struggle:
  “If we normalize broad emergency trade powers today, we should expect that a future president of either party will rely on the same authority in ways many of us would strongly oppose.” (10:52)
• Alex Boris, on AI regulation urgency:
  “Every seven months, AI is doubling the capacity… It used to be you would talk about Moore’s law and every 18 months… Seven months, recently it’s going closer to four months.” (34:27)
• On trustworthy AI and America’s edge:
  “The market actually currently is undervaluing trustworthiness of AI. The AI that will win in the long term will be trustworthy AI.” (34:54)

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Timeline of Key Segments

| Timestamp | Topic / Segment | |-----------|------------------------------------------------------| | 02:56 | Yield, deficit talk, CBO vs. Admin accounting | | 05:16 | Job market, sector concentration dilemma | | 07:13 | Fast food price inflation, value meal woes | | 09:13 | Tariffs & Congressional vote, pushback on Canada | | 20:59 | Patrick Doyle interview: fast food consumer paradox | | 25:23 | Doyle on AI in restaurants (labor, metrics, ops) | | 28:46 | Alex Boris interview: AI policy plan & implications | | 34:24 | The case for urgency in AI regulation | | 34:54 | Trust as AI’s unique US differentiator |

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Conclusion

This episode brings into focus the everyday economic pressures felt by American consumers—especially around food prices and value—and examines the crucial and complex choices policymakers face in the age of accelerating AI. The nuanced insights from both fast food industry leaders and a tech-savvy legislator paint a picture of an economy and society at the crossroads: between innovation and regulation, cost pressures and value, concentrated power and democratization. The tone is candid and occasionally irreverent, but the content underscores major shifts shaping the American present and future.

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Transcript

[Keith Lansford]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] Market Update podcast or find Schwab Market Update wherever you get your podcasts.

[Cameron Costa]

Not every sale happens at the register. Before AT&T business Wireless, checking out customers on our mobile POS systems took too long. Basically a staring contest where everyone loses. It's crazy what people will say during an awkward silence. Now transactions are done before the silence takes hold. That means I can focus on the task at hand and make an extra sale or two. Sometimes I do miss the bonding time.

[Brian Sullivan]

Sometimes AT&T business Wireless connecting changes everything.

[Steve Liesman]

Bring in show music please.

[Cameron Costa]

This is Squawk Pod and I'm CNBC producer Cameron Costa. On today's episode, what the markets value in consumers?

[Kelly Evans]

Can we talk chicken nuggets?

[Steve Liesman]

Oh yes.

[Brian Sullivan]

There's this debate about value versus money.

[Cameron Costa]

Fast food company restaurant brands, the parent of Burger King, Tim Hortons and Popeyes seem to sees how inflation is impacting consumer diet. Executive Chairman Patrick Doyle joins us.

[Patrick Doyle]

We've been very consistent with the values, so we've been doing five and seven.

[Cameron Costa]

Dollars plus how the US Will end up regulating AI and staying competitive. Maybe they're more intertwined than we expect. Tech worker turned politician, New York's Alex Boris has a plan.

[Alex Boris]

I think the market actually currently is undervaluing trustworthiness of AI. The AI that will win in the long term will be trustworthy AI. And so it's easy for all of us to say we don't want to use Chinese AI. That's obvious. If you're in Europe, why do you want to use American AI?

[Cameron Costa]

It's Thursday, February 12, 2026 and Squawkpod begins right now.

[AT&T Business Wireless Announcer]

Standby in 3, 2, 1.

[Brian Sullivan]

Q please.

[Kelly Evans]

Good morning and welcome to Squawkbox here on CNBC. We are live at the NASDAQ marketsite in Times Square. I'm Kelly Evans along with Brian Sullivan and Steve Liesman. This morning we're all in for Joe, Becky and Andrew. Yesterday we saw the struggle throughout the day with the jobs report we started positive about it ended a little bit less. So NASDAQ is now trying for its first positive week in five as we look to close out trading today and tomorrow. I'm getting a little ahead of myself and treasury yields. Well, that's you know that's kind of the 417 on the 10 year. So remember about 24 hours ago we jumped up to 420 after the stronger jobs report. We circled much of that back and we're still hovering right around those levels. 350 on the two year.

[Steve Liesman]

It's boring after a while this ten year thing, right. It just, it looks like it's going to be a story and then it comes back, then it falls and then it's just going to be a story and then it goes back and it's. I don't know guys, if you have like a one year on this thing, but it seems like it's stuck in this range like a higher in mud.

[Kelly Evans]

Rick has talked a lot about there.

[Steve Liesman]

It is two years but at the same price.

[Brian Sullivan]

I mean it's fluctuated.

[Steve Liesman]

But look at the the story of course is that the Fed has been cutting rates in the ten year has not really responded.

[Brian Sullivan]

All that wonderful bond market going to bond market. Steve, it's going to do it.

[Kelly Evans]

A layer of that is. I don't know what was it? Yes, probably around the time Brian, you were sitting down. 2pm the see when did that CBO power lunch.

[Brian Sullivan]

Yeah, right after the exchange.

[Kelly Evans]

1:00Pm thank you very much. Steve. When was the CBO?

[Steve Liesman]

CBO was yesterday at, at, at 10:00'.

[Emily Wilkins]

Clock.

[Kelly Evans]

Okay, fine. I think that look, it's going to be hard for this level to come down a lot while we're talking about deficits that are $3 trillion or whatever that number was that they gave us by 2036. I mean fundamentally, that's why it's I think kind of hovering right around these.

[Steve Liesman]

I mean the administration tries to tell a story here that they brought down the deficit to 5%, 15% year on year.

[Kelly Evans]

But it's a kind of a. Yeah.

[Brian Sullivan]

But it's still so high. It's going back up.

[Steve Liesman]

It ends up by the way, the administration. I finally got to the bottom of this. Why the administration saying one thing and the CBO saying another. And you know, with the boring answer is the administration is using calendar year. CBO is using fiscal year even for.

[Brian Sullivan]

The deficit, October to October.

[Steve Liesman]

Anyway, it ends up being $100 billion on a base of 1.9 trillion. So it's like look, I get it. You take any victory you can get. But if you read the CBO report, the big beautiful bill goes the wrong way on the deficit, immigration goes the wrong way. The only thing that goes the right way are the tariffs.

[Brian Sullivan]

So here's I'm glad you're here. Good morning, by the way.

[Steve Liesman]

Not just because I'm glad you're glad.

[Brian Sullivan]

Yeah. Well, let's.

[Steve Liesman]

Because it would be terrible if you weren't glad together. Right. Okay.

[Brian Sullivan]

And here's the narrative. So during the former president's years, whenever the jobs number would come in good, those on the political right would go on the social media thing and they'd be like, but it's all government jobs. It really doesn't count. Now the jobs number yesterday was double the expectation. And those on the political left are going online on the social media thing and they're going, but it's all health care. It doesn't really count. Does it count? How do we read the economy right now?

[Steve Liesman]

It absolutely does count. I will point out that it was Secretary Bessant who criticized the Biden economy for all of its use of health care as a source of job growth. And he has pledged as part of the Trump overhaul of the US Economy to get out of that business. Well, they're not out of that business. Health care and social assistance has been the number one sector. It's a little dangerous, Brian. It makes me a little nervous when things are focused like that. But I'm giving this jobs number a pass and I'll tell you why. If you look at the job growth over the past year, that's a cue to the guys in the back. If you can put up the job, it's a hint. It's a 603 in the morning and they didn't know we were going to go here. So apologies to them in the back. If you look at that job growth trajectory, you can see an effect of the tariffs. But then I see this little creep up and it happens in January, and I am hopeful that what that means is business is getting its feet back under it when it comes to the uncertainty generated by the tariffs. I'm hopeful. But more than being hopeful requires some confirmation. And you just can't go from 40, 41, 30 and say, oh, we're not on a new trajectory here, that which the administration wants to be able to.

[Brian Sullivan]

How many months does Steve Liesman need to see for you to be convinced?

[Steve Liesman]

At least. At least. There we go. So, so you can see, by the way, look at those three numbers, those three, three bars to the left. We were doing okay up to January and then you can see the up and down that happened. And now, okay, that's a possibility to be hopeful. But administration tried to call me last night and spin me a little bit on this, and they had at least one point which was that the seasonals were a little tough on the number yesterday. It could have been even higher if not for the seasonals. They got a little bit of break though in the birth. Death helped them out a little bit if you look at that. Anyway, it's hopeful. It's possible it's there but I got to see it repeated. I'm not going to. There's a lot of data that says the jobs market weak before I'm going to go crazy.

[Kelly Evans]

Can we talk chicken nuggets?

[Steve Liesman]

Oh yes.

[Kelly Evans]

Because the other thing. So there's probably. Go back. Let's go back to the 10 year. One piece of that is the whole deficit thing we're talking about. The other piece of it is the fact that a McDonald's chicken nugget value meal used to cost $10 after the inflationary thing a couple of years ago. Which brings us into their earnings.

[Steve Liesman]

I wouldn't.

[Emily Wilkins]

No.

[Steve Liesman]

I say her sarcastically.

[Brian Sullivan]

Yes, it's six piece.

[Kelly Evans]

They the value. The difference between what you'd pay at Chipotle and McDonald's. To Chipotle's credit. They tried not to like move a lot higher. Got a little, little close there and it was a real headwind for them and for Pepsi and First. Now what Pepsi's cutting prices and what. What is McDonald's talking about?

[Steve Liesman]

Let's talk about this. McDonald's reporting fourth quarter sales and profit. Kelly. Which was above analysts estimates as the company's value push wins over customers. Same store sales increasing by 5.7% fueled by gains in the U.S. wall street was projecting comps below 4%. McDonald's Chief Financial Officer saying the company is off to a strong start in 2026. But executives expect weaker first quarter. Same store sales growth versus the fourth quarter. Last month's winter storm keeping some diners away and caused temporary restaurant closures. So I got a lot of questions.

[Kelly Evans]

I think we've got a lot of fans here as well.

[Brian Sullivan]

I would say this. I posted a picture a couple years ago. I have a car that's old enough to have an actual key.

[Kelly Evans]

Like a. I do too.

[Brian Sullivan]

It's not a fob. It's like I gotta. If I don't have the key. And I posted a picture of a McDonald's burger next to the key. And I thought is my key getting bigger or is the burger getting smaller? I don't know. And it was like now I know. You know, two bites and I was gone. So I don't. I'd love to know. Is there any shrinkflation in there as well.

[Steve Liesman]

Right.

[Brian Sullivan]

They can lower the price or keep the price steady because things are getting a little bit smaller. And maybe it's not a bad thing. And maybe they're not. I'm not saying McDonald's. They're shrinking. Maybe my key or my hands are getting larger in my old age.

[Steve Liesman]

I feel like.

[Brian Sullivan]

I know. My gut is, once you call it.

[Steve Liesman]

A Quarter Pounder, Brian, I think you're a little locked in.

[Brian Sullivan]

Well, then you're locked in. Well, they call it Royale with Cheese in Europe.

[Steve Liesman]

Oh, okay. Well, maybe they. And they use the metric thing. So they can do anything they want.

[Brian Sullivan]

They do anything they want.

[Steve Liesman]

On this vote, the yays are 219 and the nays are 211. The joint resolution is passed without objection. The motion to reconsider is laid on the table. The House weighing in against President Trump's tariffs on Canada. Emily Wilkins joins us now with this surprising vote that broke last night. Emily.

[Emily Wilkins]

Yeah, Steve, good morning. Look, one of the strongest rebukes from Congress to Trump's tariffs policies. We saw it last night. House lawmakers voting to revoke the tariffs, this one specifically, on Canada. Now, the measure that passed the House would end the national emergency that Trump used as the legal basis for the tariffs to. So that measure now going to the Senate. And remember, senators have already approved a similar resolution to end the tariffs in Canada last year. Back in the House last night, six Republicans voted with all but one Democrat to overturn the tariffs. One of the six, Congressman Jeff Heard of Colorado. He said that farmers and steelworkers in his district have been negatively impacted by the tariffs. But he was also concerned about the balance of power in the U.S. he tweeted that if we normalize broad emergency trade powers today, we should expect that a future president of either party will rely on the same authority in ways many of us would strongly oppose. Institutional consistency matters. The Constitution does not shift depending on who occupies the White House. Trump, of course, has already threatened retaliation against Heard and the other five House Republicans, as well as any senators who plan to vote for the legislation when it hits that chamber. He posted on Truth Social last night that any Republican in the House or the Senate that votes against tariffs will seriously suffer the consequences come election time, and that includes primaries. This tariff measure that passed last night, it's not likely to be the last one. House Democrats also plan to force votes revoking tariffs on Mexico, Brazil, and globally in the coming weeks.

[Steve Liesman]

Guys, let me ask you this question. What is the chance that this ends up passing in the Senate. And then even so, does it have a veto proof majority in either chamber?

[Emily Wilkins]

Two really good questions, Steve. I mean, yes, there's a great chance this passes in the Senate because you only need a simple majority. You don't need 60 votes, you need 51. And again, we saw a similar measure get those four Republicans needed to actually pass the Senate as well. But as you correctly point out, Trump is able and will be vetoing this. And clearly there's not the support in Congress to overturn that veto soon. Still, I mean, a president having to veto a bill that his party sent him, they control both chambers of Congress. I think this is showing right now that as you get into midterm season, as lawmakers are more focused on affordability, there is concern about some of these members, particularly in competitive races, showing that they are trying to be attentive to some of the high costs and the high prices that they're seeing and push back, given that some of their industries are being hurt because of these tariffs.

[Kelly Evans]

Would, Emily, would you say in a word, though, this is theater and positioning ahead of the midterms, which is information in and in and of itself, or is there any real likelihood that the administration faces, you know, being boxed in by Congress on any aspect of the tariffs they've implemented so far?

[Emily Wilkins]

You know, Kelly, of all the issues that have kind of come up between Congress and the White House, where there's been a bit of disagreement, tariffs have always stuck out to me as really unique. I mean, last year when we were around the, the deemed liberation Day, there was a lot of frustration in Republicans that I was speaking with in the halls of Congress. You know, a number of them said, we want to see this play out. Obviously, a lot of those tariffs were rolled back. Right now, Mike Johnson was telling his members last night, hey, let's just have the Supreme Court see what they rule on this before we try to weigh in. So there's been this whole wait and see, wait and see. At the same point, there has always been a level of uncomfortableness on Capitol Hill with the tariffs that, that Trump has put in place. And I think now that you're getting to a point where members are looking at an election, the calculus is changing a little bit, given last year where maybe everyone kind of fresh off a huge win for Republicans, was feeling the unity and everyone trying to move in lockstep.

[Steve Liesman]

I'll make one very quick point, which is that it seems to me, Emily, that Congress is learning a lesson here when it provides the authority to the president or to the executive Branch to make these tariffs, Clawing it back is very, very difficult. And it, it has the ability to override.

[Kelly Evans]

Did they provide him with the authority or did he.

[Steve Liesman]

Yes, of course they did. The ieepa, the emergency tariffs decades ago. That's there. That's a provision they provided to the president to do these tariffs. But clawing it back, you can see here, is very difficult. You not only have to get a majority, but then you have to get.

[Kelly Evans]

A veto proof that majority or the Supreme Court.

[Emily Wilkins]

And this is, this has been the story of Congress for, for a decade now, giving power to the executive branch because one party wants their president to do a thing. And then as Jeff heard points out, but then the next party's president comes in and suddenly you're stuck with the precedent. And suddenly things are happening that maybe you didn't agree with or didn't.

[Brian Sullivan]

We're approaching year two of a second term and there's going to start to be pushback because people are going to realize that this president will not be president in a couple of years. They're going to start to angle for the new person, whatever that may be.

[Steve Liesman]

Let us thank Emily before we lose that opportunity. Emily, thank you.

[Brian Sullivan]

Let's talk about Cisco Systems. That stock is down about 8% right now. The company beating earnings and revenue estimates. So what's the problem? Well, in focus for investors was a slight miss on the margins because of increasing prices. What we just talked about with burgers, but this one is for computer memory. Cisco's adjusted gross margin, 67 and a half percent the second quarter. Company expects that number to worsen in the current quarter, down between 1 and 2 percentage points. On a call with investors, Cisco CEO Chuck Robbins said the company has raised its prices because of increased cost of memory. It is revising contracts with partners. Now, let's be clear, I don't make too much. The stock's down 8%. But let's be clear, okay. The stock has been soaring the last year. It's up 11% this year and is like doubled in a year.

[Kelly Evans]

This is so ironic. This is the. So Cisco was one of the last of the old tech giants to finally reach its new highs. We were just celebrating that fact while also going, wow, look at the memory trade. You know, I wish I had connected the dots. I'm sure some other investors feel the same way. The very same reason that we've seen hardware like the Western digitals and the SK Hynixes and stuff of the world is the best. The Korea stock market is doing what it's doing. Here's the collateral fallout from that. Cisco is down 7/2% almost giving up its year to date gains.

[Brian Sullivan]

Well to be fair it's doubled in five years, not one year. But you know I was here 100 years before you were born Kelly. I was standing at this wall when they had these things called fraction Steve. I don't know if you remember that. And it was all these companies that no longer exist anymore. But at that time Cisco was the largest company in the world. It hit 600 billion in market cap which now seems quaint. Like 6 trillion people are like oh my God, 600 billion is Cisco Systems. And that was the peak for 25 years.

[Steve Liesman]

Wild.

[Kelly Evans]

And here they are finally having a comeback thanks to some of this, you know, so forth and of course the the rebound in memory is taking some heat.

[Steve Liesman]

There's a cool new box they have. Did you read about that?

[Kelly Evans]

No.

[Steve Liesman]

It's going to use an Nvidia chip and help the chips talk to each other faster where there's overload in the AI system and they're I think they're putting a bunch of their hopes on that.

[Kelly Evans]

I don't know can we quickly show Apple players I mean that while that is that you'd think again that makes them an AI beneficiary. Although this is the flip side.

[Steve Liesman]

I don't know how much of the business it'll ever be but it's part.

[Kelly Evans]

Of their here's another one. Yes, it's done well over two decades. This is the other name that people are focused on having to pay more for memory pricing. All of it. Yes, they might have to raise yes, they might have to raise iPhone prices 15% later this year. That's partly why I look at the stock had been on a losing skid but doing a little bit better lately. Just curious if that reacted to and.

[Brian Sullivan]

Then only because I feel ashamed and embarrassed I don't want to be left out of the conversation is let's look up GLW Corning because this is another Cisco like name. You know the Phoenix comes out of the ashes. Corning has been one of these and I'm using and I say this very politely to all my friends up there in Corning and Elmira area Horseheads, New York where they're based which is where you're from I think originally Kelly raised in Syracuse. There you go. Which is this is one of those companies that people kind of didn't think about and they realized who makes all the fiber optic cables that connect all.

[Steve Liesman]

These things and the Screens, right?

[Kelly Evans]

Yeah.

[Brian Sullivan]

Yes. The gorilla glass on the phone.

[Steve Liesman]

I love this Corning story.

[Brian Sullivan]

Do you know why the ticker is GLW Glasswork. Correct. Glassworks.

[Kelly Evans]

But I actually don't know much more beyond glassworks. Yeah.

[Steve Liesman]

I'm amazed. The company is still there, still thriving, still part of the whole story.

[Brian Sullivan]

And Wendell Weeks is still the CEO when the Weeks. And I know he's been on Squawk Box many Times, was the CEO of Corning 25 years.

[Steve Liesman]

Am I right? They're still in Corning. The town of Corning still in Corning. But there was hard up against 17. I think I've been losing leaving a little bit. Was there a story about that? Anyway.

[Brian Sullivan]

The Finger Lakes region of New York. By the way, I know you're a big fisher. Do you fish in the Finger Lakes? They're the deepest lakes in America. The second deepest in the world.

[Steve Liesman]

I never have.

[Brian Sullivan]

Lake Seneca's 950, 53ft deep.

[Kelly Evans]

Skinny Atlas is the one I grew up near.

[Steve Liesman]

You realize they're never gonna put us together if we keep talking like this.

[Kelly Evans]

All right, let's check out 6:20 in the morning.

[Steve Liesman]

You don't really wanna come back.

[AT&T Business Wireless Announcer]

Cheese will be next.

[Cameron Costa]

Coming up on Squawk Pod, the fast food executive who leaned into technology when he was CEO of Domino's restaurant. Brand's chairman Patrick Doyle on what he sees in American wallets.

[Patrick Doyle]

If you look at the US consumer, it's what you've been hearing. It's very bifurcated.

[Cameron Costa]

We'll be right back.

[Keith Lansford]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] Market Update podcast or find Schwab Market Update wherever you get your podcasts.

[AT&T Business Wireless Announcer]

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. A 14 point turn. An influencer even live stream. The whole thing. Not good for business. 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.

[Brian Sullivan]

AT&T business Wireless connecting changes everything.

[Cameron Costa]

There's a fire inside you you can't ignore. Stand still. Not a chance. You're a lifelong learner who's come this far now, we are here to help you keep going further. Capella University. What can't you do? Visit Capella Edu to learn more. This is Squawkpod.

[Brian Sullivan]

All right, we are halfway down with Squawk Box. Good morning, everybody. Thank you very much for joining us. I'm Brian. We got Steve here, We got Kelly here as well. The whole gang has just swapped out. Do not adjust your dials. They'll be back, most of them, tomorrow. Right.

[Steve Liesman]

I know where they all gone, though. Joe's in California. He does his golf.

[Brian Sullivan]

It's a lot of big guests. You saw that board. A lot of big guests.

[Kelly Evans]

Yeah.

[Steve Liesman]

Yeah.

[Brian Sullivan]

Restaurant Brands International reporting better than expected earnings, better than expected revenues. Same store sales jumped by 3.1%, powered largely by growth outside the United States. But let's talk about it all. Bring it together. Patrick Doyle is Restaurant Brands International's executive chair. Patrick, great to have you on Squawk Box and cbc. Thank you very much. What are you seeing from the consumer and how is the consumer here in the United States different from the consumer outside of the United States?

[Patrick Doyle]

Yeah, I mean, Brian, there is real strength outside of the U.S. no question. Our international business put up a six comp. Tim Hortons continued to be very strong in Canada, almost a three. So we feel very good about that. And that's kind of 70% of our cash flow. If you look at the US consumer, it's what you've been hearing, it's very bifurcated. If it's a household income over 75,000, it's positive. If it's under, they're still being a little conservative about how they spend.

[Steve Liesman]

Patrick, I want to interrupt you right there because we gather a lot of this, but we don't have a lot of data on that point. Has that always been the case? Are you seeing it more the case now, this bifurcation than it usually is?

[Patrick Doyle]

No, much more. Certainly in the last year, year and a half, that's. That's a relatively new thing. But I'll tell you, I'm optimistic. As long as the employment picture stays good, then I think we're going to see that come back around.

[Brian Sullivan]

Is there any. We were debating earlier from one of your competitors. They've got like this golden arch thing. I won't mention my name. You might have heard of them, Patrick.

[Steve Liesman]

But I've heard of them.

[Brian Sullivan]

There's this debate about value versus money, right? What do people feel? If they feel like they're getting something that is worth their dollar, they are more likely to go to that at Your restaurants, Tim Hortons, right. At Firehouse, at Burger King and Popeyes. What have you learned in the last couple of years about the consumer? That was the most eye opening?

[Patrick Doyle]

Yeah, I think the interesting thing there, Brian, is we've been very consistent with the value. So we've been doing five and seven dollars with Burger King. That's working for us. We haven't been pulling a bunch of different levers. What we're focused on is giving better value by having better food, better service, renovating our restaurants. So we're really very focused on improving the. The experience that our customer is having and doing that for a consist. I think what you've seen from our competitors is a lot of, you know, pulling around with different value levers to try to get that right and maybe less on the experience side.

[Kelly Evans]

Patrick, you have one of the best kind of track records in restaurant history. I mean, I think you took Domino's from, what was it, 12 to 270, a very short period of time. All the tech stuff that now we are seeing kind of other chains emulate. Obviously, it's been a little bit tougher at restaurant brands, and it seems like every time something gets fixed, something else is a problem. Can I call Popeyes a problem? I mean, that was all the rage in America. And then finally, this is my indicator, they open one near me, and apparently no one's going to Popeyes anymore. Just talk about that. And what do you do with this kind of messy group of four brands?

[Patrick Doyle]

Yeah, well, I mean, three of them are doing great right now, and Popeyes is now at a run rate of $2 billion outside of the U.S. so we've just got to execute a little better inside the US So people are still definitely going to Popeyes. You know, we had a little bit of a negative in the fourth quarter at about down 5. We'll get it fixed. It's about simplifying the menu, executing better, giving better value to the consumer. We'll get that done. We know how to do it. We did it at Tim's. We're doing it at Burger King. We'll get it.

[Steve Liesman]

Patrick, tell us how. If at all AI is going to have an influence on your business, it's.

[Patrick Doyle]

Going to have a very big influence. I'm very excited about what we're getting done. Kelly mentioned, you know, Domino's kind of turned into a tech story. We're working on a lot of things. I'm excited about the opportunity to help our restaurant general managers run their businesses.

[Steve Liesman]

Give us one example. Patrick. Patrick, we're going to run out of time. I really want you to give me an example. Tell me something that you're doing now manually, that AI is going to come in and magically do for you at a much cheaper cost.

[Patrick Doyle]

You're going to see almost everything. You're going to see labor, scheduling, you're going to have cues about what's selling well, what you need to make more of. All of these things are going to happen. It's going to have a very big impact on our business and frankly, the whole restaurant industry.

[Steve Liesman]

What's it mean for your bottom line?

[Patrick Doyle]

You know, if we get more growth, if our franchisees are making more money, they're going to build more stores, we're going to collect more royalties and make more money. We promised the market 8% operating income growth. We've done that three years in a row and that should keep us on that path.

[Steve Liesman]

I hope you use AI for these ordering machines, which are terrible.

[Brian Sullivan]

I mean, what ordering machine?

[Kelly Evans]

The kiosk.

[Steve Liesman]

Terrible. Patrick ran yours.

[Brian Sullivan]

He ran Domino's for a decade and we have that for the robots to.

[Kelly Evans]

Come and see the robots.

[Brian Sullivan]

We'll talk about the robots next interview. We're out of time.

[Steve Liesman]

I'm going to get an okay boomer thing from people. I just can't you really.

[Brian Sullivan]

I'll get that. We're not boomer. Patrick Doyle, really appreciate your time. Thank you very much.

[Patrick Doyle]

Thanks, Brian.

[Cameron Costa]

Coming up on Squawk Pod, New York State Assemblyman Alex Boris traded a career in tech at Palantir for politics. He's now running for a congressional seat in Manhattan. And his plan for AI regulation is key to his platform.

[Alex Boris]

You think about age verification, you could do that where it's based on the device itself, where there's a scan of an ID and then you delete that data and you have a token that can be referenced by any app in a privacy preserving way that doesn't put more burden on companies.

[Cameron Costa]

And because of his approach to AI regulation, some big tech and AI players have poured millions of dollars into opposing his congressional campaign. A big AI conversation up next. Hey, Fidelity, what's it cost to invest with the Fidelity app? Start with as little as $1 with no account or trade commissions on US stocks and ETFs. Hmm, that's music to my ears. I can only talk.

[Brian Sullivan]

Investing involves risk, including risk of loss. 0. Account fees apply to retail brokerage accounts only sell order assessment fee not included. A limited number of ETFs are subject to a transaction based service fee of $100. See full list of Fidelity.com commissions Fidelity Brokerage Services LLC Member NYSE SIPC before.

[AT&T Business Wireless Announcer]

We had AT&T 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. A 14 point turn. An influencer even livestream the whole thing. Not good for business. 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.

[Brian Sullivan]

AT&T business Wireless connecting changes everything.

[Cameron Costa]

There's a fire inside you you can't ignore. Stand still. Not a chance. You're a lifelong learner who's come this far. Now we are here to help you keep going further. Capella University what can't you do? Visit capella.edu to learn more.

[Emily Wilkins]

Welcome back.

[Cameron Costa]

You're listening to Squawk Pod from cnbc.

[Steve Liesman]

I'm Steve Liesman, joined by Kelly Evans and Brian Sullivan. We are in for Joe, Becky and Andrew, all of them. Among today's top stories, the shrinkflation in.

[Brian Sullivan]

The anchor in the casting.

[Steve Liesman]

You're disrupting, Brian. I know you're disrupting. You're very. You're a disruptor.

[Brian Sullivan]

This morning, New York State assembly member Alex Bors unveiling his plan to regulate AI, which includes a pitch to nationalize New York's Raise Act. Both bores and the Raise act have garnered national attention in the last year after a pro AI super PAC supported by OpenAI President Greg Brockman, Palantir co founder Joe Lonsdale and tech firm Andreessen Horowitz poured millions into opposing the legislation and preventing Mr. Bohr's from winning the congressional race for New York Representative Jerry Nadler's seat. Joining us now is assembly member Alex Bors. All that aside, how was the play? Mrs. Lincoln, what do you want to do that is enraging these rich and powerful tech gurus so much?

[Alex Boris]

I want to give Americans a say in AI. It's as simple as that. Most Americans are pro innovation and pro AI, but they think there need to be some guardrails. And it's moving incredibly quickly. They're seeing impacts on their kids, on their job, on the environment, and they think government should have a say. And while lots of people are talking about what to do in AI, I'm the only one that's actually delivered.

[Brian Sullivan]

What do you want to do? What would be the Alex Bohr's Georgia Tech master's degree plan for AI?

[Alex Boris]

Yeah. First Democrat elected in New York State at any level with a degree in AI. I talk about protecting kids using AI when it can be helpful as a personalized teacher, but also looking at the effectiveness of chatbots on kids. I look at the workplace, I look at the threats to democracy, how we can regulate deepfakes in order to fix things. It's an eight point plan focused on making sure that AI benefits the many and not just the few in the.

[Kelly Evans]

Specific ways where we've seen harms, like, I don't want to use the word encouraging the suicides that have happened, those kinds of areas, things where there's a deep fix, it feels like there's obvious areas where the law could step in and play a role.

[Brian Sullivan]

Absolutely.

[Kelly Evans]

But even there, my concern, I think the concern a lot of people. I want us to have the best AI models. I want to wake up every day like I'm doing right now and go, wow, Gemini. And while this and while that, how do you make sure, especially we're such early innings, that you're targeting the specific harms and not kind of like hampering the overall pace of innovation?

[Alex Boris]

Yeah. It's not simple, it's not easy. It requires nuance and diving into the details. And the last part of the plan is about keeping America competitive. It's investing in government capacity to expedite research the same way we've done in the state of New York with Empire AI, where we built our own data cluster so that our researchers can advance the science I want.

[Kelly Evans]

Are your researchers, you mean like just.

[Alex Boris]

In New York State? At universities? So New York State put in 400 million to establish our own compute cluster so that the cost of research in the state go down and grants that our professors get, our universities get can go further. We should be doing that same thing and investing in the capacity at the federal level as well.

[Steve Liesman]

Alex, help me out here, because AI seems to me to be one of the great democratizations of knowledge and computing capacity.

[Alex Boris]

Yeah, right.

[Steve Liesman]

People are sitting at their desk now who never even understood what a line of code was. Telling AI to write code and make me an app.

[Kelly Evans]

It's amazing you can do that.

[Steve Liesman]

And there's this concept out there of the person with the billion dollar company with one employee. So is your concern here, is part of your bill, part of an effort to make sure that it remains diffuse and available to everybody? And is the opposition, do you think, part of a process of trying to make sure it's not available to everyone?

[Alex Boris]

The opposition is trying to keep power concentrated and make sure that the American people can't put standards on it. That's what the real opposition is. The pushback is not from a lot of the ideas, many of which are supported by even the people who are opposing me. It's the idea that you would pass any regulation at all in this space.

[Steve Liesman]

Could you give us one example of something you can do now but could not do under your bill?

[Alex Boris]

That you can do now, but. Yeah, but your bill would regulate sell a chatbot to kids that is intended to elicit a romantic connection.

[Steve Liesman]

Is that going? Why would they do that?

[Alex Boris]

Because it makes money, of course.

[Kelly Evans]

I mean, you have fines in here like a million dollars. So what is it specifically that in this. What this would effectively do is bring some of these large language models under regulation. And that broad sense of occurrence understandably concerns people. So how do you make sure that your chatbot is not soliciting minors and maybe fining them for that behavior while still not making these companies feel like they are in a broader way, quote unquote, being regulated?

[Alex Boris]

Yeah, you can definitely take regulation and do it in a corporate clumsy way that has more that backfires more than it's meant to help. And the debate about kids is one of the key ones. You think about age verification. You could do that where it's based on the device itself, where there's a scan of an ID and then you delete that data and you have a token that can be referenced by any app in a privacy preserving way that doesn't put more burden on companies. Or you could require every single company to scan every single license in a way that's bad. So when you say age verification and some people will be out there saying that's an awful idea, they're assuming the worst version of it. But there are good technical advances that have been made that allow us to do much more than we could have.

[Brian Sullivan]

Even because it's moving too fast. Right. I mean, for example, the first. You represent Manhattan, parts of Manhattan. Yes. First person to get killed by a car, run over by a car was in 1899 on the Upper West Side of Manhattan. Cars going two miles an hour. I don't know how it hit the person or what happened. But the point is that it took about 30 years for there to be real laws in place around traffic after that. Yep, it moved. Took that long. AI is doubling in compute capacity every year. It's doubling in speed every couple of months. Is now the time if we don't do this now, is there we might.

[Alex Boris]

Not get the chance.

[Brian Sullivan]

We might not get right. Every too pervasive.

[Alex Boris]

Every seven months. AI is doubling the capacity of what.

[Brian Sullivan]

It can do every seven months. Yes.

[Alex Boris]

It used to be you would talk about Moore's law and every 18 months you would have an increase in compute. Seven months. Recently it's going closer to four months.

[Steve Liesman]

Alex, the people who, who support, who opposes a bill like this are going to say, look, one of the reasons why America has, is in front of Europe and other parts of the world is because we have been light on regulation of tech. How do you respond that I think.

[Alex Boris]

The market actually currently is undervaluing trustworthiness of AI. The AI that will win in the long term will be trustworthy. And so it's easy for all of us to say we don't want to use Chinese AI. That's obvious. If you're in Europe, why do you want to use American AI? People want there to be verification. They want to know that the AI has been tested, that it has gone through extensive checks. And often the research into safety ends up increasing capabilities more than anything else. You think of reinforcement, learning with human feedback that came out of the safety community. You think of deep research and chain of thought reasoning that came out of the safety community opportunities. So I think if you're focused on winning, there's a role in government to make sure, hey, there's this other part. The market's undervaluing. In the short term, we should be encouraging safety.

[Kelly Evans]

Are you, is the, are you running for the seat this fall? Is that this fall? So you are for, for Nadler seat?

[Alex Boris]

For Jerry Nadler seat?

[Brian Sullivan]

Yep.

[Kelly Evans]

Very interesting.

[Steve Liesman]

I will, I will say this real quick. More and more I'm hearing the people inside of AI coming out are the ones arguing for the regulation warning.

[Brian Sullivan]

Looks like the guy that just quit poetry for a living.

[Steve Liesman]

The people who know know, well, I.

[Brian Sullivan]

Want to be rich enough one day that I can write poetry for a living.

[Steve Liesman]

Yes.

[Kelly Evans]

Wouldn't you know it's coming out of. This would be a great no.

[Steve Liesman]

You're rich enough now, Brian. You just don't know it.

[Alex Boris]

And I'm really proud to have support from a lot of the employees at these companies. Nobody has friends, Steve.

[Brian Sullivan]

Nobody's poor. Who has friends.

[Kelly Evans]

Alex, thank you. Thank you, Alex Bors.

[Cameron Costa]

That's the podcast for today. Thank you for listening. Squawk Box is hosted by Joe Kernan, Becky Quick and Andrew Ross Sorkin. Tune in weekday mornings on CNBC at 6am Eastern and you can catch them live all the way until nine to get the best bits of that TV show right into your ears. Follow Squawkpod wherever you get your podcasts. We'll meet you right back here tomorrow. Have a great day.

[AT&T Business Wireless Announcer]

We are clear.

[Alex Boris]

Thanks, guys.

[Kelly Evans]

Hey, Fidelity.

[Alex Boris]

How can I remember to invest every month?

[Cameron Costa]

With the Fidelity app, you can choose a schedule and set up recurring investments in stocks and ETFs.

[Brian Sullivan]

Oh, that sounds easier than I thought.

[Cameron Costa]

You got this?

[Brian Sullivan]

Yeah, I do.

[Kelly Evans]

Now, where did I put my keys?

[Cameron Costa]

You will find them where you left them.

[Brian Sullivan]

Investing involves risk, including risk of loss.

[Patrick Doyle]

Fidelity Brokerage Services, llc.

[Brian Sullivan]

Member nyse, sipc.