Yahoo Finance Live: Daily Market Coverage (3-5 p.m. ET)

[music] >> Hello and welcome to Market Domination. I'm Ines Ferré in [music] for Josh Lipton live from our New York headquarters. There's just an hour to go until the closing bell [music] and stocks are mixed right now. Taking a look at the major averages, we're looking at the Dow that's down about 4/10 [music] of a percent, the Nasdaq is up about 8/10 of a percent, the S&P 500 up about 3/10 of a percent. If [music] we take a look at the long-dated bonds, we have been seeing those at elevated levels. You're looking at the [music] 10-year note that's at 529, the 30-year at 564, the US dollar index inching higher. Taking a look under the hood at where we're at with the sectors, [music] you've got technology that is really the outperformer right now. You've got consumer staples and financials, health care that are in the red. [music] And over on the Nasdaq 100, you can see there the mega caps that are in green territory like Nvidia, Apple, Google, uh Microsoft, [music] and Amazon. But then you've got Meta that's slightly lower. And also taking a look at the semiconductor [music] space, a mixed picture there for semis as Micron is going to be releasing its earnings after the closing bell. Tech stocks have been volatile, but underneath the moves, AI demand remains a key driver. We're taking a look at the opportunities heading into year-end with Shawn Bocki, research analyst at Janus Henderson Investors. Shawn, thanks so much for coming into studio. Um let's take a look at the AI trade right now and where we're at with this because we've been seeing some volatility, maybe some nervousness, I would say, because we've been seeing those long-dated bonds going higher. So, is there really a risk of a slowdown in AI or is this maybe perhaps a valuation reset? >> Sure. So, I think stepping back, obviously a lot of noise in the system right now, a lot of volatility throughout the summer. First it was open models, then it was AI safety. So number of things in the system right now, but when you step back, fundamentals are actually strengthening into year end, right? So you know, hyperscaler growth rates continue to accelerate, backlog is expanding, token growth is growing exponentially. From a trading perspective, we see continued advancement in front of from the frontier model players. And then finally, we have this new exciting growth opportunity from Meta Muse and an Instinct, right? For consumer agents. So while the headlines could be a little spooky, I think fundamentals continue to strengthen into year end, not weaken. >> And speaking of that Meta Muse, which has been really like a blockbuster, you also had OpenAI that launched its dots. So how do you see those two? Because this seems to be the moment where okay, AI agents meets monetization opportunity. >> Is that how you see it? >> Absolutely. So I mean, why is this transformational? It's it's bringing agents to the masses, right? Um And [clears throat] yeah, the idea of having your own personal concierge in your pocket is really what makes AI useful. And that's something we didn't have necessarily early in the year. We had open claw, and it was difficult to program. You had to have a Mac mini. Now you can have your own personal concierge in your pocket, and it's actually driving real productivity gains, whether it's things like booking a restaurant or you know, renegotiating a bill of yours. Really takes some of that friction off. So this is a real example of sort of a killer use case, and you know, I'll even go so far as to call it potentially an iPhone moment for consumer AI. Um in terms of labs, they've taken slightly different approaches. Meta's approaching it from the consumer angle, and OpenAI dots is more geared towards enterprise. It's paywalled. But at the end of the day, it's all about bringing less friction into the agentic experience, and we welcome any sort of incremental growth opportunities that these provides. >> So would you see then Meta as a winner here and and going forward a bullish case for Meta? >> Absolutely. So if you step back, um we've always been waiting for Meta to sort of productize all this investment they've made in infrastructure and you know, as we saw earlier this week there's a number of things they're doing between Muse agents at Muse Enterprise, Muse code. So a number of new products on on the horizon. They brought in a really good leader in their enterprise platform and C data side. So we definitely see Meta potentially turning a corner here in terms of productizing AI and driving real monetization. >> Getting back to Open AI, it's been in the news of course and also the FTC just today launched an investigation according to the Wall Street Journal on whether these AI labs are have misled the public about dangers about the technology. So are these AI safety risks that's been talked so much about in the industry? Are these a headwind for the sector at the end of the day? >> So I guess stepping back initially when we all saw the saw Dario's 3900 word essay, there was a there was a little bit of a panic, right? So what does this mean for model training etc. and do we need less compute? I think when as we sit here today we've had time to digest. I think a couple of things we learned is one, this idea of pacing of model development doesn't necessarily mean slowing innovation, right? The open models are only 6-9 months behind so we don't think I don't think we can afford to actually slow the the development and and the rate and pace of model development one. And then two, there's actually it you know, the idea of AI safety actually opens up an whole new additional TAM for semiconductors and the AI ecosystem just because of the additional compute required for controls, testing, evaluation. So So that's so it could actually be incremental to compute demand. Now when you step back, I think a lot of what's being talked about makes a lot of sense. So these AI labs are large. They serve thousands of enterprise customers. So it makes sense that you'd want some sort of accountability and guardrails and it's pretty clear that um you know, the AI labs are taking a lot of that into their own hands. We saw um we saw Anthropic partner up with Accenture to bring in independent evaluators. So and then Nvidia also had a pretty good security release with open agent safety platform. So, the industry is starting moving that direction and potentially the FTC I would expect them to cooperate with that. >> And this open versus closed models, I mean, you you bring this up. So, how do you see that playing out? >> Yeah, I I don't think this is an either/or situation. I think that we'll continue to see this sort of bifurcation of open versus closed. But, I think you're going to want your most sophisticated workflows, your advanced coding, scientific research, legal workflows staying on the frontier level models. And then, you know, maybe your less sophisticated workflows like productivity tools stay on open models. But, I think we welcome anything that that sort of accelerates enterprise AI adoption and cheaper tokens is certainly a way to do that. >> And and speaking of Anthropic and OpenAI, I mean, we have seen delays when it comes to these IPOs. You also had Aura that postponed its IPO. Do you see that as a risk at all that the fact that there's been these postponements postponements in going public? >> Well, I think that the pipeline is still very strong as we look out the next 12 months. I think all eyes are going to be on the the $2 trillion IPO with Anthropic here in the next month or so. I think so, less concerned about the timing as I am about the disclosures that we'll see in in the S-1 as it comes out. Particularly around the ROI and the economics of Anthropic's business model. >> So, let's take a look at some other names. Nvidia, they just announced that massive $150 billion share buyback. How do you look at Nvidia and the valuation there? >> Yeah, very exciting time for Nvidia. Obviously, they're ramping Reuben right now. Um, they continue to lead in terms of that that full stack across networking, compute, software. So, we think they continue to take a larger share of the pie. And given their growth rate of 70%, we think that eventually they'll probably get more supply and should be able to upside to that number. So, we see upside biased estimates and we see the stock extremely attractively valued here at at sort of 11 times consensus calendar 28 earnings. >> What about AMD? I think that you you highlight that as an opportunity as well. >> Yeah, a similar story with AMD, very important product cycle with Venice for CPUs as well as MI 50 450 on the GPU side. Uh we we still think still think they have a lot of share gain opportunity ahead and uh with the advent of Muse agents, we think that uh they're well positioned to capture incremental demand that comes their way. So, excited about AMD here. >> Are there other plays that investors should be looking at? >> Absolutely. So, stepping back, I think we want to we want exposure to um the processing, the movement, and storage of data. So, obviously on the processing side we have Nvidia and AMD, but we're also excited about areas like optics. Uh Lumentum Holdings is a name that we're excited about. Um storage, hard disk drives, so Seagate, leader in hammer disk drives, and potential pricing tailwinds as we look out over a multi-year horizon. So, and then last one maybe to highlight is this Taiwan Semi. Um they're the They have 100% share of leading edge foundries. Things are extremely tight and they've got extended demand visibility out for multiple years. So. >> And Micron is going to be reporting today after the bell. So, what are you going to be listening to in the earnings call for Micron? >> So, it's interesting you step back. The last few years last few quarters for Micron is all about how much price they can take. Now, it's really about getting that paradigm shift in getting investors to think not just so much about near-term upside, but the duration of the cycle. So, our view is that if Mike if they can convince investors that they can keep gross margins in sort of that mid-80s cruising altitude and just compound free cash and generate and do a pretty substantial buyback here in the end of the year, we think that the stock could potentially re-rate from its single-digit multiple to something closer to what should be a 10x multiple for a business that's super critical and strategically important to the AI buildout. >> And has been the high flyer, especially for the first 6 months of the year. >> Absolutely. >> All right, thank you so much, Shawn. >> Thanks for having me. >> And coming up, I speak [music] to HPE CFO about the company's upgraded networking outlook and more. Stay with us. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] [music] [music] [music] [music] [music] >> Today is HPE's networking investor day. The company announcing boosted networking outlook and a $1.2 billion order from cloud company Vultr to deploy Helios AI racks. Joining me now is Marie Myers, HPE CFO. Marie, thanks so much for joining us. Let's start with that deal, that $1.2 billion deal with Vultr. Tell us about it and the impact that it's going to have on revenue, on margins over the next few years. >> Sure, and good afternoon, as it's great to be with you this afternoon. I actually just came off the floor from our investor day in Sunnyvale. I've got to say, actually, one of the favorite parts of the day was the announcement uh with AMD on the first Helios deal we've ever had, $1.2 billion with Vultr. And we unveiled our switch on the floor, and uh as I think our general manager of our data center business, Praveen Jain, said, it was literally a work of art. 7,800 copper cables all packed into this massive switch. And we actually increased our revenue guide for '27 and '28. So, we're really seeing the power of this portfolio coming together and it's super exciting day. >> And And tell us about the decision to go with AMD's Helios GPUs. >> Look, you know, I'd say as a company, I've been with the company for nearly 30 years and as we are, you know, we've always used all different types of silicon from different vendors. We're really excited about our new partnership with AMD, but frankly, it's just one of many. So, uh lots of exciting news in the pipeline here. We're really looking forward to our Helios portfolio becoming a very important part of our business. >> So, you mentioned also that you raised your uh networking segment revenue growth outlook. Uh and and taking a look at what you put here. Um now projecting a low to high 50s uh percent in data center networking revenue through 2029. So, what are the market trends that you're seeing from where you're sitting at? What are those market trends that you're seeing that uh is making the company uh raise its guidance? >> Yeah, look, I I'd have to say as you said, there's some key trends out there that we covered in investor today. One of which uh you hit on already is is data center. Uh we continue to see just explosive growth in the data center. Last quarter, we actually announced a deal with Oracle and today we announced a a new deal here with Bolcher on the AMD Helios stack. We're also seeing just great momentum in our portfolio, particularly in self-driving networks. In fact, we had ServiceNow on stage today and they set an ambitious goal for '28 to actually be 100% autonomous with their network and there's really only a couple companies on the planet who can make that happen for our customers. So, AI for networks, networks for AI, and in great momentum really across the entire networking portfolio. >> And what are customers telling you? I mean, are they wanting their ser- servers to be on premise? Is there more of a trend for for it to be more on premise so they can sort of control more the the information, make sure that they're controlling against cybersecurity attacks, etc.? I mean, is is this the the trend that they're going for? >> Absolutely, it is. And I I'm glad you brought that one up because actually in our our last earnings announcement, I actually commented that, you know, as a company, we made a deliberate and intentional decision to actually deploy a large amount of our own infrastructure on prem for our own enterprise AI usage. And as you correctly said, you know, customers like CFOs like myself, they're concerned about security. They're concerned about cyber, and they're also concerned about token costs. And what we have learned in this is that if you actually go on prem, you can save about 60% of those token costs. So, there's a really good compelling economic reason as well in addition to security and cyber, which are in themselves are a really key themes to think about as you are deploying AI in your company. >> And from what I have understood, so customers can they can either buy the servers or they can also get some type of subscription service as well. So, is what what's the mix there? What are you seeing? Are are enterprises outright buying, putting on their premise, or are they getting that subscription service even though even though you are also putting it on their premise as well? >> Well, I'd say it's a combination of both. And as a company, we're perfectly positioned to to take care of the variety of customer needs that might be out there in the market. And we have our GreenLake portfolio, which really allows customers to use a different model to satisfy their AI needs. So, it's never been a a better time in this, frankly, for our company to be in this space and and and actually to be in this business. >> Are your Are your customers saying anything about what we've been seeing in the environment right now? I mean, we have been seeing the 10-year yield that's been going higher. That is making the cost of capital more expensive. So, how are they navigating all of this? >> Look, the the power of economics for AI is is something I I feel very strongly about. I think, you know, if I talk to a lot of CFOs and CEOs in the industry, and I'd say folks are are really focused on how to make sure that any AI deployment or use of AI in the enterprise really makes good economic sense. And for us as a company, it is an area that we are incredibly intentional about. As I said, we play in the heart of hybrid. So, on-prem is really one way, as I mentioned earlier, for customers to really get the best value out of AI. Also, you know, with our on-prem infrastructure, we're able to help customers really manage their operating layer much more effectively and understand the use of AI. And everything's true to what we, you know, saw in Invest Today this morning around self-driving networks are all great examples of how we're helping companies be much more efficient in both deploying and using AI in their companies. >> And can you give us a glimpse also about what you're seeing with supply constraints? Because this is something that was mentioned in your last earnings call that you are seeing that that that there's been a supply constraints, and that is really what is is um sort of the hurdle, so to speak, to fulfill increased customer demand. So, where does that stand right now? >> Look, I'd say nothing's particularly changed in us from what we said earlier uh last year. But, what I would add is that, look, you know, demand is continuing to outpace supply. It's It's no doubt that we continue to be in a supply-constrained environment. So, uh certainly the the tailwinds that we see around AI aren't aren't changing anytime soon. >> And as competition intensifies in this space, the AI infrastructure space, how are you preserving high margin expectations that you've laid out? >> We were extremely intentional from the get-go. We built a framework in is around how we would approach managing large deals all the way through our customer base around the world. So, we've been very specific and precise and selective, I would say, around the kinds of deals that we want to take, and we've been focused on the bottom line. If you see the growth that we've driven in both our operating profit and EPS, uh I believe that is a very good example of the sort of intentionality that we've had about being really focused on driving our profitable business. At the same time, I would say today really marks the the start of a new chapter for HPE. You know, we're really positioned ourselves now uh as a growth company with the guide that we gave today around networking. You know, we're putting ourselves in a whole new category in terms of the growth even on our revenue and our top line as well. >> Yes, and you also acquired Juniper Networks. So, tell us a little bit about that as well. What are you finding as far as um higher cost benefits? How are you deploying that capital also? >> Yes, we actually acquired Juniper Networks just over a year ago, and I'd have to say in my in career, in is which spans three decades, this has been perhaps one of the fastest and and easiest integrations I've ever seen. And this was some clear evidence that, you know, both from a a revenue and a cost perspective, the integration, I would have to say, is going very well. In fact, we just completed uh a few months ago the integration of our two sales forces, which you can imagine in itself is not an easy task, and I must say it went very, very well. And today, actually, we talked about the AMD uh Helios vulture deal. One example of even the engineering that's come together is actually the production of the Helios switch, which combines both HPE liquid cooling technology that came from our server team with the outstanding and amazing engineering from our networking team that came from Juniper. So, you know, quick wins here that have come out very fast post integration both from cost and then also from engineering and revenue perspective. So, I must say the deal has been incredibly successful. >> And it seems to be reflected in your stock as well. It's up 100 and more than 160% year-to-date. Thanks so much, Marie. >> Thank you. It was a pleasure to be with you today. >> Thank you. Coming up, how hiring [music] is changing underneath the surface for our steady job market. That's next on Market Domination. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Job postings are on the rise for the first time since 2022, but some workers aren't feeling the relief. With employee confidence hitting a record low and a shrinking labor force. Sluggish hiring is leaving job seekers feeling stuck in place. Joining us now for a look at what's driving these figures as Yahoo Finance's Carri Hannan. Carri, >> Hi there. Thanks for having me on. Yeah, it's kind of messy. You know, you can't really this job market is is a bit on one hand and then on the other hand. Um, the numbers are looking pretty good. We had ADP today, the the payroll processor for private companies, uh, you know, coming up with one of the strongest reports they've had since May about, you know, hirings are up and and so forth and wages have base wages wages have increased. Um, Indeed says job postings are up the first time that's been in years as you mentioned. I mean, this is really good news and um, but the fact is when you go over another survey that I saw from, um, Glassdoor shows that, as you mentioned, at the, you know, record low confidence. And the reason is the job market isn't what it used to be. So, even if you say unemployment is at 4.1% and we'll find out more on Friday about that. Uh, the economists I talked to don't expect it to shift all that much this year or into next year. But the labor market is very different now. There's it's a shrinking population. There're just not as many jobs out there because you have the baby boomers retiring. We've been talking about this demographic cliff for years. It's finally here. But immigration, there's been a hit to immigrants in that job market as well as women. There's a reduced number. So, the shrinking job market means that even though the numbers might look good, if you're looking for a job, um, a job seeker that that was out of work in August has been out for roughly six months. It's still very difficult to get traction. >> So, what sectors are we talking about here because out of the ones that the job postings that are out there, which ones are the ones that are leading? >> Yeah, exactly. Um, you know, there's some growth here in the data technology area and also in software development. The ADP report showed that there was and these are two areas that are generally pretty positive, health care and education, there are opportunities there. So, there are jobs out there, but I think many workers, if they are employed, are still hanging on to their jobs. Their their frustration for those low confidence numbers are really coming from, you know, uncertainty, anxiety, feeling like they're stuck in their jobs, the culture's not good where they are, their wages really aren't going up what much even if we said and as I said 3.2%, that's not even cut keeping up with inflation. So, um, there is definitely concern, but people uh, so they feel, um, you know, really like they've nowhere to go if they're in the job market and if uh, if they're currently employed and if they're seeking a job, it's still quite a quite a struggle because there just not as many jobs out there. >> And Carrie, I'm curious on what you're expecting to see from Friday's jobs report. >> Yeah, I do. Um, what I, you know, I'm scanning the horizon, it looks like we'll see, um, it it a somewhat positive report, but it will that employment rate is not likely to change much beyond the 4.1% is what I'm hearing. Now, who knows, something could surprise us, but that that tends to be where where we're landing. Um, but you know, we get these reports coming from all edges saying, you know, hiring's down, hiring's up, it's hard to know what's really going on, but when I talk to the to workers themselves and job seekers, there's a very high level of anxiety. >> All right, thanks so much, Carrie. >> Thank you. >> Turning now to housing, a new Redfin analysis shows a record 21% of US home sellers cut their asking prices this month amid a persistent buyer's market. Joining me now for a closer look is Yahoo Finance's Claire Boston. Claire, >> Hi there. It is absolutely crunch time to try sell a home because we are rapidly approaching those colder months when deals don't happen. And so I think what we're seeing now is that the sellers who are still in the market are very motivated and they're realizing, "Okay, you know, maybe I priced a little bit too high in the beginning, but I really want to sell. So now I'm cutting." And that's created an environment where one in five sellers is currently cutting their prices. You know, will that be enough to bring the buyers out when mortgage rates are above 7 and 1/2%? I'm not sure, but in a way price cuts can kind of be a good sign because it signals that sellers are realizing that they read the market wrong and they're trying to fix that problem. >> Yeah, the question is by how much they're really cutting though. But Claire, I also want to ask about the latest developments on Mayor Mandami's pied-à-terre tax plan. That's been very controversial. It's a plan which a judge just ordered the city to redo. So what's behind this ruling? >> Definitely. So the key word there is redo. What the latest lawsuit has changed is how the city was ruling out this plan and how they were trying to figure out whether you had a second home or whether you lived there full-time. The judge said that the way the city was doing that was improper and that the city needed to figure out a new way to do it. So the entire tax, the legality of that tax is not in question currently. And the city said that it was going to appeal. And so when the city appeals, that will let them continue to try to collect tax as they have been. So that will not change a whole lot. However, if on appeal the city were to lose, they would have to scramble and come up with a new way to figure out how to tax people. And you know, 2026 is drawing to a close. We're about to be in the fourth quarter. And it's unclear according to experts whether the city could figure out a new system in time for this tax year. So we have a lot of questions right now, but certainly the second homeowners are probably pretty happy. >> That's right. Thanks, Claire. >> Thank you. >> As concerns over AI risk continue to grow, so does the need for reliable cybersecurity. Yahoo Finance's executive editor Brian Sozzi spoke to Rubrik CEO and co-founder about cybersecurity demand earlier today. Take a listen. >> Look, I thought you I think you have been uh in Rubrik a forgotten play in in cybersecurity. Uh and that's not the case. Your stock has been on a tear the past month, but when you hear some of the warnings we have been hearing from an Anthropic and an OpenAI and AI safety, where does your head go? >> As I've always said, let AI cook. We can't stop the technology development. If we are not doing it, then our competition in other parts of the world are doing it. We need to ensure that the cook stays in the kitchen, and we need to create guardrails and boundary conditions so that we can we can avoid the unintended consequences of agentic action, but we have to kind of develop this technology because it's important for our long-term prosperity and growth. >> I I've been talking all week people about the warning that Anthropic reportedly put in in its prospectus. I have never seen a a leaked prospectus. You went public. I remember talking to you on your IPO day. >> [laughter] >> Can you imagine your prospectus leaking? Like I've never seen anything like that. But when a company like Anthropic, again, reportedly says there is an existential risk to humanity, break it down to the average human being out there, what does that exactly mean? >> I don't believe that there is an existential risk to humanity. I mean, AI is still a technology that is trying to complete our sentences and and do some IT work for us. Uh my belief is that uh we need to ensure that the cybersecurity aspects of of agentic action is is controlled and contained, and there's a lot of technology being developed uh to ensure that not only runtime security is there, but also Rubrik is focused on creating resilience and guardrails for uh for agents. I believe that we have amazing talent in America, amazing technology in America. You saw at White House the level of uh of executives that are involved in this AI development. I believe that we are going to solve this problem and really define as an as America the frontier of what AI could be and it is going to help our students, is going to help our farmers, our our hospital workers, everybody to be more productive, remove mundane tasks, and really be there uh produce their best. >> I'm glad uh Bipul that you're not up here telling me that AI is going to wipe out humanity. I It's Wednesday. Like I just don't want I didn't really want to go there. So, I'm glad you uh you got I'm glad you got that out there. But, what keeps you up at night when it pertains to AI and and the powers that you're starting to see? We had dots yesterday from OpenAI. We have Muse. You give it your password, can control your life. I This is some serious stuff. >> We are living through an age of technology acceleration and you see that in AI and the AI's development. I'm so excited to see Muse come out and it gives uh all Americans and people around the world the power of AI in their hands. Now, they can be more productive. Things that they were calling up restaurants and trying to make a reservation and if they can't get the person on the phone, they have to repeatedly try it. Now, AI is doing that task. How great that is. And I believe that this technology will seep into enterprise and enterprise productivity will be greatly impacted positively. And all these developments are so exciting. I mean, we are really in entering in a in a world of abundance. We need to just make sure that there are right cybersecurity guardrails and and boundary conditions around this AI technology. Outside of it, I'm very, very excited. >> I mentioned uh Bipul that your your stock has been on fire. My read through that has been your phones have to be off the hill off the hook at Rubrik and you're probably not alone in cybersecurity. Um just given what we are seeing on agents. Like what are you hearing from, you know, the CTOs, the C holes that are that are talking to your company right now? >> If you look at the AI, it is thousand times more opportunities and thousand time more risk because it is a powerful technology. And with hugging face and open AI and all the cyber attacks that our customers are hearing about, they are concerned about AI powered attack coming to them and their own agents that they are deploying misbehaving and creating liability for them. So they want to ensure that they are able to recover quickly from our AI attacks so that their business remain in business and at the same time they want to ensure that they can deploy agent with confidence. So we are seeing lot more conversation, lot more customer interest in cyber resilience, AI resilience and that's where we are delivering the marketplace. >> Does the cybersecurity industry need to work closer together? You know, I see a lot of, you know, open AI Anthropic, all these folks talk. And I, you know, they're not exactly working together per se, but to protect what's coming at us from a human perspective and also from a company perspective, should like companies like yours all band together and and come up with some form of something that could end worst case scenarios? >> 100% I mean, if you just look at uh the alliances that uh Anthropic created around cybersecurity, you saw Nvidia come out with alliances around cybersecurity. There is a a lot of industry focus in ensuring that this technology has the right guardrails. And there is a lot of focus and effort in that front. I mean, it's not the first time we have done something like this. You have known You know that cybersecurity White House has in the past like created guidance and and and structures so that the private sector public sector can collaborate. >> How prepared are companies some of the risks we've all been talking about on AI? >> This is where the challenge is. Lot of Fortune 500 is still on legacy technology. >> Oh, that's terrifying. That's absolutely terrifying. Awful. >> I mean look, the last generation of cybersecurity was built for human attackers and people running businesses. Now you have AI attackers and increasingly we are rolling out agents to do our work and that increases the surface area of cyber attack and this is where adopting newer technology, refreshing and modernizing infrastructure and getting ready for this new world of AI and AI attacks as well as agentic operations is critical. >> What's your What's the next big product for for a company like Rubrik? >> I mean look, we have staked our future on AI resilience. It is about how do we give our customers confidence that they can continue to operate no matter what happens to their business and what comes after them. And then the second piece is that they can actually deploy agents and run AI operations with confidence. And so we are innovating on both fronts. Rubrik is at the intersection of data, identity and AI and this is a great place to be and we continue to kind of race forward. >> Bipul, good to see you. Thanks for hopping on. Hope to see you in person next time. >> Brian, always a pleasure. >> Thank you. >> Yeah, how options [music] traders are viewing the tech trade. That's next on Market Dominations. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. Woo. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> As we wind down the final trading day of September and look ahead to the start of Q4, we want to check in on the options trade. For that, we have Sean McLaughlin, All Star Charts Chief Options Strategist. Sean, thanks so much for joining us. >> Thanks for having me. >> Yeah, so you guys have a chart out basically showing that for the 7 months starting October 1st, that's historically the best time to be in stocks in a 4-year election cycle to own stocks. So, in plain English, what does that mean? Why should investors look at that? >> So, what that means is in the 4-year presidential cycle, if you look at stock market returns over the last 50 years, you will find that over the next 7 weeks or next 6 I'm sorry, next 7 months, that has been an average return of 18.3% for the the S&P 500. And so, with that headwind, and you think about where the market is positioned right now, we have consumer sentiment at some of the worst levels we've seen since COVID, right? We have a stock market that's had every piece of bad news thrown at it. We've got bonds basically crashing, interest rates rising like crazy. >> Oil high, we have geopolitical risks, we have war, we have uh I mean just all this scary headline. And we have consumer sentiment at the lows. And so if this headwind that we're in right now has not completely crashed the market, well we got earning season coming up. And if we get any glimmer of good news, I think I think the market's going to be caught offsides and we could have a really significant rally over the next 3 to 6 to 9 months. >> So as an options trader, how do you position yourself? >> So one of the ways that I position myself is I want to be in the leaders. And I think if we have another leg higher in the bull market, it's going to be led by semiconductors. And who's the biggest bully on the block in the semiconductors? It's Nvidia. And right now if you look at that chart in Nvidia, it's been basically consolidating since the middle of May. So 4 months building strength, building energy. And I think that this thing's ready to go. And so I want to position aggressively long. And so what I'm thinking I want to do is I As an options trader, I looked at that chart and I see the implied volatility at the lowest levels it's been probably all year. And so as an options trader, we say, "Oh, well call premiums are cheap. I could If I want to keep it simple with Nvidia trading, I think it's in like 230 right now, 235. I looked at the January 250 calls. I could position If I want to keep it simple, I can position in those for about 1050 a contract. I haven't looked at the prices in the last hour, but somewhere around $10.50 per contract. If I want to keep it simple, get exposure to the semiconductor space, exposure to the biggest name for 1050, that's my risk. That's the most I can lose. >> So you're bullish. I mean this market to me seems like it's been jittery I would say or maybe nervous. Nervous as they see these yields going higher. If you've got the cost of capital that's increased, you've got the 10-year that's high, the 30-year going higher, do you not see risk in that? >> I absolutely see risk, but again I go back to well the market has had every reason to sell off and it hasn't sold off yet. And it's if to me it feels like it's running out of time. Like if you're not going to do it now, then the path of least resistance appears to be higher, which I know sounds crazy. >> It >> [laughter] >> it does. Now Micron is going to be reporting after the bell. So are you going to be looking at that as well? How how do you feel about the memory trade? >> Well, I mean Micron is one of those names that if it surprises the street and if it if if it's a positive surprise, maybe that's what kick starts this next leg. I mean it could be anything. Again, tomorrow, not that the rally has to start tomorrow, but tomorrow kick starts the next the best 6-month period in in in the presidential cycle. So who knows? I mean the timing could be perfect. >> any other hot trades that you're looking at? >> Uh I mean >> You're always looking at something. >> Yeah, I mean look, I'm still I'm still very constructive on energy. I mean energy's very volatile, but I don't think the energy trade is over. I think we're still going to see higher prices in oil. Um I want to be long names like Exxon where where I can find good entries. Uh Chevron CVX. Um names like that still have a lot of interest to me. I'm also keeping an eye on health care a little bit. I mean there's been some biotech names that have really um played well. ABCL is one of those names that I like. Um so energy and and biotech I think for me are the areas I'd be looking at as well. >> I'm curious to get your take on AI, but in the sense of trading because Robinhood announced its agents for trading on behalf of yeah, on behalf of clients basically using AI agents for trading. Are you How do you feel about that? What's your take on it? >> Uh I've I've mixed emotions about it. I think in in some ways it's very good. Sometimes when I'm coming up with a trade, coming up with different options better or different way of expressing a thesis, I will ask Chat GPT, hey give me some input on what I'm thinking here and I'll get some very constructive ideas for it. I've also found it to be very well at helping me help me build things as a coder. I can't code anything. >> Right. >> But with with Claude I've used Anthropic's Claude. I've built apps that help me manage my trading to help me get better executions and things like that. So I think AI is is a positive for traders. I think there's I mean I think we're going to be blown away by what people develop and the the things that people with maybe very little market experience will be able to do in very positive ways. So I think it's a net positive. >> That's the one thing is is that AI mixed with experience that's that's can be very positive. If you don't have that much experience it it's a little bit more maybe a little bit more difficult. But it's certainly something that's that's that's coming into the play here. The other question I had for you is IPOs that have been delayed. I'm going to throw in a sort of a bearish stance here but do you not see that as something to like an eyebrow raiser? You've got Anthropic that's going to come after this supposedly going to be coming after the midterm elections, right? Then you've got Open AI next year. You've got Aura that also they postponed their IPO. Is that not How do you feel? >> I I kind I feel good about them delaying. I mean we had the SpaceX IPO come out and a huge it was huge amount of capital. The most we've ever seen, right? If we were to have three or four really record-breaking IPOs in short succession, I feel like that would be pretty hard for the market to carry. So I have no problem with them delaying. I think it's a good move. I mean there's some regulatory headwinds that they're all worried about now and and all the bad news or the scary news about, you know, the AI you know, going out of bounds and doing things that they're not prepared for. So, uh there's a PR issue there that they need to to work out. I have no problem with the delay. I think it's a good move. Um we'll be here we'll be ready for them when they come out. >> if the markets go higher if you're betting on calls then >> Well, that's another thing, too, right? I mean, the skeptical take would be if they're all trying to rush to to come IPO now, maybe they know that, hey, the market's getting heavy here. Maybe that could be the sign that we're due for a correction. But if they're willing to wait, that shows that there's confidence in the stock market. Like, oh, we've got time. We'll be good. So, I think it's good that they're waiting. >> All right, thanks so much, John. >> Thank you. >> And coming up, we have you covered through the closing bell on Wall Street. Don't go anywhere. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] >> Stocks ending this day mixed. Taking a look at our Wi-Fi Interactive, you can see that the Dow is down 8/10 of a percent. So, you're the session lows really when it comes to the Dow. The Nasdaq Composite had been up about almost as much as 1% throughout the session, coming down to 2/10 of a percent. And then the S&P 500 also ending the session in down 2/10 of a percent. So, we are seeing the lows of the session that it ended that the major averages have ended at. And if we take a look at the 10-year Treasury the long-dated bonds which we have been watching. This would be the seventh month of gains for yields on the 10-year Treasury note at 529, the 30-year at 564. Taking a look under the hood at where we're at with the market action, we can see that you've got technology that has eked out some gains, but consumer staples have really been in the water as well as health care and also industrials underwater, I should say. And then on the Nasdaq you can see that some of the Mag 7s ended the session in green territory. Investing platforms are adopting AI, including Robinhood on Tuesday introducing agents to help traders analyze markets and even trade on their behalf. A new study from eToro finds that 3/4 of Gen Z and millennial investors are open to AI managing their portfolio. Joining me now is Brett Kenwell, eToro US investment analyst. Brett, thanks so much for joining us. So, this new study that finds that 80% of young investors are open to using AI or using AI somehow. What do you make of this? >> Yeah, I think that this is retail investors, and particularly young retail investors way of incorporating advancing technologies more and more into their everyday lives, and that does not exclude their portfolios. They're looking for ways to save time on research, to improve their decision-making, to improve their portfolio performance. AI is the latest way to do it. >> And how specifically are they using it? Are they using it to say, "Okay, tell me how how does this call option sort of structured?" [clears throat] Or are they using it to look at earnings? What are they How are they using it? >> That's such a great question. The reality is there's a very wide range of how they're using this. Some Some investors are using it like a little analyst in their pocket, right? Just a way to help them understand markets, understand earnings, maybe an earnings call transcript to save time. Others are using it for a much wider range, a much deeper range, helping to not just understand markets, but actually help them select what to buy and what to sell. >> And this adoption of AI when it comes to trade trading, how is it going to fundamentally shift sort of the landscape for retail investors? >> Sure. So, as you pointed out earlier, it's the younger investors who are really embracing this, the Gen Zs, the millennials. We do start to see that tail off as as the older generations come into play. I think only 1/3 of baby boomers, for instance, were were in support of this. So, you know, we do sort of see that generational shift. I suspect over time we'll start to see a a further adoption as well. >> And there's also this massive generational gap, as you as you mentioned. You've got 77% of Gen Z embracing AI portfolio management, um and 32% of baby boomers. Baby boomers, come on, get on it. So, do you expect that older generations are eventually going to adopt these tools or no? >> I think so. I mean, at the end of the day that the younger generations are always more adaptive to new technologies and that's probably going to stay the case remain the case with AI, but I do expect the older generations to get on board. >> All right. And so, let's talk about what this your data is also finding. It's expecting AI related stocks to rise that that retail investors expecting AI related stocks to rise. Um that that number fell. So, they're basically not as bullish. I just had a guest on that was very bullish on AI going forward. Now, the you're saying retail investors are saying maybe you're not going to see these AI related equities rise as much. >> Yeah, and I wouldn't I would hesitate to say that they're outright bearish, right? About half of investors still expect them still expect AI stocks to rise. And we asked a lot of different questions around, you know, do you expect them to rise? Do you expect them to rise significantly, decline, or decline significantly? All those did shift to a little bit more of a bearish stance. Now, not outright bearish, but they to us it's the enthusiasm around the space kind of cooling off a little bit. And that's not to say that they can't keep going higher. I think it's to say after a very strong first half of the year, I think investor expectations are sort of getting tempered in a little bit. >> And are they looking at other areas? I mean, you've seen healthcare going higher this year. You've seen energy. Are they looking at other areas of the market? >> few different. Um so, to your point, yes. Uh energy tech energy and healthcare are the three sort of favorite sectors among investors. Interestingly, financials, which is always kind of a surprise to me. Financials were always in that top three. We've been doing this survey quarterly for the last 3 years. They've it's never been outside of the top three. So, financials is kind of taking a backseat here, but also interestingly is the Mag 7. That's this tech technology thought about AI stocks not performing as well down the line. That's not all tech. So, this it was very stable amongst Mag Mag 7 when we asked specifically about that group. Um the retail is still bullish on Mag 7. >> And on the financials note, so what do you think is is the pull why the pullback in in financials? Is it because of the higher interest rates that >> Yeah, I you know, I think it actually has less to do with being pessimistic on financials and I think it has more to do with being bullish on energy and and healthcare. I think those two sectors really brought retail investors in. They're seeing what's happening with oil prices, they're seeing sort of the secular trends within healthcare. I think that's bringing them in on the bullish side more so than than pushing them out on the bearish side on financials. >> Yeah, and I guess it would be you only have so so much money to allocate, right? So you're going to So So the areas Are Are you seeing sort of that rotation then would you say of when you're saying there's it's not that they're bearish on AI stocks, it's that perhaps they're maybe they're rotating into something else? >> Yeah, and I think that, you know, after the very strong quarter that semiconductors had in Q2, I think investors started looking around saying, let's take some profits, let's get out of this space. It's become a little bit volatile. Let's rotate into some of the undervalued and underloved sectors that are actually doing pretty well on the year, too. So. >> And what about the SpaceX's of the world? I mean, these high flyers are the the ones that had so much enthusiasm around the IP their those IPOs. I mean, we are see going to be seeing hopefully more IPOs. Anthropic is supposed to after the election after the midterms is expected to go public. OpenAI is going to go public. Do you have any data on how they view these these IPOs? >> Well, I think that retail in general, they're an opportunistic bunch. When we get sharp pullbacks in the market, they're the ones that step in and buy it, right? They love that good opportunity. And IPOs are really no different. They were very bullish on SpaceX when it came public and and it actually had a pretty good debut. And of course, it's struggled a bit since. And I think you can expect that from a such a high-profile company that has a high valuation, but they set a good stage for the the OpenAI's and the Anthropic's of the world. >> All right, Brett. Thanks so much. Great insight. >> Thank you. >> And Micron earnings just crossing the wire reporting fourth quarter adjusted revenue of $54.23 billion. Bloomberg consensus estimates was for 51.49 billion. Adjusted earnings per share 33.42 estimates were for 31.83. So, a beat on the top and the bottom line. Let's get right into this report with Gil Luria, DA Davidson head of technology research. Gil, what are your thoughts? >> Yeah, the expectations were already very high. So, the fact that they they could still exceed them even at this level is incredibly impressive. Uh we're going to have to listen for the for the guidance see if they're willing to go past one guidance worth of one quarter worth of guidance. But, uh it tells you that there's a lot of demand for memory and the supply isn't going up anytime before the end of next year or before the latter part of next year. And that sets up Micron very well and it's a good indication for the whole uh data center build-out ecosystem that demand clearly is still very strong. >> Yeah, and what are you going to be paying attention to as far as commentary on the earnings call? What's going to be the key? >> Micron has another opportunity to explain to investors that they are no longer selling a commodity product. Up until 3 years ago, really most of the categories of memory were commodity. They were interchangeable, fungible, sold invoice by invoice, month by month. And uh that made them particularly cyclical. Uh what they sell now is completely different. Especially the high end and the high bandwidth memory which is increasingly a large part of the business and uh and will be coming even bigger part of is co-designed with their customers. And then their customers are the biggest companies in the world, Microsoft, Amazon, Google, Apple. And uh sold now on long-term contracts, 5-year contracts. So, they have another opportunity. They started last quarter. But, this quarter they have another opportunity to explain to investor we are not the same company we were 3 years ago. It's a completely different company that deserves different multiple, different perspective on what a cycle looks like. So I would expect a lot of the conversation to focus on that topic. >> And is this kind of the shot in the arm that this industry needs right now with this beat that we're seeing because there's been so much concern over AI risk, over whether there's there's going to be a slow down. I mean are investors going to be looking for yes, the hyperscalers are still continuing to spend. >> I think it's a data point to indicate that they certainly are continuing to spend. But it may not be enough for investors. Investors are are are very skeptical right now about the ability to continue to to build out, how the duration of the cycle, especially when it comes to some of the biggest participants like Nvidia, like Broadcom, like Micron and the other memory companies. The market is is is really communicating through price, through multiple that the cycle is almost over. That it expects CapEx next year to go down, not up. There's a lot of other stocks where it's it's saying that it's going to go up. There's a big discrepancy there. So this is very good news. It should go towards letting investors know that the demand is continuing to grow, but it may not be enough. >> And if we take a look at the stock, I mean it has rallied 45% from its July 29 lows. And I know that you're very bullish on this stock and you believe that this is going to be a longer cycle than than anticipated. I mean is that how you're seeing this because you go back to sort of the bearish thesis that that some have on the street that say look, you're going to be this is a boom and bust kind of cycle that this you cannot continue like this forever. But what what's your bull case for this? >> I think it's the the cycle is the cycle. The AI cycle is the same cycle for GPU, for CPU, and for memory. And yet, there's huge discrepancies in how the market is treating them, especially in terms of valuation. If you have CPU companies trading at 40 to 60 times earnings, and Micron trading at seven times earnings, in spite of the fact that it's the same cycle. The only way we get oversupply in memory is if we don't use AI anymore. And if we don't use AI anymore, there's a lot more downside in the CPU stocks than there is in memory. Again, the market is being very inconsistent right now. Sure, there's more supply coming in memory. There's a lot more supply coming in CPU, as well. Intel's building new plants. TSMC is building new more capacity. Samsung is building more CPU capacity, as well. There's a lot more capacity coming along for CPUs, as well. For GPUs, but and yet, for memory is is where the market is focused on in terms of assuming that the cycle's almost over. What we're arguing is it's the same cycle. If we continue to build data centers, that means memory is very, very, very undervalued. >> Kiel, I just want to read you from the earnings release from Micron's CEO saying AI is becoming super intelligence, and memory enhances this intelligence and the competitiveness of our customers' platforms. We're increasing our investments in technology, products, and manufacturing to help drive AI forward with our customers. I want to get your take. You've been very vocal about the AI risk scare that has been out there. You saw the AI titans yesterday at the luncheon that they they signed the accord. What's your take on all this? >> Yeah, we should we need to start calling it super intelligence, right? That's the new dict. [laughter] What we did see Micron and and and Nvidia and and others yesterday with the president coming together to address these concerns. There are concerns about the risk of what AI models can do, but the reason we're concerned is that their model they're getting so very powerful. They're getting so potent, so competent that then then the risk is that bad actors use these models to attack our systems. Well, the answer to that is to use those very same systems to to defend ourselves from those attacks. To give these best, most advanced frontier models to enterprises and companies so they can harden their own code. So, they can go through the code and defend it. That's the right answer. That's what Micron's advocating for, Nvidia, Apple, Microsoft, Google, Amazon, and and and yesterday they came together with the president to deliver that message. That they're not going to let the frontier labs dump the liability on us. The liability is is on the models and who uses the models. The liability isn't a part of the government's problem. That was the message communicated yesterday. So, we should move forward full steam while making sure that we're doing everything we can to defend ourselves from an inevitable attack by bad actors using frontier models. >> And just to reiterate, revenue of 54.23 billion dollars and that was a beat on the top line. Also on the bottom line. Thanks, Gil, so much. >> Thank you. >> Coming up, Amex is rolling out new corporate cards and expensing [music] technology. We dive into that next on Market Dominations Overtime. >> [music] >> American [music] American Express. American [snorts] Express is pushing deeper into how businesses manage spending, rolling out new corporate cards, expense software, and AI-powered tools. Joining us now is Raymond Joebar, president of Global Commercial Services at American Group. Raymond, thanks so much for joining us. So, walk us through the problem that you guys were hearing and the solution that you're coming up with. What are the tools? >> Yeah, great to be here. Thank you. Um I've been in this role about 2 years and one of the first things I did when I moved into it was go out and talk to some of our customers. And customers were saying how they're finding the the management of expenses uh very administrative, time-consuming, and a little bit more cumbersome. And so, I came back in the office and I sat down with my associate Nikki and asked her to actually show me what it took to fill out my expenses. And and I was shocked. It was truly a very time-consuming effort and very administrative. So, we knew that there had to be a better way and what Amex corporate is is just a fundamentally different way to transform and streamline how companies manage their their financial operations. So, we come up with some uh uh new intelligent expense management software, a new cash back card program for it, agentic tools to streamline the automated and automate some of the processes, all backed under one platform. >> And is this for small businesses, medium-sized businesses, larger, what which ones? >> Well, we serve all three segments, but these tools are really designed for mid-size companies. Companies that would have, let's say, anywhere from $5 million of revenue up to maybe $300 million of revenue and maybe 10 to 10 employees up to 500 employees. As companies grow, their needs become a little more complicated. That's where the financial side of the running their operations, seeing who's spending the money, how they're spending it, and making sure it fits within their the policies is important for them. >> And you also have a survey that shows that these mid-size companies, I mean, this is what they want. 92% of mid-size businesses are trying to consolidate their expense tools right now. Uh so, are you now positioning yourself as sort of we can do this all for you with this is the all-in-one hub? >> That's right. So, and that's right. They want it on one platform and what we have today is a consolidated great card program, expense management software, agentic tools, and we'll be adding more and more agentic tools to streamline a lot of the administrative side of running their financial operations, but also bring bringing along some other features and products like accounts payable, the way in which they pay their vendors, a streamlined process for that on the same integrated platform. >> And have you taken a look at how much time they're saving, money that they're saving from doing it this way? >> Well, we've started to analyze how much it's saving, but what it's really allowing them to do is getting back to it's the benefits of these products are twofold. One, it helps to streamline the financial operations so that they can more simply uh for example, a lot of finance teams take a lot of the data, download it in spreadsheets, and analyze it. These tools now allow them to with some of our agentic agents real-time analyze the data from where their employees are spending. They they can eliminate a lot of the extra routines that they had to go through. The other way that this helps companies is say you're a salesperson and you have to fill out your expense reports. If you're a salesperson, you're what you really want to do is find new customers and eliminate as much of the administrative process of filling out your expense reports, remembering where your receipts are. Our new tools help streamline that for them and we're coming up with new tools that help can with the agentic tools that can help them in that process. >> And these agentic tools, can they also say to you, "Hey, you're spending too much money in this area?" Are you spending >> Great example. Uh a lot of times when employees go out, they don't know how much they can spend for a business meal. They don't know how much they can spend on hotels. These agentic tools help them understand they can query verbally or look it up through the agentic tools say, "What can I do on this type of transaction? Is it within the policy?" The finance teams love it because it helps make sure that the the teams are complying with their policies. The employees love it because it just takes the mystery out of that and they want to make sure they're doing the right thing in the right way. >> Do you see these tools as being able to sort of automate jobs that had that other humans will be doing? Are they tools that you are being used along with or are you seeing reductions in workforce because you're being able able to use these tools? >> Yeah. Well, there's no doubt there's I'd say these new tools are are helping uh let's say on the customer side first. It's allowing us to to allow them to spend more time helping to grow their customer base, grow their their business, and eliminate a lot of the administrative tasks that are not value as much value add. Uh what we're seeing just as a company and like every other company that's out there, these tools are huge productivity enhancements. What used to take us quarters to deliver, to prototype and deliver, we can now ideate, prototype, and deliver in weeks and sometimes days to be able to better meet the customer's needs. So, it's really enhancing our ability to meet our customers and the customer benefit from it because they're able to spend more time thinking about how to grow the data uh how their business or analyzing their data versus the the steps that get in the way of doing that. >> And can these agents actually approve uh these uh expenses? So, I'm approve them right on the spot. >> Well, with with with some of the great agents that we have like uh let's say a sales person goes out and takes an Uber to go and then has a business meal. Um what the agents can do is classify an Uber transaction as a travel expense and a uh meal as a business meal so that it simplifies the filing of that expense report. We have a new mobile app so all they have to do is press a couple buttons, they approve the transaction real time. If uh it needs to be approved or if they need to add receipts, the agent will route it appropriately to the right person. It's really tailored to where the company wants to run run their expense management process with the right types of controls in place and we can tailor it appropriately. >> And I'm imagining that you're also expanding into or you you already have tools in the small, in the larger >> Yeah. >> enterprise space? >> We've been uh serving small businesses. We helped create the category in uh 1988. We have over 4 million small businesses in the US alone and I think we're three times larger than the the next nearest competitor. We love what we're doing for small businesses that are heart uh heartbeat of the of the economy. Uh we're always looking for We listen to our customers all the time and are continuously looking for how we can better meet their needs. >> All right, Raymond. Thanks so much for joining us. >> Great to be here. Thanks, Annelise. >> Coming up, how one company is looking to make drinking [music] at concerts and sports games more sustainable. That's next on Asking for a Trend. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Hello and welcome to Asking for a Trend. Reusable cups are becoming big business at concerts, festivals, and sports venues as companies look for ways to cut single-use waste without sacrificing the bottom line. Our World says it has now kept 30 million single-use items out of landfills while building a model designed to work at scale. Joining me now is the founder and CEO of Our World, Michael Martin. Michael, thanks so much for joining us. Let's take a step back here because you were working on Wall Street when the Exxon Valdez spill happened and then you decided to walk away. How did that moment sort of change you and it for you to address this sort of environmental problem? >> Yeah, well, first of all, thank you very much for having me on. I really appreciate it. Yeah, you know, I was an investment banker on Wall Street and all in and doing everything and then Exxon Valdez happened and I thought, you know, this is not what business should be doing. Business, I'm a capitalist, by the way, love it, but it it should be doing good things. And how can I do good things? So, I really I just had this epiphany and so I spent the last 36 years now identifying major sustainability issues and then using culture, business to bring things together to actually create campaigns or movements. And it's it's pretty exciting as we've been able to have great success with Our World and other companies that I've started. >> And you've worked with a lot of corporations under different administrations as well. So, how do you see the landscape now, the sustainability landscape? I mean, it has changed. >> It's changed. I mean, over the last three decades that I've been working in the space, it has different evolutions, of course. It changes with administration, it changes with what's happening with the environment, with the economy, what's happening culturally, you know, in communicating truths to get people to really think about it. People think about it. Back in 1990, we were just focused on trying to get people to recycle. You know, there's a lot of I think awareness about the the of renewable energy now is lower than some fossil fuel solutions and so there's there's a lot of stuff going on out there. What we found really right now and I was at climate week last week which is an amazing week but is that there's still a lot of stuff happening in corporations around sustainability. It might be called something different right now for a little bit to might be sort of on the road but there's a lot of movement still happening and it's exciting to see that. >> So even though you've seen sort of a political pushback over years for ESG did that companies are still saying yeah we we want to be able to reuse cups. >> Oh yes and definitely. I mean basically what we're finding is it's beyond cups by the way. You know there's legislation that's been introduced in California called the EPR legislation extended producer responsibility that is actually raising funds for CPG companies for all the single use items they're generating and is creating a fund to be able to set up reuse and refill systems. There's now seven states across the country that have implemented this regulation and there's 10 more that are looking at doing it because basically what's happening is maybe your show is trends. This is a massive trend that's happening. Once we stop shipping waste to China all of a sudden people are seeing it stacking up in their communities. Incinerators are being shut down. Landfills are filling up. People are seeing a lot of plastic and waste in the environment. So one of the things that's happening is CPG companies are actually being required to come up with reuse solutions. So we work with a lot of these CPG companies on helping them figure out how to resolve that. >> So bring us into the world of our world. It's so a fan finishes a drink and then they put it in the recycling bin. How does this work reuse? How how excuse me reuse you're right. How does this work then? Do you and how does it work financially with customers? >> Yeah, I love what you did that this is one of the challenges that we have with building the movement. People keep thinking recycling, but recycling doesn't work when only 9% of plastics get recycled. So, but every so funny everybody says that and and I get it because that's what we've been told, right? >> drilled in your brain kind of thing. >> Yeah, totally. Yeah, so this is what change is about. So, what's the way our system works is it's really exciting. Uh we have a lot of technology involved, but basically break it down simply, we provide clean cups and serve where uh we'll pick up the dirties. We provide the reverse logistics, we provide the bins, we provide the training, uh we provide the accounting, the environmental impact reporting. Uh and so it's a very robust system and whether it's being used at a concert venue, a sporting venue, a university campus, a corporate campus, a hospital, an airline, reuse is the future and and that system I just described is applied across the board. >> Who are your biggest customers and what's your biggest selling point? Obviously reuse. >> Yeah, well, biggest customers of course are the leading concessionaries. Uh we are partnering with, you know, Aramark, Levy, OBG, Legends, all the major concessionaries. AEG, a big concert promoter is a is a huge partner and client. We work closely with WM, Live Nation. A lot of artists are big supporters of this. So, we work closely with Jack Johnson, Dave Matthews Band. I started the company with U2, Rolling Stones, Billie Eilish. These artists who are canaries in a coal mine and they look out across the the concert venue when the show is done and see all the waste. And so it's a that's that's how we've really grown through a lot of the cultural influencers. And it's exciting because we're growing dramatically. There's a tremendous interest in reuse because of the issues I mentioned earlier. And it really is the future of waste. >> And I'd imagine that as a concert goer, if you're thinking to yourself, oh this is going to get reused, you feel better about yourself that you are not just dumping it in in recycling bin or just or a garbage can. But, what's the next step? How are you going to scale even further? >> No, it's a great question. First of all, we have this advanced technology that is really allowing the individual containers to be a connection to the consumers. Allows gamification so forth. We use AI in some of our production methods. The secret for us is now that we've proven the model. We currently operate in Los Angeles, San Francisco, Denver, the Twin Cities, Baltimore, and DC. We have about 15 markets that are asking us to come build. So, the secret for us is scaling in the more markets and automation. >> Remember, it's reuse. Thank you so much, Michael. >> Thank you so much for having me. I really appreciate it. >> Paramount is building up its C-suite announcing that outgoing Mattel CEO Ynon Kreiz will become co-CEO of the combined Paramount Warner Bros. Discovery on Monday, October 5th. As the deal is expected to close next week. David Ellison will remain chairman and CEO focusing on strategy, creative technology, and capital allocation, according to the company's press release. And Kreiz will oversee day-to-day operations, and he will join the company's board. Kreiz is a veteran media executive and has led Mattel since 2018, helping revive the Barbie brand and push the company deeper into film and entertainment, especially with a blockbuster Barbie movie. Stick around. Much more asking for a trend still to come. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Mhm. >> [music] [music] [music] [music] [music] [music] [music] [music] >> Woo! >> [music] [music] [music] [music] [music] >> On the latest episode of Built Different, Ian Schwartzman sat down with Troy Millings and Rashad Bilal, the host of Earn Your Leisure. Let's take a listen. >> What about your long-standing relationship since middle school gave you both the courage and trust to go into business with each other, to start Earn Your Leisure, and everything that has bud from that? >> Yeah, I think it was a natural progression. Like you said, we spoke every single day. >> Okay, so I kind of knew the personality of the person. I knew the determination. I knew the sacrifice watching him being an athlete that he had for that. So, I knew in business that would be something that would naturally just, you know, transfer over. Um, obviously, we didn't think, "Hey, we're going to be business partners." We were just best friends first. Um, so we ventured out first, right? We were doing collab uh things in the classroom. Right. So, he was co-teaching with me and we started to do that, and that went really well. But, then we had other businesses that didn't work. We had a social media site called Fashion Wave, and that didn't work just because, you know, we liked fashion. >> The both of you? >> Both of us. And it grew some steam, but we just weren't passionate about it. >> But but okay, so so now you before you even get to EYL, what was interesting about you two doing business together? Because I as a young kid, teenager, most kids are talking about sports. I happen to be one of the kids that was always like, oh, I want to go detail cars. I want to shovel snow. Anyway to earn my own money because it gave to me the money meant freedom. >> Well, I mean, I can tell my perspective is I was always an entrepreneur. I always like when I got when I graduated from college, I I started as a financial advisor. >> Okay. And where? If you don't mind me asking. >> So Penn Mutual was the first company that I was at. >> Penn Mutual. You're a licensed financial advisor. That's your very first career path. >> That's my first career path. That's my only career path before I started this. And and and I did that for 12 years. And so but the financial advisor and it's two ways that you can go financial advisor. You can go through like a bank. >> Correct. >> And you you like get paid a salary and clients come in and you work with those clients or like how I started with an insurance company, it's pretty much it's commission-based job. >> So you're building a book of business that you hope will pay dividends style commissions over the period of time you work with the company. >> Right. So there's no so you're freelance worker. There's no salary. >> No guarantee. >> There's nothing. You eat what you kill. So you get paid commission for the products that you that you sell and then like you said, you get residual income over the course of the time. So you set your own schedule. >> Which is rewarding, right? >> 100% for sure. But I'm saying since you're an entrepreneur, cuz you set your own schedule, you have your own marketing, you got to come up with, you know, ideas of how to reach people, you got to get referrals, you got to do seminars, all that type of stuff. So that's the only career that I ever had before doing this. So >> I love that, by the way. I I had a question that's going to lead into that statement you just made is going to lead into our next question, but I want to first know Troy, what was your first job? >> So my I was around education my entire life. So I worked at a camp was my first job as as a professional was a teacher. So I was teaching kids. I was the phys ed teacher and the health teacher. I got to watch entrepreneurship. So like not just him, but like our other partner Mike, they were entrepreneurs. So I'm watching him make his own schedule. >> So you're and I don't want to judge, but you're the structure, you're the one who is the I believe is the most modest, grounded, and provides a level-headed view of everything. You're the entrepreneur risk-taker. >> Where did you get that idea? >> [laughter] >> You're the entrepreneur risk-taker and then there's a third party, is it Mike? >> Yeah. >> Mike, who helps with balancing you both out. >> Well, he's he's the technology aspect of it. That was he he always was good with computers. He always had he he was a cameraman before he did videography. So he always knew behind the scenes aspects of like media. >> this by the way because I I've never knew this about you guys and now it makes all the sense in the world. You guys have all the simple ingredients to make a dish that you could serve up to the public. This has to be the segue into how did you come up with creating EYL as a show and podcast? What happened? What triggered the transition from ooh, I'm an educator, I'm an entrepreneur, we all observe and and look up to each other for what they do, and he's the tech guy. How do we put this all together and present a show that helps people better their financial literacy, better the their standing with taxes and investing and real estate and stocks. Like what made you do that? >> The show came from the the public, really. The demand from the public. Like, you know, the the people already thought that they it was a show. Cuz >> What were you doing? >> Well, so I when I was a financial advisor, my first goal was to build a social media following okay to get clients, athletes, and entertainers. >> So, you were actually taking uh the approach when you were at Penn like, I'm going to go out there and act like I'm my own management business cuz you have to. It was. You are truly um a contractor at that point. If you don't bring in business, you make no money. >> Right. >> So, your networking had to take place whether you had a show or not. >> Right. But we But so, in that time, we we're doing content. So, he's a teacher. We're doing financial literacy in classrooms. And filming that and putting that on my social >> Yeah, in in the summer >> Summer program. >> So, we So, we're filming that and we're putting that on my social media page. Then I have a public access show. I'm taking clips from that and putting it on my social media page. Then I will go on other people's shows as well. So, I I Like as a guest. Right. So, somebody wanted like an in-house financial expert, like local shows, you know, nothing crazy. I've developed relationships with different people. So, I would go and they have like a financial segment. >> Oh, I love it. >> And I would go and I would talk about different things. So, it was a whole content strategy, but uh some of the clips started to go viral. Like, and one clip in particular with the 50 Cent broke I broke down 50 Cent Vitamin Water deal. And a lot of people didn't know that that story. And that story that got like a lot of views on social media. So, the social media my my personal social media page started to grow. It was like 50,000 followers. But from these interviews that I was just posting, people thought that it was already a show. >> Mhm. >> So, they're like, "Where can I find >> the full version?" >> So, people were like, "All right, I see it. Now, where can I get it?" >> Where can I see it? Where can I get it? Where can I get it? And like I said, we have the relationship already because he came up with the name Earn Your Leisure as a hashtag. Clips start to go viral. >> The demand was there. >> was there. People kept asking. People kept asking. And then it was honestly people was asking for a couple of months. Like, "Where can I see long form >> And you're probably figuring out, "Oh, what do we do? They're asking for something that we don't even have made yet." >> It was a comment. It was like, "Where's the Where's the podcast?" >> Where's this podcast? We were like, >> And then and then um Wallo, I spoke to him. >> And shout out to Wallo. >> Yeah, shout out to him. And he's he's he's one of the people that really kind of pushed it over the edge cuz I had like a 4-hour conversation with him and he was saying like, "Look, you really need to take this and make this a show. Like, this is interesting. This is the way that you're distributing this information it's never really been done before. It's entertaining. You're mixing pop culture with the business lessons. Da da da. So, the idea of a show was already building up for months. And then that phone call, I was like, "All right, now it's time to do a show. Like, the demand is there." >> We're going to take action and get to it. >> So, so then so then I just called him. I was like, "Yo, you want to do a show?" >> And this is a great thing cuz it ends with you guys making this enormously successful business. But, what's wrong with the education system that you guys had to turn into the Mr. Rachel of finance? >> The complacency was what forced me to say, "We need to do this." Right? Like, I'm working in education for I think 10 years at that time. I'm realizing that everything that we're teaching and I'm watching my colleagues teach and I'm watching students. I'm like, "What are they going to be using in the future?" Right? Like, we're learning about science and all these things are great fundamentally for the development of the child. But, like, who's going to teach them about the things that are going to take them out of their neighborhood, out of their circumstances? How are they going to make decisions whether it's college or whether they're going to become an entrepreneur. Nobody's giving them that fundamental structure or even education. And so, the summer became that for me. And what happened in that 6 weeks of the summer, I was like, "Look, I teach for 10 months, and this 6 weeks that we're educating it feels more fulfilling." And so, I knew that was the calling. How do I get this? So, while he's doing that on social media, I'm thinking to myself, "How do I scale this program to make it available to more people?" Because as they see it, they're like, "Why isn't my kid in there? Why didn't I learn that?" And so, you see the gap where, "Okay, they left this out very intentionally, in my opinion, for somebody to fulfill it." And so, >> I I guess that's something I'm interested in. How did you see this as being a path to actually create freedom via this business and IP you were going to build with EYL? >> Hey, we didn't have any expectations to make money from the show. >> Right. That's important to know. But what But But why not? Why wouldn't you look at this as being, even if it's just a marketing driver? >> Well, that's what it was. That's what That's success, right? Well, that's originally that's how I was looking at it. It was like, "This is still I'm still in my financial advising brain." >> So, you weren't even thinking EYL as a brand, you're thinking EYL is going to get me >> the clients I need. >> Right. So, it was actually a mistake. >> It wasn't a mistake, it was just it wasn't it wasn't the original thesis. >> So, neither of you quit your your jobs to do this. >> Not at first. Not at first. But But very quickly, very quickly, I realized this had more potential than the financial market. >> You realized it had more potential. I need each of the moments you realize we have to stop everything else we're doing and put all of our effort into this. What was the moment? Each of you. >> I don't know for me, I don't know the exact moment, but I know very quickly that this was going I stopped focusing on my financial planning business, and I started to focus way more on Earn Your Leisure. >> I know, but what Some some series of events or an event had to happen. >> I know I know exactly what was for me. Um again, I'm working. I'm in the I'm teaching kindergarten at the time. I'll never forget it. Teaching kindergarten kids. I remember I had hula hoops. Where are you? I'm in New Rochelle. I'm teaching in the in the in the phys ed in the gym, right? And we're getting their texts back and forth, him and him and my partner. And I'm reading the texts, but I'm trying to teach, and I'm reading the texts. And then I see this somebody commented from Tokyo. And they wanted to have a conversation with us. And somebody was in Kuwait and wanted to have a conversation with us. And I would I thought to myself, this is bigger than I thought. >> Stick around. More Asking for a Trend still to come. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> Time now for what to watch Thursday, October 1st. First up, Nike, the sportswear giant, is set to report its first quarter earnings on Thursday amid low investor sentiment. Shares are trading near their lowest level since 2014. Analysts keeping an eye on China sales and progress on the company's turnaround as it competes with rivals on running [music] and Lululemon. Also on deck, weekly mortgage data from Freddie Mac. The current average [music] on the 30-year fixed is sitting above 7% as borrowing costs remain high for potential home buyers. >> [music] >> Finally, we're getting a fresh look at the labor market with weekly initial jobless claims data. Economists forecasting claims to tick up to 200,000, giving us more insight into the labor force ahead of Friday's full [music] jobs report. That's a wrap on today's show. Thanks for watching. >> [music] [music] >> I'm ready. >> [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] [music] >> I'm ready. >> [music] [music] [music] [music] [music] >> Mhm.