Stocks eye the day's tech earnings, Etsy CEO: Market Domination

It's the final trading day of Thursday and stocks (^DJI, ^IXIC, ^GSPC) are giving it their all, anxious ahead of the day's Big Tech earnings expected out after the market close. Julie Hyman and Josh Lipton discuss the market trends ahead of the closing bell and interview several chief executives.

Headline venture partner Kamran Ansari talks his top stock pick in today's episode of Good Buy or Goodbye.

Etsy (ETSY) CEO Josh Silverman sits down with the Market Domination team to talk about the e-commerce site's earnings and how it is maneuvering a difficult consumer environment.

US Department of Transportation Secretary Pete Buttigieg joins Yahoo Finance executive editor Brian Sozzi in a discussion Boeing's (BA) new CEO and new policies to protect airline customers.

This post was written by Luke Carberry Mogan.

Video Transcript

Hello and welcome to market domination.

I'm Julie Hyman.

That's Josh Slip in live from our New York City headquarters.

We are giving you the ultimate investing playbook to help tune out the noise and make the right moves for your money.

And here's your headline blitz getting at the speed one hour before the closing bell rings on Wall Street.

The core ads business is just doing really well.

Uh It's re in the low twenties percentage and it shows you that already in their core business, they're benefiting from A I.

So it was really quite a change from 90 days ago and certainly viewed positively by, by investors.

Definitely set up September as a, as a key point for the committee.

Uh I think the market pricing is about right, the 85% there.

You do have two inflation reports, you have two jobs reports before that meeting.

So it's possible that it would get derailed.

But I think the committee is ready to go when the fixed income market which is forward looking and the fed which is backward looking.

You have the fixed income market has numerous times reassessed and repriced.

So what, what ends up happening is as a data, if the data should come out, stronger yields go up.

So we do think that we definitely wouldn't buy at this level overall.

We think yields come down.

But we do think it's gone down a little bit too fast and the market is definitely a bit too dovishness versus what the fed has guided.

We have got one hour to go until the market close and we are looking at a sell off in which losses are accelerating here.

Let's check on the major averages first.

We've got the dow down more than 700 points set for its worst drop of the year.

In fact, with that, almost 2% decline, the S and P 500 down almost 2% and the NASDAQ, the big loser here down almost 3%.

Now, in terms of what's going on here today, Josh, we did have a little bit of economic data this morning seems to be also partially tied into earnings and then there seems to be some trepidation about tomorrow morning's jobs report that potentially we could get a triggering of the so called ST so rule which J pal yesterday called a statistical regularity.

In other words, if we see the unemployment rate tick up, that could trigger this indicator that in the past has signaled a recession is coming.

Yeah, I think you, you nailed the join.

I mean, we did have weak economic data today, which is interesting because, you know, these unemployment claims it was a manufacturing activity.

Um You know, I was talking to our colleague Josh Schafer about this in the newsroom and, and we're talking about how you, has there been a shift in the narrative because for a while there for a good stretch, it was bad news was good news.

And you see these bad economic data and investors would think.

Well, that's, that's, you know, disappointing, but it just means Jay cut is gonna send that rate cut faster.

Right?

And I wonder if now, which is bad news is bad news.

Well, because the thinking was, it's ok if he, if the fed is cutting to get us back to a normalized level, as long as they're not cut into economic weakness and now maybe there's a little bit more nervousness about that economic weakness.

I wanna point out what's going on in the 10 year yield today.

It is now at 3.98% here.

And that's the first time we've seen a sub 4% yield going all the way back to about February here.

So that an important trigger here that the market seems to be watching and then there's what's going on.

I mentioned the other part of it today is what's going on in big tech, right?

NVIDIA, you win some, I'm up what, 13% yesterday, down a quick 8% today.

Meta the stand out here to the upside.

But otherwise you got a lot of selling going on in big, big names after the bill today.

Yes, indeed.

All right.

For more on a rough day for the markets.

Joining us now is Michael Kantrowitz, Piper Sandler's Chief Investment Strategist Michael.

I don't know if you heard that.

Uh you know, we were talking here just about that narrative, Michael, you know, bad economic news was good news for a while because it meant a rate cut was coming.

Um Now today Michael, is it just bad news is actually bad news?

Is there a change in the script here?

Yeah, I uh bad news is certainly bad news today and we got a lot of it between claims rising, the ism declining remaining in contraction territory, seeing the employment data set uh at 43 which is, I think the lowest of uh since COVID.

Uh so, yeah, I think bad news is bad news.

I would say though that, you know, we started seeing this in May uh where we, when we started getting interest rates falling from uh late April of this year when the tenure was at 472 we started getting some bad news.

It didn't really hurt large caps and mega caps, but it certainly hit the average stock uh and certainly hit smaller caps, uh which we saw this big dichotomy open up between large and small caps which then quickly reversed when we got that good CP I report on the 11th of July.

And that's kind of given, I think a lot of investors, a lot of confidence and then we get the string of bad news and it kind of resets to reality.

So, where are we in that reality, Mike?

Because not only, uh, we mentioned the rule before, um, which shows that, um, you know, it's a recession indicator tied to the unemployment rate.

You've got your own can rule as well.

That's your own uh homegrown recession indicator.

Are we there?

Are we getting close?

Uh Mine's already triggered, mine triggered three months ago and, and mine looks at how fast unemployment growth.

Uh So how many people are unemployed, the pace of that growth in uh rising year on year and when it breaks 10% historically and just like the Psalm rule, it's been similarly accurate.

You are heading towards a recession or you've used it, you've always had a recession.

Um And so that broke three months ago and it's continued to rise and it's, again, it's just more evidence uh that the economy continues to kind of break down.

I I think, and maybe that's too aggressive a word to say.

But, you know, we're seeing despite lower rates in the last month or two months, housing data is not really responding positively.

That's not a good sign PM is, are not responding positively and uh consumer confidence is not responding positively.

So, uh there's more breath in this economic softness than we've seen in some time.

And I'm curious, Michael, we got another big economic data point tomorrow.

Right.

The jobs report.

I, I'm just interested what your expectations are there.

Sure.

Uh, I, I'm, I'm in, I'm in the camp and now I'm a strategist.

I don't necessarily do point forecasts, but I, you know, I continue to think the unemployment rate is going to continue gliding higher at a modest pace or moderate, moderate pace.

And I think what investors are fearful about is a quick acceleration in the unemployment rate, not something we've seen yet.

And I, I think there's a s there's several reasons that we won't see that.

Uh that again, it will be more glacial in nature.

Number one being that oil prices are, are, are, are not spiking something we've often seen before before recessions and big spikes in the unemployment rate.

Um, we still have a decent amount of fiscal spending and, and we have parts of the economy that are still holding up for uh fiscal, fiscal reasons or even the housing sector.

It's gonna take more pain to break that because the lack of inventory.

Uh, so I just don't think things are gonna accelerate quickly.

But, uh I think we're gonna continue to see a weaker labor market.

The, the labor market I'm really focused on is next month when we're likely to see the post revisions.

Uh, the annual benchmark revisions on the, uh BLS and, and that could lead to a major shift in what has arguably been overstating employment, which has been the birth death model.

Uh that could see a pretty sizable downshift next month.

Uh And that's something I'm looking out for as we go forward, something else that you have been noticing, you know, and we mentioned the milestone today of the 10 year yield falling below 4% for the first time since February.

I know you have been noticing the reactivity to moves in the two year yield.

In a recent note.

In particular, you were, you were looking at correlations between all kinds of things and the two year yield from everything from small caps to utilities to other groups here and noticing perhaps that some of these groups like the small caps are taking their q more from the two year yield.

In other words, benefiting when we see that yield go down and that's an inverse uh uh small cap chart look looking at it moving very much correlated to the yield.

What do we, what, what does that imply that the two year sort of taking precedence?

I think it's just a natural shift of what was driving interest rates for the last couple of years was really the inflation and economic growth backdrop.

And now that we're getting closer to the first fed rate cut, which uh we, we agree it's in September.

I although I would argue, I think the fed should have started cutting already.

Uh but I, I think it's just the market more focused on what the fed is going to do.

Uh More so than what the economic is go datas are doing.

What I would, what I would in that note, I more broadly dis discussed though that um in the last three weeks, not including today, much of that decline in interest rates has come from a good inflation report we had earlier this month.

Whereas today we've broken 4% on the 10 year.

The two year yields down a lot.

Five year yields are down a lot.

Uh But that's because of bad data.

And so you're seeing a very negative reaction from markets and so when yields go down, it could still be a good thing going forward if it comes from lower inflation.

But if it comes from higher unemployment, bad PM is bad earnings, bad macro data.

Um While that was good news a year ago when everyone was worried about inflation, that's not the case today.

And I don't think that's gonna con uh we're gonna see that as good news, Michael.

I think the last time you were on the show you were a fan of utilities.

I think uh if I remember Michael, you uh referred to Iron Man football, that sector.

It's kind of like offense and defense.

Are you still a fan?

Absolutely.

In fact, uh while everyone's been cheerleading, small caps, not everyone, but many have been cheerleading small caps for the last three weeks.

I, I've been arguing that utilities is really the place to be.

And as of today, as we sit here today, now, utilities have actually outperformed the Russell 2000 since the beginning of that rotation, which started on July 11th.

So you've been better all year being in utilities rather than small caps.

They're beating them year to date.

And even from this massive record breaking move in small caps, that really was four days in length from the 11th to the 16th.

Um, it's been utilities that have continued to, to work.

And I think that makes sense because that's the part of the market that is much more stable, that tends to outperform when risk is rising in the economy and doesn't have the earnings and economic risk that a smaller cap companies do.

Yeah, indeed, that utilities group in the S and P up about 16.5% year to date.

I cannot tell you, Michael how much discussion the Iron Man Trade has engendered around the office here at Yahoo Finance.

That was a popular, popular one to talk about.

So thank you for bringing us that once again.

Yeah, thank you.

Good to see you.

Thank you.

We're less than an hour away from a slew of major earnings reports from Wall Street.

Let's take a look at some of the expectations heading into these prints and here to explain Yahoo Finance's Dan Halley Dan let's begin with the biggie, let's talk about Apple here and what to expect.

Yeah, Julie, there's a lot of anticipation around specifically Apple's performance in the Greater China region.

This has been a point of contention uh among analysts, some saying that Apple's gaining share, some saying that it's losing share.

Some saying that overall smartphone sales in the region are doing well, but Apple's just not catching up.

Uh but let's break things down first overall.

So for revenue, uh we're expected to see uh 84.84 $0.4 billion and eps of a dollar 35 that would be up from the 81.7 billion uh and a dollar 26 that the company saw uh in the same time last year.

Now, uh it's also important to point out that this would be uh potentially a jump uh year over year if they do get that number versus the uh slowing growth decline, year over year that we had saw in overall revenue.

But let's talk about the greater China region.

Uh analysts are expecting $15.2 billion out of that region.

That would be down 3.1% versus 15.7 billion.

Uh overall iphone sales are gonna be three po uh 38 point 9 billion.

Uh That would be down 1.8% from the year prior.

So those are really the, the biggest numbers that we're going to be watching for apple.

Though there could potentially be some bright spots specifically in services, which is always uh a an important number for apple.

It's their second largest category.

Uh estimations are for 23.9 billion.

That would be up from last year.

Uh And then for ipad sales that's expected to come in at 6.6 billion versus the 5.7 billion uh in the quarter last year.

Uh And that could be due to the ipad Pro release uh with that M four chip inside uh higher uh average selling price, which could lead to uh also better margins on ipad uh as well.

And then, you know, Mac sales are expected to be uh down year over year as are wearable.

So, you know, that's really Apple's go to on the phone call.

We'll be expecting to hear something from Tim Cook uh on Apple Intelligence, uh potentially the roll out there.

And then obviously, we're anticipating the iphone 16 to come sometime in December.

Uh on the other side, we have Intel.

Now Intel, uh at least according to Bloomberg is expected to start doing uh uh layoffs shortly, which could be uh in the thousands of workers.

Uh They're really trying to reinvest themselves or at least reclaim what they were as far as market share uh in the PC market as well as catch up in the A I data center space and become a rival, a foundry rival to TS MC.

So far, the foundry, obviously, it's just getting off the ground.

Uh, with third party, uh, customers, Microsoft is going to be one of them right now.

Intel's biggest customer is Intel, uh, because they're still making, uh, the majority of their chips.

So they're not really, uh, flying high there.

But as far as the, the top line numbers were expected 12.9 billion in revenue and 10 cents in uh earnings per share that 12.9 would be flat year over year if they come in there.

Uh And the eps would be down from 13 cents that the company had seen last year.

No, on the data center side, which is what everybody's going to be looking at because it relates to A I and everybody wants to talk about A I, they're expected to bring in $3 billion.

That would be down 2.6% versus the 3.1 billion they saw in the year prior.

Uh the data center is where they sell their server CP US and server GP US.

Uh And then importantly, for Intel is their client side, that's still their biggest uh uh set, which is where they sell CP US uh for enterprise and consumer customers for desktops and laptops.

Uh out of there, they're expected to see 7.5 billion in revenue.

That would be a jump of 6.1% from last year when they had 6.7 billion in revenue.

But one of the important things to point out is that Intel is potentially facing an existential right from Qualcomm, they jumped into the PC space deeper now, they had been in there for a little bit.

But now they have a real uh product that can compete in their ex elite snapdragon chip for P CS.

It really is uh an incredible chip uh inside uh Microsoft's surface devices.

Intel is expected to launch though its own rival chip later this year.

Dan, thanks very much.

I know that you're uh gonna be very busy in just a little while here.

Appreciate it.

We're just getting started here on market domination with what will be a big day headlined by big tech earnings before we get there.

We've got a jam packed hour ahead for you coming up, Nick of the Wall Street Journal joining us to break down the path ahead for the FED plus will be speaking to the CEO of C and Wing stop as well following their latest starting supports.

And we also hear from the US Secretary of Transportation, but the judge in his latest proposal to lower the cost of flying all that and more when market domination returns, the fed is leaving rates unchanged in July.

But the likelihood of a September cut seems to be increasing.

At least that's the perception fed chair Jay Powell saying a cut could come as soon as the next meeting for more, bringing in someone who was at Powell's presser that is Nick Tiros, he's chief economics correspondent at the Wall Street Journal.

Nick, it's good to see you here.

Um So as always the fed chair tried to not say explicitly September is happening, the market is taking it that way.

We're seeing swaps traders now pricing in three cuts still this year.

Do you think that's the right interpretation here?

Uh You know, ask me after the payroll number comes out tomorrow.

Uh It's, it's, you know, it's, it's hard to say, it's, it's, it's, you know, markets have to take a view of what's going to happen down the road.

I don't, uh what I would say is that I thought Powell came as close yesterday as he could to saying September without making some promise that someone could hold up later if, for whatever reason they decided not to do it.

Um And I'm not sure why the communication came out that way.

Um But nevertheless, I mean, if you look at the policy statement that came out at 2 p.m. sometimes when the fed is ready to cut rates, but hasn't, you know, isn't doing it at that meeting, they'll put something in the guidance uh yesterday, they could have weakened the guidance around, you know, we won't cut rates until we have greater confidence.

They could have said until we have some greater confidence, they chose not to do that uh in his opening statement at the press conference.

Powell also didn't say anything new in the monetary policy guidance section of his opening remarks.

So he left it all for the Q and A but in the Q and A, he said it could come as soon as September.

So again, I think he went as close to the line of saying, you know, the market's not wrong about September.

Uh without actually saying the code words that would make it seem like more of a promise.

Can I get your Nick?

Uh your, your uh kind of insight, Nick on one data point that got some attention today.

Just I'm curious, you know, investors looking at this economic data ism manufacturing, Nick and the unemployment measure sank to 43.

It was the lowest since June 2020.

Uh I'm just curious, Nick, when you kind of, you know, the economist you read and talk to if you heard any kind of feedback on that.

Yeah, I, I think the number tomorrow just will matter a lot more ism.

Yes, I realized this employment Subindex uh was very weak today.

Uh It's bounced around a bit uh both in the manufacturing and the Non man index.

Um But it's, it's just, it's one data point that I think is quickly gonna be overtaken by a bigger data point tomorrow.

Um And as for that um uh data point tomorrow, um you know, there has been a lot of commentary that the Fed should have cut yesterday.

Um, what was your assessment of, of the committee, sort of acknowledging the risks of unemployment slowing further and how they're weighing that?

Well, I think the issue right now on the committee is really one where I think the hawks, uh, people who have been reluctant to entertain cutting.

Uh, they, you know, there, there's a question to ask right now, which is, where are upside, inflation risks going to come from in an economy where the vu the vacancy to unemployed worker ratio uh is fallen to where it was before the pandemic.

You have hiring uh rates down layoff rates are low.

So turnover is low to the extent people, you're worried that people are going to bid up wages by changing jobs.

That doesn't seem to be happening.

You had a fairly cool uh employment cost index report on Wednesday.

So the labor market, as Powell said yesterday, doesn't seem to be a source of inflation risk.

So where, you know, if you're worried about inflation, where is it going to come from?

Is it going to come from abroad?

Uh Probably not with what you're seeing from the dollar and commodities right now.

Uh I think that's the issue right now.

You know, the fed says that the balance that the risks are more balanced between their inflation and employment mandate.

Uh But I, I do think the market is looking at it saying, well, we see downside risks much more on the employment side than we see upside risks on the inflation side.

And, you know, they're putting, they're putting their money to play accordingly.

Now, you know, back in May, the market only saw one cut this year and people were talking about, well, is the fed gonna have to go back to having a neutral bias or a hiking bias in the statement?

And Powell sort of dismissed that and seems to have been, uh, you know, had that view vindicated.

Uh but this is obviously a different situation.

And Nick, you also, you know, wrote about uh policy changes during election years.

I'm just curious what, what you made of Powell's commentary about that topic.

Well, his commentary hasn't changed at all in the six years now that he's been fed chair.

I mean, he says the same thing every time the question comes up.

No, we don't take politics into, into account if you look at what the Fed has been trying to accomplish here, getting inflation done without having unnecessary weakness to the labor market.

I mean, that's a really big lift.

There is so much more at stake than trying to figure out well, this election or that election.

But nevertheless, the question comes up all the time.

I hear it from my readers all the time.

Well, that, that must be doing this.

You know, I can't understand why they would cut or I can't understand why they wouldn't cut.

Therefore, it must be politics.

Uh If you listen to what fed officials say, if you look at how they've behaved before past elections, there's no evidence that, you know, they take politics into account.

I do think it makes their communication more difficult.

And so I do think if you're going to cut interest rates, if you're going to start a cutting cycle in June of this year or September of this year, as opposed to next year, then you just have to explain it, you know, very clearly for the people in the back of the room, make sure they can hear it.

Uh why you're doing this, that it really isn't about politics.

I think there are some people that the fed just is never going to be able to convince and they're just going to look at this and say, well, I can't understand it.

Therefore, it must be politics and those probably aren't the people the fed is trying to assuage with the answers like what Powell said yesterday, right?

And Powell definitely tried to be very clear in that answer.

Finally, Nick, since we have you here as we talk about all of this monetary policy, we also want to acknowledge the milestone that's happened for you all at the Wall Street Journal with reporter Evan Gershowitz being uh Gershowitz being freed by Russia.

I know this has been a big effort on the part of the journal staff.

Um And so I just wanted to acknowledge that and get your reaction.

And I, I'm sure that uh you and the other folks in the newsroom have been celebrating this today.

Yeah.

Well, thank you for that.

I mean, I'm obviously thrilled.

It's profoundly good news and everybody here is, is really excited and uh you know, very appreciative of what others particularly in the press have done to keep attention on this.

Uh And of course, everybody in the government who worked so hard to secure his release.

Um I'm really, I'm, I'm happy for him and for him to be reunited with his family.

Definitely Nick, thank you so much.

Appreciate it.

Thank you.

Well, switching gears to a training ticker today, we're talking about online retailer, Etsy reporting stronger than expected revenue for its second quarter, gross merchandise sales were in line with expectations though they did fall 2% from a year earlier.

The online marketplace is looking to boost sluggish sales with the plan, roll out of its first ever royalty program and joining us now is Etsy CEO Josh Silverman here with us in the studio.

It's good to see you, Josh.

Thanks for coming in.

So um indeed talked about some revenue growth, gross merchandise sales falling a bit and there seems to be a little bit of confusion on the street about the full year gross merchandise sales guidance which I believe you guys pulled.

You don't have that full year guidance anymore.

Can you explain to us a little bit more about that decision or just how you're thinking about the rest of the year.

So we're pleased to see that we actually saw some modest acceleration already in the second quarter.

We guided to low single digits for the third quarter, but things have just been very volatile and so we're really not comfortable giving 1/4 quarter guide yet.

We have an election that's been incredibly mind share consuming and I expect unfortunately that that's going to get worse in terms of mind share consuming and the macro, you know, continues to be very volatile.

We're pleased that in spite of what we think are very significant macro headwinds for discretionary consumer products.

We've been maintaining our position and we had 91.5 million active buyers last quarter about the uh uh very close to our all time high while we're swimming upstream.

And importantly, we think that this is only making our muscles stronger for when we come out of the recession, doubling down on the things that make Etsy the most special and importantly, resisting the urge to follow the race to the bottom.

Most people in e commerce right now are just all about deep discounting.

That's not Etsy, it's not where we're gonna win.

We're really about highlighting the very best of Etsy.

We've made enormous progress in that.

We are excited about the progress we're making there and we think that's what's gonna make Etsy bigger and stronger for a long time to come.

You know, Josh, the way that I use Etsy, um, is probably like a lot of viewers wa right now use it.

So if I want something really just kind of basic and general, honestly, I go, I go to Amazon.

Right.

That's my first stop.

And then if I want something just cool and you, he can differ.

I go to Etsy whether it's for myself or, you know, uh maybe it's a gift, right?

How do you think about that?

And how, how do you get, um, I don't know, consumers to think about that.

Maybe you think about that differently.

Yeah.

So great question.

I think we've done an amazing job of becoming the very best place to go when you can't find it anywhere else, whatever it is you have in mind.

If you can imagine it, it is for sale on Etsy and can be made just for you exactly to your specifications.

We have a and by the way, for several years during the pandemic, there were a lot of things you wanted and couldn't find anywhere else.

Even if, uh you know, forget offline, even online places were out of stock.

So tens of millions of people needed to come to Etsy to buy things that they couldn't find anywhere else.

We're really proud of the fact that we've been able to maintain nearly all of that volume even now in a deep, uh you know what I think is a recession for consumer discretionary products right now.

I think we're in one, we've been able to maintain nearly all that volume.

But the opportunity for us now is to be a starting point for your commerce need.

You can buy a cheap bookshelf somewhere else if you want.

But the bookshelf that people are gonna Etsy you got from Etsy that people say, wow, that's such a cool bookshelf.

Where did you get it?

That's only Etsy.

And so instead of you needing to already know exactly what you need, I need this bookshelf of exact dimensions.

We want you to come to Etsy.

When you're just thinking, I'm gonna redecorate my office.

I am planning a wedding.

I'm having a baby.

I need a gift for a friend.

I'm planning Thanksgiving and have us be having such an organized experience for you that we can take you through.

Here's all the things we can do for you from that very high level.

Very, let's say low definition need all the way to specifically the things that you wanna buy.

That's been hard because with over 100 and 20 million things for sale.

None of which map to a catalog organizing that in a way that people can understand is tough.

But this is where LL MS are magical.

They're really good at taking vast amounts of information and summarizing them and organizing them in a way that humans can understand.

So the kinds of investments we're making right now, I think are really exciting for making Etsy a place you can start for all of your commerce journeys.

This loyalty be we're starting.

Um Right now, a loyalty program is really about asking people, hey, pay a small monthly fee and by committing to that small monthly fee, we think those people will then say, well, hey, I'm already paying the fee.

I'll start all my shopping missions on Etsy.

And you're gonna be surprised that we can deliver not only great stuff made just for you, but at good value as well.

I want to double click on what you said about us being in a consumer discretionary recession because that on the face of it seems to be pretty bad news for a, a company like Etsy.

So you're doing these things like the loyalty program.

When does it inflect for you?

Then I think we've been the tip of the spear.

I think we've been facing this for many quarters now.

And now we're hearing, for example, Starbucks having a tough quarter, right in the last recession.

The last thing people gave up on was that cup of coffee.

That was that affordable luxury.

We're seeing, you know, mcdonald's say that it needs a $5 and your meal now because paying full price at mcdonald's is too much.

So I think Etsy's been feeling the brunt of the Wells Fargo published a survey recently saying 60% of Americans right now say that by the time they're done paying for their essential bills, they have very little left over for anything else.

So will you be one of the first to come out of it then?

I certainly hope so.

And we are leveraging this moment to make Etsy even stronger, lean into what makes us different, celebrate the very best of Etsy elevate the best sellers.

We've made huge progress with Etsy search just in this quarter on increasing the diversity of, of, of Etsy sellers, reducing uh duplication and highlighting the best uh the most artisanal, the most craft person like.

And that's a track of work we're really invested in right now behind item at Etsy.

There's a human, there's a real person who made that item or designed that item and we're doing more and more to celebrate and center that seller and her work.

I think that's gonna pay off in spades, especially as we come through the other side of this cycle.

All right, Josh, thanks so much for joining us today.

That was great.

Appreciate it.

Thank you very much.

And coming up, it's latest edition of our series.

Goodbye or goodbye.

We're gonna take a deep dive into two stocks to help you make the best moves for your portfolio.

Stick around the crackdown on junk fees at airlines.

Well, that continues.

Let's bring in uh Transportation Secretary, Pete Buttigieg Mr Secretary.

Always nice to get some time with you.

Another real interesting initiative by the Department of Transportation.

My question to you is this with these fees?

How much are airlines, I guess bilking passengers with these?

Like, how much does this become a profit center for these companies?

So what I can tell you is that we've gotten hundreds of complaints about cases where this has happened and it may not be the number one category of complaints in terms of volume, but it's certainly one of the most troubling in terms of severity.

The idea that you get into a situation where you got to pay extra just to sit next to your kids.

And I think consumers are already kind of kind of grumpy about the practice that has developed of, uh, you know, feeling like your nickel and dime for, for every service on board a plane.

But we're talking about something much more serious than that.

Uh Just think about how frustrating, even scary it could be if you are separated from your kids in flight and how challenging it can be.

If you are told that either you got to pay or you find yourself haggling with another passenger and, and pulling a flight attendant into this as you're kind of begging or to be able to sit next to your kids.

Parents shouldn't have to deal with that.

I feel even more strongly about that now that I've flown with, uh with my husband and our toddlers, that is a challenge, challenging thing enough without facing this.

So the rule would make it clear that when you fly, there's no extra charge to be sitting with your own kids.

A number of airlines have answered our calls and are already doing this voluntarily.

The rule would make that standard across the industry.

Mr Mr Secretary, we talked to a lot of uh CEO S of publicly traded airlines here at Yahoo Finance.

Do they know this stuff is happening?

Are they sitting in their ballrooms like rubbing their hands?

Like, gee how can I get more profits out of each passenger?

I mean, or they just, I guess not surprised by this at all.

Uh You know, I've definitely raised this directly with some airline, ceos.

They don't seem to view it as the problem that we do, but we're guided by the complaints and the input that we're getting from passengers, by the way, like all rules of this type, this is going to go to an open comment period where passengers can weigh in.

Airlines can weigh in too.

Uh Look, they have been fighting us on a lot of these rules, right.

We, uh we did uh fee transparency.

Uh we've done automatic refunds, we're doing ancillary fees where you got to at least be able to get your money back on the Wi Fi if the Wi Fi didn't work.

Um And it is frustrating when the airlines push back.

Notably, they have gone to court uh over the rule that we have on fee transparency.

Now, to me, if you're going to court of law saying that, uh, it will irreparably harm you to have to disclose the fees that you charge.

Uh, to me, you're kind of telling on yourself in terms of your business model, but that's the posture they've taken and those processes work themselves through.

But what we do know is that passengers appreciate these passenger protections.

And I would argue they ultimately make the airline sector better off too because they build confidence in that sector instead of passengers being so frustrated all the time.

Uh Also Mr Secretary, we um we talked around the time of uh the door blowing off that Boeing airplane.

Now yesterday, we had big news.

Boeing has reported has announced new Seal, Robert Ortberg, a veteran of the aerospace industry.

When we talked last time you said something like that is a personal issue for you.

Have you scheduled a meeting with Mr Ortberg?

And what's your message to him as he takes over the helm of this iconic American company?

I haven't yet arranged to speak with the new CEO, but of course, we'll be watching that leadership change closely.

You know, we don't pick and choose a hiring decisions for a company like that.

But we are going to stress the importance of establishing the right kind of safety culture.

And when I do get the opportunity to speak with him, that will be my focus I want to know what steps he thinks can be taken and what he is committed to leading in order to make sure that Boeing put safety and quality first.

Uh There's been a lot of focus on the uh the analytics and the economics.

Uh All of that, of course, is important for any company, but uh none of it means anything.

If you don't have safety and quality first, we've covered your whole time uh at dot uh Mr Secretary from start right up until now.

I only know you as a Department of Transportation Secretary, but you've now been rumored to be in the running for vice president.

I know you can't say much because of the Hatch Act.

I get it.

But you know, to the CEO S that watch Yahoo Finance, could you just tell us, tell them or speak to them about the economic agenda o of, of, I guess the Biden administration and, and how pro business is the vice president?

Uh Well, without getting into the campaign side, what what I'll say is that you can expect a continued focus in this administration on sustaining the historic economic growth and job growth that we've experienced.

I think this demons, this administration has demonstrated that you can be pro worker, pro consumer, pro competition, pro little guy and business thrives too.

I mean, that's the thing.

It's not like uh profitability has somehow collapsed because we've been supporting workers and unions and better wages and, and the rest of it, on the contrary, everybody has been better off.

Jobs are up, companies are, are doing great at a time when we are also showing how serious we are about those labor protections and consumer protections.

These things can go hand in hand as they have for the last 3.5 years.

And the vice president under the president's leadership has been a key architect of that.

Lastly, I'm glad you mentioned infrastructure because your administration, the ban, I mean, and you have led a lot of these efforts, Mr Secretary in the EV Industry.

Uh and you're going to, I believe uh be visiting a stent is battery uh factory tomorrow.

As you take a step back, do you just find it Bizarro that Elon Musk is not out here supporting the efforts of the Biden administration and that he's throwing his support behind President Trump who may come in here if he wins four years in the White House, pull back that ev tax credit and maybe undermine a lot of the ev investments that this administration has made.

Yeah, again, I'll take care not to talk about the campaign side of things.

But you know, this administration has seen to it that the EV industry has flourished in this country, whether we're talking about new companies like Tesla or whether we're talking about some of the most traditional names in auto manufacturing in the big three making their moves to thrive in the future.

And we're doing this, we know not, of course, because there, there's climate benefit and because there's benefit to our economic security, just like China has worked to edge us out in the market.

Not I think because they are environment enthusiasts, but because they understand the strategic gains, we have gained so much ground.

And that's part of what I'm going to get to see tomorrow in Indiana.

You know, I first spent a lot of time in Kokomo and in uh in Howard County, Indiana during the time of the great recession, the auto crisis in 2009, I saw what it was like in that community as they were facing almost 20% unemployment and was, uh we were worried that that unemployment rate could hit 40% if companies like Delphi and Chrysler went, went under it.

It's part of how I got into politics, politics to begin with was standing up for the rescue that, that kept Chrysler in business and kept really so many families in Indiana on their feet.

So it's an amazing full circle moment to go back to this place that was experiencing such economic pain when I first got deeply engaged there and now has a new factory because of the focus on EVs and the jobs associated with them taking shape.

That will mean not just the people who work there, but thousands of people in that community are going to benefit.

And it's a great example of how this administration has broken the old false choice that you either care about climate or you care about jobs.

And instead it demonstrated that you create jobs by leaning into our clean future.

Great to get some time with you.

As always, Transportation Secretary Pete Bogied.

We'll talk to you soon.

Good luck on that trip to the ST anti plan.

We'll talk to you soon.

Very much.

It's a big noisy universe of stocks out there.

Welcome to, goodbye or goodbye.

Our goal to help cut through that noise to navigate the best moves for your portfolio.

Today.

We're taking a deeper look into the market captivating tech sector.

I'm here with headline venture partner, Cameron and sorry.

Good to see you.

Thanks for coming in.

Good to be back.

Let's take a look.

Here.

Your goodbye.

Today is Microsoft.

It's an interesting one of course is just reported, the market punished it a little bit, but the shares are up more than 20% of the last year.

This sort of sell off that we've seen not with standing and I know you like big tech generally, but so we'll use Microsoft sort of as a representative, right in this case, and the valuations have come in, as I mentioned, you know, Microsoft got punished after its earnings, but generally we've seen tech stocks come down.

Oh yeah, look, I mean, Microsoft itself obviously a big run up this year.

They're down 10% almost in the past month.

So I think it's an opportunity for folks to come into these big names.

The Fang names, the Magnificent Seven.

However, you want to find them, they're all down about five or 5 to 10% in the past month or so.

You're talking hundreds of billions of dollars of market cap kind of wiped off very casually.

Uh as, as investors have rotated to more kind of Russell 2000 and traditional sectors away from tech.

So I think it's a buying opportunity because these companies are still doing tremendously well and you buy and hold and stick out for the long term.

And maybe the valuation is now a little more in line with that, that kind of outlook.

That's hey, the ro that said the rotation, you think to that non tech, you think it's, it's gone too far in that?

Absolutely.

And I think people are spooked by some of the Capex.

They're seeing in the numbers from Microsoft, from alphabet, from meta where, you know Microsoft thing I think is projected to spend like $80 billion in the next year.

Uh In Capex, that's roughly the GDP of Luxembourg.

That's a massive number, right?

Uh And it scares people, but the truth is, you know, we're in the early innings of the A I revolution and I think, you know, you don't build a house by putting in the fixtures and the paint and, and the art you put in the concrete, the foundation, the steel and that's what these companies are doing.

They're spending now for the future.

So it's gonna be a heavy Capex period.

But I think you buy and hold these names in the long term.

OK. And let's talk a little bit more about that.

Laying the foundations for A I here.

So is there though a situation as they're building the foundations, they're also gonna be revenue generated, you know, so when do we look for that next phase?

You know, and it's already there, the intelligent cloud unit of Microsoft, which is where most of the A I business sits today.

I think the street projected 28.7 billion.

The quarter came in at 28 5, they missed by inches, but this company is still ahead by miles.

So let's not, I think lose that perspective.

Um So the revenue is there too.

It, it's, it's gonna be on the come, right.

A lot of the revenue from the A I businesses in these companies are still gonna be forthcoming that said it's not without risk.

We always like to point out what could go wrong here and we could see a continued rotation.

There's been a little bit of trepidation too that the A I story leaving even the stock prices aside was a little overdone was overbought and people kind of got too excited about it.

And I think, you know, it is gonna be maybe one of these things where it's kind of, you know, two steps forward, one step back where investors are gonna take a moment to pause and move to other sectors and maybe safer spaces.

But I think again, if you buy and hold and look, you know, zoom out for the long term, these are great investments, these companies are, are built to last.

Um So let's talk about the stock you do not like as much and that his group on which to be honest, I've been talking about in quite a long time.

Neither.

I shares are actually up quite a bit over the last year.

If I pulled out this chart longer though, it would be a collapse in the shares over the past five years and over the maximum time.

But we're seeing this at a time when and we have a chart of the company's year over year revenue here.

So this is the annual revenue going back to 2019.

And I mean, I'm not even sure what else to say.

This sort of, this is not a great chart.

Uh You know, they're exiting business.

I think this is a business in transition that's slimming down.

It almost feels like a business that's trying to kind of narrow down to just a couple of business lines that they feel are gonna be profitable and push forward.

But again, the entire company has shrank and, and it's just, the story is not a great one in terms of declining year on your revenue.

Right.

So the revenue is declining, but also they've got net loss, the surprise net loss, the hit in Q two, which I think folks didn't expect, uh, they were profitable the prior quarter and all of a sudden they had a $10 million net loss in Q two.

Some of it due to, uh, I think a write off related to they're closing down their Italian business.

So I think again, this business is one that's slimming down, that's shrinking, that's declining.

And I think you're gonna see that reflected in the stock price.

Yeah.

And then there's sort of the, I don't know, existential issue around Groupon also.

Who are these guys anymore?

Right?

Like it's like, uh if you want coupons and stuff, you're gonna retail me not or ebates or these other sites.

If you're doing online shopping or social shopping, you find Instagram or tiktok or Pinterest or somewhere else.

I don't know where Groupon really plays anymore.

And sort of the cons Zoom or tech stack, the totem pole of the apps you go to on your phone every day.

I just don't think Groupons in that, in that conversation anymore.

So what could go right for Groupon?

Maybe somebody buys them.

I think maybe someone comes along and buy if you, if you buy this asset, restructure it, I mean, the brand is still a well known name.

It probably sits on, you know, tens of millions of phones out there, uh, that have the app that, you know, maybe don't open it every day, but I haven't bothered to uninstall it.

So it still has a lot of users, customers accounts, uh, app downloads and I think if someone came in and bought it, restructured it, that could be upside for the stock and it could drive it up.

Got you.

Do you have a position in either of these?

I do not.

Ok. All right.

So uh by Microsoft avoid Groupon at this point, Cameron, good to see you.

Thanks for coming in.

Appreciate it.

Thank you and thank you so much for watching.

Goodbye or goodbye.

We'll be bringing you new episodes at 3:30 p.m. Eastern.

Stay tuned.

We've got more market domination on the other side.

Wingstop, delivering appetizing growth of nearly 29% in the same store sales for the second quarter.

The restaurant chain now eyeing a new average unit volume target of $3 million.

Wingstop co Michael Skip Worth joins me now to discuss along with Yahoo finances, Brian Sazi Michael.

It is good to see you.

Um So you know Michael, you look at the stock, it's slipping a bit today.

But listen, it has been a rocket ship.

It's up about 45% already this year and I, I looked through the report, Michael Q two domestic comparable sales beats you boosted forecast for that metric wa walk us through the the quarter, Michael.

What drove the business?

Yeah, Josh, I think our Q two results that we reported yesterday really showcased Wing Stop operating in a category of one.

We grow, grew same store sells 28.7 percent.

And it's important to note that that same store sales growth was primarily driven by transaction growth.

Our supply chain strategy is working, we're delivering predictable food costs to our franchisees.

They're making a lot of money and they're opening up a lot more restaurants.

We set a record in Q two of 73 restaurants.

So we're excited about the results translating to a really strong IBI A number that we delivered uh a record quarter for the brand Michael.

It's Brian.

Good to see you as always, you know, you know why I always talk to to wing stop, why I've covered the company since its IP O many years ago.

Well, it is one of the growth stories, the loan growth stories in a really a fast food industry that my opinion is, is falling apart your stocks at about 303 100% in the past five years.

If I am right, you just took your long term growth target for stores from 7000 to 10,000.

There's not a lot of companies in fast food doing that.

So my question to you is how sustainable is your growth profile, Brian?

We have so much momentum in the brand right now, just a few years ago, we set in an average unit volume target of 2 million.

We already hit it within two years by continuing to execute against strategies that we believe have a ton of runway in front of us that supports our new target of $3 million in average unit volume.

Our footprint, we continue to expand in the last 12 months, we opened 300 restaurants.

So I think that really speaks to how the brand is resonating with consumers.

And more importantly, just how strong those returns are for our franchisees who have a desire to open more wing stops.

As of the end of 22, our pipeline for new restaurant development is the strongest it's ever been.

So it gives us a lot of confidence in our ability to scale Wing Stop to over 10,000 restaurants globally.

Mike, I'm curious to get your take on the consumer right now as well.

You, you know, you have unique insight there and any changes in consumer behavior, Michael, I think for Wingstop, I, we read and hear the same things you do about what other brands are experiencing.

But at Wings Stop, it's different.

We saw growth across all income cohorts for the second quarter.

And we actually saw for the first time in my 10 years with the brand, we actually saw an uptick in frequency.

So within that 28.7% same store sales growth, I think we're just in a completely different category than other brands right now, Michael your same store sales.

Um, uh talking to a couple of folks on the street.

They've never seen anything like this before.

Mcdonald's us sales didn't even grow Wendy's reported earnings today just to hit a few tickers on, on Yahoo Finance.

You're up almost five times.

Your central sales were five times more than Wendy's.

What is it about a chicken wing?

What is it about a new chicken sandwich?

Uh because the consumer is essentially saying they don't want what mcdonald's is selling, they don't want what Wendy's is selling.

I mean, what is it about what you guys are pumping out around the clock?

I think Brian, what we've heard from the consumer is they are prioritizing value and quality when it comes to making decisions around how to spend their dining out dollars.

And that plays beautifully with that wing stop indulgent occasion.

And we've been measuring record levels in both value and quality with guests.

And I think you're seeing that show up in the business and I think consumers are continuing to come back into the brand and we're seeing something really exciting and that we're continuing to bring in a record level of new guests.

But these new guests look a little bit different than our traditional guests and they're coming back to the brand quicker for that second visit and they're actually moving up the frequency curve faster which gets us pretty excited about our ability to deliver on our outlook for this year, which Brian would mark our 21st year of cons same store sales.

Michael.

Skip forth Brian Sazi.

Thank you guys both for joining the show today.

Appreciate it.

Thank you.

And while wrapping up today's market domination, don't go anywhere because the earnings fund is just about to get started.

We got you cut with all the numbers from Amazon Apple Intel and many more.

Stay tuned for market domination over time.