AI Rally Detour for Micron, Walgreens Plummets, $2T Amazon 6/27/24

Carl Quintanilla (0:00)

Market moving insight and analysis. Join Jim Cramer, David Faber and me, Carl Quintanilla on the opening bell hour of CNBC Squawk on the Street.

Good Thursday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer at Post 9 of the New York Stock Exchange. David Faber as the morning off. Futures are getting challenged by a trio of poorly received earnings. Micron, Levis and Walgreens all down 5 to 20% pre-market. Of course, Nike tonight. A roadmap begins with the chips under pressure. Micron does fail to top the revenue forecast despite executives expressing optimism about AI. Walgreens plunges ahead of the open, slashing profit guidance in what it calls a challenging consumer environment.

But then the shares of Amazon climbing again after becoming only the fifth US company to cross the $2 trillion market cap.

Let's begin though with Micron not getting that AI boost in the pre-market. The memory chip maker among the biggest laggards on the S&P revenue guidance overshadows a quarterly beat. But last night on the call, Sanjay Marotra did express some optimism about AI demand.

Sanjay Marotra (1:02)

We expect continued price increases throughout calendar 2024, despite only steady near-term demand in PCs and smartphones. As we look ahead to 2025, demand for AI PCs and AI smartphones and continued growth of AI in the data center create a favorable setup that gives us confidence that we can deliver a substantial revenue record in fiscal 2025

Carl Quintanilla (1:30)

Jim, you're going to get a chance to talk to him tonight.

Jim Cramer (1:33)

Yeah, okay. So do people know Sanjay? I mean, I read all the headlines. Chris Daly had a good PC. Chris Daly's always solid. He's been around for a long time. There's a way to be able to look at what Sanjay talks about, and I've gone over with many calls with Sanjay, and I'm glad I have him tonight. And it's always like, Sanjay, why didn't you give bigger guidance? And it's always like, Jim, that's not who I am. And then it's always like, yeah, but you see, it's gonna hurt the stock. And then he's gonna say, I don't do it for the stock, I do it to be able to make it so what I think we can be.

I don't wanna lead people on, I don't wanna create aggressive expectations. That's what this quarter was. So you buy the stock, I mean, it was down 10 at one point, so maybe you had a chance to buy it down 10 But I think that there is some benefit to age.

It's hard to find, other than my daughter's letter X tweet that I just put up.

Sanjay is a person who has a style. And we have lots of coaches who have styles. I've seen coaches go into, I've seen Andy Reid say, listen, I don't know, we're just gonna be, oh, there we go. That's of course a real live picture and a reincarnation. We were back there that year. But I don't know why people don't understand who Sanjay is and what he does. This was typical Sanjay. Do you know that in the last call, two calls ago, I went out with something really positive and he had someone rein me in.

And I then changed my view because I didn't want to get ahead of the story, but that's him. Had me reined in because he just, Jim, come on. I mean, I'm doing the best I can and you've created unreasonable expectations. So look, I love the guy. I have to admit, I just think he's one of the best executives in the country and he's done a lot of things. The only thing that's strange is that he's got this New York facilities building and apparently there's a problem with bats.

I kid you not with bats. Not baseball bats, but like, you know, the ones that are.

Carl Quintanilla (3:22)

I don't remember reading about that in the Chips Act.

Jim Cramer (3:24)

Yeah, no, we're focused on the bats issue, but I just really want people to understand that this stock has moved up a great deal and that this is very typical. The actual, if you go back to 94, you usually get a two year run in that new. And this 94, so I'm really talking about, I'm talking about 30 years of being very involved with the stock and you get a two year move. You don't get a move since October. So now again, that's the benefit of age. I remember the 94 decline. It was one of the most brutals ever. And it's single or major decline. When you have a major advance, it does not last for three quarters. So people should understand the history rather than just shoot from the hip, but they don't because they're young.