Closing Bell 10/20/26

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SPEAKER_1 (1:00)

Thank you very much, guys.

Scott Wapner (1:01)

Welcome to Closing Bell. Scott Wapner live from Post9, right here at the New York Stock Exchange. This make or break out begins with the bull market as sectors other than tech rally. Yet again, it certainly raises questions about where things are heading over the remainder of this year. We'll ask our experts over this final stretch. There's a scorecard with 60 to go in regulation. We're still green. We're off the best levels of the day, though. Healthcare, financials, utilities, some of the better sectors today.

Oil is above 100 It's reversed a bit. We're watching it, though. Well, there it is. Now it is back above 101 for WTI, almost 109 for Brent, maybe, as that has stayed above that level. The market's gotten a little bit cooled off. Most of the mega caps, they are red today. Don't forget, Meta reports tomorrow. We do begin with our talk of the tape, all that is riding on those big earnings reports in Overtime tonight. SpaceX and Netflix. We do begin with Julia Borsten, who's following Netflix. Julia?

Julia Borsten (1:56)

Well, Scott, ahead of earnings, Netflix has been making some big changes, which are fueling investor concerns about the quarter. With Netflix shares down over 40% in the past year, down more than 4% since its last earnings report, it's been making moves that are seen as foreshadowing a rough quarter. Last week, Netflix laid off 6% of its staff and replaced Chief Content Officer Bella Bejaria with Fox veteran and Disney veteran Peter Rice, yesterday firing Netflix film chairman Dan Lin. And just today, Netflix announced it's expanding its ad platform with new tools to target ads and measure their impact and plans to expand ads to 15 more countries next year. Now, all of this comes as new numbers reveal evidence of weakening engagement. Nielsen reporting that Netflix's share of US viewing time is down one percentage point year over year to 7.8% in July versus YouTube gaining nearly as much to 14.2%.

KeyBank with an overweight rating saying, We believe management is aware of these issues and expect to see corrective action taken across content investment and expense realignment to bolster growth and earnings and deliver value. Scott?

Scott Wapner (3:07)

All right, Julia, thank you very much, Julia Borsten. All right, SpaceX with our Morgan Brennan now as we walk up to that report. Hi there.

Morgan Brennan (3:14)

Yeah, we are walking up to that report, Scott. And when SpaceX reports Q3 results in T minus one hour, I can't help myself.

Wall Street is expecting this to be the first profitable quarter on an adjusted basis. We're looking for 13 cents per share on about $12.7 billion in revenue. Big dynamic here, can growth and Starlink continue to help bankroll the buildout of AI?

As that business begins to grow revenue dramatically itself. Now for the connectivity business, which is Starlink, it's about... Subscriber Growth and ARPU, it's the V3 satellite rollout planned for Starlink Mobile with the recent Spectrum deal. Wall Street wants guidance for the next Starship flight as well in an attempt to catch the ship. And for AI, it is about compute capacity, cursor integration, Grok adoption, and of course, all of those NeoCloud deals. Here's the big thing to watch and what will likely move the stock, guidance for adding more compute capacity. Elon Musk previously said 5 to 10 gigawatts next year. That represents hundreds of billions of dollars in spending. What's the CapEx plan and where does the capital come from? Also, analysts are looking for any hint of a mer The merger- with Tesla, which reports after the bell tomorrow, might be a bit of a long shot, but the speculation has been growing ahead of this report, Scott.

Scott Wapner (4:28)

Well, and it's not going to go away either, as we both know. Morgan, thank you. That's Morgan Brennan. Let's bring in our panel now. Big Technologies, Alex Kantrowitz, Odyssey Capital's Jason Snipe. Alex and Jason are both CNBC contributors. Jason owns Netflix, but I'm going to start AK with you and SpaceX. I heard one bullish analyst earlier this afternoon on one of our programs say, it's a hard one to judge because it's such a long-term story. The quote was, what's science fiction versus financial model?