SOTS 2nd Hour: New India Tariffs, Earnings Wrap-up – AMD, McDonald’s, & Disney – Plus Upstart, Lucid CEOs 8/6/25

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Carl Quintanilla (0:55)

Good Wednesday morning, welcome to Squawk on the Street. I'm Carl Quintanilla with Leslie Picker, David Faber, live at Post 9 of the New York Stock Exchange. Sarah has the morning off. Markets holding in there amid a wave of important results from corporate earnings, McDonald's, Uber, AMD, Disney, Shopify, 10-year, pretty steady at 422 Coming up on today's show, we'll talk to the CEO of Lucid. Fresh off earnings, get some insights into the EV market as that stock does pull back a bit on a miss in software guidance. Plus a lot more on today's blue chip earnings, including McDonald's and Disney, which as you may know, just inked a major deal with the NFL.

Leslie Picker (1:28)

But first, we're 30 minutes into the trading session. Here are three big movers we're watching this morning. Apple on the move after the White House said the company will invest another $100 billion in the US focused on beefing up domestic manufacturing. That's on top of the $500 billion it pledged back in February. Those shares up 3.4% right now. Meantime, AMD under pressure after missing earnings estimates. This CEO Lisa Su joined last hour to discuss the numbers and their shift toward manufacturing here in the US.

David Faber (1:58)

Take a listen.

SPEAKER_7 (2:00)

We're very supportive of manufacturing in the United States. I think it's good for us to have resiliency across the supply chain. We have a very strong supply chain. We continue to make sure that we're in active dialogue with the administration as we're going through this, but clearly US manufacturing is a good thing, but we also have to recognize semiconductors require a global supply chain.

Leslie Picker (2:23)

Sticking with chips, Super Micro also in the red plummeting this morning after week fourth quarter results, and soft guidance, those shares down more than 18 percent right now. Let's get to Christina Patsanvelis with more on Super Micro. Christina.

Christina Patel-Neville (2:37)

Thanks Leslie. Well, the AI server assembler really is caught in the classic growth trap. They're trying to scale production to meet AI server demand, but they're just burning through cash and sacrificing margins in the process. Super Micro CEO Charles Liang admitted on the earnings call, they lacked working capital to expand as quickly as needed, which is why they had to issue a 2.3 billion dollar convertible bond offering just in June. The margins really tell this story and why you're seeing the stock down so much. They collapse from 18 percent at the end of 2022 to under just 10 percent right now. That's what happens though when you're assembling expensive AI components but you have to compete primarily on price against big players like Dell and HP Enterprise. Mizuho points to customer concentration as a risk. There's about four customers who contribute over 50 percent of revenues. One of them is just massive. The bull case though hinges on their technical advantages. They're typically first to market with new AI server configurations and their liquid cooling technology becomes more valuable as Nvidia rolls out more powerful chips because you got to cool them down. But they need to prove they can translate technical leadership into sustainable profitability and not always have to wait on Nvidia to deliver their next set of chips. That was a major complaint for this quarter as well. Super Micro though is riding one of the biggest infrastructure build outs in tech history, but investors just are learning that being at picks and shovels play doesn't guarantee a gold rush profit when everyone else like Dell and HPE are selling shovels too.

Carl Quintanilla (4:05)

Guys, Christina, I wonder what you made of the interview with Lisa Sue over at AMD. There's still a little reticent to put any numbers on these China shipments if and when they begin.

Christina Patel-Neville (4:14)

Yes, that was a major concern for the upcoming corner. But if I were to point out, Nvidia spoke to analysts after the United States said they were going to be putting these export controls and allowing those chips to be sent. And Nvidia said that you wouldn't actually see it until Q3 if at best Q4. Why? Because these licenses take a long time to get in place. There's paperwork. And so for AMD's case, just especially in Lisa Su's interview today, as well as in the earnings call yesterday, she was very unsure as to where they stood with those licenses. I'm paraphrasing. But that was the takeaway from a lot of Wall Street, and which is why you can't really price it in. But we knew this. So the negative reaction to the stock shouldn't be contingent on the AMD chips going to China. There's the drivers, the GPU that they said they're going to be ramping into this year and to next year. They have next iterations.