SOTS 2nd Hour: Tesla in Reverse, More Software Slumps, & Raymond James CEO LIVE 4/23/26

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Sara Eisen (0:35)

Good Thursday morning, welcome to Squawk on the Street. I'm Sara Eisen with David Faber and Mike Santoli. We are live as always from Post 9 of the New York Stock Exchange. Carl Quintanilla is off today. Coming up, Tesla shares moving in reverse this morning after mixed results and a big increase in capex guidance. We'll talk to an analyst who says the stock is a sell and could lose two thirds of its value. Plus, the CEO of Nvidia backed AI firm Reflection, which is positioning itself as America's answer to deep seek and is reportedly eyeing a $25 billion valuation. And then details on some big post-earnings moves from ServiceNow and IBM, including what IBM CEO told me about the global economy and the impact of the war. I just wanted to start off with what we're gathering about the economy right now, which is jobless claims.

And the good news is jobless claims are uneventful. We haven't really seen any big spike up. If you worried about corporations pulling back and getting nervous, you would see a spike in jobless claims. We've seen Americans filing for unemployment benefits. But what we've seen, we're on trend here. 214,000. It was a little higher than the 210,000 estimates. But it's right in line with what we have been seeing lately, especially on jobless claims. If you want to make a case for the economy doing well, being resilient and the job market not being a problem, you look at the weekly jobless claims. These are continuing claims, those that are more longer-term, continuing to file unemployment claims. And again, they've been a little bit elevated, but haven't seen any big spike there. So what are we hearing from companies, which is sort of more of an immediate take on what's going on out there with the economy as a result of higher gas prices in the war? Southwest CEO, echoing sort of what we heard from United earlier this week. Like you've heard from others, they say we're seeing broad-based demand strength. That strength is in all geographies. It's across all fair structures. It's across business. It's leisure.

And as far as we have visibility, that demand strength is across all forward months, which goes a little countermike to the idea that it's just the high-income spending code word. Definitely more resilient in this moment, but it's not like we've seen any collapse.

If you have companies like a Southwest, we heard it from Philip Morris as well yesterday, saying that they're not really seeing any demand.

Mike Santoli (2:51)

Travel is not something that people quickly give up. It seems right now. So that's definitely, I do think, is strong. So as far as they have visibility, it looks okay.

Sara Eisen (3:01)

Yeah, and then American Express, which again, caters a little bit more higher income. I mean, I thought that this was really telling. Card member spending grew 10% on a reported basis at Amex. And this is the highest quarterly growth in three years, driven by strong growth across both goods and services and T&E expenses. We continue to see strong demand and engagement with our premium products across our customer base. Within the US Platinum portfolio, we're seeing accelerated spend growth following the refresh while maintaining high retention rates after the fee increase went into effect. Millennial and Gen Z spending growth continues to be robust.

I mean, Amex is a tell. The stock is down 2.5 percent. But overall, I think it sounded pretty bullish.

Mike Santoli (3:41)

It does. I mean, I think that you can kind of pull back and say, whatever disruption, whatever energy shock has taken place is not been of long duration. And so we just don't know if we're going to see it or if we've dodged the bullet. And basically, it's completely in the capacity of the economy to absorb it. It's tough for the economy to get into too much trouble when you do have obviously a fiscal push. You're going to be 6 percent deficit and corporate profits at a record high actually is a backstop for economic growth as well because they don't have to cut back that much.