Tesla and Netflix Shares Slump on Q2 Results, Nine-Day Win Streak for the Dow? 7/20/23

SPEAKER_1 (0:00)

What do you see on the horizon for financial markets?

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Carl Quintanilla (0:31)

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.

David Faber (0:39)

Good Thursday morning, everybody. Welcome to Squawk on the Street. I'm David Faber, Jim Cramer. We're live from Post 9 at the New York Stock Exchange. Carl has the morning off. Let's give you a look at futures this morning as we get ready to trade. One half an hour from now.

I don't know, I guess that means we're going to be down. Just cross the Dow off.

Why do we bother?

Jim Cramer (1:01)

Well, because at a Vistick, I mean, Nasdaq is what matters.

David Faber (1:05)

While our viewers look up the word at a Vistick, I think that's a perfect word for it. Let's give them a roadmap though, because we do have some other things we're going to talk about. Tesla is under pressure in the pre-market despite what was a beat on the top and bottom lines.

Jim Cramer (1:18)

Don't worry, I got a whole wrap on that.

David Faber (1:19)

I bet you got a wrap on it. Netflix posting strong sub-growth. It cracks down on password sharing.

Again, though, that stock also down. In fact, it's one of the biggest laggers on this.

Jim Cramer (1:29)

Don't worry, I have a wrap on it.

David Faber (1:30)

He's got a wrap on that too. How about J&J? You got a wrap on that?

Earnings beat. Hikes its full year guidance as medical technology sales surge. Of course, Jim's been talking about J&J a bit on the litigation front.

Jim Cramer (1:42)

Yeah, but I knew it was going to be down. I told him it was going to be down. It's down big.

David Faber (1:45)

All right, let's start with Tesla though.

Lower in the pre-market. Quarterly results overshadowed by a decrease in gross margins. Of course, many of our viewers are well aware of the price cuts that took place on last night's earnings call. Elon Musk said investors should think about Tesla on a long-term basis.

Elon Musk (2:04)

The short-term variances in gross margin and profitability really are minor relative to the long-term picture. Autonomy will make all of these numbers look silly.

So I strongly believe Tesla is an epic long-term investment and don't swear when things go up and down. In fact, if the market panics by, if the market's a little too exuberant, sell at the time. But just generally, I feel confident we will deliver over long-term but can't control short-term. And the autonomy is really where it's at.

David Faber (2:49)

Autonomy is where it's at, obviously something he also had indicated to me during our interview back on May 16th now, some time ago.

But this move to full self-driving, when it occurs, and the ultimate accretion of revenues that will occur as a result of what he believes over many years will be fleets of Tesla robo-taxis essentially. And they'll take a piece, and they'll take a piece of that revenue stream. But give me your overall take here on the quarter, Jim.

Jim Cramer (3:16)

OK, so I think that when you had the best selling car in Europe, when you have an aggressive ramp for the cyber truck, when you talk about how you're going to have people who are going to use your full self-driving, actually, I don't know, sell it to others, because it's so much better, and the same way they did the charge.

But you talk about how you're going to have to spend more money on a supercomputer, people say, you know what, this stock is running off, and so I'm going to take profits.

And it tends to be a one or two day affair, if that happens. But holy cow, you know, once again, long-termers have to hold on to it. And a lot of this is in keeping with what you said in your, what you have with your interview. He's just a visionary. He's not a one quarter visionary. And there wasn't anything in this that I didn't think made it so that 2025, 2026, 2027 were amazing years for this thing. But so if you want to sell it fine, because you feel the market should be broadening to other areas, David, he is every bit as thoughtful and as inspirational and as forward-looking as indicated in your interview.