Walmart’s Soft Outlook, Baba’s Big Beat, Live: OpenAi CFO 2/20/25

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Jim Cramer (0:59)

It's Jim Cramer here. You're listening to the opening bell of CNBC's Squawk on the Street. Don't miss a minute of the action.

Carl Quintanilla (1:07)

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 is live at the FII Priority Summit down in Miami. Meantime, futures backing off another day of all-time highs as Walmart, first of the major US retailers to report earnings guides below for the full year. It's on pace or close to it for the second worst day since COVID. Our roadmap begins with this tariff uncertainty. Walmart says it won't be immune from the looming levies and does expect profit growth to slow. Palantir, of course, under pressure yesterday as this Doge cost-cut target hits defense spending and the AI race, OpenAI CFO Sarah Friar is going to join David at the FII event in Miami later on this hour. Speaking of which, let's get right to David today after the president did speak.

At that investments of it. Morning, David.

David Faber (1:57)

Good morning, Carl. Yeah, it was interesting. Obviously, we took those remarks, I think, live on CNBC, at least many of them, of course. Much of it not necessarily new, although some certainly some comments that got people's attention when it comes to the continued war in Ukraine. But as for the agenda here today, of course, as you said, Sarah Friar, plenty to talk about with OpenAI as well. You heard Kate Rooney earlier introducing those new metrics that the company has introduced.

Also, hoping to speak with former Treasury Secretary Steven Mnuchin shortly as well, get his take on the status of a number of things here. But with that, I'll send it back to you guys and let's get to some of the news of the day. Obviously, Jim, those Palantir shares, we talked about them on Monday. They are off a bit today, aren't they?

Jim Cramer (2:47)

Yeah. Well, I think people felt that maybe there'd be something with Palantir and the Justice Department and the Defense Department. This is an important thing to do. Palantir does have a lot of business with the Defense Department, but it is not dispositive to all Palantir's business. But there are a lot of people who felt that the cuts in the Defense Department would actually be orchestrated or at least would have something to do with some Palantir's views about the military industrial complex. We didn't hear anything like that. At the same time, we got this report obviously about what Alex Karp is doing in terms of selling. And it's not at all clear that there's any real change, but it's being used to say that maybe if he's getting out big, you should get out big. I think the key takeaway here, David, is that this is a very retail-oriented stock and they don't know what to do. And they just presume that therefore you take the 8% off the Palantir too. I don't think that's going to prove to be the case. I just don't think so.

David Faber (3:43)

Yeah. Well, and the stock is obviously was down a lot more in after hours, I believe, Jim, than it is right now. And as you point out, it was the 8% headline. Carl mentioned at the very top of the show in terms of potential cuts to the defense budget. There are those who obviously argue that the impact would be the opposite because, of course, more efficiencies conceivably are available when you use Palantir and therefore it would actually be used more often rather than less at the Pentagon. I'll leave that to you. But I do come back to the valuation itself, which we've talked about so many times, Jim, being a territory that is extraordinarily high and doesn't seem to allow for a lot of room for error.