All starts about 8 30 a. M. Eastern time it is the busiest day of earnings season bringing you reports of 3m, hershey and more like comcast september durable goods orders and the latest read on home sales. Tesla shares soaring. Earning 1. 86 per share versus a loss of 1. 82 per share they have reported producing 300,000 vehicles the company saying it is ahead of schedule with its new giga factory in shanghai and on the long awaited model y cross over and expects that launch by next summer what ceo elon musk said on the Conference Call for demand of electric vehicles. When flat screens came out, it was a big step in demand because now getting a flat screen was much better than having a small crt screen tv weem see the same thing instead of just buying a car because their last car wore out, theyll buy and electric car because it is fundamentally a better car. Big numbers for investors to a large degree on prediction of when this motdle y will come and when this factory will be on board. It is worth saying so many times. Hes offered projections that have been out there ahead of schedule and sometimes when you are dreaming big, you dream too big. Well have an analyst join us. This is an excellent quarter. They did a great job the question i have, you look at the stock i dont know if it is so much the numbers themselves as them saying the hang high will be on top more thanpeople thought. We have the model y issue. Hes made proclamation about things coming that have taken longer than in the past. They get to create their own milestones and goal posts. Model y comingsooner lets take a step back. What part of the news, you you are discounting . Yes they could show us 5,000 cars before the end of the year realistically, it is demand out of china that demands more than anything not ramping as quickly as we thought. It still should see Pretty Healthy demand into the end of the year i give almost 100 of the discount into the shanghai move. Model y, usually tesla does start shifting backwards with new cars the last four launches have gone backwards. So this is a positive. I think they are pretty conservative in the time line they shared initially. Your stock price for this company. 2. 49 target im looking at that revenue is down year over year. Why is that . We have 10,000 fewer model x cars this year than last price of the 3 is off year over year looks like quicksand to me we have to look at 2020 and ask, are we going to see further probable price pressure on model 3. I think so you think the margin has to come down . I think so. And the model y isnt going to save the story . Im a skeptic i think it does end up can ib alliesing the 3 in the same way we saw the x come in with the s. What about the competition. We always say the competition is coming these other electric cars are going to come. Thats not really the story at the moment no. It is not. I think the headline numbers on the porch were taken positive. The range and 0 to 60 not as compelling as the model s. Tesla has a technology lead. Others are trying to catch up. A lot of the pms out there are all talking about preorders now versus when we were talking about preorders for the model s. Do you zil think it is an electric vehicle to electric vehicle competition. The way elon musk talks about it, it is a converting to electric story i would say a huge percentage of people buying a tesla are buying that because they think it is cool versus that or buying a bmw with fuel in it. Both sides are fair if someone wants an ev, tesla is one of the most compelling stories. There are people being pulled into the pool. I expect that to be growing. You expect that on both sides as they continue to roll. They are looking at that as a huge advantage given the fact there. What do you think . The recent volatility with the trade spat has me backing off a little bit just looking at what has happened with the mba and internally, those dont translate in the momentum that they should. Elon has done a dramatic job managing expectations there. A little uncertain now we have to see how it rolls and moves forward. I do expect manufacturing there to ramp smoothly though. That may be the difference with some of these the honeywell ceo. The way theyve been impacted and using local employees and offices. It is probably still a tricky line to walk as an american based company and you dont want to offend your home office with some of these things there is merit to that but teslas culture is to overhire at the friend end and then cut the head count that is not taken very well in china. There will need to be some cultural accommodations. There has been a tone deaf management style at the company in the past. What is the debt story . 12 billion in debt is a lot of money im only pointing this out, when you go out there now i would short it here i dont expect the Fourth Quarter to be as interesting given the cost for shanghai. Looking for the detail. Could be rich. Nine grand plus versus 13. 80 a car. Subsidies are very important they do drive Gross Margins up there is a couple hundred basis points now so subsidies matter well leave the conversation there. Thank you. We should tell everybody, ron baron is going to join us from the annual baron Investment Conference over at Lincoln Center one of his special guests will be tesla chairman robyn denholm. She was already on the tesla board. Experience in both toyota and some Technology Sector big telecom person. He said publicly, he wasnt going to listen to her well talk about all those things with her. Good. Dow out with earnings. Down 91 cents a share compared to 73 cents. Revenue was just above wall street expectations as well says here although profit did fall 32 from a year earlier on weaker demand higher income costs and global weakness joining squawk on the street at 9 00 a. M. Eastern. Coming up, earnings check. Well get reports from 3k and more ill show you numbers behind the biggest premarket earner. Speaking of movers, here are the biggest losers in t biggest winners and losers in the dow right now. Some stocks to watch. Other earnings reported. Ford shares are under pressure following disappointing earnings weaker than expected sales in china. Ford also experienced a bumpy launch of the redesigned explorer and Lincoln Aviator microsofts First Quarter results easily beating forecast on gains and revenue the companys intelligent cloud segments, revenue Beat Estimates but growth slowed in the quarter. Microsoft still reporting profit in fiscal 2020, up about 1 . Paypal beating forecast saying higher customer traffic as customers used paypal to pay for transactions that is up about 8 . Look at that, i dont know if we need to go back about 2. 5 years when paypal was spun off everything is more than what we think it was. Let me tell you, if you remember when ebay and paypal were split apart. Carol icon fought about it no you it looks obvious. Now the ebay story not as positive secondly, ebay reports facing fierce competition from walmart and amazon shares of nokia are down sharply, the company is slashing its out look for 2019 and 2020 saying this saying they will spend author more to fight off rivals check out the stock, down by more than 18 . A drop to 4. 16. Coming up, more on squawk box this morning. Are your coworkers coughing and sneezing this morning . Joe and becky . No. That would be you im not most days we have results of a new survey about employees that come to work sick you dont want to miss this. Back in a moment is the monolithic view of emerging markets obsolete . At pgim, we see alpha in the trends driving specific sectors of outperformance. Where a rising middle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Every day, our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment management businesses of prudential. But were also a company that controls hiv, fights cancer, repairs shattered bones, relieves depression, restores heart rhythms, helps you back from strokes, and keeps you healthy your whole life. From the day youre born we never stop taking care of you. Do you ever come into work when you are feeling a little under the weather . You are not alone. 90 of emplo iys admit to sometimes coming in with cold or flu symptoms those said they always come into work because they say they have too much work and oerthers don want to use up their sick time you dont have sick time, really you do. Stop coming in here sick all the time you have sick days. After 20 years on this show i dont remember the last time i told you, get some animals in your house. Kiss them in the morning you are exposed to every single thing. You should see what they do. Your immune system is like super charged. Too late for me no, it is not im a delicate flower you are i thought you were thinking about a dog. To be continue. The cities where this is most common, charlotte, North Carolina and miami, florida. Interesting how many sick days do we get i dont know. But i want to come in if you are vomiting, stay home when we come back, we are expecting numbers from 3m and southwest air in the next few minutes. Hang on to that. 3m shares down an update on the Power Outages in california. Hundreds could be in the dark this morning looking at yesterdays s p 500 winners and losers through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From using feedback to innovate. To introducing products faster. To managing website inventory. And network bandwidth. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. When i lost my sight, my biggest fear was losing my independence. Mmm. Good. So ive spent my life developing technology to help the visually impaired. We are so good. We built a guide that uses ibm watson. To help the blind. It is already working in cities like tokyo. My dream is to help millions more people like me. Announcer welcome back you are watching squawk box live from the marketsite in times square good morning. We are awaiting Quarterly Results from 3m and southwest air. Take a look at where things stand right now with futures dow looks like it would open higher s p 500 looking to open a little above five points and the nasdaq looking to open up about 38 points pg e looking to cut power to california homes now the second shut off. Portions of 15 counties are without power. The expansion will span to more today. Thousands will be affected the Power Company is warning that the forecast for high winds could mean more outages that extend to next week. Xilinx says fullyear outlook is down. Including the impact of the u. S. Governments restrictions on huawei the second major to impact the trade war. Chip making equipment maker lam research are rising. Beat estimates saw jim tweeting about this. Monster quarterback for lam. Johnson johnson cutting profit by 3 billion to account for the deal announced before federal trial was set to start the framework hammered out in North Carolina, tennessee and texas. Saying j j would pay a 4 billion fine and other Drug Companies have offered to pay 18 billion collectively over 18year period theyll need proud support Johnson Johnson facing thousands of lawsuits over a number of its products lowering a number of Third Quarter profits to 1. 81 a share. No impact to its adjusted earnings numbers when did we talk to the cfo of j j . Two weeks ago . Might have been three. We were talking about what these settlements could mean i think it was the next day it wasnt that long ago. The next day is when they had to recall that single lot of baby powder we werent even really talking about that part of the litigation should we look at this looking at a number now 3m, does it make sense . No. 2. 72 the gap number is 2. 72 street was looking for 2. 49. That still puts earnings above expectations and gets you back down to 2. 58 versus 2. 49 expects were for 8. 16. Talking about the performance. The chairman and ceo says the macroeconomic environment remains challenging. Looks lore. Not a big beat still looking for what else to strip out of that Southwest Airlines reporting. Looking at luv i always like the symbol the ceo will be on to talk about the results. We are going to talk all about boeing lets look, adjusted earnings per share is 1. 23 versus expectations of 1. 08. Getting a nice jump. Revenue 5. 6 billion capacity was down a little at 2. 9 load, 83. 5 . Thats a pretty good beat. I dont know if there is anything in that one either. Well above expectations. Is he on our show today . Gary or on squawk on the street they are trying to do everything at once. Luv just reporting, you are on your own just looking back at the 3m guidance excludeing some things they now expect 2019 earnings to be in the range of 8. 99 to 9. 09. It is below their prior expectations of 9. 25 including 15 cents a share impact of the recently closed facility even with that 15 cents that brings guidance to well below what it had been before. Thats probably why you are seeing the pressure shares off that updated guidance again, it looks like it is weaker than what they had said before. In april, they had cut their guidance that stock was up by about 13 when we come back, well talk about facebook under fire. Mark zuckerberg testifying on capitol hill talking about cryptocurrency and privacy and more well talk to a governor there part of that conversation. Well talk about bit kind taxes. You wont want to miss stay tuned you are watching squawk box on cnbc thats what happens in golf nothiand in life. Ily. Im very fortunate i can lean on people, and that for me is what teamwork is all about. You cant do everything yourself. You need someone to guide you and help you make those tough decisions, thats Morgan Stanley. Theyre industry leaders, but the most important thing is they want to do it the right way. Im really excited to be part of the Morgan Stanley team. Im justin rose. We are Morgan Stanley. Takin it off road station ted goiwagon, eh . Ip, huh . You know its an suv your family is duckin and rollin. While we stowin and goin but thats cool, i know for a fact your suv does not suck. And why is that . It aint got that vacuum in the back, whoo sucking stuff up what else are we gonna find . We got to go. Vacuum in the back, hallelujah get 0 financing for 60 months plus 2,250 total bonus cash on the 2019 chrysler pacifica. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Welcome back. Futures now indicated up 27 points nasdaq um almost 38 and change s p indicated up 5. 23. 3m at this point, so we were up quite a bit more on the dow. That is shaving down about five points equivalent the dow would be about double now in terms of gains. Facebook Ceo Mark Zuckerberg facing questions on capitol hill yesterday on libra, data privacy and more libra is going to be backed mostly by dollars. I believe it will expand leadership around the world. If american doesnt innovate, our Financial Leadership is not guaranteed welcome the congressman from texas. Good to see you. Thank you for joining us today thank you good morning what did you think of Mark Zuckerbergs testimony yesterday . Let me start positively i think Mark Zuckerberg is a nice guy he was calm, cool and collected in a hostile environment now to the actual subject matter this was supposed to be about cryptocurrency and it was but some of it was a general airing of grievances from both sides of the aisle. It got a little out of hand. I think members walked away not helling any better. One thing i was concerned about is his decision or statement that if u. S. Regulators dont jump on board, theyll pull out. Lets bring this home and have this based in the United States. What was his response to that it wasnt a total shutdown but it wasnt an eager stance to agree with me. I implored him to consider it. I think he will. They seem to be moving towards the direction of switzerland why do you think they chose switzerland . That struck me as being odd from the beginning. I asked that question some asked the question, one of the responses he gave is that the companies headquartered there are international. He didnt say the word neutral but i think the thinking is that it is an historic location for financial firms. A democrat from california said, dont we have a few Financial Institutions based in the United States i dont know why it is so important to move this to switzerland and why they wouldnt want the u. S. On board. It is important we be leaders in innovation lets be leaders in the usa and make this a project everyone can get on board with. Maxine waters brought up the idea of breaking up facebook yesterday. What do you think about that and what do you hear from people on both sides of the aisle concerning that . That is one thing chairperson waters is big about. I dont particularly think republicans will be pushing for Something Like that. But i think facebook has become a victim of their own successes. They are dealing with a problem they never thought of. Alexandria ocasiocortez was asking questions like if an ad is run in a district that targets minorities of a certain age and says that election day is on a wrong day to surpresident turn out, is that allowed . He didnt have answers for those. I saw that exchange irthink they just havent considered them. They are so big, they are dealing with things they have never dealt with before. I think his intentions are good. I think it really troubles him that facebook has gotten a bad rap. Congressman, what do you think the answer should be on the issues i just raised, thats a problem and that particular issue is a problem. The follow up question is, what if i run ads in someone elses district with false claims, is that okay . They deliver a political mailing no matter what the mail has to deliver it why does facebook has these is