Cracks forming in the a. I. Led rally. Nvidia continued its decent today, dropping 5 the stock down over 11 from its alltime high hit less than a month ago. And yesterday, we got that warning from data dog, those shares fell another percent and a half today, the lowest close since midmay. And theres super micro, shedding 23 the Company Warning about weak demand for its a. I. Servers. The nasdaq closed below its 50day moving average for the first time in five months. So, is this the canary in the coal mine . Could there be more danger ahead . If we are to believe that a lot of gains were built on the promise of a. I. , and now there are cracks, guy, should we be concerned . In terms of demand . The storys intact, without question the run in some of these stocks, we talked about it, i think thats clearly gotten ahead of itself and you couple with what super computer said, with taiwan semi couple weeks ago, then you start saying to yourself, hmm. Obviously, its an industry thats coming around, its not going anywhere, but a lot of pull forward has been done without question and a stock like super computer went from 100 to 300 in two months you give Something Back today, it makes sense but will it start to feed on itself youre going to start to see the same thing, i believe, in nvidia important company, but a company at 60 times toward earnings, 25, 26 times sales thats rich in any environment yeah, you were doing some some comparison right, interestingly, super micro, even with that big loss today, i think we have a chart of it, both the oneyear and the fiveyear has outperformed nvidia nicely, particularly over the five years, which is kind of surprising to me so, its they are a supplier to nvidia, nvidias extremely important to super micro, a little less the other way around, but i mean, you know, when youre trading in a. I. Pixie dust, kind of everything in the dust bowl is going down a. I. And so, its not surprising i do think to guys point, did it get ahead of itself, probably were going to have to wait to see what nvidia reports on august 23rd. I think thats really going to be big i still think were sort of in the early innings here i did put on today a one by two call spread of 450, 500, that expires right after earnings did it for a tad over four bucks. Make money between 454 and 546. Thats a wide range. If it really goes berserk, then ill be selling some of my stock, but that will probably be the options action kind of thing anyway 5 30 on fridays but im long the story. For sure im going to see this through. At least this reporting this quarter was good, right right, right. And that its the guided the guided. I dont know what nvidias guidance will be it has to be very big, otherwise stocks going to continue to fall, but i think were in a va vacuum, that, until we have something on the 23rd, im staying long and were talking about a company that we really hardly ever talk about on this show data dog yesterday we led with that again, another company that we hardly ever talk about, but take a look at, for instance, the microsoft Earnings Guidance about monetizing a. I it was a longer projection in terms of when they were going to monetize than what an lists had been expecting and thats why that quarter was so disappointing. So, its all of these things put together are you worried here about the rally . Yeah, i think, if you think about a. I. Broadly speaking, as a technology, its still very vague, what the implications for it are every time i hear a ceo talking about it, it seems very hard to follow how its going to help their business its going to help their business, for sure they are all assuring mel of that but its so vague. The only people who really talk about it concretely are the writers on strike. The thing about a. I. , unlike ecommerce, its really hard to get people enthusiastic about it most people on the street are not, like, yes, im so excited about a. I. , the way they are about ecommerce and, like, shopping for handbags to offset it doesnt have such a clear value proposition. I dont know anyone thats, like, gosh, i wish technology went faster. And i think a lot of Companies Feel that way, too they dont necessarily want to be investing in a. I. So, i think the underlining fundamental drivers of it are really vague, really unclear and gosh, things have gotten really expensive around it carter, how do you view all of these charts here well, of course, you get take the flavor of the day, smci, dropping like that is a simple function of one of two circumstances. Extreme strength or extreme weakness meaning you get some of the biggest moves to the downside in a stock thats been going down and down, and then it pulls yet another messup, an enron, and you plunge or you its this circumstance. Steep, steep uncorrected, and what comes out is not good enough to keep it going. But the real issue is this were not getting the kind of followthrough from the ones that have popped google popped, didnt follow through. Meta popped. Netflix popped but the ones that have done the sort of the unhappy drop thats microsoft, apple, theyve followed through the downside. And so, the nasdaq 100 now down more than 5 , one would have to assume that its not going to stop here. All right, so, more downside ahead for the nasdaq, according to carter. Lets get to disney. Subscriber losses, restructuring costs continue to weigh on the entertainment giant, but the company is raising prices for adfree disney . Julia boorstin has been listening in on the call whats the latest . Reporter well, as you mentioned, melissa, disney has adjusted earnings were a big beat, as the company has made progress with costcutting this is something that bob iger has been stressing on the call, saying that disney is on tract to exceed its initial goal of 5. 5 billion in savings and improved direct to consumer operating income by 1 billion over three quarters. This particular quarter, streaming losses were far less than anticipated on the call just now, iger announcing that adsupported disney , 3. 3 million subscribers, saying hes very optimistic about the longterm potential of advertising in these streaming services with that, iger announced they are expanding adsupported disney more internationally, they are going to be launching a new combo of adfree disney with an adfree hulu in september for 20 and perhaps most important, they are hiking prices of the adfree streamening app, in particular, disney is going to 14 from 11, hulu to 18 from 15. The adsupported versions are going to stay flat now, iger saying also that they are looking at a crackdown on account sharing, sounds a little familiar, with what netflix did, and they will roll out tactics to drive monetization sometime next year. He also said plans to take espn direct to consumer, its not a matter of if but when, noting that ratings on espns Linear Networks have increased even as cord cutting has accelerated they noted that domestic sports ad revenue is up 10 disney shares up 4 . Melissa . No word yet on espn bet no, they were just talking about it as being part of the broader strategy the call is still ongoing, though, so, im going to jump back on and see if they have anything to say. But they are still looking for partners, they are looking at taking disney direct to consumer seems like the betting partnership does not preclude them from doing anything else around monetization here all right, julia, thank you Julia Boorstin in los angeles for us looks like they took a little playbook out of Netflix Netflix in terms of the price hikes and cracking down on password sharing. All right, so, lets talk about the stock, because theres a lot for bears to like in this, a lot for bulls to like. Free cash flow, good the net ads were disaster, but maybe this Restructuring Plan is starting to get some teeth and maybe they finally have troughed this is what ill say, carter will probably back me up the fact we traded down to and seemingly have held levels we made in the woes of covid in march of 2020, thats encouraging. And again, not great news, but great price action is something you want to see if you are about to make a bottom in a stock, so, we might have if we open here tomorrow, and theres obviously a long time before that, this 91, 91 1 2 level, we are through a downtrend line thats been in tact for quite some time i sont dont want to make a hug deal but bad news price action, thats what you want to see. Carter . Thats right. You have both reactions here in the immediate aftermath. Initially down, now up a bit but the key takeaway, its not up enough, at this point, while that can change, to really set an important kind of low my hunch is, and we did a poll, interestingly, institutional clients much less sanguine than retail individual clients. They, in fact, were looking for an up move institutional, in general, looking for a down move. But here we are, up, but fairly muted. I think this is the kind of thing that you just leave it alone. All right julie, what are some outstanding quells in your mind still about disney you know, i think understanding how theyre going to do it all, right . How am i going to cult kt costs, raise prices, and still have enough good Quality Content that you can continue to drive the business forward and, you know, drive the shareholder price forward. It cannot just rest on the laurels of the parks there are limits to what the parks can do for this business and i think until there are concrete answers to that, its going to be really hard to get super enthusiastic here. Yeah. Karen . Well, we were talking about this in the green room before. You know, that iger faber interview, which was so good, he really talked down that stock pretty decisively, i think, so, im sort of wondering, is it a sell the rumor, which is waiting for this terrible quarter, and then buy the news, which is, okay, wasnt all bad, you know, the subscriber wasnt good, but i mean, that the bottom line accretion, when you raise prices by, what is it, 20 some odd percent, you are probably going to lose some subscribers, but thats going to be a net positive. If you have the product to do it, thats going to be good. So, i dont know if this is enough to stem the tide, but i would start to look at it here or maybe you lose some subscribers to the paid version, but they migrate lower to the adsupported version, where you dont lose them completely and you have the ad revenue if they had not introduced price increases in this quarter, if they did not see they were going to crack down on password sharing, would we see the stock up 4 . You would have seen it where it was 40 minutes ago, which was 84 1 2, 85 so, that turned the tables for sure, and listen, we were talking about this again, we had this conversation, this is not a broken business, this is just a flawed business, they can turn it around, absolutely. And, you know, this is when you start to see bottoms being made. When you get a quarter like this, it wasnt great, but the price action is, well come back in a couple weeks, you know, mark my words, if this holds here tonight, well come back in three weeks, four weeks, say, remember that Earnings Release traded lower in the afterhours and it that was a sign. All right, for more on disneys report, lets bring in tom rogers, hes currently the newsweek editor at large and the first nbc cable president. Tom, always great to see you thanks for having me. What did you make of this quarter . And is it worth 4 of the stock, the, you know, the hike in fees and also the crackdown on password sharing well, theres much more to be skeptical about, i think, than to be excited about, and, look, the linear business is clearly in decline 7 revenue decline leading to a 23 operating income decline is obviously not good you have a stalled streaming business theyre not growing subs, yes, they have lowered losses, but most of those losses are over the backs of disney , which will probably lose close to 2 billion this year. Advertising on streaming, which should be a really positive element for them, something iger talked a lot about in the cnbc interview, as a major important ingredient of streaming success, disney advertising down, hulu advertising down and hulu advertising per sub for the first time in about five quarters was up. And the only way that can happen, if you have hulu advertising declining, is to have a a situation where your number of advertising subs, people taking advertising on the hulu services, down, which is not a good thing and disney world was down, Consumer Product is down its a good day to be talking about gambling, i think. Yeah, tom, not surprisingly, you did a masterful job over the years talking about disney comes as no surprise to any of us here, nor our viewers, they know that tom is what melissa . You say it. A stud. It would be cooler if melissa said it. Cant get everything in life. This penn gaming espn deal, late to the dance, but everybody is talking about it today does this even move the needle at this point . Look, its a contribution, all contributions, when you need cash and an answer to a declining linear business are a good thing but just to put this 150 million a year in licensing fees on the gambling side i is worth 150 per year so, this makes up for the loss of about a million subs. Now, espn over the next te years is going to lose 10, 15, 20 million subs, just to put in context how much of a contribution toward filling that hole in the bucket it is more importantly, look, weve seen media brands try to drive sports gambling business fubo failed at it, ballys, with the Regional Sports networks could not make a difference there, as they go into bankruptcy, obviously barstool with penn didnt help. And fox, a great sports brand, just discontinued fox bet. So, theres a lot here that you can be skeptical about, as to whether espn paired with penn, which only has about 2 of the Gambling Market against the combined fan duel draft kings, 75 of the market, whether its really going to make a difference off the back of that, particularly when espn is going to continue to take advertising from other gambling players, so how much 0 a diof a diffe is this going to make . Tom, we have maybe a minute left how would you rank abc as a problem on bob igers list and what can he do with that asset . Well, abc is an issue, because its very hard to imagine how to separate abc from espn, which they plan to keep. Given the importance of the broadcast network in terms of major sports packages. Its also hard to see how to maintain what hulu is in the absence of abc and the Cable Networks and so much of hulus programming is a function of the programming on those networks. I will say, hes got kevin mayer back, which is a really good thing. Its great that he and milted bob chapek was a mistake bringing kevin back further admits that mistake. This is a company that has to transact, and its a company that has to figure out its major issues probably no better around to handle both of those so, if theres an answer for abc, i assume kevin will find it tom, great to speak with you. Always great to get your thoughts, since you are, as guy called you, a stud there you go. You said it much better coming from you. For you tom, thanks. Tom rogers thanks. Karen, we were talking about that abc, like, what do you do its so entrenched in the business its so entrenched, and, you know, the headwinds that the business faces, who would want to buy it . Right i dont know. Thats interesting, does this make kevin mayer the, you know, the anointed one when ultimately bob iger does step down . I dont know seems like they have no other candidates but i dont know, i just its when we were talking about it, it hit over 200 you just slightly over 200 during the pandemic, when streaming was seen as so valuable, and money was free then, and they didnt have the disney debt that they have now, so, a lot of things were different. But i mean, 50 plus off since thats sort of intriguing for me for an iconic name worth a look. Coming up, wynn is on the move in the afterhours shares are up almost 3 after delivering results well bring you the details out of the quarter next. Plus, carvana enlightening investors with guidance. Should you namaste in this name . Well debate that when fast money returns they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. And you are . Im an investor. In invesco qqq, a fund that gives me access to. Nasdaq 100 innovations like. Wearable training optimization tech. Uh, how long are you. Im done. Im okay. 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Welcome back to fast money. Earnings alert on wynn resorts a beat on the top and bottom lines. The casino operator seeing continued strength in north america and a huge boost to operating levels in macao. Contessa Craig Billings kicked off the call with an enthusiastic what a quarter after a beat on the top and bottom lines strength coming from north america, with las vegas and Boston Generating a new Second Quarter record for adjusted property ebidta. Rook b room bookings, group rates trending upward. Wynn seeing strength in macao and the mass gaming market, luxury retail, their hotel business, billings says that v. I. P. Volumes are still surprisingly good there, though theres been a dramatic decline in the junket business customers are spending more in macao, but their length of stay has decreased. And when it comes to the luxury consumer, so far, so good. Billings says consumers seem more than willing to keep spending on the nicer things in life billings says they are looking ahead to the big vegas f1 race in november, and, of course, super bowl in february, where already wynn, as well as other properties up and down the las vegas strip, melissa, are seeing premium. Contessa, thank you contessa brewer. Up 2. 4 , guy should be i dont know whats going on in boston, they did 221 million there. Las vegas does almost 600 million in the quarter, so i dont know if folks in bosto