The companys earnings fell short of wall street expectationss its heavy investments cut into the profitability. They have been spending on oneday delivery to Cloud Business and Advertising Sales force as well. The good news is revenue grew at a healthy clip, but wasnt what analysts were looking for. Josh whitman takes a closer look at amazons quarter. Reporter good quarter, bad guide. Thats how on lists are describing the latest Earnings Report, specifically of the companys g 4 forecast disappointed analysts calling for 80 billion to 86. 5 billion. Jeffrey says thats critical. G 4 is the big quarter, the holiday quarter, though he does caution amazon is conservative in its forecast. He also notes the company is back in investment mode, spending to bring oneday shipping to its prim members and its weighing on the bottom line. Josh whitman, san francisco. Lets push to tom forthey to learn more. Hes a Senior Research analyst. Toto welcome, nice to have you here. Thanksor having me. I dont think you were surprised by the results that much. You had been saying the big investment they had been doing would weaken the bottom line. Sure. Looking the investment spending for faster prime shipping and content on their video platform would result in profits lower than expected for the september period, which, as it turned out, happened. Now, how long do you think, though its going to take to recoup some of this investmt . I noted on the Earnings Call today the cfo said they were investing heavily in hiring soft ware engineers. Theres a lot of money going into personnel. Part of that is to drive content, but how long do you think it will take to recoup the cost . Historically, actually, well suited on buying shares when theyre under shortterm pressure because amazons ramping its investment spending. I think the good news is that while theyre investing in faster shipping for prime,u seeing faster Revenue Growth because consumers can get more product to them quickly. It opens the opportunity to buy Different Things on amazon than not past and advertising and Cloud Computing, those are still two big Profit Centers for amazon. So it might be suited for a bigger payoff than historically. Are you at all worried that their Cloud Business did slow a little bit . The answer is absolutely. If you look at the competitors, especially microsoft youre starting to see increme pressure and it is important because Cloud Computing along with advertising and when other people sell on amazon, thirdparty retail sales those are for amazon. What about Regulatory Risk . Thats something in your notes you pointed out a number of times. So glad you brought that up. I like to think of amazon as the great white shark in retail and i think o Regulatory Risk as the megalodon. The basic concern is the goth like they did with microsoft could institute rules not to be able to maximize sales and profits in the future. Its something we are monitoring closely. Tom, thanks so much. Thank you. It was a different s sry fot intel, the Semiconductor Company trounced earning ands expect faces, better than expected sales in the data ceer. Its guidance was above estimates for the entire year. John ft has more on intels quarter. Reporter big takeaway from the intels repept today is that its really not about the pc business anymore. The companys been saying that for a while, but no quarter in recent memory underscored it like this one, the pc centric business was down 5 and yes, intel surprised big to the upside the cons of data and t T Data Center the business that intel has been touting at its growth area for years now. They really did deliver. We are talking everything from cloud to the regular server hard ware that Companies Buy to put in their own data centers performed strongly, not just for this quarter but so strong that intell upped its full year guidance. For nightly Business Report im john fort. It has indeed been a roller coaster ride for semiconductor stocks. This chipmakers have been caught in the hashs of the trade war between the u. S. And china making the sector volatile and creating a lot of uncertainty. Are things about to change for the group . Joining me, from rock feller capital management. Good to be back. Lets start with intels report. A lot of people were surprised they d d so well given the pressure the chip sector has been under. I think its been a Long Time Coming for intel. They hit a walkoff grand slam with these earnings numbers. Even with this growth theyre still treating it 12 times earnings, which i a low p. E. And theyre yielding 2. 5 . Sonhis interes rate environment, not only is it trading cheaply from an evaluation standpoint youre also getting 2. 5 to wait and own the stock for longterm. Is this a success story, or do you think that translates to the entire chip sector . Thats a good point. Look, we e in the middle of a technology kl revolution well never see again probably in the next 500 years. Data is more important than ever as we just saw. From the cloud to everything they prove, everything that intel provides, until someone comes along and starts to compete with them in a meaningful way, i dont think you know, the sector is going to grow just because of technology, but intel is definitely a leader in this sector. I see that continuing for the foreseeable future. Itot up that much, 11 , 12 . The s p is up much higher. It hasnt hit high yet. Youll see this 12, 18 months out higher. We have a little bit of fear with the trade wars but like anything else, any other name, any other equity, anything else t solvopef sner ay those will than later. I dont think it will have the impact everyone expects. Its interesting you say that. The company has been basically given the indication they think they are better prepared to handle the trade war than other player in the sector. Would you agree with that . Yeah, i think they probably are. Theyve expected it for a long time. Theyre repatriotizing some of their plans. They have expected this for, lets say, a year now, and even though its not soft theyre very prepared. Im sure theyve spent their money to be able to manage there through it as it gets solved. Is it your favorite name in the space . Absolutely. Its one of my favorite names in general, as well as technology and just in general. Michael, thank you so much. Dow component visa topped earnings expectations and gher than last year, but in line with estimates th company said an increase in its payment volume helped drive results for the quarter. The stock wasas volatile in an initial extended hours trading. Bell 3m is the latest manufacturer to be hit by slowing global economies. Revenue fell in a third o oits markets and the company cut his earnings outlook for the year, fell 3 , making it the worst performing stock today. But the ceo has a plan to try to offset that weakness. Reporter from diapers to cars, 3ms adhesive products can be found everywhere. Ths why its Earnings Report is widely regarded by wall street as an indicator of a Global Economy and the results were not good. Revenue slowed, forcing the giant to cut due to ongoing weakness in china. A gaining market share in the company is becoming a bigger struggle for 3m at chinas economy slows. At the same time competition from chinese players is making it harder to win new business. On a call with analyst mike roman he says he doesnt see the situation in china changing in the near term. As i said in m m remarks we are still anticipating that slowing in china automomive and electrics continue to q 4, but outlook continues to are remain the same. Reporter this quarters results are seens a setback for roman who became ceo in 2014 and is facing pressure by shareholders to turn around the company. The f fst part of our fiveyear plan didnt go as anticipated. While those markets, which include china, electrics and automotive slow, the company is betting that acquisition in its health care busineses will pay off, having recently acquired a wound care company for more than 4 billion. The medical business is getting stronger. By the way, the results in Health Information are reflecting some of the early synergs. Reporter while the sale in e Companys Health business did rise in the quarter, analysts caution it may not be enough to offset the weakness its experience inningther parts of its business. For nightly Business Report, sema modi. While they were big informations in individua stocks the Broader Market struggled. Offsting a strong report from microsoft which we told you about last night. All of that result in the a mixed finish for major averages. The dow jones fell to28,604. The nasdaq up and the s 500 added 5. It is time to take a look at some of todays upgrades and downwnades. Ford downloaded by diech bank. The analyst cites a weak earning outlook and pressure in the u. S. On volumes in china. The price target is 11. The stock fell 6 . Ebay downgraded. The analyst says the soft ware will likely remain r rge bound following the companys soft guidance for its growth. The price target is 24. The stock fell 9 to 3,562. Tesla got a number offers in, including one from oppenh m oppenheimer. The call follows teslas earnings which saw solid Quarterly Results and stronger free cash flow, which we told you about last night. The term has an outperform rating on the stock. It soared 17 . Both southwest and American Airlines reported better than expected earnings and that sent shares of both of those carriers higher. They have been also been forced to cut their capacity because they cannot fly the boeing 737 max and as w w report, their ces are not happy about that. Eporter southwest and american, bo posted betr than expects earnings thanks to strong demand, but both carriers say they could have flown even more passengers if they had all of the planes in their fleet. Not only has the grounding of the 737 max forced southwest and american to cut their flight schedules, theyre tired of waiting for the plane to be fixed. I have been very clear we are not happy about our situation. You know, we put our future in the hands of boeing and thehe m and we are grounded. Reporter the grounding of the southwest planes means the airline, which has exclusively flown the 737 since i started in 1967, will now look at potentially buying air bus models in the future. Meanwhile, american, which has lost more than 500 million being unable to buy the max says boeing will have to make up for the losses. Boeing is bearing the cost of boeings failures, not American Airlines. Reporter the other challenge for southwest is making sure customers will want to get back on the max when itsed to fly. Yes, the plane will be thoroughly checked out by the faa before its declared safe, but it could take more than recertification to put everyone at ease. We are going to have to convince not just our own people, be yut our customers, t everything is fine and everything i safe. Reporter the other iues for airlines that fly the max, bringing those planes back next year. It may not be a smooth schedule which could create some operational challenges as Airlines Start to fly the 737 max again. Nightly Business Report, chicago. Still ahead, demand is strong for new homes, sosohy are prices falling . Vice president pence expressed hope for a near term trade deal with cna while at the same time accusing beijing of restricting righthtand libertieiein hong kong taxpayer policy speech came ahead of a new round of talking aimed at ending t ending the trade war between the u. S. And china. The opportunity we have to set this economicelationship right is where a new reretionship between the United States and china not end. But in that environment of a more affair, mutually respectful, reciprocal eclationship as the president often says, we think there is a foundation f our nations to move forward. He Vice President also criticized the nba, accusing it of acting like a, ote, wholly owned subsidiary of china. This follows the nbas handling of a team owners support backing protesters in hong kong. Other news we are watching tonight, Boris Johnson called for a general election on december 12th. He said he was asking parliament to approve a National Election as part of his effort to ensure that britain leaves the european union. Last week, Johnsons Brexit bill was passed bute failed to push through an aggressive brexit timetable. The European Central bank held Interest Rates steady, but the ecbs president used his final appearance to warn about risks to the euro zone ecomy, risks that include a no deal brexit. The likelihood of a brexit over cliff edge improved the overall situation. At the same time the medium term uncertainty is considered with concern. So, and at the same time, the rest of the Geopolitical Uncertainty continued to affect markets. Hell leave the ecb after eight years in charge of that institution. Mix reported on the u. S. Economy today. Durable goods fell more than 1 last month, more than expected and the largest amount in four months. Within that report, a closely watched Business Investment was lower for a second straight mo manufacturing in the Second Quarter expanded at a more robust pace. And a number americans find the applications for unemploymentenefits dipped, suggesting the labor market remainss tight. Mortgages increased for the Third Straight week but remama below levels. According to freddy mac, the fixed rate averaged 3. 75 . A separate report shows sales of newly built homes were notes so strong but the it was the dip in prices that got all the attention. Reporter the median price of a new home sold in september fello the lowest in nearly three years but not because builders lowered prices. Instead it was due to a shift in the type of homes sellin namely cheaper homes. Exactly half of the home sold in september were priced below 300,000. Compare that with 43 just one year ago according to the u. S. Census. Builders are starting to put up more entryevel hom but not nearly enough to meet the demand. One of the things we have seen since the Great Recession is the shift in the new Construction Market up to the higher end. Larger homes, more expensive homes. The reason why costs went up its easy to pass along the cost to buyers at the higher end of the market. Eers porter recently build turninged to town homes which are cheaper. One of the cases we have seen is building townhouses. Townhouse construction has grown 15 in 2018. We think it will continue to grow Going Forward in the cycle, and the reason why is they represent smaller homes. Reporter lower Mortgage Rates helped demand, keeping sales above a year ago when rates for much higher. But todays buyers are very sensitive. Rates moved slightly high near september and sales fell in august. Newly built homes have always come at a premium to existing homes but existing homes are heating up again. That price gap is shrinking. That could help buyers move in as long as Mortgage Rates dont make a move higher. A technical bug takes down twitters results. Thats where we begin tonights market focus. The social Media Company ported 145 million daily active users, beating analysts expectations but missed revenue and profit estimates base in the part onhat the company says was a glitch which denied the ability to tarart ads and share data to partners. Reporter the setting was not working as expected. We were usinghe device setting to swdso them. When we realized it, we tweeted about it so people were aware in an effort to try to continue to be transparent and also stopped using that seseing. Theres impact when things like that happen. Twitter also gave weak guidance and shares fell nearly 21 . Nokia warned of a price fall. Theyll be halting its dividend to cover the chaos for 5g equipment and the Company Cease weakakemand in china and pricing competition from huawei. Shares lost neay 24 to 39. 39. 00. Dow posted better than e eects results as it cut plans for chemicals used inlasticicand other products. Inventories are down. You have seen the backlog in the industrial sector down. I think we are poised now where any pull on the industrial sector, a a kind of a tail wind at all means well get a little bit of earningsomentutu and margin improvement and tightening of the supply demand balances. Do you rose. Candy bars and other chocolates help cover rising costf ingredients in shipping and led to hersheys rise. But they had a drop in sales and hershey dropped more than 2 to 146. 37. Coming up, for all of those who sayhe Department Store is dead, well, dont tell that to nordstrom. Cvs is pulli all 22 ounce containers of baby powder off its shelf and removing it from its website. J and j, whied a recall in an abundance of cautiononnd after a te that showed the presence of asbestos. J and j fell further this ternoon when that announcement was made. When you think of retail you probably think of online retailers and boutiques and nordstrom is betting a venstory Department Stores the future. Courtney reagan is at nordstroms new Flagship Store in new york city. Reporter two decades a