The Technology Company thats in the middle of the largest corporate split in history recorded earnings of 87 cents per share, two cents better than estimates. Revenues however, light coming in at 25. 5 billion down from 27 billion last year. Despite the revenue drop and a cautious outlook, the stock initially climbed after the report. The one thing to watch in hps report. Reporter the big take away from the hewlettpackard Earnings Report is that the company is still seeing declines in many of its major units, but companies appe to be boosting spending albeit at a more modest level. Thats important for a company like hp. Many of us know them as the ones that make desktop and notebook computers, as well a printers. Thats still a very big part of the company, but they are also devoting resources towards enterprise or business clients. Later on this year hps going to split itself into two separate publicly traded companies, one thats going to handle the traditional pc and Printer Market the other is going to focus solely on selling Technology Solutions to business clients. A lot of what hp does in the future will be about whether it can compete effectively for those more lucrative enterprise clients. For nightly business rep im dominic chu. Best buy is bucking the retail trend, the chain reported a stronger quarter while many other retailers have posted disappointing results. Both sales and profits at best buy topped wall street forecasts, up nearly 4 . Courtney reagan has more. Reporter at least one retailers transformation seems to be paying off. Gaining market share in a category with declining sales. Best buy beat wall street estimates for quarterly profit revenue, and comparable sales thanks in part to continued cost cuts and strong sales of appliance n smartphones, and large tvs. Though muted by softness in tablet and computer sales. Theyve proved to me once more that a wellrun company whos executing well on the internet can compete with amazon even in a space that the internet has begun to dominate. If amazon had to make a profit they really could win the game with them. They are managing to do it and make a profit. Thats pretty remarkable. Many acknowledge best buy has garnered strengths from being one of the last Large ConsumerElectronics RetailersStill Standing consumers are switching to spend on experiences, like dining out and travel and Digital Services rather than physical goods. Youre buying your songs online youre buying and consuming movies online and what that means is that whereas in the past you might go to the store to buy those products once best buy got you in the store they had an opportunity to things best buy now to use a hockey analogy, loses out that potential shot on goal. More harder and that shift continues. Reporter best buys ceo acknowledged to me on the phone the trend towards experiences has been going on for a while. It is something thats real but its exciting. Using an example to explain, the best buy provides training and tools to capture images on your new camera at an experience like your childs soccer game. 65 of best buys business is consumer electronics, a category industry statistics show is contracting, but jolie says large appliances particularly those with enhanced technology is a growing opportunity for the retailer. Using appliances is a good category a, because their market share in that category right now is low, b, because well probably see sears, which has a significant amount of market share continue to donate that to other retailers. Reporter he specifically points to potential for connected Home Products and appliances like ovens you can start or turn off remotely. And best buy wants not only to sell them to you, but also deliver, install, and teach you how to use them. For nightly business rep im courtney reagan. Gap also out with its quarterly report. Earnings were in line while revenue missed. The retailer saw continued weakness at its namesake Banana Republic brands and currency fluctuations also weighed on the results. Still the company stuck to Earnings Guidance for the year. Shares were little changed after hours. Before the bell the stock was a few cents. The big merger in the health care sector, cvs health has agreed to omnicare expanding cvss presence in largest pharmacy benefipeople cvs healths acquisition of rs side is the number of individuals in the United States over the age of 80 are growing significantly. Reporter omnicare is the leading pharmacy provid ot are positive saying it will help the company hold on to medicare clients as they age, while strengthening its position in the fast growing specialty business helping drive industry 12. 8 billion to acquire catamaran, following the deal to by envision in february. In a battle against rising drug costs, its not t phy pharmacies but the pbms playing a more important role. We estimate in 2016 alone, specialt nations larger has been increas pus back its drug makers on high priced specialty drugs like hepat treatments. Thats benefitted consumers and insurance plansy but not without disruption. When express scr recoil at the high cost. Reporter expensive drugs in pipeline that tug of war is likely to grow increasingly heated. Bertha cf points closing about a point away from a new record close. The s p 500 ended at 2130, a gain of abdh eao meetings we go sachs approved a pay hike approving in san francisco, ground zero for innovation. Inonosr be company. The vote comes as mcdonalds ie pd higher wages and the right to unionize this for the second straight day. Now to the economy where the number of americans filing for Unemployment Benefits rose slightly than expected last week but despite the rise claims remain below 300,000, a threshold associated with a ma has been below 300,000 for 11 straight weeks. Sales of previously occupied homes adjusted annual rate to 5. 04 million. The drop in sales is being blamed on a lack of supply which in turn is driving up prices. Get this in april 40 of properties sol o. Issu is widespread it is most acute in denver, where job ica nightmare. Really pushing everyone throughout the process. Reporter denvers Housing Market is so tight that biddi t t8ha this house. A letter pleading his case and then used some risky tactics. I waived the inspection and the appraisal contingencies on all offers i made a this one, as well. Reporter thats what it took in a market thats down 15 from a year ago and homes that are listed are flying off the shelves. Prices are up 11 from a year ago because supply is nowhere near demand. Demand here is very high thanks to above average employment growth. Companies like apple and google bringing new workers here and there is new construction but its mostly rentals, not condos. Were not building condos because we dont want to get sued. Reporter this developer is talking about a controversial colorado construction law put in place five years ago that makes developers far more susceptible to lawsuits for even the tiniest defect it has nearly stalled condo construction here fuelling rental demand and pushing rent. For investors its a fantastic market but i dont think incomes have been rising at that pace and we all know what happened in 200809 when we had an imbalance between incomes and value of property in this case rent. Reporter the only condos that are going up are on the very high end, where developers can afford to pay for insurance against lawsuits and go over the top testing for defects. Two reviews, have people looking over each others shoulder continually to make sure everything gets done right. Reporter roy kline is developing where most units list for more than 1 million. The project is over 80 sold. Kline calls that amazing, but says lawyers will target the project, scouring the units for defects. There are sharks out there looking to get you . Absolutely. Absolutely. So you really have to be careful. Rep just the cost of doing business in the mile high city where home prices have nowhere to go but up. For nightly business repor im diana olick in denver. To find out more about denvers Housing Market head to our website, nbr. Com. Still ahead, the great divide the split between the haves and the have nots. Its a big social issue and some are warning its also a big the transpac initiati backed by president obama has cleared a key procedural hurdle in the senate. The bill faced major opposition from senate democrats, but the final passage is not yet clear. The senate will consider a number of amendments including controversial sanctions for trading partners that manipulate their currency. The bill is expected to face a quite tough time over in the house, the transpacific trade deal is the biggest trade pact since the north American Free trade agreement, nafta, two decades ago. A Financial Regulation bill, the measure alter rules for small and mid sized banks and clears the way for months of negotiations. Th republicanbacked bill takes aim at the 2010 doddfrank law and in addition eedsasing rules for small banks, it would increase scrutiny for the Federal Reserve and give a chance to redo a business before being classified as systemically important. The securities and Exchange Commission announced fraud charges against an atlanta firm for its handling of the citys Pension Funds for Police Firefighters and transit workers. In an s. E. C. Statement, the firm gray financial group, put pension fund clients into investments that did not comply with state law, and it collected more than 1. 5 million as a result. A bit earlier in the program we told you that hewlettpackard reported better than expected earnings. Well the company also sold part of its business in china to a chinese company. This is viewed by many as a socalled win for the Chinese Government which has been concerned about cyber spying following the snowden revelations. Ai men javers is in washington with more on t impacts. Aman is this an example of the chilly relations u. S. Tech companies have with the chinese . Reporter it is also a lack of demand in china for American Technology products in the wake of the Edward Snowden u. S. Spying allegations. The hp subsidiary here is called h3c and hp is spinning that off, selling 51 to another entity thats controlled by a university the university thats considered the m. I. T. Of china. That of course is affiliated with the Chinese Government. The government there now getting a majority stake in this digital networking subsidiary. Hp i gather is holding on to other divisions over there that work in sort of Consumer Products printers and the like. Lets patriot act. What about the professes against it . Rep t s of the Edward Snowden spying allegations hestates as well with rand paul United States senator doing sort of a mini filibuster on the senate floor against the patriot act. Now theres some real question about whether the provisions of the patriot act that apply to spying on meta data for telephone records for american citizens whether those provisions will be reauthorized by the june 1st deadline or not. Theres some question about whether or not there a votes in the senate to do that. The house has passed its version, not clear at this point whats going to happen here. We also heard from fbi director who expressed concerns over Tech Companies and their encryption. Yeah broad number of companies wrote a letter to president obama thi week saying they dont want any limits placed in u. S. Law on their ability to sell encryption. Law enforcement, including fbi director comey said they want encry so they can get into the iphones and devices of criminals they are targeting with a warrant, but the companies would like to sell encryption to their companies uninhibited by the u. S. Government comey saying he just doesnt think they see what he sees and its a real culture clash now between Law Enforcement and u. S Tech Companies and doesnt look to be resolved any time soon. Thank you so much. Aman javers in washington. Things keep getting worse for lumber liquidators. Thats where we begin tonights focus, the ceo, robert lynch, quit abruptly as the firm has been in an investigation over products in china over allegations some of companys flooring contains the carcinogen formaldehyde. Shares tumbled 16. 5 . What a year its been at that company, right now at 21. 10. Chicos, the retailers chief says hell retire next spring. No successor just yet. Shares were a fraction lower to 17. 02. Shake shack getting a lift on speculation the company may flip some birds. Filed an application for chicken shack in april. Investors like the possibility of expansion, sending shares up 8. 5 to 89. 87. Dollar tree posting higher sales and traffic, also updating investors, saying it expects its deal to close in early july. Its outlook for the Current Quarter came in below estimates. Nonetheless, shares were 3 higher to 78. 68. Qualcomm announced a plan for a buyback program, under pressure by Jana Partners to increase share holder value. Shares were 1 higher to 70. 09. Financial engines spiked on a reuters report that wells fargo is planning to offer financial Engine Services through its retirement platform. That move would make it available to 4 million wells fargo 401 k participants. Engines rose wells fargo was off a few cents to 56. 01. Shopify surged seeing strong investor interest even though shares were priced above expectations at 17 a share. The company, which makes software to help retailers sell things online raised about 130 million. Shares were 51 higher to close at 25. 68. Well sue, a new oecd study says income inequality in developed nations is hurting the global economy. The report found the richest 10 of the population saw their earnings grow 10 while the income of the poorest fell 3 . Josh fineman, chief global economist at Deutsche Bank joins us. Good to see you, thanks for coming. Whats interesting to me here is beyond the sort of social strain that wealth disparity imposes, it may be transmitted in view of this study and in your view into Slower Growth and less vibrant economies. Whats how does that get transmitted, why happen . It could. Keep in mind if it works the other way, too, there is a certai amount of income inequality thats a natural manifestation of a market economy, differential skills abilities, effort endowments things like that. That if it were squashed could potentially have negative impacts for incentives things like that. On the other side coin if inequality rises too much it could have negative effects and one could be if it retards mobility. The mobility of people say, born in the lower income brackets from being able to move as they age into higher brackets by their ability, their education, and so forth. If that is inhibited, thats a key channel through which it could have negative effect on the macro economy. Josh a lot of people think that technology is one of the main reasons why we are seeing that gap widen so dramatically. Do you agree with that or not . I do. I think a big cause of it is increasing returns to skills and education. People who get the right skills the right education, their incomes growing rapidly, those folks who dont, their incomes are lagging. Thats a big not the only driver but a big driver of a widening inequality. Whats the fix . You know not easy to say but clearly if educations a big part of the problem its got to be a big part of the solution too. And getting folks to get more education, expanding opportunities to people throughout the spectrum income and social spectrum access to education and skills will be part of it. Important to keep in mind this is not only a u. S. Phenomenon. This is going on for decades across democratic and republican administrations, across countries, merging economies, as well as developed economies, so theres no you know local solution to this. This is a global situation. Although it is a global situation, the United States seems to be on the lead in terms of the gap widening. Well the u. S. Is certainly in the lead in terms of levels of inequality but thats always been true. In terms of its widening inequality maybe a little bit in terms of the 1 but not clear cut. In fact, s biggest increases, ironically in emerging economies, places like china. And the other thing i point out about the mobility issue, so far it seems that the widening inequality in the u. S. And elsewhere has not caused deteri in intergenerationa mobility and folks to move up. Some people worry it may if it were to continue but so far it hasnt and thats at least encouraging to date. We leave on that good note. Josh fineman, thanks very much with deutsche asset and wealth management. Coming up how one vineyard in droughtstricken california is turning water, waste heres what to watch tomorrow fed chair janet yellen will give a speech on the countrys Economic Outlook and well have the outlook. The Consumer Price index is out, which is an important inflation indicator and thats whats on the agenda for friday. California is getting about 33 million in federal money for water saving programs upgrading irrigation controls line canals to prevent seepage, catch your storm water runoff and other Water Conservation projects. The program is designed to increase local Water Supplies in the long term. Other states impacted by the big drought will also receive funding. Californias drought has some local wineries looking for alternative ways to save water. And as jane wells reports from the napa valley one vineyard owner is putting a new spin on turning water reporter these are pinot noir . Y. The gr